As part of what I’m seeing out in the debt relief world, the demand for debt relief services in general is slowing for everybody in the debt relief space.
I just posted an article on lower bankruptcy filings for the tail of 2010 from the year before and I expect to see filings, when compared for the same time period last year, drop.
Jay Fleishman, a bankruptcy attorney that helps other bankruptcy attorneys market their practices just told me “Lots of my consumer bankruptcy lawyer colleagues are in slowdown mode and have been for some time.” On Twitter (@JayFleishman) he said “Too many lawyers flooded the field when the recession hit. So now people are just broke and angry.”
This just reinforces what I’ve been saying.
My opinion is it’s time for good debt relief to stop sinking money into finding just those few consumers that match your niche solution and instead widen your solution base to serve all the consumers that contact you.
With a falling number of consumers that need bankruptcy, debt settlement, or credit counseling; trying to compete just for your niche client is only going to get more expensive since acquisition costs will remain steady or increase as the demand for the smaller audience of consumers who need X solution, falls.
The irony is that while many debt settlement companies are angry and blame regulation and the government for killing their industry, the fact is the shrinking demand for services was doing that already. Consumers that are stone broke don’t have money for repayment solutions. The most at risk solution to this slowdown is probably credit counseling that provides little to no monthly payment reduction.
Debt relief services will always be needed but until credit begins to loosen up and consumers start absorbing new debt, expect demand for debt relief help to only continue to trend downward.
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