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How Much Residual Can You Make Selling Merchant Services? – Merchant Services Sales Commission

Many sales people leave insurance, real estate, or automotive sales for merchant services. Why make that change? Choosing a merchant services career offers residual income! Everyone wants a big residual portfolio. In this mini-series about merchant services sales commission we’ve already discussed sales...



Many sales people leave insurance, real estate, or automotive sales for merchant services.  Why make that change?  Choosing a merchant services career offers residual income!  Everyone wants a big residual portfolio.  In this mini-series about merchant services sales commission we’ve already discussed sales and up-front bonuses.  If you haven’t read or heard the previous episodes in the series, please click here.    “How Many Merchants Can You Sell”  “How To Sell More Than 100 Merchants”  “Understanding Up-front Bonuses”  “Why Your Residuals Are Not Growing”  In this episode get a better understanding of the all-important residual split.

In this series of episodes, we’ve been using my calculator on instantquotetool.com.  You don’t need to sign in or sign up; it’s free.  Please go there now and click on “goals.”  The calculator will figure how much money you can make selling merchant services, based on some assumptions.  The following figures were entered in the earlier episodes of the series.  Sales per month for year one: 12.  Sales per month year 2: 7.  Sales per month year 3 and on: 5.  The average up-front bonus: $450 (assuming you’re doing half leases and half free terminal sales.)  In the last episode we discussed the gross margin.  That is extremely important to understand and will be vital to the information today.  Please make sure you read and/or watch that episode before continuing.  “Why Your Residuals Are Not Growing”  The number entered in the calculator for gross margin is $70.

Before launching into a discussion of residual split, you need some information about the Schedule A cost.  Two important items determine how profitable an account is going to be.

#1.  What size account are you pursuing – big or small?

#2.  What is your cost structure?  The processor will give you a Schedule A.

At ccsalespro we have a support team who can load your schedule A information as a program into the instant quote tool.  This would give you the capability to run different scenarios, different size merchants, and different types of merchants to calculate your projected residual per month.  You would be crazy not to take advantage of that opportunity!  Email us at support@instantquotetool.com.  Send the Schedule A from your processor and choose compensation details you want to include in the tool.  The data is in a completely separate database just for your use.  If your processor has authorized you to have the data, you can enter it yourself.  Or ask our support team to input for you.  By entering your information, you can easily compare “apples to apples” when choosing between companies for whom to sell.

Here is a warning – a huge red flag:  Beware of a processor who doesn’t want to share the Schedule A with you!  Make sure you have a good Schedule A.  Also, make sure you understand the previous episode about profitability of the account.  “Why Your Residuals Are Not Growing”  Then the last variable necessary to understand when calculating residual is the residual split.

In the “goals” section of instantquotetool.com, the residual split in my calculator is set at 25%.  This is a very conservative number.  And that number is assuming you’re a sub-agent of another ISO who offers good support, lots of leads, and similar services.  The industry average right now is probably about 50%, so change that number in the calculator.

I advise you not to focus entirely on the national average though.  If a processor offers only 30% or 40% residual but gives leads, coaching, or other services, this gives a huge opportunity for reps to make many more sales.  That’s great!  Some processors will offer as much as 70% or 80% residual in exchange for no up-front bonus.  Other processors may offer you an 80% split with an up-front bonus, but you must consider how they are paying for that.  You’ll find they’ve taken the cost up on your Schedule A, giving you a big piece of a smaller pie.

Work with your processor to make sure you understand the residual split.  For this series, we will enter 50% in the calculator.  Don’t miss the final episode of this mini-series on merchant services sales commission.  There is one last assumption to address.  Then find out how all the different assumptions relate to your over-all earnings and income.

Share this information with your friends and associates if it’s been helpful to you!

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Why Your Residuals Are Not Growing – Merchant Services Sales Commission

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Why Merchants Cancel – Merchant Services Sales Commission

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