I have sold merchant services for a lot of different processors.  I have made many mistakes along the way.  The most important decision you will make in the merchant services industry is choosing a processor for whom to sell.  I have helped thousands of agents and ISOs find the right processor.  Today, I want to help you.  Make sure you email me if you have any questions or want to get introduced to a processor which fits one of the descriptions below.

The first step in choosing the right processor is to place yourself into one of three buckets:

  1. “Inexperienced Bankcard Agent”
  2. “Experienced Bankcard Agent”
  3. An “ISO”
After years of working with reps, I believe each one of these groups has specific needs when searching for a processor.

Bucket #1 – Choosing a Processor as an Inexperienced Bankcard Sales Rep

An “Inexperienced Bankcard Agent” means you have made less than thirty sales in the merchant services industry, or you sell less than five deals a month.  Perhaps you were the top car salesman in your market before coming to our industry.  However, if you haven’t sold thirty merchant accounts or broken through the five per month barrier consistently, you are inexperienced by definition.  The number one mistake made by inexperienced agents in this industry is focusing on compensation details rather than training and coaching.  I am sad to say I have directed many new agents to processors who didn’t have a robust, in-person training program.  Thus far, my success rate with this approach is pretty close to 0%.You need to ask the processor two simple questions:

  1. “May I go in the field with an experienced rep and watch the rep make some sales?”
  2. “Do you have daily / weekly sales calls and feedback sessions where I can interact with other reps, get motivated, and share ideas?”
If the answer to either of these questions is “No,” your odds of succeeding with no experience in this industry are slim.  Appointment scheduled leads are also a big help when you are getting started.  But even more valuable is in-field training where you will see success in action.

Bucket #2 – Choosing a Processor as an Experienced Bankcard Sales Rep

An experienced bankcard sales rep has a book of businesses with at least thirty accounts and consistently sells at least five deals per month.  This is the individual who has broken through and figured out a way to sell merchant accounts – a very valuable skill.  How can you choose the right processor for whom to sell if you’re in this bucket?

One thing I have found to be true with almost every top earning rep in this industry is a real, personal relationship with the executive team at the processing company.  As you grow your book of businesses, you will need exceptions made, customized compensation, perhaps capital to keep growing when you hit a wall.  All of this will come from your relationship with the key decision makers at your processing company.

If you like the company with which you are currently working but don’t have a relationship with the top people, call and ask them to fly you to the office to meet the team.  For a rep who has made at least thirty sales to get a refusal of that request indicates time to shop for a new processor.  Either the company doesn’t value your relationship, or they don’t want you to see what the business really looks like.

When searching for a new processor, you need to see how far up the ladder you go.  While being the only good rep at a tiny company is undesirable, neither do you want to be a little fish in a huge pond.  If you provide a potential processing company with residual reports proving you have at least thirty accounts and consistently sell at least five deals per month, you should get a call with a key decision maker at the company.  A good sales person can always recognize such a person when talking.

Don’t ask for a plane ticket on the first call.  Instead, state your serious intentions of working with them and placing five deals with them before making a long term commitment.  Ask this question, “If I get you five deals in the next three weeks, would you fly me out to see the office and meet the team?”  For you to go to them rather than them coming to you is important.  You need to see their facility and ensure it is a legitimate operation.  There is no substitute for the gut feeling you will get when you walk through a processor’s office and see the operation in person.

Most experienced bankcard reps are all about compensation; that is understandable.  You have a valuable skill and want to be rewarded for it.  Resist the urge to push negotiations when you have very little leverage at the beginning.  As long as they make you a reasonable offer initially, take that offer and go make five sales for them.  Make sure they know you plan to further negotiate when you come to visit the office.  Then, when you do make the visit, you will have made some sales for them.  Thus, both sides will know if working together will be profitable.  This is the time to negotiate your long-term compensation.

Bucket #3 – Choosing a Processor as an ISO (Independent Sales Organization)

You are an ISO if you are currently submitting thirty deals per month and have three or more people on your team.  This will be the shortest section because it is the simplest to explain.  Everything I said in the previous section to experienced agents applies here, but the importance of visiting in person and providing proof of past performance is intensified.The most important thing about choosing a processing partner as an ISO is deciding what your core competency is and outsourcing the rest.  Far too many ISOs go for an extra 5% residual split in exchange for taking on customer service and terminal deployment.  They end up submitting 20% less deals.  This is a terrible trade!  What has made you successful so far?  Are you good at recruiting and training sales people?  If so, find a super ISO or processor who will do everything for you except recruiting and training your sales people.  Don’t take on operational responsibilities that are outside your core competency.  There is no residual split that will justify losing focus on what you do best.

Relationships are crucial for your growth.  But for the ISO, cash flow is equally important.  I have worked with many ISOs who negotiated a really high residual split without up-front bonus money or any way to generate cash up front.  Then, the ISO failed because their  reps didn’t get enough pay to survive while building their book.  To scale and grow quickly, you need to sacrifice some of your residual in order to get cash.  Cash and growth go hand-in-hand.  You must have one in order to get the other.

I hope these tips will help you choose the right processor.  As an industry consultant over the last six years, I know most of the players in this industry.  I would be glad to help you find the right processor.  Shoot me an email james@ccsalespro.com or visit http://www.ccsalespro.com/processors/

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