Overview

Pay up: Increased outsourcing of debt collection duties will support industry growth

IBISWorld’s Debt Collection Agencies market research report can be used to help you: understand market size and growth potential; major companies; draft business plans and pitch books; and conduct benchmarking and SWOT analysis. Our industry analysis highlights macro industry trends in the overall sector and micro trends faced by companies that do business in the industry. The industry report also provides key industry statistics and 5-year forecasts to anticipate future industry prospects so you can decide with confidence.

REPORT SNAPSHOT

Industry Threats & Opportunities

  • With consumers still cautious after the recession, industry revenue slightly declined despite rising aggregate household debt
  • Growth in consumer credit reversed during the early recovery as consumers tightened budgets
  • As credit markets thaw and economic recovery appears more wholesome, household debt will continue to grow

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    Industry Analysis & Industry Trends

    Over the five years to 2016, revenue for the Debt Collection Agencies industry is expected to fall. Moving past the recession, growth in the industry has been tied to several distinct epochs. Initially, the high rate of credit defaults in 2011 and 2012 created an influx of industry demand. With consumers still cautious in 2013, despite rising aggregate household debt, industry revenue slightly declined. From 2013 onward, households began to more readily assume debt yet industry revenue continued to decline. This is partly attributed to more stringent supervision from the Consumer Financial Protection Bureau (CFPB) and lower recovery rates. As the deleveraging process wrapped up, aggregate household debt is expected to strengthen over the five years to 2021...

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    Industry Report - Starting a New Business Chapter

    Overall, there are few barriers to entry in this industry. The industry is highly labor intensive, with wages accounting for most of the operating costs. The industry has relatively few major players and is highly fragmented demonstrated by the large number of companies in the industry. In 2016, IBISWorld estimates that there are 10,081 establishments in the industry, with the average establishment employing between 13 and 14 workers. Starting a collection agency does not require significant technological investment, however this trend is slowly changing as technology becomes more important in reducing wage costs. Add..

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    Additional Insights for the Debt Collection Agencies Industry

    IBISWorld identifies 250 Key Success Factors for a business.The most important for the Debt Collection Agencies Industry are

  • Maintenance of excellent customer relations
  • Highly trained workforce
  • Having a high prior success rate (including completed prior contracts)
  • IBISWorld analysts also discuss how external factors such as Aggregate household debt and Outsourcing to the Debt Collection Agencies industry in the Debt Collection Agencies industry impact industry performance..

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    Industry Products

    What is the Debt Collection Agencies Industry?

    The Debt Collection Agencies industry comprises businesses that pursue payments on debts owed by individuals and businesses. Most collection agencies operate as agents of creditors and render their services for a fee or percentage of the total amount owed. Other agencies purchase debt portfolios from creditors at deep discounts and then pursue outstanding balances for their own gain.

    Industry Products
    Contingent-fee servicing
    Fixed-fee servicing
    Portfolio acquisition
    Collateral recovery and repossession services
    Industry Activities
    Account collection services
    Bill collection services
    Debt collection services
    Delinquent account collection services
    Tax collection services on a contract or fee basis
    Collection on debt portfolios
    Repossession services
    Credit reporting services

    Table of Contents

    About this Industry
    Industry Definition
    Main Activities
    Similar Industries
    Additional Resources
    Industry at a Glance
    Industry Statistics Snapshot
    Industry Structure
    Executive Summary
    Industry Performance
    Executive Summary
    Key External Drivers
  • Aggregate household debt
  • Outsourcing to the Debt Collection Agencies industry
  • Per capita disposable income
  • Yield on 10-year Treasury note

  • Current Performance
  • Consumer debt
  • Regulations begin to take their toll
  • Chart: Revenue Growth

  • Industry Outlook
  • Consumer credit
  • Mergers and acquisitions
  • Technology and profit
  • Table: Debt Collection Agencies Industry Revenue Outlook

  • Industry Life Cycle
  • Life cycle reasons
  • Chart: Benchmarking - Debt Collection Agencies Industry Lifecycle vs The Economy

  • Products & Markets
    Supply Chains
    Key Buying Industries
  • Credit Card Issuing
  • Real Estate Loans & Collateralized Debt
  • Apartment Rental
  • Healthcare and Social Assistance

  • Key Selling Industries
  • Credit Bureaus & Rating Agencies
  • Credit Card Issuing
  • Real Estate Loans & Collateralized Debt

  • Products & Services
  • Contingent-fee servicing
  • Portfolio acquisition
  • Fixed-fee servicing
  • Other
  • Collateral recovery and repossession services
  • Chart: Debt Collection Agencies Industry Products and Services Segmentation

