What are the current strategy and company mission for PassTime USA?
PassTime is currently seeing a lot of consolidation in the market so a primary focus of our company is to ensure that we are doing everything we can to meet the needs of our existing customers — locking them up tight. At the same time, we are also developing strategies that will allow us to expand our footprint.
Specifically, we are looking at other vertical markets such as electronic information, some lead generation, and we are forming a lot more institutional contacts that we ever have in the past.
Historically, our customers have been primarily Buy Here Pay Here and Independent Dealers. Now we’re also forming strong alliances with portfolio buying companies, point of sale companies, banks and credit unions. The perfect example is SFG Finance. SFG Finance is a company based in Texas which purchases automobile retail installment contract portfolios. We just launched a new program with them where — if the dealer is going to sell their paper — SFG Finance is going to give the unit to the dealers for 90 days free without the dealer having to purchase the unit. And then when they purchase the paper, the bank will end up paying PassTime for the device.
What are your marketing objectives and what do you see as marketing opportunities for the second half of this year and beyond?
Our immediate objective is to educate the dealers about the two different types of products in the marketplace. Essentially, there are products which help with collections, and products which help with repossessions. What we have been preaching all along is how to improve collections. PassTime is continuing to educate the market with what we call ACT.
ACT is automated collection technology. The dealers are starting to require more than just GPS tracking. They are starting to see that they want to be able to enhance their collection activities so we are very, very focused on getting out the word on how our technology is different and how our collection numbers, relative to other providers in the market, is substantially different.
From a long-term perspective, we are focusing on marketing to and working with a lot of large banks, finance companies like Morgan Joseph and those type of folks that are buying the paper and warehousing some of the paper. Our technology can enhance those portfolios and by integrating our technology into their systems, we can help make their collection process more efficient and the technology extremely simple to use.
We have done it with Morgan Stanley and we are starting to do it with some other large, I guess you would call them PE firms and/or banks.
How would you assess the current industry situation?
I think what you are starting to see in the overall industry is a large-scale consolidation- really at all levels. Not only in device providers, but in services as well … DMS companies, for example. You are just seeing that it is an industry that is maturing and is becoming more institutionalized. With that you start eliminating a lot of the periphery players because there is just not a lot of room.
So, that is basically where it’s at right now. It is on every level it is not just one or two. I think you will see one, or maybe two or three providers in our space at the most. I think you will see basically one or two DMS carriers simply because of the demands that as the industry is growing up and the bigger players are coming in you have to be able to integrate with them and if you can’t you are just kind of lost in the shuffle.
What do you consider PassTime’s most significant accomplishment in the past year?
First, I think PassTime’s expansion in Canada and the UK. PassTime’s product base is absolutely exploding in those markets. In fact, in the UK we are selling at levels four or five times what they were just a year ago. It is remarkable.
Secondly, on a partnership basis, I would say the SFG Finance relationship that we have formed. I think that is absolutely — once it catches hold it can be a game changer in the industry. The ability for qualified lenders to get access to PassTime products with no upfront device cost to the dealer or initial lender while also providing them access to needed capital and liquidity through their relationship with SFG Finance is something this market has never seen before.
So, overall, I think our biggest accomplishments are the inroads we have made overseas and with our northern border friends as well as the banking relationships that we are starting to form here in the United States.