Archives May 19, 2000----UAEL Conference in San Francisco

254 attended the United Association of Equipment Leasing Conference held this last weekend in San Francisco, hosted by Ken Greene, Esq., Conference Chair, along with UAEL President Bob Rodi, CLP, and Dr. Ray Williams, Executive Vice-President.

The goal was 250, and Dr. Williams says this is the second highest attendance of a Spring Conference when it is not a joint-conference, as many have been in the past. I did not hear a disparaging word; nothing but compliments. It was like old friends getting together and enjoying seeing each other in good health, surviving, laughing, and maybe even having a good time.

As past president of UAEL, vice-president at Textron Financial Service, Jim Merrilees, CLP, wrote in the " 'Spring Conference Edition': Without sharing our collective experiences, where would we be? How would we share if UAEL were not there? Are we really so independent as our industry and popularized cultural gurus subscribe? One more. No matter how successful or confident we become, don't you think there will be a time we just might need a reliable resource? In your personal life you may go to a friend, family member or church. In your business life, our old friend is UAEL."

The San Francisco conference chaired by Ken Greene, Esq., was a success because many first timers and "veterans" got together. It was not only a renewal of friendship, but a sharing of knowledge from all the sectors of the industry: brokers, lessors, captive lessors, fundors, Internet leasing, and service, including attorneys.

While I mean no disrespect to the key note speakers or workshop panel participants panels (I sat on four separate panels), I thought the most meaningful talk came from Oren Hall, former president, leasing leader with IFG, Heritage and First Sierra, retired almost a year-and-a-half.

He did a workshop conference wrap-up at 4:15pm, Saturday, "From the Outside Looking In." Oren Hall hasn't lost it, believe me... While a small attendance due to the last of the day, perhaps many playing golf, or seeing the sights of San Francisco, he still has a pulse on the industry he has been a part of since 1967.

Hall believes there are "great opportunities, but you have to make some corporate thinking changes, look at the leasing industry different, and do more than just 'value added' relationship selling." "I am on the outside looking in and I see a lot of fear," he began. "First thing you need to do, which you should have learned from this conference---You need to start managing change."

He also was concerned with the number of consolidations and companies getting out of the leasing business.

"Fundors are not getting their return,” he stated. "This alone will create more change and perhaps you may view this as chaos in the fall of this year. You must recognize and manage change."

Hall mentioned one of the speakers at the conference who likened leasing to golf, where you "play it where it lies," and you take the "gimmes."

"Don't be afraid of the water trap or getting in the rough", he continued. "There are great deals of opportunities. Look at the opportunities and play your ball the best you can no matter where it lands." Hall predicted prime rate would go up twice this year (I think he said a half point each time). He was not happy that home prices, employee prices, gasoline, the cost of doing business was so high for a year and adjustments were not done. He sees the fall of this year "industry shakeout" and "portfolio problems." He sees more consolidations, more leasing companies failing, and brokers having less access to better rates.

"If you can't get your yield, something has to give", he said. "Where is this going to happen? It is going to happen with commissions, first."

Hall believes there will be more "Program Sales" versus "Transactional Sales." The definition of "Program Sales" would be an "account executive" who takes the vendor account to the funding source and does not get paid per transaction. In fact, he is not involved in each transaction. He gave numerous examples of this, stating this is a salaried person, perhaps with a yield or "volume bonus." Many vendors, and perhaps even fundors, will put "operating personnel" into special program vendor sales.

The "Transactional Sale" is where the sales person gets a commission on each transaction, often handles each sale, handles each application by itself, and is very much a "personal relationship." He predicts "niche sales" will continue to increase, but with fewer players. The "relationship sale" will continue, but it will be different for those who cannot manage change.

Many of the leasing services displaying at the conference were aware of the "consolidation" and changes in the industry. Randy Haug, CPL, Vice-President of LeaseTeam said it has been very good for his company.

"In the last six months, we have added 50 new users", he said. "We now have a total of 270 users as the industry is propelling the survivors into understanding and controlling their business at top speed."

A highly attended panel workshop that I had the pleasure to be the moderator (available on video tape as many of the workshops were professionally taped) found little to fear from the Internet. The consensus of the internet leasing experts such as alphabetically David Collier, TotalFunding, John Kruse, CapitalStream (formerly System 1), Aaron Ross, LeaseExchange, the internet "will not" kill the small ticket "application only" business. While the very highly respected educator of the leasing industry Sudhir Amembal held a different opinion at the NAELB Conference in Nashville, Tennessee, the overwhelming consensus was that the internet tool would be utilized by brokers and funders alike, with more defining of "niche" markets and all parties becoming more "internet" savvy. The entire conference called "Lease Trek, the Next Frontier" echoed this theme (" Beam me, up! Scotty!").

