Wake up, Buy Here, Pay Here people. It's a beautiful day. Go grab yourself another cup of joe and say hello to Jim and Michelle Rhodes on the Buy Here, Pay Here morning show. Take it away, you two. Hey, everybody. Good morning. Friday, right? It is Friday. Yeah, it is. We've got a weekend away coming up, so sorry to be a little bit late. Some technical audio stuff on our side. We're kind of getting it figured out. Hopefully, you folks in the BHP Success Group are being able to find us. Now we're still kind of wrestling with how to get the broadcast over there streamed because most people have seen it in Facebook now. But Facebook made some changes which are preventing us from being able to stream live into the group. So we're just having to figure out ways to get it over there. So we want to make sure our buy here, pay here people can find this kind of stuff. Because especially today, we've got a really important topic to introduce. Updates? We had our first May meeting for V8 last night. Super great meeting. Yeah, and Jim comes upstairs and he's like, that was good. I think that was the best meeting we've had so far. And, you know, of course, we're new enough with all that that we're kind of settling into processes and rhythms. And our group has been good about working to kind of get the things formatted in a way that can work for everybody. But yesterday was a really great conversation. And we're kind of getting zeroed in on format and how to make it work for everybody and get value for everybody. yeah the members so good yep and then um just so y'all know I will be I'll be gone wednesday to wednesday so jim will be on his own it'll be a train wreck y'all so tune in you're gonna want to see what what do you do you do you want to be yeah aware of a train wreck okay all right it can be it can be entertaining especially you know um yeah it can be entertaining so So Michelle manages a lot of the equipment, the buttons and knobs. And so that stuff will be clunky when she's away, but we'll get live and we'll talk about it here, pay here. Yeah, yeah, it'll work. And so, yeah, the V8 meeting yesterday, after having shown a few of the things that were really impactful with the team, Jim's like, I think I want to talk about this on the morning show. And so we, just about what it is that they talked about, why, you know, after getting feedback from the dealers and the group that it was like, yeah, this, it puts a different view. I mean, it's just, it's looking at the same, it's looking at each person's kind of portfolio. Yeah. from a different angle and um and it's you know as I was looking at that and knowing some of the things that that we know about what the typical performance of like you know most people will pay off or trade up or whatever after certain amount of time it's it is pretty it's pretty important information yeah and I gotta say what what really inspired me to create this was going into the meeting. It was mostly came about as a result of conversations I had recently with other industry players, like people have been in the space for 20 plus years and kind of what they had shared about their own observations with the data across the industry. And it kind of got me thinking about it helped me zero in on kind of where I would want to set the marker, you know, so that was kind of what I brought into last night's meeting. And, you know, if last night's meeting was any indication, I think today what people see will be on the surface, it can be kind of confusing. So I'm going to just make it super simple in our conversation this morning. And if it's not super simple enough, since I'm the novice, I'll be asking questions. Yeah. But I think this number is like super important. I think this is the kind of thing that, It's one thing for dealers to see because, you know, we have a lot of KPIs and ratios that we share in these groups. It's been a really great learning experience because it's been my observation, too, that you and I might have the same pages of numbers, but we might see them differently. We might see our business differently. And so, you know, a number that might be important to you might not be important to me. Right. Yeah. And then, so it's one thing too, to understand the formulas, you know, that are going on and what's being calculated. And sometimes the dealers, you know, yesterday we were able to get the numbers out, let dealers have a chance to absorb this stuff before the meeting. And that was helpful. That let us really, you know, get into the stuff yesterday, but it let us spend a little time on this one element that I created. And so you want to share the slide? I do. Well, I'm going to add you to the stage and you don't have anything shared thus far. Okay. So let me just take a quick peek here. Yep. Is it ready for me to share? I'm adding you to the stage and you can share. Yes. Oh, I see. Okay. I didn't know that. There you go. It's a good thing you're here to push the buttons. Train wreck. Train wreck. That's right. Get ready. Yeah, get ready. Okay. So I think folks can see the screen. At least I can. So let's take you through. Go ahead. So, you know, I want to, just from my novice understanding, The thing that I hear dealers talk about all the time is cash is