By Jeffrey I. Shavitz
There are hundreds, if not thousands, of business topics to discuss within our MLS Forum community. And, as the current Street SmartsSM author, I appreciate the dedicated people who consistently respond to questions, urge me with great topics and get engaged by starting new forum threads. However, I believe the forum would work much better if more MLSs and other payment professionals became involved. To be a dynamic resource going forward, we need more engagement from all of us.
I hope this preamble will encourage more of you to participate in our discussions. The MLS Forum can help all of our businesses if all of us, from new industry entrants to the most seasoned pros, provide timely, thoughtful responses to questions posed.
Enough ranting. In this article, I want to present ideas members of the MLS Forum shared with me about possible topics to cover in future Street SmartsSM columns. Forum member Steve Norell was the first to weigh in. "What do we have to do as ISOs and MLSs to get either the card cos., banks, states, cities or villages to require a registration for anyone selling credit card processing?" he wrote. "At the very least, it should require criminal background check, annual fee and continuing education. Start there."
Banks are a major concern to forum member more 2, who posted, "Banks, banks and more. We as MLSs and ISOs have to fight the fight of keeping our merchants daily from other MLSs and ISOs. Then my bank, your bank and credit unions … just sit and wait for a merchant to open accounts with them, and it's game on. Banks are so much more aggressive these days. (We have all lost accounts to them). Understanding tying is not legal (I believe that's the word) yet every bank has some kind of incentive if they get a merchant account.
"Example one: bank's merchant can settle later than my merchant and still have money available the next morning, and on and on. We can't get to merchants fast enough. What can we do to improve our industry so … the next move wouldn't be to go down to 7/11 and open up a merchant account and get a free frozen drink or Home Depot and get free detergent with a new merchant account. It just feels like everybody wants into our industry."
In response to more 2, nwbc wrote, "You bundle … just like the banks do, which leads to my question: Is it best to specialize in just one product like POS? Or are you better off having a good number of products to sell to a merchant? … Is it better to be the go-to guy for that one product, or be a broker for lots of products? I personally believe in the latter, but I've seen quite a few arguments for the former. I would love to know pros/cons."
Forum member jotucker1983 shared several ideas. "What is the future for the 'small office' MLS/agent in terms of surviving/thriving in the industry? In a nutshell, what do you think an MLS/agent needs to specialize in, target, niche, partner with, etc., to make $50,000 to $75,000 a year, or $100,000 to $150,000 a year?
"If you could break down the planning from beginning to end, that would be great. Also if you think that the "small office" MLS/agent's future in terms of specializing in anything related to merchant services is pretty much doomed, list those reasons and explain why.
"With the implementation of EMV, word has it that the fraud would shift from CP to CNP merchant categories. What is your opinion on this and can you provide more details/breakdown on the fraud shift as well as the new strategies that fraudsters would use for CNP merchant categories that they haven't used before?"
In addition, jotucker1983 asked, "Do you think an MLS/agent club or association is needed in our industry to fight back against larger ISOs that seemingly use dishonest tactics toward their MLS/agents, who are usually very small and without sufficient legal resources to protect themselves? If the answer is no, then what do you recommend for MLS/agents in terms of fighting back against this situation?
Benjamin Abel seconded jotucker1983's suggestions and offered one of his own. "One recommendation I can give from when Tom and I were writing the column was that the idea of the column was that it's 'dedicated to the merchant level salesperson (MLS) whose feet are firmly planted out on the street and whose opinions, observations, concerns and critiques need to be heard.' I took that to mean while yes, it covers direct industry topics like the ones posed above, it also encompasses topics that the feet on the street level salesperson would be concerned with.
"This forum is populated with some real industry heavyweights who have the ability to really pull up to a bird's-eye view of the industry and look at topics with an impressive experience base. This might make you, because it did for me at first, think that since these are the people answering the questions that the very idea of these questions must be directly targeted at their interests.
"But to the average MLS things like sales techniques are also important and so are lead generation models, networking strategies, building a personal brand, deciding where to place deals and what secondary products to promote or things of these sorts. These are also things that said heavyweights can throw their two cents on and provide some vicarious experience for younger industry members to learn from.
"My advice to you, because, trust me, I know it can be exceptionally hard to generate 24 worthwhile articles, would be to expand your scope of conversation to topics that may not have seemed like the obvious go-tos but are equally important to an MLS who's building a career and portfolio."
Regarding jotucker1983's question about starting an MLS/agent club or association, amsusa responded, "It's been tried. Perhaps at the wrong time. Realistically, without the support of a larger ISO or two, it won't fly. Without some level of recognition from the brands, it won't fly. I can say from first-hand experience, it is a full time job to get [an association of agents] started. It is a very political arena sullied with more individual agendas than a singular goal. The notion of an integrity-based group focused on some moniker of standardization, training, and the value in same is a noble one."
I will continue to welcome your thoughts on topics to cover in this column. In the next issue, I'll share perspectives on how members of the MLS Forum are planning for 2016. In the meantime, I'd like to share some thoughts on the future of our industry.
MLSs and other salespeople who are considering entering the payments biz frequently ask me what's in store for our sector. Here's my simple answer: I don't know. How's that for honesty? What do you think? Hint: this is your chance to go to MLS Forum and post your thoughts, or send me an email at email@example.com if that's easier for you.
However, I do feel confident stating that our business is not going away. Credit card usage (both debit and credit) continues to grow and more and more merchants, although they do not like the accompanying interchange fees, must continue to accept all forms of plastic payment.
And margins and are shrinking (that's an obvious statement). To make the same or more money, we all need to open an increasing number of merchant accounts. It's all about scale and leverage and how you can exponentially grow your independent sales business.
What makes life and business so rewarding, especially for a salesperson, is the unknown. Embrace it. The unknown is why you have chosen to become an entrepreneur. There is a big difference between a job where you earn a salary and a sales opportunity where you can create your future. Nobody knows what the future will hold, but I'm excited to be part of the payments industry journey.
Jeffrey I. Shavitz is Chief Executive Officer of TrafficJamming LLC, which is a virtual business group for entrepreneurs and small business owners to help grow a company's sales (traffic = customers in his language). His experience in payments includes co-founding Charge Card Systems Inc., which was sold to Card Connect in 2012; Alternative Merchant Processing, dedicated to high-risk merchant processing; and Charge Card Funding, involved in the cash advance space. Jeff has published four books: Size Doesn't Matter — Why Small Business is Big Business, which became an Amazon No. 1 top release in both the business and entrepreneur categories; Small Business Aha Messages; The Power of Residual Income – You Can Bank on It!, and Networking – Get Connected. He can be contacted at 800-878-4100 or firstname.lastname@example.org; his websites are www.jeffshavitz.com and www.trafficjamming.com.
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