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. Apparently, it's Monday and it has been a really off day for me so far. Well, I mean, we get up in the morning and we do coffee time and that's kind of just like... We have a cup of coffee. Sometimes we don't say anything to each other. Sometimes we have a lot to talk about, but it's just kind of our time to sit and all that. And then I have an agreement with my brother that at seven thirty I am upstairs to get him out of bed because he can't get himself out of mountain time or mountain time. So so I go upstairs and he's watching TV. He's watching something like a Star Wars something. And this is the first time. that he's been watching TV when I go upstairs to get it. And I love Star Wars. So my ADD kicked in so massively. It was really interesting to observe myself because it's like we have our routine. I get him out of bed and I do the thing and the next thing and the next thing. And there's like a list of about eight things that happen every morning. And with every step, I was like, I don't know what to do next. Right. so it's like my brain is wanting to be there because it's a shiny thing add um in my brain and we don't watch a lot of tv and I just you know and I was like afterwards I was like jim I it was a really interesting thing to observe myself and my level of add and to know that I really need a list in there so that I can like be watching and ticking it off. And that's like when I want to escape, Jim hasn't really understood that I like to watch a show. And it is like I check out. So I was like trying to check out. It was crazy this morning. But he's dressed. He's eating breakfast. All of the things got done. But I think he had to remind me like seventeen thousand times about what's next. Um, can you put my hearing aids in? Oh yeah, that's right. That's something we do. So I have ADD. Yeah. So, you know, it's diagnosed by Jim. Cause I have, I did a lot more than I do, but yeah, I think so. What makes you say that? Um, uh, We can save that for coffee time. Let's do that. Let's have another conversation about that. That'll be fun. That'll be fun. So happy Monday, y'all. We're back to talk about cash flow. A couple quick announcements. Next Sunday, this coming Sunday, is the kickoff for the Marriott Gathering in Atlantic City. I see a lot of marketing stuff. And there's a lot of vendors that are going to be there that are helping with education and all of that. So... Yeah, just if that's something that you want to do. It's an economical way. If you're a customer of TaxMax, reach out to them because they're covering a bit of it. Or I think all of it or something for you to be there. And I think I saw something on social media that Arizona's conference starts today or maybe yesterday. But I just saw something about that. So we didn't. feature anything about that one. I didn't know it was happening. I mean, honestly, anybody out there in Buy Here, Pay Here land that is part of a board for a state, if you want us to make an announcement that your conference is going on, just let us know. We're more than happy to add that. Happy to do that for nonprofits and anywhere there's good education. Speaking of other good education, LHPH Capital has their event October two through four. And that will be really great information. It's specifically LHPH. Yeah. So, yeah, if you are. Yeah. Yeah, there will certainly be subjects specific to LHPH, but obviously those that are there will have a chance if they're contemplating LHPH to be the right place to be. And then also there's just a ton of information that's going to correlate. You know, in our V-Aid groups, we've got dealers who are both V-Aid and LHPH in the same groups. That's something we wanted to be able to do with V-Aid. So far, so good. It's just... you know, it's, it's today we're talking cashflow and, and really it's a cashflow business, right? So, so it's how much down payment from the customer. The big things that become different in that scenario is, is going to be sales tax and income tax and how that's handled is very different. And of course, you know how the balance sheet looks, but otherwise, uh, I think this whole thing about kind of getting into our topic for the day, cash flow, I've been in my head with cash flow and how to present it to dealers. And of course, our Friday episode was around that. Well, you had like two cash flow modeling this last week. Yeah, we've done cash flow sessions. Yeah, so it just kind of like new questions come up and all of that as well, which spurs, oh, this is something that we can talk about. Yeah, and also just that dealers... You know, obviously, when you've done it a long time, you can fall into this place where you take for granted that people would understand certain elements. And so I realize you can't do that. You got to kind of start from real fundamental place when you're working with new folks. But what we're going to talk about today is kind of and by the way, I forgot to also mention as an announcement. On Friday, we're going to have Benjamin Clifford come. A lot of people know Ben through Facebook and twenty groups and what have you. So he's going to come and talk about cash flow and his own perspective on cash flow. So, yeah, there is one more announcement and we'll talk about it at the end of the show again as well. After much consideration and soul searching, we are going to be cutting back to twice a week