king in this business. All the other stuff that other businesses look at, their P&Ls, it's just cash or not P&Ls, but you know what I'm talking about. Cash is king. And this is about cash. It is. And it's, um, it's kind of a, a twist on, you know, there's a lot of talk about collateral recovery rates. Why? Because that's, that's a, you know, and this is a function of some sort of collateral recovery rate. I'll explain, uh, the math and especially for those who aren't able to see the screen, uh, who are picking this up on audio later, but it's, um, Basically, we hear a lot of talk about cloud of recovery rate, which has got a, you know, a formula to it. And part of what also set this in motion for me to build this was I was kind of frustrated because I couldn't seem to get people on the same page about what is this formula? What are we supposed to be measuring with cloud of recovery? I don't happen to... I'm happy to continue to talk to the lenders and the parties that really lean on that number to make sure that I've got the formula that they want. So obviously in these groups, we want to share that with people. But this is kind of taking numbers that would ordinarily be drivers in the collateral recovery rate, and they're converting it into just pure cash. And so what we're seeing on the screen is an illustration of the cash yield rate the projected cash yield on these dealers portfolios. So I just kind of gave blank labels on here, just generic labels, but these are the cash yields on the portfolio at the current rate of performance. So, you know, we can get inside that calculation a little bit, but in its simplest form right now, inside the V8 thing, we have some dealers that we barely have three or four months worth of data history, right? So we're only able to do a three month history. and then extrapolate that forward and say, okay, if we continue to collect and the portfolio were to continue to perform at the rate that it is for the last, has been for the last three months, then this is the projection. And I think where this leads to is let's break these numbers down. So on the screen, the dealer on the far left of the graph is 70.5%. So let me explain what that means. This is a percentage of portfolio principle at the start of the period. So maybe if we kind of role play through this or model it out, if I'm dealer number one on the far left side there, and you're dealer number two, the Alabama dealer, then what this says is if we both close the month of April with a $10 million portfolio principle balance, then in my case, I'm projected to collect right at $7 million in the next 24 months. Okay, gotcha. Pure and simple. It's just a projection cash. I love round numbers. Round numbers are so much easier to wrap your head around. So, yeah. Okay. And I would have about $3 million still in principle at the close of 24 months. Okay. Okay? Okay. So, it's like when you look at the Alabama dealer, they would have collected 80%. Or about eight million or about eight million. And they would have cash. This is like cash. Now, let me kind of take people through the formula. So when I say cash, this is a projected cash yield. So what would we generate in cash out of that portfolio? We would collect principal. We would collect interest and we would collect repos. So the value of the repos that we recovered. Okay. So again, this is just taking it down to a level where just cash. And so in this, I mean, I know that dealers have a very hot, you know, I don't know a dealer that has a zero repo rate. So how do you, this is just based on their current repo rate. And collection. Per dealer. It's like an individual kind of thing. It's like, so where are you at with your repos? Where are you at with your collections? And here's your number based on historical, you know, and for, like you said, for some of these, it's only three months. So it's like how you've performed the last three months. Right. And as this group and other groups continue on, that you're going to get a year or two years, and it'll just get more and more and more accurate. That's right. And so what we would be encouraging dealers to do, and I would encourage dealers to capture this number. How do you get to this number, though? Okay. So what you do is you have to first get to what I call conversion rates. So I've talked about that. People can find they can look up conversion rates and find our past episodes. You want to give us a reader's digest? Sure. The quick version is it's a simple measurement of let's take the month of April. It's you would first look at your principal conversion rate. How much principal did I collect in the month of April? as a percentage of how much principal was in the portfolio at the start of the month okay then I would do the same thing with charge-offs how much principal did I charge off in the month of april as a percentage of what we started the month of april with principal so we're just looking at principal conversion rates And so now, same thing with interest and repo recovery. So now I've got these conversion rates. And I go through that and I say, okay, here's my three-month average. For dealers, I would recommend, you touched on it, like I would say at least six months. Ideally, if you've got 12 