How can you sell monster merchant accounts without flipping their processing?
Sell big accounts with this unique approach. Are you up for a new challenge? Get my tips on this unique approach for selling monster merchant accounts. After some experience in the industry and understanding merchant statements, try this advanced concept. This episode features a unique and advanced concept in selling monster merchant accounts. But […]
Are you up for a new challenge? Get my tips on this unique approach for selling monster merchant accounts. After some experience in the industry and understanding merchant statements, try this advanced concept.
This episode features a unique and advanced concept in selling monster merchant accounts. But this episode is not for beginners. If you’re new to the industry, you may not understand much of this content. But I have plenty of other helpful information available for you! Come back to this one after some experience in the industry and gaining a thorough understanding of merchant statements.
How can you sell monster merchant accounts without flipping their processing? I’m referring to big accounts doing $500,00, a million, or two million monthly.
These big merchants have already negotiated what they consider good rates with their processor. They aren’t interested in getting another bid. They are also already integrated into their POS systems and don’t want to rock the boat there!
Although I’ve never published content on this subject, I did use the concept when selling full time in the field. This concept is not original with me. The sales professionals who use it sometimes call themselves “Interchange Consultants.”
This is a unique approach to payment processing which I expect will gain momentum over the next thirty-six months.
If you’re an ISO executive, I encourage you to make a team to go after these merchants exclusively using this methodology.
You don’t have to change their processing relationship to sell these monster merchants.
But you need to use a totally different pitch:
“I’m not here to flip your merchant account at all. I am a payments expert. Companies contract with me to help them save money. If you hire me as a paid consultant to negotiate on your behalf, I can find ways to save you money. I can identify things on your statement that you can’t identify. I’ll be able to look at your interchange table and find your percentage of EIRF or standard downgrades. Maybe your business-to-business transactions aren’t processing over level 2 or 3; they’re all level 1. There’s interchange optimization. Maybe you’re paying 25 basis points of mark-up and $0.10, and I know we could probably negotiate that company down to 10 basis points. And great news! You only pay me if I’m able to save you money!”
There are several possible models using this concept. But the key is establishing an agreement with the company which allows you to represent them to their current processor.
A thorough understanding of the merchant statement is vital; you must understand every area of the statement. After your agreement is in place, carefully study the company’s statements. Make notes of changes which will save the merchant money.
You’ll discover shocking ease in finding ways to lower costs of a big company:
· The company may have done nothing with interchange optimization.
· Their operational procedures may be screwed up.
· There are usually hidden fees.
Saving $500-$600 per month will not be difficult in most cases.
When your study and notes are complete, send that statement to get estimates. Get two or three competing bids.
Then send the lowest bid and your notes of changes needed on behalf of the merchant to the current processor. Notify them that the company is shopping payment providers. Ask for rate reduction.
There are two ways for you to make money in this agreement.
1. Get a percentage of the savings you find for the company. Look at the last five or six statements to establish the baseline effective rate. Agree that you’ll get 50% of anything you save below that for a period of 24 months.
2. Charge an initial fee. That makes the deal harder to sell, but you get more money.
Another great benefit to this approach
You’ve established a relationship with one of the decision makers for a big merchant who trusts you implicitly. You have plenty of time in 24 months to do homework on this account. For instance, learn what gateway is needed to integrate with their current solution. Glean everything you need to know to actually land the merchant account.
When the six-month or one-year mark of the agreement comes, say,
“You’ve been paying me $200-$300 a month, which I’m happy to take. I don’t think I’ll be able to squeeze any more savings out of this provider. However, the provider with whom I work who pays my commission when I bring them merchants offers comparable rates. I know what’s needed for a smooth integration. If you’d like, I would be willing to switch you to this provider. We could cancel our savings contract and eliminate your monthly payment to me. Then I’m basically working for you free because I work with the processor.”
This concept offers you the option of being paid during the normal six months to a year needed to get these large accounts. And eventually you’ll get the residuals when they change processors.
I realize this is a very complicated topic. I am very interested in your feedback on this. Please comment in the section below.