Tsi Green Flag Notebook Web Presentation Version 29 Apr09

The tools to help you

MIND YOUR

OWNBUSINESS

T.S.I.

Accounts Receivable Specialist

Prospective Client Quick Overview

PART #0

Client Survey

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Agenda

• Survey of your current situation to see if you qualify for our service

• Company information and “Green Flag Profit Recovery” processoverview

• Display of actual Status Reports of our customers

• Sharing of Recommendation Letters from our customers

• Becoming a customer if you qualify

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Agenda - Detailed• Customer A/R Late Past Due Survey Overview - @10 min.

• TSI Review - @20 min.

– Collections Approaches

– TSI Corporate Structure Linkage

– TSI Press

– TSI Customer Base

– TSI Service

– TSI Locations

– TSI Regulation Compliance

– A/R Depreciation

– Industry Advice on 3rd Party Involvement

– TSI Recovery Statistics

– TSI Website Interface

– TSI Written Demand Notices

– TSI Written Demand Notice Recovery & Cost Statistics

– TSI Client Feedback on Written Demand Notices

– TSI Written Demand Notice Performance Guarantee

– TSI Verbal Demands

– TSI Verbal Demand Recovery & Cost Statistics

– TSI Legal Options

– TSI Litigation Determination

– TSI vs. Typical Collection Agency Netback Comparison

– TSI Service Summary

• TSI Client Report Review for Performance Facts - @15 min.

• TSI Client Recommendation Letter Review - @5 min.

• TSI Pricing Proposal - @10 min.

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Accounts Receivable AnalysisNeed

• What are your terms? Net ____ days

• When do you feel you should be paid? ____ days after ship/invoice

• How many accounts per month do you send to collections? ____ accounts

• When do you turn your accounts over to collections? ____ days past due

• How much of your money in % do they keep? ____ %

• How many different accounts would you say go at least 60 days past due eachmonth conservatively? ____ accounts/month

• What is your average balance per past due account? $ __________

• How many active accounts do you bill on average each month?____ accounts/month

• If you experience bad checks, how many per month bounce?____ checks/month

• If you experience credit card charge-backs, how many per month?____ charge-backs/month

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Accounts Receivable AnalysisMoney Owed Right Now

• How much money is owed to you right now which should have already beenpaid that you would like to have recovered? $__________

• How many accounts does that represent? ____ accounts

• What is their average age? _____ days past due

• What is the oldest age? _____ days past due

• What is the youngest age? _____ days past due

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Accounts Receivable AnalysisEvidence

• Do you have a copy of your aging report available to look at? ____

• How much money is 30 but not yet 60 days past due? $__________


• What is the average balance under 60 days past due? $__________


• How much money is over 120 days past due? $__________

• What is the average balance over 60 days past due? $__________

• Do you have good addresses for all the debtors? ____

• What % of the delinquent customers do you care to do business with again?____%

• Out of $100, what is your net profit? $____

• What sales volume would be needed to offset this loss? ____ units

• How long would it take to sell this this extra volume? ____ months

• How much does your company spend monthly on collections? $__________

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Accounts Receivable AnalysisAging

Days Past Due 0-29 30-59 60-89 90-119 120-180 181-360 +360 >60 >90 >120# of Accounts 0 0 0Dollars $0 $0 $0

#DIV/0! #DIV/0! #DIV/0!Avg. $/Acct:

Accts Days Old Tot Days Old60 090 0

150 0270 0360 0 Avg. Days

Total 0 0 #DIV/0!

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Accounts Receivable AnalysisDecision Makers & Influencers

• Other than yourself, is there anyone else required to make the decision to useGreen Flag? ____

• Are any key influencers necessary to be in the meeting whose decision yourwould rely on to make the decision to use Green Flag? ____

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A/R Process Timeline

KeyS - Ship or Supply Service

OI - Original InvoiceP - Payment Due

I# - Additional Invoice CopyL - Letter

PC - Phone CallCA - Collection Agency Involved

LG - Lawyers Involved

0-30-60-90

+30 +60 +90 +120 +150 +180Payment Due

Wish List of Things to Change••••••

Days

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PART #1

CollectionsProcess

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Conventional 2 PhaseApproach to Collections

The traditional collection process is expensive int ernally and externally.