months of history, you would go that route. Yeah. And I know, you know, we've worked with a lot of dealers. And some, the minority of dealers, when you speak those things, will like totally get it. A lot of dealers, you can speak those things and it's like, it sounds pretty, but I'll tell you as the novice, as you're saying that, it's like, I know kind of what you're talking about, but it is just, it's, and what I've recognized with clients and all that, it takes taking a dealer through a couple of times before there's a full wrap in their head of like, oh, I get this. And then you can say the words and that the words now connect with a picture and an understanding. So there are, you know, I would go back, anyone who's listening to this, go back to the, what was the one you said to go back and listen to? Oh, on conversion rates. On conversion rates. Because there were some charts and things about that as well. So if you're confused about that, go back and watch that because that'll help you start to wrap your head around this. And I get this. I do. And you're right. But I think this is why it's important for us to emphasize and reemphasize this number because... you can talk about all these different indicators. Like I must have six or eight different indicators that we look at on portfolio performance. So there's lots of different ways to slice and dice the stuff. But I think what I would really say is, like back to our example, you and I are standing at a conference. I'm dealer number one, you're dealer number two. And I say, I've got a $10 million portfolio and you've got a $10 million portfolio. But the question really is, what's the performance rate of that portfolio? What's the yield off of that portfolio? So if we could move the conversation over to, and this is exaggerated, but you know, if I'm dealer number one and I say, well, I got a $10 million portfolio, you got a 10 million. So what's, and I ask, what's your, what's your, you know, conversion rate or what's your, your projection, 24 month projection index, you know, and you would say, well, I'm at 80.4. And I would be able to say I'm at 70 point. This is my current travel rate. This is the rate at which I'm converting that portfolio to cash. So the reason this stuff becomes super important, like forget lines of credit, forget selling the paper. I'm just saying as a dealer, I would like to know if I quit putting contracts in that portfolio today and I were to run it off and that's not the strategy, right? For 99% of the dealers we've talked to, that's not the strategy. But I think it's still important to know. And this is why side by side, when you look at other dealers, it's one thing to know your own numbers, but then be able to see this side by side and say, man, so this is also a reflection of business model, right? When you can say, I'm sitting over here as dealer number one, I'm traveling to collect 7 million in the next 24 months. And I still have 3 million on the books at the end of that. Whereas you are collecting 8 million in 24 months and you've only got 17 or 1.7 million on the books, right? 17%. And you know, I, again, going back to understanding the, where that is being pulled, what numbers to look at, all of that. It's been interesting. I mean, now I married into buy here, pay here. It's been interesting to me as we've worked with different clients, um, Um, that there are, it is a, it is a minority thing in dealers. It's absolute minority thing in dealers for dealers to understand their numbers. Um, and, and, and it's, and it's, it's an interesting thing where, um, you know, I, I've, I've witnessed with clients and all of that, that, that it's, it's sometimes, um, it depends on whether or not they are open. to learning and coachable because sometimes it's a rude awakening and, and they can either push back or they can be like, okay, how do I get better? And, and, and I, I think that, you know, that from my perspective, there is no shame at all in not understanding if you've never been taught. Sure. these things. Cause so many dealers that we talked to, it's like, well, what does the bank account look like? Are we able to pay our bills? You know, we have this much money and we're able to pay ourselves this much money. We're good. Yeah. And, and that doesn't, that doesn't tell you the health of your portfolio because And if you can improve the health of your portfolio, and it's kind of like one of those things that we talk about frequently, is that it's a whole idea. It's like, I want to sell 20 cars a month. Well, is it better or worse to take a month or two months and sell 20? 