for the podcast. So we're going to do White Hat Wednesday and Fridays. So I would just say right now what we can expect is we probably will keep with that Friday time slot. We may drop other episodes throughout the week or other content. And it's mostly about when we're going live. Right. Yeah. And so we're going to go where we're still committed to going live as best as we can, unless we have like a guest or, you know, something like that. But that those podcasts will drop Wednesday and Friday or go live. This is our last Monday to do. That's right. Yeah. So, but we're still going to be here. Yep. You just won't find us live on Monday mornings. You just won't find us live on Monday mornings. But you've got a lot of catching up to do on our YouTube channel anyway. So just go find all that stuff. That is hilarious because we'll get people that have just barely found the podcast and you've got a meeting with them, new whatever, and they're like, oh my gosh, I just spent the weekend watching and learning. So if you all have questions, there's quite a library. I find this not so great to search our YouTube channel. I often refer people to go find the YouTube channel. It's going to come. A topical guide and search is going to come. Until then, if you're trying to find these topics around cash flow, I would say if you use the hashtag cash flow in the success group, you'll probably find most of these podcasts. Well, except for since they just changed Facebook, changed the rules and we can't go live on there. That's been since the beginning of the year. Yeah, but there's still a post that goes out there. So anyway, you can find this stuff. If you can't call me, let's get you in touch with us. Exactly, because we can send you to the right ones. Yeah, because I think for today, as we kind of shift into our topic of the day, so cash flow is interesting because there's different ways to think about it. You can look at cash flow on a per deal basis. You can look at cash flow operationally, like how's my cash flowing relative to my overhead and my cost of replacing inventory, right? We look at that. Today, I'm looking more at individual deals, like amortization tables, cash flow on a single deal structure. So I brought the same numbers that we used on Friday's podcast. I've got those where I can share them on the screen. Let me just get them up there where people can see them. You see the one that says Jim's laptop there? Mm-hmm. You want to share it before I do? I do. I got it. So these are just kind of some of you who caught the episode on Friday know that we use seventy four hundred and thirty dollars. These numbers are from our July V eight groups. Yes. So, yes. And these are averages of, you know, a bunch of dealers that we work with. So this is the average that people are spending. And I would say, let's not get too hung up in those numbers. I just want people to understand why I chose these numbers, where they came from. And so this future value is something that... You know, dealers, you can shoot in the comments. If you're listening live this morning, you shoot in comments what you think a seventy four hundred dollar unit, a reconditioned cost car would be worth wholesale in two years. I picked three thousand dollars. It just is kind of giving us a point of reference. OK, so obviously we don't have a good crystal ball here, but. But then you've got a selling price of thirteen to on that seventy four hundred dollar vehicle. I used an APR of twenty three point nine and a down payment of sixteen hundred twenty three, which was the average again from all the dealers that we're working with right now and be eight. Right. And so you've got, you know, I put sales tax in there, six percent. But I don't think in the numbers that I presented today that I brought in TT&L. So for tax title license is typically the calculation. Because there are people out there like, what's TT&L? Some people call it the T's, tag tax and whatever, tag tax and title. So, you know, it's just like it's different in different states. I have different fees. Right. But let me jump over to this screen. This is. So this is taking an amortization. Actually, I probably should show the amortizations here. And this is the same. If you see reference to LHPH, it's just because I'm using the form that I was using to map out both LHPH and BHPH side by side. For this morning, I'm just looking at BHPH. And just to kind of run some simple interest amortization. So all these numbers over here, our calculated financed amount is twelve six and our payment from the customers at five oh nine. Same numbers we used on Friday. And now if we just build an amortization based on that simple interest structure, I came out and followed that amortization to twelve months and then to twenty four months. So that's what I want to present today. And you and I talked about way back we did Something around some of this same math where we, it's all kind of in the same context of me asking dealers to start to do the math and look hard at twenty four months and their position at twenty four months in contract because I feel like that we. I think dealers would be well served to get comfortable with the math on what it looks like to trade their customers approximately every twenty four months. I'm choosing twenty four months for a variety of reasons, which we can go into if we have time, but or somebody cares to know. But it's basically in thinking