Business Plan Writer
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Business Plan Writer
$425 Flat Rate
No Templates Used
7 Day Turnaround

All Purchased Plans
Are Updated for 2018

Repo Company SWOT Analysis

 

Strengths

 

Repossession companies are almost always able to remain profitable given that a certain percentage of the population is going to default on their debts at some point. Unlike other businesses, repo companies tend to do better in times of economic recession. The barriers to entry for a new repo business are relatively low. It should be noted that most states require specific licensure in order to act in a repossession capacity. The startup costs associated with this type of business range from $10,000 to $50,000 depending on the location and scope of which the entrepreneur wants to launch operations. The gross margins generated by repo companies usually exceeds 90%. Once this type of business establishes strong relationships with local or regional financing companies, the operating of risks of the business are minimal. It is imperative, in order to maintain profitable operations, to remain within the letter of the law at all times. Banks and related financing entities can sometimes be held responsible for the actions of a third party repo company.

Weaknesses

 

As it relates to competition, these issues are usually mitigated substantially once a proven track record is established by the repo business. There are also many laws and regulatory issues that need to be dealt with on a constant basis. Since the end of the economic recession, there have been a number of new laws put in place to protect consumers. As such, it is imperative that a repo company retain an attorney to make sure that the business operates within the letter of the law at all times. While the operating expenses for these businesses are low, the liability insurance required by these businesses is substantial.

 

Opportunities

 

For most repo businesses, the best way to expand revenues is to continually develop ongoing relationships with banks that provide a substantial stream of ongoing work. Most repo companies specialize in vehicles, but it is very easily to branch out into home furnishings and other big ticket items. Repo companies often maintain several satellite offices in order to be able to provide their services to a number of different financial institutions.

 

Threats

The laws related to repossession can change on both the federal and state law. Generally, when the laws change - it is for the benefit of the consumer. As always, competitive issues are always a threat to any business. Finally, and unusually, a very prosperous economic climate can impact the top line income of a repo business.

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