40 or 60 cars in one month while you learn in the other months. You know, what, what would, what would yield a healthier portfolio is, is understanding and learning and tweaking and, and, you know, figuring out how, how to look at your numbers and how to, to measure the different things. And then, then it's like this, this is now I understand apples to apples. Yeah, there's so many elements to this, but I think, like I say, in its simplest form, I want, I would, if I had to pick a number for dealers, I think, and we're early with this particular index, if you want to call it that, but I think if I were to pick an index, it would be this one. And so why? There's so many different ways to think about this. It's like, you know, the example I've kind of always used is, you know, suppose I own this water bottle and I'm going to tell you, I own this water bottle and it's worth X, right? Whatever, $10 million. Now, the question is, I'm not selling it. So what difference does it make what it's worth on the balance sheet? What the question is, what will I, what would it produce for me? Yeah. That's what this page, this graph shows is what, what this asset will produce for me. Based on your current model. Your, and your current performance. Performance. Yeah. And, and go ahead. Well, it just kind of goes back to, you know, I'm always reminded and I think our friend Tommy Brandes deserves credit. I don't think this gets talked about enough. It's like, you know, so how would you. So, first of all, you can see the difference in the business models right here on the screen. Right. I mean, just it's pretty good indication. The one is very heavy on cash. They will have less receivables. Obviously, if you look at. The dealer number four over there, just for those who aren't seeing the screen, dealer number four is actually at 102%. Now, keep in mind, I haven't even explained what all goes into there, but I guess I did sort of. So you'd ask, how can a dealer collect more than 100%? Well, remember, we're starting with just principle, right? So what we're forecasting is if we collect 100%, Principal plus interest plus recover our repos. This dealer is actually traveling at 102% in the next 24 months. Probably a function of shorter contracts and success in collections. And the dealer shows to only have about 16% or 1.6 million left in their portfolio at the close of 24 months compared to some of the others. So it's an indication of business model and term of loan. And it's an indication of collection. So the Tommy Brandes piece is fantastic. So Tommy says, look, you can have all the sophisticated underwriting in the world, but if you don't collect well... That's... Yeah. So this is an indicator of both. This is part of why I'm leaning on this indicator more now is because this is a function of how well we're collecting. Yes. And maybe sometimes what we see sometimes is that the dealers might be... um, sorry, they, they may be able to see their collections rate dipping, but obviously they recover some repos. So depending on the value of those repos that come back in, you know, that'll, that'll soften, you know, the, that's part of why we'd have that right. Recovery collateral and, and, uh, reduce that loss. And I think that, again, back to the Tommy piece, this is kind of capturing both. It's like saying, regardless of how you underwrite, this is a function of how well this portfolio has collected. Yeah. Right? Yeah. And so this is a kind of extension of, this is just cash. We don't have to talk about, you don't have to think about losses. You don't have to think about repo percentages. Yeah. This is cash. So don't make it overly complicated. Don't think about the value of the collateral. And the way I explained it in our group meeting last night is I said, if you think about your portfolio as a wet towel, and you're just saying, how much can I wring out of it? I'm in the desert. How long is it going to last me for 20? And it's, you know, if you could take that $10 million portfolio and, you know, it's you have the ability of collecting a lot more on that portfolio when you start to sharpen your collections and your underwriting too. And there's a lot of really great softwares out there to help us with underwriting. There are some things that I, I would love to be able to just look at this and go, Jim, if you know, uh, the some of the underwriting um uh softwares that that are out there it's like it's based on the performance of your portfolio it's not based on the performance of the industry or any of that so you know and and that like let's say dealer one north carolina um has you know they're now only writing like the the good paper you know and good paper but they're still not collecting Right. Based on this indication, that particular dealer, at least according to the most recent three months, that dealer is not producing as much cash out of their portfolio. But so because some of these softwares just look at the dealer, it's like everything looks really good. You're collecting well. You're collecting as well as you've ever collected. It looks like eight. You're looking at these kind of things. And that's valuable information. but it's it's incomplete it's very incomplete and it's part of one of the other things that dealers lean on sometimes and and it looks like this is not meant as an indictment this is just reality across our industry and you're right most dealers don't you know go and then most aren't as analytical as I am right but it's like and yes and I married him it's fun so and and most dealers aren't on their laptop at 5 30 in the morning crunching numbers I know Yeah. I'm sales down to sleep and it's like, Jim's gone. I'm going back to sleep. Yeah. Yeah. He's, he's nerding out probably with his laptop somewhere. But no, I, this is, this is kind of the analysis that I think, and I'm a cashflow guy. You know, people talk about