through that what I wanted to begin to analyze further from a cash flow standpoint is looking at an amortization and saying, okay, if a customer pays us for twelve months, let's look at where we're at with the customer in that situation. So let's just go through that math. Here's twelve months in this column, and I think our viewers hopefully can see that well. So you've got a down payment. And again, for those listening on audio, we'd recommend you find our YouTube channel and we'll put it in the comments so you can see where to find that. Your down payment is sixteen hundred twenty three dollars. The principal collected across twenty or across twelve months would be thirty four hundred dollars approximately. And the interest collected twenty six hundred for a total of seventy seven twenty eight total collected in twelve months. Down payment plus P&I collected from the customer. Now, our inventory cost that we chose back there was seventy four hundred dollars. So we're actually positive already. Three hundred dollars. If you're adding up interest and principal. Yes, that's right. So I'm glad you kind of saw it that way. So the customer's remaining balance on the note at that point in time is ninety two hundred dollars. Just a little over ninety two. So what this the reason this matters to me is that at twelve months, the dealer's already in a positive cash position. They've recovered their costs. Again, I don't have tag and tax in there, but just from a simple kind of operational look, they've they've now collected enough cash to cover their risk in the contract. So is this let me ask you something, because I mean, I sometimes I just I feel like I'm still in kindergarten. so when you had that did that poll and it's like are you interested in interest income and principal income or in cash flow and everyone said cash flow this is cash flow so it's like so it's like you're not looking at how much interest I've collected because it kind of just goes into it goes it merges together and how much money has come in that's right And at what is still left. And so it's not like it's, it's in a way it's looking at it that, that all of the money coming in is decreasing your risk because the interest is also like going into that same, that same pool. Right. for your comfort level and you know so it's like oh okay this is how much money we've this is how much money we've collected this is how much money we've collected right and so this is what I again kindergarten me understanding is I I think I'm grasping this even better what what cash flow means cash flow means all of the money coming in interest in principle and where does that put our risk on the road and that's right okay and so the only thing just keep in mind here is that dealer would be at three hundred dollars ahead they would be three hundred dollars ahead in twelve months before you factor in whatever they spent for tag attacks right which that varies by state well and that that the the dealer the dealer would be okay overall with all the money that they put into it yes all the money that they put in the car to recondition it which is their total risk to and with the customer right again uh kind of putting aside tag attacks for a minute and then so that's why I'm saying the dealer's three hundred dollars cash positive through twelve months on the so this would be the formula that people would often use for amount writing I find that some people include tag attacks others don't um but we're three hundred dollars of amount writing we're three hundred positive okay so we actually have recovered we don't have any amount writing here we're we're negative three hundred in amount writing context it's like we've collected three hundred more So, OK, yeah. So, yeah. So then again, the customer's remaining balance at that point is ninety two hundred dollars and a projected wholesale value because I just used a curve. I just used a straight line method to say, OK, if we started out seventy four and we ended up at three grand in twenty four months, then I just use a straight line method to say the car must be worth about fifty two hundred dollars. at the end of twelve months. So just this is just information. This is just a snapshot look at where we're at. And so the projected negative equity based on those numbers would be four thousand dollars. Okay. So we're upside down about the customer would be upside down about four thousand dollars. They still owe ninety two and the car. But I mean, if you if you had to repo, you wouldn't be. Say again. If you had to repo the car, you wouldn't be upside down because you've already covered all of your costs. Okay. Yeah. So that's right. Well, and this is it's yeah. go ahead. I just, so many things that I'm. Exactly. That's why this, this particular thread is, that's why it's so important because there's so many different pieces to consider here. And I think before I go any further here, the customer's remaining principal balance adjusted. So let me, let me explain. This is going to get, this is going to get a little bit convoluted. So I'm going to, I'm going to go slow. I mean, is it convoluted or does it just sound convoluted? Well, it's, let me just, it's uncommon sort of, thought process. It's an uncommon way of looking at this. Yeah. I don't hear dealers talk about this and, and I feel like I understand why. And I, I put a little comment on LinkedIn this morning. I can see that as I present