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48 A recent National Organization of Mortgage Field Services survey identified a significant exodus of vendor partners that provide direct boot-on-the-ground services. Are you experiencing challenges maintaining necessary labor or vendor partnerships, and if so, how are you combatting this? It's no secret that there is a significant exodus of field vendors in the industry. is is largely attributable to market conditions—the labor market is tight, material and fuel costs skyrocketed, and inventories plummeted. We have gotten scrappy, taking a relationship approach and diversifying services to leverage our infrastructure and network. e diversification of our services has provided more opportunities for vendors to repair and preserve commercial and retail assets through cross-training. We are also sharing our network across our family of companies. Lastly, MSI was an early adopter and supporter of the pricing initiative and discussions regarding investor allowables not reflecting historically high inflation, low volumes of work, and increasing operating costs due to further distances between properties. How are you and your team working to improve efficiencies within the industry to attract and retain new talent and improve the economic model for those that have remained in this sector? MSI is continuously working to reduce the administrative burden of our field vendors by helping with automation and third-party system integration where possible. MSI has proprietary software and systems for our field vendors to send results and photos, but we also recognize our field partners are not exclusive to MSI, so integration and automated software to reduce the number of systems they use offers lift to their crews and staff. In addition, through partnerships across the Insight One family, we can offer opportunities outside of property preservation. With training our field network is able to pursue revenue opportunities assisting with proof of loss for IProperty Claims, inspections, and signage assistance for Williams & Williams Auctions, as well as expanding to service our retail and commercial accounts. One thing we've heard about is an ongoing demographic shift to a higher concentration of rural versus urban properties that go through the foreclosure sale process and are taken by the investors/insurers back into inventory. Have you seen this, and if so, what challenges are presented by this higher concentration of properties in "hard to serve" areas? e ratio of metropolitan properties to rural has shifted significantly. I would not say the rural properties are "hard to serve," but I would agree servicing these properties comes at a much higher cost to the boots on the ground due to gas prices, distance to drive, and lack of density. A field vendor may need to forgo work at three metropolitan properties to service one rural property in the same amount of time. Meanwhile, the tradeoff is two-thirds less money in their pocket. Common sense often prevails when they are faced with this decision, and the rural property doesn't get scheduled. e pricing initiatives and considerations for paying for time and materials, in lieu of payment by task, are more reflective of market conditions and may result in faster completion timeframes for the rural properties. Are there any other critical challenges you are facing heading into 2023? If so, how are you navigating and preparing for these? As mentioned above, inflation rising at an annually compounded rate of 10% combined with operating under fixed pricing established over a decade ago is a challenge. It's reassuring to see the recent interest and active discussions on adjusting investor/insurer allowables across the diverse parties in the industry. Beyond that, increased interest in consumer protections is on the horizon. e rapidly rising interest rates, increasing hazard insurance rates, higher frequency of storms, and expansion of flood zones by the NFIP will affect home affordability for millions of Americans. Real estate sale prices have begun to slow in both quantity and pricing. If the downward pressure on prices continues, the industry may see a sharp reduction in second- chance auction sales, which will result in an increased demand for property preservation on a lean and strained field vendor network. Michael Greenbaum CIO, Safeguard Properties What regulatory issues or impacts are most challenging for the property preservation sector? How are you navigating them? State licensing requirements are one of the most challenging issues that impact the property preservation space. ey create barriers to hiring new personnel from outside of the industry and reduce our ability to drive competition within an existing vendor network. We navigate by spending significant marketing dollars in these areas to attract and retain talent. A recent National Organization of Mortgage Field Services survey identified a significant exodus of vendor partners that provide direct boot-on-the-ground services. Are you experiencing challenges maintaining necessary labor or vendor partnerships, and if so, how are you combatting this? Yes, we are experiencing this to an extent. To combat this, we have placed a focus on recruiting new talent, as well as developing retention programs for both the current network and new hires just starting with Safeguard. How are you and your team working to improve efficiencies within the industry to attract and retain new talent and improve the economic model for those that have remained in this sector? We have focused on clear, honest marketing in our recruiting efforts, including true testimonials from our long-term, loyal vendor partners. We have adjusted payment for services in response to inflation to help reflect the current economic environment. Feature By: David Wharton