this, like it's not about, it's not about size of the portfolio. It's like, so I think when you start to think about this way, and this is why we're trying to put this information in front of dealers, it's like, how much cash, because the other thing that this, the reason this becomes into, it comes into question is like, how am I ever going to get out from under debt? Like, you know, you could now start to extrapolate. What did my cash yield? You know, what does that look like? And if you think about it, like, um, you know, old portfolio, new portfolio. This is like old portfolio. Like if I close these portfolios, so this is what this math is. And nothing changed. No new contracts going in the portfolio. I don't know if I explained that part. And also nothing changes in how you handle your collections. Correct. It's like no new contracts. Sure. And, you know, yeah, you're going to collect the same way you've always collected. Yeah. And this also kind of takes out the confusion that can be principal and interest split like that. That is how that would reflect in your P&L. Like interest income would obviously boost your P&L. This takes that out. You know, if you're a high interest dealer, if you're a low interest dealer, this takes this out. It's just cash yield, all cash yield on the portfolio. And this is why I'm really, you know, liking what... Education can come from this information when we just simplify it. And I should explain why I chose 24 months again. You know, we're going to do some more studies on that. I think 24 months is a valid checkpoint here. Well, I mean, well, why? Why did you choose 24 months? Because even if you're a dealer doing a 36-month term or even longer term, what at least according to others and this is the part where people that have been in the industry for like decades yeah a very very long time yeah and so they they recently someone shared with me that their uh history says excuse me their history says that um accounts are going to typically uh I forget the language but it's not it's not going to be mature like it doesn't reach maturity but it's it um it basically resolves itself in about 24 to 27 months so let's think about that obviously we know from history our own history and study and That repos, the repo losses and charge off losses are in that. I think the recent study we did was like 13 months is kind of the average of where. Yeah, well, it was someone else has access to a lot of data that I remember them saying 12 to 18 months, 12 to 18 months. Yeah. It wasn't more narrow than that, like 12 to 14 months. It wasn't more narrow than 12 to 14 months. But it was like, you're going to see those that are going to be just bad debts are going to fall off in that amount of time. And so if you season that far, that's a whole other conversation. But it's like, if you can season your paper to 12 months, you're going to get a better return if you finance it, sell it, whatever. That's the highest risk window is that 12 months. But then if you take those out and you say, okay, besides my charge-offs, The rest of the accounts in my portfolio, what percentage of those? So the part we're going to go study is what percentage of the contracts really make it past 24 months? It doesn't mean they went bad. It could be that we traded the customer in at 23 months. It could be that they had an accident. Insurance settled it up. Like it doesn't mean that that there wasn't a decent outcome. But the question is, how many contracts really make it past 24 months? And we'll we'll bring that information back because. I think that's going to be important to understand, but I think it's going to be a fairly small percentage of the customers make it past 24 months. So I think 24 months is a pretty good indication right here. And just if I run across it at the end of 24 months for those who aren't seeing the screen, our group average is, was 82 well but what I'm looking at is the re or the the portfolio side okay that there are 27 percent of the portfolio principal would remain at the end of 24 months so so these dealers would be forecasting to still have about 2.7 million of their 10 million in our example, they would still have about 2.7 on the books at 24 months. So again, this is just all it really does. This extrapolates out to 36 months and I just stopped it at 24 and said, this is our interesting data. I mean, and it'll be, it'll be, like I said, fun to watch, um, as this group is together for over a year and it's like now we're it's getting richer every month you know with numbers every month you add and you can see you can start to really track trends you can start to really track those things and and you know I'm I'm thinking like ken shilson would be like yeah yeah because yeah I mean he's he's the uh he's the analytic person for for as ben the grandfather of a lot of that stuff It's like, yeah, the more you can string together, the more holistic view you get of the dealer and the industry. So this is pretty new to look at this. So it's interesting to watch as we add more data. And also, you can't always... Dealers. With dealers that we've worked with, it's like they'll see something bad and then they throw three things at it to solve it. And so how do you know what has