this concept that I'm about to introduce it, I can hear dealers just saying, yeah, but yeah, but you know, it's like, there's so many things in this industry that are, yeah, but yeah. So I think that here's, again, it's just math, but yeah, here's something that's been running through my mind a lot in recent months, probably dating back to our V eight plus session in particular, where we had conversations with Steve Burke and Mark with Jimmy Rambo and Brent Carmichael. And so that kind of stimulated a lot of thoughts for me. And so in our finance world, it's, We need to talk about interest coverage on a future session because for those not familiar with interest coverage, that is a number that lenders would typically look at. It's really a portfolio performance question. Is are we generating enough interest income to offset our net charge off losses? Okay. So if you look at that on a running average or just across a pool of many months and virtually all of our dealers in V eight are running positive across multiple months. Okay. Okay. So that suggests that our, our interest that we collect from all customers in the portfolio is, um, is covering the, the, those net losses, which is good. That's what we want to have happen. Now, again understanding that it's done on an aggregated basis you're looking at the whole portfolio I'm simply posing the question that because in this twelve month example and it looks even different we jump over to twenty four of course but in twelve months we've we've collected twenty six hundred dollars from a customer in interest in interest that That interest, if we think of it just for a moment, think about it like we just reserve that interest because it's supposed to go to net charge off losses. Well, in this case, customers still active at twelve months. We don't have a charge off. So my point is. we've collected that interest from a customer that we didn't need the funds. If we treat it like it was in a reserve bank account, we didn't need it for charge off losses with this particular customer. And so if I adjust that interest in there, the customer's remaining principal balance, would be instead of ninety two hundred up there on row eleven, it would only be sixty five hundred. Had we applied that money that they paid as and again, I know it's not how it works, but I'm saying if we just contemplate for a minute, this can just be in the dealer's head. This is not anything that happens in the balance sheet. It doesn't show up in the profit loss report. I'm simply saying that theoretically, When that customer is in that position in twelve months, we really I'm asking dealers to at least make a mental adjustment in the interest of keeping their business moving forward. And we sometimes talk about mental adjustments in the context of inventory, which is a different subject. But the same idea is like we don't have to go physically make any write downs or adjustments or set up any reserve accounts. I'm simply saying, let's jump to twelve months or twenty four months rather. And let's have the same conversation at twenty four months. What have we done? We've collected the down payment initially. We've now collected seventy eight hundred dollars in principle. We've got about forty four hundred in interest. So we've now collected through twenty four months, thirteen eight. We still have that seventy four hundred dollar initial risk. And so across twenty four months with a typical customer, the typical deal structure from the month of July, we've now collected amortized in a simple interest deal. We've now collected sixty four hundred dollars more than was our initial cost in the car. Okay. So again, dealers don't care if it's interest or if it's profit. I don't even have any calculation here for how much of that's gross profit and how much of it's cost, but we could get to that math. But it's really the part that I think is most relevant here is that we're saying our amount riding by those calculations would now be a negative sixty four hundred dollars we would have collected sixty four hundred dollars more than our cost in the vehicle okay through twenty four months and the customer's remaining principal balance is forty eight hundred now they still have negative equity because we forecasted that the car was only going to have a value of three thousand dollars OK, so now the customer is still sitting there at twenty four months of eighteen hundred dollars of negative equity. And my question to dealers would be. Does it make sense for you to make an adjustment internally? uh, to that negative equity. And I would say most dealers do, we've kind of surveyed that and you see in the comments typically that, um, you know, they, they're prepared to trade the customers at this stage. I'm just simply trying to lay it out in a way that is more specific to say, based on all this math, uh, That customer is still upside down, eighteen hundred dollars versus our wholesale, our anticipated wholesale value. But we're sixty four hundred dollars to the positive across twenty four months. Granted, we have overhead to think about. We have all these things to think about. I'm simply saying I got a customer in front of me that's been with me twenty four months. They've paid me. They paid all the way to twenty four months, which we we know we have a whole lot of customers that don't do that. Right. This customer's made it to twenty four months. I really don't want to