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The Green Sheet Online Edition

May 14, 2012 • Issue 12:05:01

Street SmartsSM

How to avoid that 'What just happened?' moment

By Jeff Fortney
Clearent LLC

You're sitting in your car with a fully completed, signed application. You have all the supporting data you need, so you should be happy. But instead, you ask yourself, What just happened? The good news is the merchant signed. However, the bad news is you reduced your price well below your minimum.

You waived fees you never usually waive, and even offered to get the merchant new equipment at cost. You should have walked away from the deal, but instead you signed the merchant and even thanked the new client for signing.

Somehow, in some way, the merchant sold you, not the other way around. At the price agreed upon, you won't cover your costs of acquisition for up to a year. Instead of being pleased with the sale, you regret signing the merchant and you haven't even left the parking lot.

This story is one all ISOs and merchant level salespeople (MLSs) have experienced. It doesn't matter if you sell face to face or over the phone. At some point in our careers, we have all asked, What just happened? And probably we ask that question of ourselves more than once.

We come up with some pretty creative answers, but when it comes right down to it, we're basically trying to justify our mistakes. We swear it won't happen again, but somehow it does. Until we examine this question closely, and truthfully answer it, we will continue to fall into the same trap, asking the same dreaded question while we stare at another unprofitable contract.

Many sales trainers offer advice on this subject, and their responses fall into four distinct categories:

  1. Fear
  2. Intimidation
  3. Price resistance
  4. Embarrassment


One definition of fear is the feeling or condition of being afraid, or more accurately, a distressing emotion aroused by impending danger, evil, pain, etc., whether the threat is real or imagined.

My first experience with fear occurred when I was four years old. My parents and I were on vacation in Los Angeles. My mother wanted to eat lunch one day at the Brown Derby, in hopes of seeing Hollywood stars in the popular celebrity hangout.

Sure enough, sitting one table over from us was Jack Benny and his TV sidekick Dennis Day. (For those of you younger than 30, Benny was a popular comedian of his time, ranking along George Burns and Bob Hope.) My mom wanted Benny's autograph. But knowing a youngster had a better chance at getting an autograph than an adult, she handed me a pen and pad and instructed me to walk over to their table.

When I got within two feet of the men I froze. I couldn't go back, and had no desire to go forward. I just stood there for what seemed like hours. Finally, Day said, "Hey Jack, I think that little boy wants your autograph." Benny turned around and asked if that was true. I nodded. He signed the pad, handed it back and returned to his lunch.

Still shaking, I walked back to our table and gave the autograph to my mother. I was both relieved it was over and a little excited, for that was my first autograph. Many years passed before I had the courage to ask for another, simply because of the fear I felt that day.

As adults, fear can creep into our professional lives. We fear failure, fear a prospect's reaction to us and sometimes just fear the initial introduction. Sometimes our fear is rational, sometimes it's not, but it's real to us all the same.

To prevent fear from taking a stranglehold, we must learn how to recognize it and effectively manage it. Here are three suggestions:

  1. Knowledge: By having a working knowledge of your payment offerings, you will be confident when talking with merchants. You don't need to have all of the answers; you just need access to someone at your organization who does.

  2. Confidence: Remember that the merchant needs you, even if he or she doesn't know it yet.

  3. Thick skin: Be prepared to hear no, and don't take it personally.


Fear is personal, whereas intimidation is an external force. Its definition can be summed up in one word - bullying: the act of intimidating a weaker person to make the victim do something. Intimidation comes in many forms, but it always results in the victim losing control of some situation.

Once while I was training a new MLS, we walked into a retail store, and the MLS introduced herself. Before she could say another word, the merchant reached under the counter and slapped down his statement, saying, "This is what you want." He proceeded to cross his arms and stare at us with what I took to be a look of contempt.

We were faced with two choices. We could acknowledge that the statement was indeed what we wanted to see, and proceed with an analysis to save him money, or we could change his perception of us.

