Sunday, May 24 2020
Merchant services are quickly becoming the hottest field in the technology and commerce industry as more and more businesses realize the importance of having a robust and functional payments solution that works well for their business. As a new agent or ISO in this space, you are probably extremely excited to begin and start making a name for yourself in merchant services. If you are new to merchant services, there is some advice that you must have if you want to have success and avoid some of the errors that many must make early on. With this knowledge in hand, you'll be a step ahead of the competition and well-poised to earn a good income as a merchant services agent.
This rundown of who you should sell to and how will give you knowledge that has been passed down from many merchant services agents in the hope that new merchant services agent will follow the advice and make the industry a better place to work. The earnings potential for a merchant services agent is high, but you can raise the bar even higher if you follow these actionable tips that will show you exactly how to interact with businesses and which businesses you should be reaching out to.
One of the most important skills that you are going to learn when you are a merchant services agent is which businesses need your services that you should target. However, an equally important skill is to learn which ones you shouldn’t even bother talking to at the moment. Knowing which businesses to target could get you some nice results, but knowing which ones to wait on could be the accounts that end up feeding you residual income for life. That’s because these businesses are often larger and more established than the typical startup small shop that you might target right out of the gate.
One way to know if you should not even bother with a business is if you walk into the business and you see a POS system. Unlike a standard terminal, these are complicated systems that are difficult for the beginner agent to comprehend and speak knowledgeably about. Typically, these belong to businesses that have been around for a while and if you even get a meeting with them, they are going to want references. You likely won’t be able to provide them with any, since you are just starting out. They also will want you to understand their current system, which you probably don’t, because again, you are new. Once these things happen, you can pretty much forget about this sale forever.
However, if you make a list of these businesses and target them at a time that you are more established on the business and can actually guide them, then you might have found yourself a client for life. So, don’t waste your time and resources going for a big client like this right out of the gate. Get your feet wet with some smaller clients and come back to these ones later.
If you are just starting out, then you might be tempted to track down a friend or family member that has a business that operates out of state or online and try to sell them on a merchant services package. This is not recommended. Not only because you should never mix business and family, but also because walking these types of businesses through the setup process is much more difficult and requires much more attention and care. Failure to complete the setup process could prove disastrous for your relationship and your confidence. Don’t try to set up these businesses with a merchant services contract unless they are local. It will save you time, money, and hassle.
When you think of being a merchant service agent, you might think of the traditional method of reeling in clients like cold calls and cold emails. However, the world has changed since credit card processing first came out and there are new ways to build relationships. One of the best ways to do this is by always networking. Networking is a valuable skill to learn and it can be done in a variety of ways. Networking could mean that you simply start meeting and talking with the people in your professional circle about whether they know any businesses that need to evaluate their merchant services needs. It could mean speaking with past clients about any business colleagues they have that have merchant services needs.
One of the most popular ways to network for new business connections in the modern world is to join professional apps and platforms such as LinkedIn. With these platforms, you’ll be able to find business owners and managers in your area that could need merchant services or might be interested in what you have to say. If you are going to be successful in being a merchant services agent, then you need to establish a consistent pipeline from a variety of sources that makes it easy to continue bringing in the customers without having to rely completely on cold-calling and cold emailing. Building a network through online or in-person networking can help to establish this for you.
Though you might be eager to make any sale that you can get your hands on, sometimes it really is better to take the cautious approach. Just like clients are selective in who they partner with to handle their processing, you also should be selective of the client that you work with. There are many industries that you might not want to touch or simply are a bad fit for what you offer as a merchant services agent. There is such a thing as a bad fit in this industry, and you would be well-served to recognize it before it happens because it just creates more hassle than the short-lived sale will be worth.
As a merchant services agent, you need to be able to know when it is best to walk away from a potential deal due to compatibility issues between you and the client. One example of a business that you should avoid is anyone that is doing all online sales. Most merchant services solutions are just not designed to handle these transactions well and you should avoid them.
One of the most important things that you can do as a merchant services agent is trying to evaluate and estimate the profit that you'll be making from the sale before you actually commit to it. Too many young merchant services reps are too eager to get started that they lose sight of the risk to reward ratio and don't track the time that they will actually be spending on the setup, support, and other time commitments that it takes to onboard and maintain a merchant.
If you have an account that is only making you $25/month, then you probably already know that it’s just not worth the hassle for that small amount of residual income. For many merchant services agents, it is advised that you walk away from any deal that makes less than $30/month. We know that it’s difficult to walk away from any amount of money, but the time that you spend maintaining that account could be much better spent on landing a client that could bring in hundreds of dollars per month.
If you’ve been trying to make a sale for a while or you want to get out to a fast start, you might be very tempted to make some very bold pricing promises to your client to get them to sign on. You are encouraged to help make them feel more comfortable, but you should be careful with what you offer to close a sale. While you can estimate all you want, you will never truly know how much a merchant services contract for any particular business is going to bring in. You don’t want to spend more than 6 months of the profit from an account to close it, and you should always estimate on the very conservative side.
Even if you are desperate for a sale, you should always be very cautious in offering discounts because it could cause you to lose all profit that you make on the sale. In addition, your client might expect these large discounts every time they purchase going forward. That isn’t a precedent that you want to set.