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Leasing Life, the journal for asset finance, LinkedIn group.
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If you are or were a CEO or
CFO of an asset-based finance or leasing company, and you had a
comprehensive business intelligence dashboard to monitor the health
of your company day to day, what are all the important metrics
you’d be tracking?
Metrics in addition to these:
new business volume; aging of receivables; average losses as a% of
net receivables; and year-on-year; credit approval ratios as a% of
all decisions submitted, year-on-year.
Ian Goldsmith, MD,
customer centric marketing, The House, New
Zealand
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By GlobalDataIt depends on the sector you
work in, Ian. No matter what sector, an absolute must is accurate
and aged debtor reporting.
For a volume environment, you
really want to be able to analyse pipeline performance.
What% of leads turn into
sales? What% of leads get stopped at the credit stage?
Leasing systems which offer a
new business workflow can provide these metrics easily enough and
they are important for volume businesses. They are less important
for big-ticket, low-volume business.
Everyone is obsessed with bad
debt write-offs at the moment. Reporting in this area is going to
attract attention in the current climate. It’s also key for
directors to track.
For me the final “must have”
is projection reporting. Especially on the operating lease
portfolio, where a lessor may be carrying significant RV risk. RV
maturity analysis and general portfolio maturity analysis is a
must.
I want to know when my assets
are going to be returned and I want to know as much information
about those assets to gauge whether those assets will achieve that
RV upon sale.
This is what makes or breaks
an operating lease transaction.
From a systems perspective
what you need is granularity of information: the more the better.
Then get a decent reporting tool over the top of it to summarise at
an appropriate level.
It’s easy to summarise the
detail, but you can’t create the detail if it’s not there to begin
with. Sounds obvious, but a lot of systems fail on this
point.
Edward Twydell,
assistant vice-president, SMBC Leasing UK
In my last life as a lessor,
www.salesforce.com was used to track some of the items described by
Edward, on dashboards, and we had pipelines describing the work in
progress.
The aging reports were
generated with a Lawson package (but I’m sure Sage and others do
the job equally as well).
The RV calculations were more
unpredictable in the container business because of the variable
nature of the values for containers (repaired or unrepaired, in
demand locations or not, dry or specials, aluminium or steel, and
so on), and the life of the containers, of 10 to 15
years.
I imagine auto re-sale prices
are more stable and predictable.
Martyn Benson,
principal, Cambrian Maritime,