lose them. And so I'm sitting there in a great cash position. And I'm in a negative equity position. I've got some balance to write off if I'm going to trade that car and I'm going to use three thousand dollars as my as my behind the scenes actual cash value of the car. Then then there's a balance there. I'm simply suggesting, you know, if the interest had been applied to to the whole thing, you know, or using the same methodology that I used before, the customer's principal balance at this point in time would be four hundred forty eight dollars. if we had applied that money that we in the the interest part their principal balance is still sitting there at forty eight hundred have we applied the interest just in our head to the principal balance the customer would actually have a balance of four hundred fifty dollars roughly and so I think it's that idea of real negative equity and this is the first time I've even really expressed this in this way it's like if you think about actual negative equity on the balance sheet yes in your software if you look this deal up and you loaded a deal your sales manager loaded a deal to trade with this customer today yes on the ledger or in the recap for the deal, you would be showing negative equity. My, my question to dealers, it's not a statement, but again, with our V eight dealers and everybody through podcasts, I've been challenging dealers to go back and do this math on their own deal structure and ask themselves, look at this and say, okay, Could I, should I trade this customer at twenty four months? Because I have quite a few dealers who say, no, I wouldn't trade yet. There's too much negative equity. And I think it just kind of troubles me and it makes me want to present the math and say, let's look at this. Because if you if you walk through all the math and we did another podcast many months ago, probably a year ago, where we kind of projected. I think in that case, we use thirty months, but it's it's all the same thing. And I think this is the subject that you're going to hear me talk about a lot in terms of, you know, just kind of taking breaking down the math and just putting real math in front of people and let them decide for themselves. Because this is what I keep saying about dealers. I feel like I feel like buy here, pay your dealers as a group. don't get enough credit for their intellect. I think they're capable of making really good business decisions when they have good information in front of them. So this is the thing that I've challenged myself to do is get more actual information in front of dealers that they can rely on and then make their own judgment. I'm simply saying that based on what I see in the math, I'm challenging dealers to get comfortable with the idea of dealing with that negative equity at twenty four months in the interest of keeping the customer on the books, you know, keeping the customer satisfied and. You're going to what's going to happen. The customer's principal balance is going to go up. Yes, they're going to be in a different car, which means we're we're resetting the contract in a way. And we're we're now going to be earning more interest from that customer in the next twelve months than we did in the prior, you know, or that we would have had we not traded. So there's a lot of things to consider there. And I think we just, it's just math. We just want to get the math in front of people and let them kind of think through the thing. And because I just know as a former dealer and somebody who works with a lot of dealers, it's hard for dealers to find enough time at their desk to get to these numbers and really lay it out in this way. So this is part of where, you know, I want us to stay with the podcast and continue to kind of break this information. Well, and, and we may do more educational straight line things on a different track even too. So, um, uh, All right. I have thoughts. Oh boy. Let's go. Cause I, you know, we had a conversation the other day that it's like, sometimes I squirrel and it's like derails the conversation. So I'm trying really, really squirrel. Um, because you know, then it's just like, Jim goes, I can tell I've lost you. Yeah. You're gone. Yeah. And then I, it's hard for me to get back on track. So, um, you know, I'm, I'm looking at all of this and I'm thinking, like a ten thousand foot view to the entire thing and and I'm from my first question is an average dealer and I know you work this into your cash flow modeling um the percentage of deals that repo and and like it's usually higher the first twelve months right and And then it kind of trails off a little bit. I mean, and that's why a lot of a lot of your capital providers, people that are going to buy notes, if you can season your notes to twelve months. Yeah, most don't go that far. But but I'm just saying that if you can season your notes to twelve months, then that actually is is has a higher value because the most of the repos are happening in the first twelve months. Right. What is that percentage typically? Of what? Of repos that happen for a deal. Is it like around thirty percent? It's kind of the number you hear. OK. So percent of what of all accounts that were originated all of that point. Yeah. Yeah. It's like it's like when you look at an individual, whatever, every account, thirty percent chance you're going to repo. Let's just say, you know, something like that. So my next question and this is