solved it? But it's like three things or whatever. Dealers aren't very scientific. They're not very scientific. And so it's just like, oh, we've got a problem. And then something gets better, but what got it better? Yeah. And I guess what I'm saying is you can look at your P&Ls all day long. You can look at your balance sheet all day long. You can look at your delinquency report. It's not going to tell the story that this tells, which is what I'm really trying to get to. And so this is why, you know, your CPA can't really get to this information. They don't really know. Everything we're looking at here really comes out of the DMS. I don't need that. those other reports. So I think that's why we like this. I mean, I just, I feel like this is going to be a really important index for us to lean on going forward because it's just the best way to say, you know, regardless of portfolio size, what is it producing? Like, isn't that what it's there to do? It's like my water bottle example. What is it going to yield? Yeah. Do you think that, I mean, this is really about how you collect, isn't it? I would say so, but it's also a function of business model. Okay. Because even if you're collecting well, you might have a little different term of loan. And so that's going to be something of a factor. But yes, first and foremost, this is a, that's why I call it conversion rates. This is the, this is the rate at which you would be converting that $10 million portfolio example. This is the rate at which you would be converting it to cash. So this is a number, these are, these are percentages that you, like if, if you wanted to improve what your projected cash yield is that you like, and this is where the scientific thing comes in. It's like you find the, one way of trying you know like let's try this new and see how this works over the course of two or three months and then you know track that and see it has it improved has it has it moved the needle because you know we all know that sometimes you can find a thing and it's like overnight it changes the thing and and it's like and how many of you out there in listener land have gone like And I wish I had known that like 10 years ago. And it's just, it's a simple tweak. So, you know, this, this gives, I, I love this in that it gives a very holistic, like, where are you at right now? Where's your cash right now? And now you can see that, I would say that the dealer four doesn't have as much they need to tweak in their collection practices, that they've got a really good collection. It seems so. And so to me, when this group has a conversation, it's like, what are you doing? Yeah. you know, and it wasn't an underwriting thing because that, that may be part of it, but it's like, what are you doing in your collections? And, and how can we, you know, what are the, what are the things that could be that like little tweak that just moves the needle? And we can wrap up, but I think it's also for me, it's interesting to look at the deal structure to a degree. So one of the things we'll be able to analyze, remember that there are three on those green bars on the screen there, there are three, elements that are driving those numbers. The principle that we collect from the customer, the interest that we collect from the customer and the repo values that we recover, at least the value that we assigned to them at the time that they come back in. So that drives that number. So it'll be interesting to take each of those three components because we're looking at business model and and be able to see those kind of charted out one over the other. Look first at the interest element. What's your interest yield across 24 months? What's your principal yield across 24 months with all of them? And so she's grinning because I see me nerd out. Well, it's nerding out, but it's just like I see, you know, as we talk to dealers and I have conferences and the questions that are asked, it's like, dealers want to know based on, you know, aggregate data, what works best. And this is a, this is like one of those things that you can, you can measure who's doing well. And now you break apart. What are you doing? That's different because, you know, um, in this industry, lots and lots of Mavericks, lots of, I mean, it's like fiercely independent, um, renegades, whatever. Um, but, and, and there's people that have been in this industry for a very, very long time that says you will never be able to standardize, uh, Not holistically, but to start to standardize certain things. I generally agree with that. And I, you know, I'm going to be... Pollyanna. I'm going to say... things, you know, industries change, markets change, people change. And especially with the, with what we have out there for new softwares, new, you know, artificial intelligence, all of these kinds of things, solutions are, right at the door. And as we start to look at these kind of things, we have the opportunity as an industry in whole is to find things that we can align on and that makes our businesses more valuable. And it helps to make our businesses stronger. And so the more that we can, it's not that we want to all be cookie cutters, but there are some things in, you know, how we look at members, how we, you know, those kinds