Recovering losses.

D&R Recovery makes sure clients are repaid

Debt collectors often have an ominous and forbidding image. But if Alvin D. Rice, president and CEO of the Silver Spring, Maryland-based D&R Recovery Inc., has his way, that perception will be changing.

As a means of empowering himself after losing his job with a major collections agency in 1991, Rice decided to create his own collections agency the following year. Armed with just $100 and his experience in the field, Rice, 38, started in the basement of his home, becoming one of the few African Americans in the country to own a debt collections company.

By focusing on small rental stores, Rice was able to move into a lucrative but untapped debt collections market. "Our first clients were video stores in the metropolitan Washington, D.C., area, " Rice says. "I knew that people rented videos and didn't return them, and recognized that this would be a market with high volume."

Since its founding, D&R Recovery has aggressively positioned itself as a unique alternative in the high stakes world of debt collections, which is dominated by large and traditionally impersonal agencies.

In 1998, D&R retained over $50 million in bad debts for both consumer and corporate accounts. The firm has 25 employees, 70% of whom are traditional collectors (they settle accounts 90-plus days past due) and 30% of whom are customer service representatives (they place courtesy calls to remind debtors their payments are overdue).

The highly personalized philosophy of the firm distinguishes it from other collection houses, along with what Rice calls its "boot camp mentality" to recovering delinquent accounts. "We give a person time to pay off a debt," he says. "We find out what happens and what options are available to them in paying off their debts, such as debt consolidation." In addition, D&R offers customized corporate client programs that include a guaranteed debt-recovery rate. If the set goal is not met, D&R pays the difference.

Marc A. Hopkins, former credit and collections manager of Cable TV Montgomery, a Rockville, Maryland-based cable company and a client of D&R, says D&R brought the firm's debt recovery up from 12% to 25%. With revenues of just under $1 million, D&R's clients include Bell Atlantic, Comcast Communications, TCI Communications and the state of Maryland.

Forging a firm niche within the trillion-dollar collections industry has not been easy for Rice, but he believes that sheer persistence and the use of technology--D&R has a computerized system that dials the company's database of over 200,000 debtors automatically as well as an electronic billing system--have allowed his company to compete and win major accounts.

D&R Recovery Inc., 8403 Colesville Rd., Suite 700, Silver Spring, MD 20910; 800-394-7741