you're going to go like crap. We're going to go there again. During COVID, in a twelve-month period of time, and I don't think you've measured this, but it would be an interesting thing to look at, I think, for my ten-thousand-foot view. What was your repo rate during COVID when everyone was getting free money? It was almost nothing. It was almost nothing. Okay. And one of the reasons why you don't want COVID to come back. No, I don't want COVID to come back, but it's not the, it's not the COVID it's the, um, it's the, the money, um, that, that our customers had more money in their, in their account and they paid their bills, um, And they bought a beer, and they paid their bills, and they paid their bills, and the repo rates were super, super low. And so my question to you is, because I've not been in the trenches and been beat up, bloodied, or whatever from this, but it makes me wonder if, hear me out, if interest rates were lower, and car payments were lower, would your repo rates drop? A lot of people, in fact, in those conversations that we had for our V eight plus meeting, I think that was the consensus. Okay. So then it's to me, it's like, if you dropped your repo rate down by five percent, and you ran them side by side. This is the model, and this is the one where we're decreasing the interest rate, decreasing the payment, and we're dropping that repo rate now to this. What does that look like? Because my argument is, if a dealer could bring in as much money And have the success of their customer so that they can trade them out after twenty four months because they're keeping them on track better. Sure. Even if it's five percent more. Yeah. What would that look like? And that it to me, that's what White Hat way is about. It's like, how can we help customers be successful? And which means dealers become successful. And dealer, because that's just like, if customers are successful, dealers are collecting. Right. And they're getting, you know, they're getting the, and they're keeping a customer for a long period of time. So to me... That's like that ten thousand foot view squirreled is, you know, and I know that, you know, you you talk to dealers. It's like the customer can pay more. The customer can pay more. My my premise is who cares if they can? Because there's you're squeezing blood out of a turnip. But if you give them some wiggle room for them to make that payment. Yeah. I don't know. I mean, is it enough wiggle room that you can have the scenario that happened during COVID happen again? Because my premise is, is that that scenario was not about COVID. It was about people having more money in their account. Yeah. Yeah. There, there were some other factors I think there, but I, that's generally going to be true. That's customer had the funds. They didn't have other places to spend the funds. You know, I, I, I would counter that with Uber eats was going through the roof. So, you know, you could get all the food in and that kind of stuff. And, but I mean, I just, it's, it's good. I think it's, it's part of what we want to continue to analyze. And I think one of the things that's happening with V eight is we're fortunate to have a We have twenty four data points that come in from dealers each month and those twenty four to inventory, sales, collections, receivables, etc. And so now when we get those snapshots and we string those together across many months, now you're going to have more. more data that's meaningful because it's all contiguous you know you can track it from front to back and so now that's been part of my challenge over the years is we'll have this bucket of data and this bucket of data but they're not connected and you can't really you know draw any conclusions because there's just no no correlations and so now we've got data that is going to be more contiguous and I think there will be lots of great lessons that come from that and I think what you're talking about is really where I see me myself spending a big chunk of the rest of my career is digging into this stuff and I I so look forward to working with brent carmichael oh yeah and chariot and ida and doing some of the same stuff over here because we we you know I have I I think I what I hear dealers say to me because they may not know that I'm a former dealer and before I was a numbers guy before that but You've been a dealer, like a dealer principal. He's been a general manager. He's been, you know, just like you've worked all of the things. I've had lots of dealers throughout my career say, you talk about numbers the way I like to think about numbers, which I think is important because there are a lot of people in our industry who may not have that same perspective. And that's okay. I'm just saying because I have that perspective and I get inside the weeds and get inside these numbers, I think we have a chance to really help dealers understand get a look at some of the stuff that is really critical in decision-making. Cause I think it just, it just so disconnected. The data is so disjointed and we don't have enough information. And so we're, we're, we're drawing a lot of information off of this pool of data or this pool of data. And I think we just want to get more and better information in front of dealers so that they can look at this. And yes, you're right. Why? How way I think has is in a great position, but, to be able to help dealers operate more efficiently. And by understanding some of