Phase I: IN-HOUSE COLLECTION FOR 6 MONTHS

Past Due30 Days

2nd Statement

Past Due60 Days

3rd Statement1st Letter

Past Due90 Days

4th Statement2nd Letter

1st Phone Call

Past Due120 Days

5th Statement3rd Letter

2nd Phone Call

Past Due+120 Days

6th Statement4th Letter

3rd Phone Call

Phase II: PERCENTAGE AGENCY/ATTORNEYAverage Rate of Recovery = 10% to 20% . Average Fees = 30% to 50% of your money.

True Cost of Collections = a loss of 90% or more of your company’s revenue!

$1.10 $1.10$1.10

$1.10$1.10$2.96

$1.10$1.10$2.96

$1.10$1.10$2.96

In-house cost$20 to $30Dartnell Institute

of Business Research

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3 Phase Approach to Collections The Greenflag Profit Recovery service is simply a middle step (at a controlled cost) between yourinternal efforts and traditional agency representation. It provides your company with 3 clear benefits:

Phase I: In House Phase II: Greenflag by Transworld Systems, Inc.

Phase III: Verbal Demands and/or Legal Action/(CMS)

TSI offers you the opportunity to use adiplomatic 3rd party to recover your profit whilemaintaining sensitive client relationships!

36% to 76% Recovery Rate

TSI 5th andFinal Contact

4th TSIContact

3rd TSIContact

2nd TSIContact

TSI CourtesyNotice

Day 100Day 90Day 80Day 70Day 60

80% to 95% Collected

$1.10

$1.10

$2.96

Statement

Letter

Phone Call

Day 0 to 60

Optimize in-house procedures

• Improved cash flow• Reduced expenses• Identify intent

Improved cash flowImproved cash flow

Reduced expensesReduced expenses

Identify intentIdentify intent

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PART #2

CorporateOverview

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Corporate Structure

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• Makes private equity investments behind compelling business ideasand strong management teams

• Established in 2001

• Manages US$ 8 billion of investments and commitments forJPMorgan Chase & Co.

• Invests in transactions that initiate strategic and operational changesin businesses to create long-term value

• Management-led buyouts

• Growth capital financing with an emphasis on corporatepartnerships and divestitures

• Typical transaction is US$ 50 million to US$ 200 million

• Has offices in North America, Europe, and Asia

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• Business process outsourcing giant

• Acquired Outsourcing Solutions Inc. (OSI), which owned

TransWorld Systems Inc. (TSI), in March of 2008 making it thelargest collection agency in America

• Has over 29,000 employees

• Operates in 10 countries

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• We are in the business of profit recovery.

• We lead the industry in providing businesses with better tools forrecovering bad debt and accounts receivables.

• We’ve been proving it to our customers, including more than 200 Fortune500 companies, since 1970.

• Last year, we recovered $700 Million for an

average of $10.00 per account.*

• Our success rate is more than 3 times thatof the industry average.**

• We provide local impact with over 120 offices

coast to coast.

* Company average.** Based on ACA statistics.

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PART #3

Press

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What the Experts Say– “Transworld gets credit for the highest recovery rate in the industry.”

» Barron’s

– “The Company has a collection rate of well over 50%. The typicalcollection firm gets only 20% and keeps 25% to 50% of recovered funds.”

» Fortune Magazine

– “Its low fee structure encourages clients to assign accounts early, usually45-90 days past due. Their recovery is more than 2 ½ times better than thecompetition.

» Investor’s Daily

– “In addition to the superior collection rate and speed of recovery,Transworld’s low fee provide the client with a 30%-70% savings.”

» FORBES Magazine

– “…Transworld has a long term proven record of being able to deliver twicethe normal recovery rate at a fraction of the normal cost.”

Shearson Lehman

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PART #4

Clients

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Industries Transworld SupportsCity, County & State Governmentsover 300*

