The Green Sheet Online Edition
May 09, 2011 • Issue 11:05:01
Let's reform our industry's education and training
In March of 2004, I answered an ad on Monster.com to become a credit card processing agent for a California-based company. Training consisted of weekly conference calls, and I was given the number of my "manager." I was told not to let my lack of industry knowledge stop me from signing merchants, as my manager would be available to help me from noon to 8:30 p.m. Eastern time.
As a new merchant level salesperson (MLS), I joined a towing association and asked the members many towing-related questions to learn about their industry. I soon began signing towing companies because I gained their trust.
Under the advice and consent of my processor's management team, I lined out areas of the contract that were not agreed to by my customers, and I received permission to make pricing adjustments as long as I properly filled out the "Special Directions" area of the contract.
My first inkling that I was not properly trained by this company came when I was pricing card services for a cemetery. I was told by the prospect that the company was paying 0.75 percent on everything, but the statement had carryover charges from the previous month.
My manager and her team could not decipher the statements. It took me four hours with a pen, paper and calculator, but I found a way to calculate all but $5 in fees out of almost $2,000 in charges.
I had to fight through three layers of management on the phone until I heard, "You're right; I've never seen this before." Unknown to me, I had found my first EBB statement; it was another year before I knew that EBB stands for Enhanced BillBack.
I left the company when I discovered its representatives were ignoring the changes I was making to the contracts (which they had authorized) and then telling merchants I was not allowed to make those changes.
Today, MLSs are still signed up with no experience and tossed to the streets with nothing but a phone number. Most get frustrated and quit. Others quit because they give their word to merchants who are then cheated by the processor.
As JDECKARD said on GS Online's MLS Forum, "I believe that for the most part people are genuine and honest ... and won't knowingly take advantage of their fellow human beings. The only way to get them to do so is to train them with false information. Eventually, they figure it out ... and either leave the industry or find a more reputable company to work with ... but by then the damage is already done."
The second processor I worked for, the processor for LaSalle Bank, was the polar opposite of the first. For two weeks straight, I drove 60 miles each way to Saginaw, Mich., for eight hours of classroom training before I ever saw a customer.
The field guide was extensive and detailed. It was written by Rod Katzfey, now an industry consultant and on the Advisory Board of the The Green Sheet. There was not much leeway: the rates were specific to whether the customer banked with LaSalle, and fees like the application fee could not be waived.
I was, however, grateful to have been taught thoroughly in that system. This education was the foundation I am still building upon. When I asked MLS Forum members for their thoughts on education in the industry, CLEARENT said, "Knowledge is important. But first build a sound foundation. Build it on one premise; 'If I don't know the exact answer, who do I call to get that answer?'
"Follow some basic rules:
- Don't translate information. If you're not 100 percent sure, tell the merchant and get the answer.
- Take time to learn the basics like: What is interchange? How do merchants get charged? What key areas happen with every merchant? ... There are others, but these are where I would start.
- Find someone to act as your trusted adviser. Your ISO partner should be that person, as it benefits both of you. But make sure they follow rule number 1.
- Be prepared to say, 'I don't know,' even if you think you do. Merchants will respect you for that. Just get the answer.
Last but not least, don't try to know everything. It can paralyze your sales efforts, and it's not necessary.
"We are in a very complex industry," he added. "Knowing everything isn't truly possible, because we are evolving almost daily. You must learn as you go along. Retain the information that is valuable to you and your efforts. But don't think you have to know everything to be successful."
MTY MSI agreed, "To reiterate some of what Jeff [CLEARENT] said to me, the two most important things about industry knowledge (after learning the basics) are:
- Knowing when you don't know the answer to a question
- Having someone who can answer the question
"And those people for me are my ISO/MSP partners and the many knowledgeable members of this forum."
The need for reference materials
My idea on education in this industry is replacing the need to have "someone who can answer the question" with "have something that can answer the question." In other words, it is critical to create reference materials.
I wrote Navigating Through the Risks of Credit Card Processing to help educate merchants on credit card processing. Many MLSs use the book not only to educate themselves, but also to win merchants.
MLSs looking for help on sales can read Paul H. Green's books, Good Selling and Good Selling 2, as well as Marc Beauchamp's Survive and Thrive in the Merchant Services Industry. To increase referrals, I recommend Bob Burg's Endless Referrals and Tim R. Green's Set 4 Life, which I discussed in "Referrals: Do you play the numbers game," The Green Sheet, Feb. 28, 2011, issue 11:02:02.
Other authors worth looking at for sales or management guidance include Brian Tracy, Zig Ziglar, Tony Robbins and Dale Carnegie. Carnegie's company also has a famous sales training course that many have used successfully.
The preceding are good reference materials, along with The Green Sheet archives. But are these enough?