these things and there will be dealers who will decide to adjust their rates down and they may adjust their payments down. But even if they don't adjust their payments down, the customer will be will be paying down their balance, you know, more quickly in these same numbers, you know, they would be reducing their, their numbers better. In fact, Michelle, we can do this. We got, do you have any place you have to be? I do. You do. Okay. Well, give me one second. I'm going to try something. I think this math will flow through and this is just adding this back to the stage. Okay. So just all I'm doing is changing the APR. from twenty four three point nine, twenty three to twenty nine point nine. And so I don't know if we remember our numbers, but now Now we are, instead of what was the number, six, seven hundred, we're at fifty nine hundred of cash ahead. And so then those numbers shift. But what's the payment now for a customer? Oh, I just kept it the same. I would have to go back. Really, that's a good point, because I'd have to go back and rework that amortization. So we probably better not do that without having all the pieces ready, because... Um, that's, that's going to be to keep it apples to apples. I just, I, I think it's an interesting question and I think that it's, it's, it's worthy. It's worth, there's a lot of worth in diving into that because, um, you know, I just, from a thousand foot view is that when, when our customers had more money in their pocket, um, that they paid their bills and they still, I mean, I, I talked to my, my, uh, one of my kids, um, living in New York, making no money, you know, the, the, uh, the living wage stuff, the free money came in. And I mean, they, he and he and his partner were like, I got to buy a pair of pants new. Yeah. Yeah. And I always have to go thrifting. And I bought a pair of pants new. I did my research. And because Amazon was just kicking ass during that time. I mean, they were like, but just the, and I, that the having a little bit more bandwidth, because I'll tell you, I know my son and my partner worked their high knees off. They were not lazy. They were working their high knees off. And I think that's most of our customers. They're out there working hard. And they're trying to make ends meet. And they're having to make a choice between, all right, do I buy gas? Or do I buy a birthday cake? And so it's like, what can we do to help? It kind of depends on whether it's my birthday. I mean, well, yes. I know this. I know this. So the White Hat Way is about bringing the heart element back into decision making. And looking at things like, how can we help? How can we help you be successful? And that's without throwing out the headpiece. That's without throwing. Yeah. Oh, yeah. You still very much use your head in the business. Heck yeah. Heck yeah. The straight line stuff is so important. Yeah. And we got to stay in business. We can't serve anybody. So all this stuff about, even if you're thinking about adjusting an interest rate from twenty three point nine to twenty point nine in our in our simple example, it's like we, there's a lot of stuff to consider there. And I think we gotta, we gotta be mindful of all those pieces. So, so Jim and Michelle are never going to suggest that we do anything that's going to make us less profitable. We might shift timing of investments and we, but we might, you know, advise some things according to that, but we're really, we're really just advocating for dealers to create a long-term strategy, one that's comprehensive and one that certainly moves them a long way from anything that looks predatory. We want to move them away from anything that looks predatory. And so this is part of what we can help do because that's where we can sidestep compliance issues and it will be compliant. And I can have my feeling about it. And we've talked about this. You can't trust something you can't measure. And so I have my feelings about it. And I just, that's where I was like, well, I would love to see the data. like strung out from that period of time for dealers all across the US. And it's like, then what are the conditions that changed? And it was mostly that. And so, you know, my, my premises is if you dropped your payment and people are going, no, because now it's a six year loan. It's like, who's that? Heck cares because they're not going to see it that long anyway. But then, you know, work this out so that you can trade them out in twelve months. Their payments are low. Twenty four. Twenty four months. Their payments are low. You've got great ways of supporting them. And then you just keep a customer for we talk about White Hat Way is about ten plus year customers. Yeah. And so how do we help create an environment that really facilitates that? Right. Because you think about it, dealers out there, that if you could get half of your clients, your customers to repeat, how much less you'd have to spend on marketing. And or if you could cut your repos and charge offs by twenty, twenty five percent. How much? Well, yeah, you've got like you. Exactly. I mean, it's how much does it cost us to get a car out of impound? Yeah. How much does it cost us to pay a tow tech driver to go get the thing? Yeah. So this is all part of a strategy around, you know, and we talked about this. I was like dealers. I meet so many dealers that are trying to just grow. They're just trying to sell three or four more cars a