  • Demand Determinants
  • Economic growth
  • Interest rates
  • Desire to reduce operating expenses
  • Disposable income

  • Major Markets
  • Financial services
  • Telecommunications
  • Other
  • Healthcare
  • Retail and commercial
  • Government
  • Chart: Major Market Segmentation for the Debt Collection Agencies Industry

  • International Trade
    Business Locations
    Chart: Business Locations by State
    Competitive Landscape
    Market Share Concentration
    Key Success Factors
    Cost Structure Benchmarks
  • Profit
  • Wages
  • Purchases
  • Depreciation and marketing
  • Other expenses
  • Chart: Cost Structure Benchmarking – Sector vs Debt Collection Agencies

  • Basis of Competition
  • Internal competition
  • External competition

  • Barriers to Entry
  • Table: Barrier to Entry Checklist for the Debt Collection Agencies Industry

  • Industry Globalization
    Major Companies
    Expert Global SolutionsPRA Group Inc.Encore Capital Group
  • Table: Expert Global Solutions - financial performance
  • Table: PRA Group Inc. - financial performance
  • Table: Encore Capital Group - financial performance

  • Operating Conditions
    Capital Intensity
  • Chart: Level of Capital Intensity for the Debt Collection Agencies Industry
  • Chart: Tools of the Trade: Growth Strategies for Success

  • Technology & Systems
    Revenue Volatility
  • Chart: Volatility vs Industry Growth

  • Regulation & Policy
    Industry Assistance
    Key Statistics
    Table: Industry Data for the Debt Collection Agencies Industry
    Includes:
  • Industry Revenue (2007-2021)
  • Industry Gross Product (2007-2021)
  • Establishments (2007-2021)
  • Businesses (2007-2021)
  • Employment (2007-2021)
  • Wages (2007-2021)
  • Aggregate Household Debt (2007-2021)

  • Table: Annual Percentage Change for Key Industry Data
    Table: Key Ratios for Industry Key Data
    Table: Industry Financial Ratios
    Jargon & Glossary
    Accounts Receivable
  • Money owed to a company for goods or services it has sold.
  • Charged-Off Debt
  • Also known as bad debt or write-offs, this debt is written off as a loss because it is not expected to be paid back.
  • Collectivity Rate
  • Also known as a recovery rate, this rate is calculated by subtracting recovered income from total outstanding debt. The higher the rate, the greater percentage of income recovered.
  • Default Rate
  • Also known as a delinquency rate, this rate is calculated as the level of defaults (amount of times a person is unable to meet a financial obligation) in relation to total debt outstanding.
  • Nonrevolving Credit
  • Credit unable to be used after payment, including auto, home and student loans.
  • Primary Placement
  • An account that is typically 90 to 270 days past due and has the highest recovery rates and lowest commissions.
  • Revolving Credit
  • Credit lacking a fixed number of payments that can also be used again after payment, such as credit cards.
  • Secondary Placement
  • An account generally 270 to 360 days past due and has already been recalled from a primary collection agency.
  • Skip Tracing
  • Collection work associated with collecting information that will assist collectors in locating delinquent debtors.
  • Tertiary Placement
  • An account 360 days past due, which has the lowest recovery rates and highest commissions. It has generally been recalled from one or more collection agencies.
  • Why buy this report?

    IBISWorld industry market research reports enable you to:
    • Find out about key industry trends
    • Identify threats and opportunities
    • Inform your decisions for marketing, strategy and planning
    • Quickly build competitive intelligence
    This report on Debt Collection Agencies:
    • Provides Market Size information to assist with planning and strategic decisions.
    • Includes the necessary information to perform SWOT, PEST and STEER analysis.
    • Helps you understand market dynamics to give you a deeper understanding of industry competition and the supply chain.
    • Analyses key performance and operational metrics so that you can benchmark against your own business, that of your customers’ businesses, or your competitors’ businesses.
    The Debt Collection Agencies market research report includes:
    • Historical data and analysis for the key drivers of this industry
    • A five-year forecast of the market and noted trends
    • Detailed research and segmentation for the main products and markets
    • An assessment of the competitive landscape and market shares for major companies
    • And of course, much more

    IBISWorld reports on thousands of industries around the world. Our clients rely on our information and data to stay up-to-date on industry trends across all industries. With this IBISWorld Industry Research Report on Debt Collection Agencies, you can expect thoroughly researched, reliable and current information that will help you to make faster, better business decisions.

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