of things that the industry, I just, I see just business overall. It's like everyone will get better if we do these things. I think it's not too much to say that an index like this can help do exactly that because now we can simplify the conversation. Don't talk to me about, yeah, but I'm a max interest. I'm at a 29% interest. I don't care how much cash. I'm just trying to know how much cash is going to produce and how much portfolio we have left at the end of 24 months. That's all I care about. Because here's the thing is that you can have a 0% interest rate. zero. And you know, if you're only you know, your your loan is a two year loan. And so you're the it's it's going to be you're going to see a different Yeah. It's like what it's because you're talking principle. You're not talking principle and interest. Are you talking principle and interest on this green bar? It's both. It's principle. And OK, never mind. Yeah. Then. Yeah. So that's why I say it's just simple. We don't have to worry about and you can now start to analyze the business model thing of, you know, high interest versus lower interest, whatever. And so we'll be able to study that and the numbers will tell us. But I think what this does is just say, look. apples to apples. So you can look at that and say, yeah, but this is just coming off a tax refund season for that guy who's 102%. It's like, well, so were the other dealers. They were all in the same period of time. They're all measuring the same history and extrapolating. So I think it's going to be useful. I think it's important that we continue to emphasize this one. We're certainly going to bring it to our other groups and make sure they all see the same thing and kind of begin to grasp it because I personally, I can't think of a number that I've seen that would be more, at least for those dealers who are like most of the ones we think about, they're more interested in cash. then profit. It's like, you know, you can't, you can't meet payroll from, we had a great month. We sold a lot of cars and we profited 300 grand, but that doesn't, we're negative on cash. It didn't help us. It's so funny to me when I, because, because of what I understand. And I think that this is just because like, like we talked about before, is that, that a lot of dealers are coming from a different paradigm and, And, and it's just like it, you keep, you have reinforced with me over and it's phantom profit, phantom profit, phantom profit. It's like, what are you actually going to collect? And, and so, you know, we can talk huge numbers, but it's just, uh, and, and as we talk to more dealers that understand these things and they're like, yeah, uh, there's X dealer that was always the top of whatever. And they crashed and burned because you know, that was, they talked big, uh, um you know they padded their numbers or whatever to to whatever groups that they were in but it's like it it wasn't accurate and then and they they just it wasn't sustainable or whatever it's just because the cash element you can't you can't pay your loan payments if you got a debt you can't you know all this stuff all the payroll and overhead is all going to come from cash and so for me I definitely think the business should you know in our buy here pay your business we talk to some dealers that are equity focused others are more cash flow focused And I would say after seeing that chart, it's one more indication that I've always been a cash flow first person. I want I want to see the portfolio convert to cash and I really want to see it do it as quickly as possible. Why? Because every minute I'm in that contract is a minute I'm at risk. And so I really want that money in the bank as quickly as I possibly can. That would be my personal strategy. but everybody can have their own strategy they don't have to follow the one that I would choose but I just this is why we would just measure it and put it in front of people and let them make their own judgment which is what you know you hear me talk about all the time I just want dealers to have better information yes so that they can make their own decisions well it's not just better information but you know this is one of the things that I know that we're running a little bit long but um We have the privilege of being able to have these kind of conversations three days a week and teach dealers, anyone that wants to be able to tune in, because all ships rise. And the more dealers understand these things, the more we can just kind of get out there and talk about the stuff and raise awareness. Mm-hmm. raise and and and we raise the bar and everyone raises with it sure and and it's such a beautiful thing and I and I'm just I'm so grateful that you know we we don't hold things close to our chest. We share, we share, we share, we share, we share. Some people say we overshare, right? And we've had that conversation a bunch of times. It's like, have we overshared? No, we haven't overshared because it has paid back in aces. Yeah. It really has to share and to share and to share. It's not just what it does for us. Well, and the payback doesn't have to be dollars. Right. But there's other things. It's like we're helping dealers. We're helping dealers get dollars. better and be better at