JOHN GALT?'s post speaks to the question. "As an agent burning gas and shoes on the street, I'd say everything helps," he said. "[The] problem I've seen is if you're new, you don't get enough of what you need and too much of what you don't. Any and all sales tips are invaluable, but no one wants to give up their 'secrets.'
Even partners are hesitant to give away secrets. But sometimes you get too much technical information, which leads to speaking a different language than the prospective merchant. KISS."
One of the topics he'd like covered is interchange. "[Y]es, I know the rate charts are online, but [they do not say] what type of merchant qualifies for which rate," he wrote. "What is the difference between CPS Retail and CPS Retail 2? What is SIRF and EIRF and why would a trans[action] go there? What is the best way to explain PIN-debit costs to a merchant (and usually by the time you explain it, the rates have changed again)."
Merchant University (www.merchantuniversity.org) is pursuing writers and contributors for educational materials. My publishing company is also interested in creating an extensive training program.
What would it take to have some of the foremost experts in this industry collaborate to use their specialized talents to create components of a standard educational vehicle? We can't completely train individuals in every capacity with this tool, but we can create a guide to help MLSs in the field, allowing them to quickly find the right answer to a question.
My editor recently had a great idea. She asked, "Wouldn't it be nice to be able to create a phone app with all kinds of tools and formulas to help agents in the field?" Sure it would, but it would take several specialized apps, and I don't know of anyone who creates them. (Perhaps a reader of this article does.)
Even with the most comprehensive guide possible, ISOs will want to customize certain areas, if not write them from scratch. These will include applications, underwriting, customer service and unique selling propositions or points (USPs) - meaning explain why your ISO is better than others.
Additional vital components are other income opportunities for agents and specific merchant issues. Other income opportunities include gift card programs, check acceptance, phone cards, ATMs, leasing, etc. Specific merchant issues include business type, e-commerce, POS systems and common questions merchants pose. Another vital area to cover is fraud, whether merchant or consumer based.
An optional section would be on how to successfully establish your own ISO. This part alone could be a full book, covering areas from phone setups to risk to paying your agents.
The question of merchant education
Merchant education is a different thing entirely. Merchants don't trust our industry and will not simply accept what we say. Have you watched the commercial about how sugar is sugar with no difference to our bodies whether from corn or cane?
That commercial was paid for by corn refiners. If you believe there is a difference between corn and cane sugar, the commercial will not sway you because of its source.
Educational materials provided by independent sources carry more weight. ISOs should approach chambers of commerce to set up training for merchants on proper card procedures and to answer merchant questions on processing costs.
Sen. Richard Durbin, D-Ill., although not a merchant, exemplifies the need for merchant education. Merchants mistakenly believe that what they pay for processing credit cards is interchange. They asked Congress for help, and Durbin suggested capping interchange, thinking it would help everyone.
Since interchange is known by the industry to simply be a component of the fees, the card brands and the processors, for the most part, threw the banks under the bus and said, "Fine, cap interchange." If the cap goes through, the card brands will go untouched, and most ISOs will get a huge raise if they are pricing on tiered rates. That is, until consumer costs spike and we drop into a deeper recession.
JDECKARD was right when he posted, "[I]f you're actively trying to educate yourself about this industry, it's going to take several years for everything to gel. And about the time the pieces start to fit together, something new comes along that changes the game ... so you have to learn all you can about that ... it's a never-ending process."
This is the reason to start now. It could be at least a year before my company starts publishing training materials; the compiling process and locating the many experts to work on the project is ongoing.
Some ISOs and MLSs are opposed to standard training or education of agents. Some prefer hiring inexperienced MLSs; others consider a lack of training to be a competitive advantage.
However, standardized training can benefit the industry as follows:
- Scams used by uneducated or new agents will be reduced
- Fewer agents will leave over frustration with the learning curve
- ISOs will focus more time and energy to support agents by customizing materials instead of creating new pieces from scratch
- Agents will find answers to questions quicker
- Agents will specialize more
Some payment professionals will vigorously oppose a standardized method of training: either a certification program or a registration program. However, a uniform, industrywide training or education process developed for ISOs and MLSs is critical for the success of a certification or registration program. Without standardization, the certifying or registration body would have to develop training to help people pass the test it creates.
Regardless of what form our industry's education and training ultimately adopts, we need to take action now. Remember, what you do today defines your tomorrow.
Bill Pirtle is the President of MPCT Publishing Co. and author of Navigating Through the Risks of Credit Card Processing. He is also a merchant level salesperson for Clearent LLC, Electronic Payments Inc. and Electronic Merchant Systems Inc. Bill's website is www.creditcardprocessingbook.com, and his email address is email@example.com. He welcomes all connections on Facebook and LinkedIn.
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