Court Reporters

Convention Services

Libraries

Colleges and Universities - over 625*

Fraternities and Sororities

Trade Schools

Utility Companies

Waste Disposal Companies - over 310*

Cable TV Services

TV Stations

Long Distance Telephone Services

Cellular Telephone Services

Security Alarm Companies

Fuel Oil Companies

Oil and Gas Companies

Wholesalers and Retailers - over 10,000*

Wholesale Food Manufacturers & Distributors

Clothing Manufacturers

Manufacturers

Industrial Manufacturers and Distributors

Auto Parts Stores and Suppliers

Automobile Rental Agencies

Auto Dealerships and Repair ShopsOver 1,200*

Trucking and Moving Companies - over 1000*

Heating and Air Conditioning Services - over 560*

Plumbing Services

Electrical Services

Pest Control

Travel Agencies

Hotels - over 635*

Professional Athletic Teams

Hospitals, Medical, and DentalPractices and Clinics - over 10,400*

Medical Laboratories

Medical Supply

Ambulance Services

Optical Stores

Health and Fitness Clubs

Veterinarians - over 610*

Employment Agencies

Florists

Video Stores

Advertising and Marketing Firms

IT & Web Firms

Publishing & Printing Companies - over 840*

Printing Shops

Newspapers and Magazines

Mail Order Houses

Girls Scout Councils & YMCAs - over 250*

Banks and Credit Unions - over 1,500*

Financial Services - over 215*

CPA’s - over 825 practices*

Insurance Companies & Agents - over 550*

Real Estate Services over 700*

Information extracted fromaudited client lists -

* individual companies orinstitutions using the TSI system

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Some of Transworld’s 60,000 Clients

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Customers of TransworldCitibank

Union Bank

Downey Savings

Ernst & Young

KPMG

Deloitte & Touche

Merrill Lynch

American Express

Transamerica

State Farm Insurance

GEICO Insurance

Con Edison

AT&T

Bell South

Cingular Wireless

Sprint Cellular

Comcast Cable

Direct TV

ADT Security

Waste Management

USA Waist

SYSCO Food Service

Alliant Food Service

Sam’s Club

Coca Cola

Pepsi Cola

American Linen

Tru-Value Hardware

Chicago Bar Association

University of Phoenix

Vassar College

Sylvan Learning Centers

Goodwill Industries

American Red Cross

Chamber of Commerce

YMCA

Girl Scouts

Office-Max

Canon Computer

Eastman Kodak

LA Weekly

Gannett USA Today

Val-Pak

Guthy-Renker

ADP Proxy Services

Culver City

City of Irvine

City of Inglewood

Hollywood City

Marriott Hotels

Hilton Hotels

Embassy Suites

National Rental Car

ChoicePoint

Blue Cross-Blue Shield

Healthsouth

Columbia HCA

VA Hospitals Nationwide

Gold’s Gym

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What Our ClientsHave in Common

• They extend credit and/or accept checks.

• They mostly have an individual or an entire department devoted tocollecting past due accounts internally.

• They all use GreenFlag Early Profit Recovery services to minimizebad debt losses.

“As a national direct marketerwe faced some very uniquechallenges in the area ofcollections. TSI not only helpedus meet these challenges, buthelp us exceed our goals in avery cost effective manner.”

Tom Miglino Vice President American Mint

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PART #5

Offering

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What We Do For You

• For an average of less than $10.00 per account, we provide the impactof third party intervention.

• Minimize internal efforts, improving overall department performance.

• Preserve your valued customer relationships.

• Minimize the risk of accidental violations of state and federalcollection laws and/or harassment suits through the use of a holdharmless agreement - $25M in insurance coverage

• Allow 24/7 access to account information via OCP website as well ascomplete monthly reporting on all accounts.

“As important as collecting arrearages is ... even more important is …retaining customers. This is where your company has really shined. Our re-activation of collected accounts has leapt a full 14%! This difference hasreally set your company apart from those we’ve used in the past”

Margaret Lewis – DBS Coordinator – DirecTV

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PART #6

Locations

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120 offices nationwide, including Canada now too! (Not shown)

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PART #7

Aging &Depreciation

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How Your Money DepreciatesStart Early – Recover More

We all know that the older an account gets, the harder it becomes to collect.But did you know that at 90 days past due, accounts begin to depreciate at the

accelerated rate of @½% per day?At 180 days past due, consumer/commercial accounts have depreciated to the point

where only 30%/44% on average will ever be recovered!

ConventionalAgency

0 30 60 90 120 150 180 210 240 270 300 330 365

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

10%

30%

74%

95%

A G E O F A C C O U N T S IN DAYS

Source: (U.S. Department of Commerce study on depreciation of accounts held in-house)

Critical DepreciationPeriod

1/2% per day

TransworldSystems

45 90

72%

44%

29%

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I stronglyrecommend that

at the end of 60days

you consider goingto

a third party …

when you getbeyond 90 days,

all your profit inthat sale

is gone!

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Turn over delinquent

accounts for outside

collection quickly -

after the first broken promise.

There is a significant drop-off

in the collectability of accounts

after 90 days past due.