Funders such as Bob Fisher of Fisher-Anderson spoke about how Capital Stream was enabling his company to speed communications with both brokers and funders. Alan Collier spoke about how brokers would be paid fees to funnel business on the Internet. Aaron Ross of LeaseExchange participated in two panel workshops, talking about how the World Wide Web financial investors saw the leasing industry, and in the second stated the Venture Market had changed and if the leasing companies on line did not have their money raised from the VC Market, it was too late.

There were several Internet leasing companies in the audience, such as AccessLease, Cyberlease, (AJ Batt says he received $12 to $15 million a month via the internet, but only 35% qualify and less than this fund, something that he is trying to get a handle on).

Past President George Davis, CLP spoke at "Quasi-Vendor," about how he "partnered" with vendors formally creating separate corporations and delivered captive business for both vendor and broker benefit. By the way, this is on videotape, and worth the price to hear George "let his hair down" and tell you the secrets he has learned and found very successful.

There were several panels regarding pricing, risk rewards, and unfortunately I was unable to attend them as I was participating in other panels, or choose another workshop (I could not plan very well what I would be able to attend). One on "Pricing Dynamics" the moderator Bob Rodi said would be repeated in Orlando, Florida, at the September UAEL Fall Conference. Participants included Randy Ernst, Textron Financial, Curt Lysne, GE Capital/Colonial Pacific, and Troy Molitor, The Manifest Group. The pricing and viewpoint of fundors was fascinating as late charges are considered profit (“We like lessees who pay within 11 to 29 days.”)

"The Wired World" moderated by Rochelle Batt was with Aaron Ross of LeaseExchange. and myself. Aaron went over current and future aspects of the new internet leasing companies approach to the marketplace. Basically I spoke about the same theme I gave at the NAELB Conference: the importance of educating yourself, your employees, where to get this for free, other advice; increase the speed of your computer, why, how, where to go, plus internet connections, where, how ( I do recommend you visit: ).

There were many keynote speakers, such as Dr. James Canton, whose book "Technofutures" was given to all participates compliments of Fisher-Anderson; Professor Haim Mendelson from Stanford University; Mark Oman, and Rich Masterson, former lessor, broker, master of the internet, co-founder of US Interactive, and now a major investor in the industry from his financial success and strategic internet consultant to many blue chip clients. Their remarks and speeches would fill up several books. You should have been there.

Membership Chairs Rudy Trebels, CLP and Theresa Kabot, CLP, bestowed the 1999 membership contest award to past president Jim Lahti, CLP, for bringing in twelve new members. Runner up with ten new members was Bob Baker, CLP, with ten new members, and past president George J. Davis, II, CLP for eight new members.

The Fisher-Memorial Award, in honor of the late Jim Fisher, was presented to Alan Jenson, CLP, 1999 Arizona Regional Chair.

Chris Canavati, CLP, Education Committee Chair, and Jim McCommon, CLP, the Board Liaison noted that less than five years ago there were less than 50 CLP's across the nation. Today there are over 200 Certified Lease Professionals. At the conference, eight new CLP's were honored, plus received their Plaques:
J. Craig Bradfield, CLP - BB&T Leasing Corporation
Jill Brothers, CLP - Financial Pacific, Co.
Irv Ellis, CLP - LeaseCor, Inc.
Renee Fox, CLP - Alliance Funding Inc.
Brent M. Hall, CLP - Pinnacle Capital, LLC
Tino Hernandez, CLP - Fisher-Anderson, LC
Robert Al Herndon, CLP - Equipment Leasing Specialists, Inc.
Tim Hill, CLP - Leasource Financial Services
Kristina A. Jupka, CLP - FMC Leasing Corp.
John Kirby, CLP - BB&T Leasing Corporation
Tom Persia, CLP - Worcester Financial Group, Inc.
Ronald Schutz, CLP - Source Capital Leasing Co.
Tony J. Sedlacek, CLP - Financial Pacific Leasing
Pauniece Shuck, CLP - Ivanjack, Lamberth & Aranoff
Steve Tidland, CLP - Golden West Financial Services
Carl Villella, CLP - Onyx Capital Corporation
Scott Wheeler, CLP - Priority Funding Corporation
Steve Whitney, CLP - Fisher-Anderson, LC