Unsure of what to do, the MLS looked at me. I chose the latter approach. I put my hand in the middle of the statement and said, "You don't want to show us this. First we don't even know if we are a fit for what you need, and besides we don't know if you fit us."

The merchant was dumbfounded, because all previous MLSs who had called on him wanted to see his statement and show him how much money they could save him. The merchant uncrossed his arms, and his look changed from disdain to surprise. For the next 10 minutes he tried to convince us that he was a fit for us.

This is an example of how a merchant's impression changed from one of us being inferior to him to one of all of us being equals. Treat merchants as equals, and you can expect to be treated the same. That is the first step to overcoming intimidation.

The second step is information. Know something about your prospective customers, at least what they sell. Remember, even though the goal is for them to sign with you, the sale is all about them.

Lastly, do not accept intimidation, or even consider signing a merchant if you feel intimidated. If nothing else, walk away.

Price resistance

No matter how you sell, the conversation will inevitably turn to cost. When that happens, the response to your pricing will not always be positive. Keep in mind that how you respond to the merchant's resistance will define your success.

In Crush Price Objections, author Tom Reilly wrote that 72 percent of salespeople give up when the buyer resists the quoted price. It should be expected that the merchant will question price, even if it's fair. As such, you should be prepared for this discussion in advance. That preparation begins with your "floor."

Before starting any sales effort, identify the price you will not drop below. This isn't the lowest price you can quote, but rather the lowest price you will quote.

When calculating your floor, remember it's not just fixed costs, but also your costs of acquisition (that is, gas, time, etc.) that must be included to determine where you break even.

Next, add your minimum mark-up. Remember that, in almost every case, a merchant is a for-profit business, and you should be too. If a merchant presses you to drop below your minimum, say thank you and walk away.

Don't avoid the price conversation, but rather know how to control it. When a merchant objects to your price, don't react by offering to reduce or waive anything. If the retailer says, "That's just too high," ask, "In what way?" Make the merchant be specific about his or her concerns, and address those concerns.

Price needs to be part of the conversation, but don't let it dominate. Otherwise you'll be in for a debate, one you will likely lose.


Has something like this ever happened to you? A merchant asks a specific question about the terminal on the counter before you. The merchant might say, "Can you connect it to the Internet?" You are not knowledgeable about that particular terminal, but in your effort to please the merchant you say, "Sure!"

The merchant then looks at you skeptically and asks if you're sure, because everyone else has said no. At this point, you admit you aren't sure, try to back pedal or begin to argue the point. None of these choices are good ones.

When MLSs are trapped in a corner, they will often attempt to save face instead of admitting mistakes. A signed deal may follow, but chances are the profitability will be lacking, and MLSs will end up with merchants who have little respect for them - and will rarely provide referrals.

The keys to avoiding embarrassment are confidence and honesty. You have to have confidence and honesty to be able to say, "I don't know." Don't be afraid to say it. Confidence grows as MLSs grow their industry knowledge. If you're selling processing, you need to understand the payment cycle as well as the structure behind the costs. If you're selling equipment, you need a working knowledge of the various types of terminals that your company sells.

You don't need to know the rules surrounding chargebacks, or the specifics of interchange, but you do need to know what a chargeback is and the principles behind interchange.

Merchants may not come out and say it, but if they think you don't understand your product offerings, they will wonder why they should sign with you.

When we consider all of the moving parts associated with sales, it's easy to see how MLSs could find themselves asking, What just happened? That's why we must carefully follow the steps herein and focus on staying in control of the sale. If we do, we will soon find little else that is as professionally rewarding. end of article

Jeff Fortney is Vice President, ISO Channel Management with Clearent LLC. He has more than 17 years' experience in the payments industry. Contact him at jeff@clearent.com or 972-618-7340. To learn about how Clearent can help you grow faster and go further, visit www.clearent.com.

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