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PART #8

ClientInterface

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Convenience Counts

– Interactive Web Site (recommended) Upload and manage your accounts 24/7 via

our secure interactive web-based OnyxCustomer Portal (OCP)

– Paper submission of accounts also available

– For a demo of our TSI web site and tosee service videos: www.collections4leeeeeeeeeeeeeeeeess.comwww.collections4leeeeeeeeeeeeeeeeess.com

•GreenFlag offers you two ways to transmit and manageyour accounts:

Contact us: (818) 710-0244

WWW.COLLECTIONS4LESS.COM

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Interactive Website

Can also batch upload

all delinquent accounts

via these file types:

Excel

Access

CVS

dBase3

ASCII2

Can manually enter

delinquent accounts

one by one via this

screen

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PART #9

Phase #1Demand Notices

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Getting Better Results• We recover more because we start earlier.

– We recover more than traditional agencies because:• We work ALL of the accounts the same way, regardless of the size or the

balance.

• Most percentage-based agencies work only the accounts with higherbalances that are the most cost effective for them, leaving the smallerbalances uncollected.

• Our fixed fee, diplomatic service allows you to have us get started early inthe process with the increased impact of third party intervention.

“…studies by the American Collectors Association show that 80% of all the monies collected byagencies are collected as a result of letters.”

» American Collectors Association, Inc.

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You Have 3 Choices Over theContent of our 1st Contact…

Diplomatic, Intensive, or NSF Check

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5 Contacts in 40 Days

Optional“Thank You”

Letter

sent wheneveryour customer

pays

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Average AgencyCost

33%

(ACA Average)

National Statistics Prove It

� According to the American CollectorsAssociation, Inc., the average collectionagency collects less than 14% of all debtsassigned to a demand notice phase at anaverage cost of 33% per dollar collected.

� Our clients experience a 56% recovery rate ata cost of approximately 5 cents per dollarcollected.

TSI Cost:5¢ per dollar

collected(company average)

TSI Collected56%

(companyaverage)

( Our clients receive over 3 times the recovery at about 1/5th the cost)

AverageAgency

Collection

14%

(ACA Average)

Phase I - Written Demand Notices

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What Our Clients Say…• “I’d recommend Transworld Systems to any business large or small that’s fed up with slow paying or delinquent

customers and would like to get paid sooner without worrying about losing future business” » SYSCO Food Services

• “Boy, was I surprised! Not only have you gotten our accounts paid faster than we used to by ourselves, but by youletting our clients know in a nice way that we need our money you’ve reduced the strain that had been building up inthe relationships. Better still, once they understand our situation, they start paying on time regularly.

» American Linen

• “We’ve been using your service for the last seven years and have recently renewed for the fourth time. We had triedseveral other collection agencies prior to TSI, but we have stayed with you because you have produced results farsuperior to any other agency we ever used. TSI’s nationwide coverage affords us the opportunity to pursue accountsacross the country for an amount that is much less than it would cost us, making TSI very cost effective.”

» AAA Motor Club

• “We have been using TSI at this location for three years now and the results have been nothing less than outstanding -69%!! The demands for payment are diplomatic and yet very effective. It’s easy to see why Marriott Hotels chose touse Transworld Systems nationwide. You have our recommendation for any business looking to simplify collectionprocedures”

» Marriott Hotels

• “Many of our balances are small so we needed a service that would work for all of our balances not just the big ones.TSI has really come through. Collection success rate is great, cost is reasonable and best of all, my time is freed up toconcentrate on my business and paying customers.”

» Jennie Craig Weight Loss Centers

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Written Demand PerformanceGuarantee Summary

• If the amount TSI collects is equal to or less than the cost paid for the xaccount system then 100% of the cost is refunded in addition to what wasrecovered

• If the amount TSI collects is greater than the cost paid for the x accountsystem but less than twice the cost paid then the difference between twicethe cost and what was recovered is refunded in addition to what wasrecovered

• The 4 criteria below must be met for the guarantee to be honored:– All accounts placed into the Phase I Demand Notice service are $50 or higher

average principal only balances– 100% of the accounts purchased must be placed/started in TSI’s collection

service within 24 months of signing up– 100% of the accounts placed/started in TSI’s collection service must be less

than 12 months past due– 90% of accounts placed/started in TSI’s collection service must have good

addresses

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PART #10

Phase #2Verbal Demands

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Verbal Demands• When intensive recovery efforts are required• GreenFlag Verbal Demands employs a team of highly trained college

educated recovery specialists operating from 22 nationwide call centers.

– Verbal Demands Phase:

• Turns up the heat on overdue accounts

• Demands full payment in 7 days

• Abides by all governmental regulations

• You pay only for what is recovered

• Offers legal recourse for tough cases

• Handles the types of accounts otheragencies ignore as un-collectable.

