Members of the Commercial Collection Agency Association (CCAA) of the Commercial Law League of America (CLLA) report that the dollar amount of commercial accounts placed for collection during the Fourth Quarter of 2004 declined by approximately 2.6% when compared to the Third Quarter of 2004. In the Fourth Quarter of 2004, CCAA members received $2,525,383,057 in accounts placed versus $2,593,845,516 in the Third Quarter of 2004.
When comparing the Fourth Quarter of 2004 to the Fourth Quarter of 2003, accounts placed for collection rose by a modest 1.3%. While this gain appears modest, it represents a gain experienced on a very bad quarter in 2003. The Fourth Quarter of 2003 represented a decline in placement dollars of approximately 30% when compared to the same quarter in 2002.
The decline in placements in the Fourth Quarter of 2004, compared to the same quarter of 2003, was not uniform for all members. Approximately fifty-five percent of the members had a decline in placement, while forty-five percent of the members experienced an increase in account placement.
On a calendar year basis, 2004 was a lackluster year for account placement. Account placement declined by approximately 2.1%. Account placement in 2004 totaled approximately $10.1 billion versus approximately $10.3 billion. 2003 was a bad account placement year registering a decline in placements over 2002 of approximately 22%.
Where is the commercial collection industry headed? We believe that 2005 will show modest increases in commercial account placement as the economy weakens and past due accounts rise. The latest statistics from various industry sources shows signs of declining sales and a slight rise in delinquencies for credit grantors. We expect that trend to continue in the first half of 2005. While it is hard to predict exact numbers for account placement, we expect accounts placed for collection in 2005 to rise by about two to four percent. If the economy continues to decline in the second half of 2005, increases of account placement will likely be in the three to six percent range.
2005 portends not to be a great year but a better year, particularly when compared to 2004 and 2003.
The Commercial Collection Agency Association (CCAA) is an association of 102 commercial collection agencies that have been CERTIFIED by the Commercial Law League of America. They represent the leaders in the commercial collection or business to business collection industry, handling about sixty-five percent of the commercial accounts placed for collection. The Commercial Law League of America is the nation?s oldest creditors? rights organization, founded in 1895.
Members of the CCAA subscribe to a strict Code of Ethics and undergo an intensive and continuing certification process. For more information on CCAA, the certification process and its members, go to the Website: www.ccaacollect.com or call Emil Hartleb at (973) 239-0721.