being a business owner. And if you look at those charts and you say, if I'm a payment processor, would I want my dealer to be successful with those numbers? If I'm a lender, would I want my dealer to be successful with those numbers? You know, if any of those things, you know, it's like we want to support dealers and success here because first of all, you know, we talk about they provide a really important service. Yeah. They provide, dealers provide a really important service to this country. And so I just think it's like nobody else is prepared to take that risk. It's renegades or mavericks. Oh, exactly. You know, somebody's got to do that stuff and they're taking some risk. And it's interesting. We were, when we were in Vegas a couple of weeks ago, we were meeting with our interim CEO and Jerry Martinez. Those of you who haven't heard about him, he's a retired businessman. multi-star general out of the pacific um you know he was he was the one that ran the the show out there during some of north korea's being naughty as you know naughty stuff um and and he you know when we first we understood what we were doing at first it was a extreme aversion he was like to the by your payer space and once he kind of got the the gist of what we were what we were working on, what we were doing in changing and helping to improve the dealers, helping to improve the consumer experience, helping to improve the optics on the industry, all of that. When we were there, he mentioned to us that he drives around in Vegas and he sees someone out carrying Uh, you know, they're heavy laden with grocery sacks and they're walking and he's just like, they can't do a car. And it is so, you know, he's he, and he has a great appreciation for what we do and, and not we, but the industry of buy, hear, pay your dealers. It's like, we help people that need help. Yeah. I think he sees it that way. Now, when we first were talking to him, you know, after a 40-year career and much of that as an officer, he just, his view of the buy here, pay here segment was that they're predatory. And we tried to keep our, you know, airmen away from, you know, his Air Force. He's like, did we try to keep our people away from him? That and like, what did he say, payday loans was the other thing. He's like, no, no, no, no, no, don't do it. So his view is they're predatory. And so, you know, is he right? Yeah. Well, the best way for us to not be perceived, well, one of the really great ways for us not to be perceived as predatory is education. Because sometimes people don't understand there's a better way or don't, it's just, and there is, and it can be so darn profitable. Right. with repeat and referral and all of these things, when you get better at, at your collections, at making, at helping your, your customer, um, be successful because that, that collection thing, that's about successive loans too. Yeah. And you use the word profitable and I would say profitability has never been a problem by, by your payer industry. Cash, your cash. Yeah, well, but I'm just saying, if you extend that past that, and so profitability has never been a thing. That's never been a problem, even for the predatory dealers. They have plenty of profit. But it's like the question is, what's most sustainable? Well, and there's plenty of dealers out there that would say, I have to be cutthroat or I'm not going to have the profits. It's like you don't, and you can still have those. Well, and I think the math is going to tell us. The math is going to prove that out as we move forward. Yeah. So, um, we do need to wrap up and I just, I, I put out on the screen, um, if you need any help with understanding these numbers, uh, whatever, uh, call or text Jim, 903-816-0216. If you are listening on one of the syndicated podcast stations, please go to our YouTube channel, which is Jim and Michelle Rhodes slash the Octane group. That might be changing sometime soon. Um, because we're, we're doing a little bit of internal rebranding on some stuff, but, um, But go to YouTube, subscribe, like, and subscribe. I mean, I sound like, you know, like and subscribe, like and subscribe, like and subscribe. But it's going to give you a way to be able to see the charts, see the things. And so, yeah. You'll always find this on YouTube. Yeah, I think being a subscriber over there is the way to go because that way you get notification of whatever the new topics are. And you can grab the one you want at your own convenience. Yep, absolutely. And see the stuff on the screen. Absolutely. Or if you would prefer to email Jim, it's Jim at whitehatway.com. And you can send him an email. You know, I know that Jim just he loves to be able to to help. Absolutely. Yeah, absolutely. Okay. Well, I think that we are, we are. Shall we run? Yeah. She's afraid to push the button. I'm afraid to push the button. Cause there's, we, we have a new soundboard and I haven't quite figured it out. So, um, it gets super, super loud on our end. And we were like, Whoa, earlier. So have yourselves, guys, a great weekend. We're so grateful that you joined us and you make us part of your day. And we just hope you have a fantastic, fantastic Mother's Day weekend. Don't forget it's Mother's Day. Yeah. Have a great day, everybody.