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National Statistics Prove It

� According to the American CollectorsAssociation, Inc., the average collectionagency collects approximately 11% of alldebts assigned to a verbal phase at an averagecost of 30% to 50% per dollar collected.

� Our clients experience a 25% recovery rate ata cost of 40% to 50% per dollar collected.

TSI Collected25%

(companyaverage)

( Our clients receive over 2 times the recovery at about the same cost)

AverageAgency

Collection

11%

(ACA Average)

Phase II - Verbal Demands

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PART #11

Phase #3Litigation

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Legal Options• Making the difference in the toughest cases:• GreenFlag Legal Options can make a difference where court action is

warranted, and there are assets that can be recovered.

– Legal Options Phase:• Cause suit to be filed• Pay all court costs• Pay attorney fees, service, or process fees• Pay any other fees necessary to satisfy a judgement

• An attorney will appear in court on your behalf.

– Most Importantly:• If no money or assets

are collected,there is no charge.

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Litigation Determination

• Account balance must be over US$500• Account can not be over 3 years old when sent to the Legal step• Facts justifying supply of product & service and failure to pay must exist• The debtor must have “attachable assets”

– Real property with equity to place a lien against– Bank accounts with sufficient balance to levy against– Wages with >25% discretionary liquidity to garnish– Owner of a cash business to till tap

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PART #12

Netback &Summary

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Netback Example

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Collection Approach Est. Timeline

In House / Traditional Agency Transworld Explanation

500 500 Accounts Placed$200.00 $200.00 Avg. Account Value

$100,000.00 $100,000.00 Total $ Assigned

14.0% 56%

TSI "Written Demand" recovery rates vary by industry and age of account, but historically the recovery rates have been between 35 - 64%. According to the American Collectors Association, Inc. (ACA), the 2004 industry median recovery rate was 16.2%.

$14,000.00 $56,000.00 $ Recovered

40% $10.99

TSI "Written Demand" cost ranges from $4.99 - $24.99 per account, depending on the number of accounts purchased - this represents the price of a 500 account system. Most agencies charge between 30% - 50% contingency fee for their recovery efforts.

($5,600.00) ($5,495.00) Total Cost

$8,400.00 $50,505.00 Client Net Back (recoveries get paid directly to client)220 Accounts Rolled Over to TSI Verbal Demands Phase

$200.00 Avg. Account Value$44,000.00 Total $ Assigned

26%TSI "Verbal Demand" recovery rates vary by industry and age of account, but historically the rates have been between 16% - 36%.

$11,440.00 $ Recovered

50% TSI "Verbal Demand" Cost (Contingency)($5,720.00) Total Cost

$5,720.00 Client Net Back (paid from Transworld to client)

$8,400.00 $56,225.00 Total Client Netback (from "Written" & "Verbal" Dem and Phases)14.00% 67.44% Total Recovery Rate (from "Written" & "Verbal" Dema nd Phases)

430 163 Accounts Remaining$200.00 $200.00 Avg. Account Value

$86,000.00 $32,560.00Total $ Remaining (this can move to our legal department for contingency collections or can be written off as uncollectable)

* Timing of the TSI written demands can be altered to fit specific client needs. Starts, stops and cancels are all controlled by the client.** Variables are highlighted in red

(verbal demands done for entire time)

Written Demands

Verbal Demands

Legal Demands

Day 151 - 190

Day 191+

Day 90 - 150

A Final Word…See for yourself why 60,000 businesses choose TSI over extended in-house effortsand all other 3rd party alternatives combined

•We recover three times the industry average for about one sixththe cost.

•Flat-fee, no percentages – regardless of the balance. Average costof only 7 cents per dollar collected.

•Diplomatic/Intensive approach – we recover your profits withoutoffending/simply with intent to collect from your valued/pastcustomers.

•You stay in control – you decide how diplomatic to be and when toturn up the heat.

•Recovered profit is paid directly to you. No more waiting 30-60days for an agency to pay you your money.

•Over 120 Offices Nationwide – provides unparalleled local impact.

•Performance is guaranteed – Use TSI at no financial riskwhatsoever.

•Other services include bad check recovery, check guarantee,and medical insurance claim resolution.

For reference letters of client resultsgo see “testimonials” at

www.collections4less.com

Call us at (818) 710-0244 for more info

www.collections4less.com

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PART #13

Reports

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PART #14

Recommendations

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PART #15

Pricing

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Tsi Green Flag Notebook Web Presentation Version 29 Apr09

Economy & Finance

Transcript of Tsi Green Flag Notebook Web Presentation Version 29 Apr09