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Table of Contents

Lead Story

New payment player flexes muscle

News

Industry Update

Interchange dodges a bullet

Two more terminal types under PCI SSC umbrella

Small-business confidence rising

Contactless faring well

Terrorism funded with stolen data

Flying for wishes, Isaacman sets record

Visa Inc. interchange rates as of April 2009

Features

Data security dominates ETA Expo

Selling Prepaid

Prepaid in brief

The Fair Gift Card Act of 2009:
Good intentions, disastrous results

Brad Fauss
Springbok Services Inc.

The ISO challenge: Selling prepaid

Drilling down on the prepaid-unbanked relationship

Views

Protect merchants with the basics

Biff Matthews
CardWare International

The drive toward integrated solutions

Robbie Lopez
VeriFone

Extending security beyond assessments

Michael Petitti
Trustwave

Education

Street SmartsSM:
What does your billboard say?

Jon Perry and Vanessa Lang
888QuikRate.com

What it takes to thrive in business

Curt Hensley
CSH Consulting

PCI: Taking the proper path

Tim Cranny
Panoptic Security Inc.

Facing the elephants

Jeff Fortney
Clearent LLC

Company Profile

Merchant Cash and Capital

New Products

Private pathway for POS data

AprivaNet
Company: Apriva

Boundless processing

Whizpay
TalentBeat

Revenue streams through referrals

VendorVantage
AdvanceMe Inc.

Inspiration

Capitalizing on distractions

Miscellaneous

2009 Calendar of events

Departments

Forum

Resource Guide

Datebook

A Bigger Thing

The Green Sheet Online Edition

May 11, 2009  •  Issue 09:05:01

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New Products

Revenue streams through referrals

Product: VendorVantage

AdvanceMe Inc. has long furnished merchants with financial help, but its newest program, VendorVantage, is designed to buoy merchant vendors at the same time.

AdvanceMe indicated the program provides capital in two ways to merchant vendors. One, it helps them make sales to merchants by getting those merchants a money injection; two, it positions them to receive a commission on the repayment of that same advance.

For its part, AdvanceMe has been able to expand its clientele by attracting merchants through business partners with whom those merchants have a history.

"One of the things we've been hearing ... is that a lot of companies that provided a lot of traditional financing to vendors, or to merchants so they could buy things from vendors - leasing companies or banks or things like that - in the recent economic situation, they're getting a little tighter," said Mark Lorimer, Chief Marketing Officer for AdvanceMe.

"It's getting a little harder to get that money, and it's not only squeezing the merchants - it's squeezing the vendors," he added.

A slice of the pie

Through VendorVantage, merchant vendors who act as referrals for AdvanceMe become eligible for a commission with each merchant they refer; the size of that commission depends on the extent of the vendor's involvement.

"What [a vendor] would do is go to their existing base and say, 'You can either pay me through cash, credit card, or I can help you to get money to pay for this ordered through AdvanceMe,'" Lorimer said. How deeply vendors get involved is up to them - Lorimer said their involvement can range from simply referring the name of a merchant to actually assuming the role of an ISO and "doing the paperwork to sell AdvanceMe's product."

"Depending on what the vendor needs, we will structure the program and customize it," Lorimer noted.

Money injection

The "product" to which Lorimer refers is a merchant's "future receivables," which is what AdvanceMe purchases when it provides a money injection; the company obtains that "product" by taking a percentage (the size of which varies with each arrangement) out of every subsequent credit transaction the merchant conducts.

Merchant vendors participating in VendorVantage then get a portion of that commission.

For vendors "just flipping us a name," that portion is typically between 1 and 2 percent, Lorimer said, while those that "sell the deal end to end" get 6 to 9 percent of the commission.

And because AdvanceMe assumes the entire risk for such transactions - because they advance the money - the merchant vendor stands only to gain, Lorimer added.

The worst case scenario with any contract is that a merchant goes out of business. Yet, while AdvanceMe in that case would lose whatever money it fronted, the referring vendor would only cease collecting its percentage - without suffering a loss overall.

Indeed, if that vendor made a sale or had a loan recouped through AdvanceMe's purchase of an account receivable, it would still benefit from the arrangement - only without the added boon of the commission returns.

"It's more like an affiliate marketing program, because merchants have an affiliation with [the vendor]," Lorimer said. "Basically they're leveraging that relationship and expanding their ability to make revenue by selling this product to people with whom they have a relationship."

AdvanceMe Inc.
770-590-9822
www.advanceme.com

Notice to readers: These are archived articles. Contact names or information may be out of date. We regret any inconvenience.

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