month. And so I think another way to grow your account base is to save three or four charge offs a month. Right. And so ding, ding, ding, ding, ding, ding, ding on the nose. Yeah. It's all part of the same thing. It all kind of gets tied together. So this is a part of where we want to, you know help dealers again just get information I think if we put good information I just want to I want to throw a yeah but thing and this is why we have to kind of run through all the math and lay it out for people because you know when you talk about lowering the payment you talk about a customer doesn't have the income we lower the payment well I can say yeah but I still have my overhead so I still have to support I still have the same cost in the car and if I let a customer pay four hundred instead of five hundred I can do that longer term you're talking about but now that's that's cutting into my cash flow as a dealer because I still have my overhead and I'm still trying to replace the, you know, and that's where I'm like, when you can start to string data where like the percentage for, and the aggregate is changing, right. How that offsets that lower payment. Right. So, I mean, cause there's a lot of math in this too, but if, but it's, you know, we can go with feelings and we can go with gut and a lot of dealers out there have been burned so badly that it's like, no, not going to happen. But when you can start to show the math and how, when you do this, this, these are, these are direct correlations. Yeah. Um, so I'm going to put my phone number up there and folks, these are the kind of conversations we're having at VAT. Yes. So please, I mean, talking about it, I've got some groups that are like one or two seats left. Yeah. And so please reach out to me. And you have a VAT plus meeting coming up. I haven't scheduled it. Oh, we haven't even chosen a topic. We will have one. We have several V eight plus that's, that's like a, that's like an additional opportunity to, and it's not about going through the numbers. It's about a topic and bringing in the experts and all of that. And that's, that's something that, that's what, that's where that, uh, we've talked about the, um, the conversation with, um, Carmichael and Jimmy Rambo and Steve Burke and, that was around capital. And, you know, it's like some super, super rich conversations, but that's not something right now that we're offering to the general public. That is only for VA dealers. Yeah, so we've got VA Plus coming up. It looks like it'll be collections. That's the kind of the subject that dealers are asking for most. And we are hearing from some dealers that are telling us that their repo rates and charge-offs are up. We don't, I haven't even begun to pull together all the August numbers. They're coming in now, but I haven't started to assemble them. And so the, I don't, I don't know what August looks like for dealers, but I'm just talking to some dealers through, you know, people that are inquiring about VAT and this and that, and they're telling me repos are high. And I'm saying, you know, we just did a study. We went back to our own stuff and kind of sampled certain group of dealers and what we have is, you know, through July, we're not up. And so I think what we'll watch, we'll continue to watch and see what's happening there. But I can just tell you, our VAT dealers aren't seeing a spike so far. And it just kind of goes to a lot of different things. The more data we can start to get access to, the more data that we start watching, the better opportunity for us to have conversations around this is what the data is showing and share it in a very public way. Jim Collison, Well, and also just sharing in the V-Eight meetings is like, if I can sit in a group and I can say, Wow, my charge-off rate is two point three percent per month, how do you, Joe, do one point five? You've been running one point five or under two for how do you, how do you keep your repo rate? So that's where, that's the value of a peer review. And I can hear a dealer saying, Are you, is everyone late? Is everyone, you know, how long do you let a deal go before you before you do the thing but I mean it's like well when it when it comes and it's a great conversation because it's like oh I've always had a recency but I don't charge off yeah because I just allow people to kind of have a little bit more grace and flowing with the stuff so what I'm hearing is philosophy belongs in the conversation it does it does and it naturally flows in there so this there's a lot of stuff that happens there we better wrap We probably, that would be a good idea. That's awesome. I love that there's software people calling. And we'll give you an update on Friday if we've had a chance to on where we're at with the DMS reporting. We get closer and closer every day. But, you know, this is like an ancillary, it's a thing on the side that a lot of the DMSs are working on. but there is progress and it you know once we get the first one that's it's like ready we'll let you know they'll be on the show and you'll be able to see what it is that we're looking for hey everybody thanks so much for joining us on monday again this is our last monday live monday um for the morning show but we will be here for white hat wednesday and for our friday and this friday we have terry no have um been Ben Clifford. Thank you. Okay. Have a great rest of your week and we will see you on Wednesday. Thank you.
