[WHO is your best bet for a Payment Processing?]

When choosing a credit card processor, most experienced business owners prefer to work directly with the source.

Visa and MasterCard designate payment processors to set up the warehouses full of computers to move the money from the customer to the merchant.  Examples of these payment processors are First Data, Elevon and Paymentech.  Each payment processor uses similar methods to gain customers (Merchants, like you).  They use a variety of retail channels (sales agents, resellers, etc.) that businesses can work with directly, to get access to the processing network.

Working directly with a payment processor provides 4 DISTINCT ADVANTAGES for you, the Merchant:

  • Competitive Programs
  • Clear Information 
  • Value Added Solutions
  • More money in the till! 

HOWEVER – there’s a catch! 

Not all Sales Agents are created equal … and the differences are critical to your bottom line!:

The  important differences between these sales channels is the nature and relationship to their payment processor; each of which employ inside and outside sales agents to generate new accounts; W2’d employees, complete with base salaries, benefits and 401k’s.

In First Data’s case (and here’s the key difference), they also manage their own independent sales channel, known as Ignite Payments.  Each Ignite office operates as an independent agency but utilizes the direct resources of First Data.    Every agent office in the Ignite channel is its own, independent business entity (similar in structure to the insurance industry; think ‘Farmers Insurance’ vs. ‘Joe Johnson’s Farmers Insurance Agency’.)

So – if you do go the “direct” route, how do you know WHO to choose? Let’s break down your options:

1)      Inside Sales Rep – Think about what it takes to become in inside sales rep for a major corporation.  College degree, two years of industry experience and you might have to chart just right on a behavioral test.  The inside sales person generally has a compliant and conservative mindset.  Being able to sit in a cube, make a certain amount of contacts and “dials” is a prerequisite.  They also need to be” a follower” by nature, having the demeanor of an employee and not an entrepreneur.  Most inside people like the security of a base salary, regular hours, scheduled vacations, and of course – the 401kThey will never push the envelope or take a service call after hours on their cell phone.

2)      Outside Sales Rep – The best outside reps are road warriors, guys/ladies that blast the phone, and play “the numbers game”.  Generally, their best incentives revolve around signing up the next deal or some arbitrary quota for new accounts.  The old adage of “sign and dash” applies here.  They generally have a small base salary, car and phone allowance, scheduled vacations and – you guessed it – the 401k.  Outside reps are used to working long hours, always seeking the next deal as if it’s the Holy Grail, but when it comes to customer service, they typically “don’t have the time”.  Why? Because they’re on to the next deal to make their quota.  Since none of their compensation comes from service work, they avoid customer follow up like a locust storm.

3)      Independent Sales  – What you get from the independent sales agent is the opportunity to work with someone who lives in your shoes every day.  S/he walks-the-walk and talks-the-talk known as “Business Owner & Entrepreneur” because – well, s/he is!  Each day the independent sales agent starts out with the same goal that 85% of all business owners have, and that is to make $$$’s.  The independent sales agent does not have a salary or benefits provided by corporate.  The successful agent pays for their phone, car, vacations, and all their benefits out of the money they earn.  And a 401k? … Well, any retirement accounts the independent agent might fund comes ONLY from his/her ability to create and maintain long term business relationships.  In other words, the level of their success (and whether or not I have get to fund a  401k) is simply a direct result of your satisfaction with their efforts as they pertain to your account.

In the world of an Independent Sales Rep, YOUR success = THEIR Success!  Since there is no corporate salary, benefits or safety net to fall back on,  an Independent Rep either succeeds (by providing exemplary Customer Service to you, the Merchant) – or fails miserably.

When all the facts are presented, most experienced business owners prefer to work directly with an independent REP.  So, if the most successful and most savvy business owners are choosing to process customer payments at this level, then why wouldn’t it be a good idea for your business?

The consistent flow of money (cash flow) is the life blood of your business.  It is imperative that you have good communication and a great working relationship with the folks responsible for making that happen.  So, be sure to choose wisely when it comes to entering into a processing relationship; your business success could depend on it.