The Green Sheet Online Edition

December 28, 2020 • Issue 20:12:02

Advisory Board: Insights from 2020, plans for 2021 - Part 2

This is the second article of a series in which members of The Green Sheet Advisory Board share their insights and advice on transitioning from 2020, a year that brought unprecedented challenges, to 2021, which we hope will bring a return to overall health and stability.

To that end, members answered the following questions:

How did you successfully address the major business challenges of 2020?

What might you have done differently, knowing what you know now?

What do you envision for the coming year for your company, and how are you planning for it?

What challenges lie ahead for the payments sphere, and what advice do you have for professionals who want 2021 to be their best year ever?

The first portion of responses appeared in our Dec. 14, 2020, issue; the remainder will be published in January 2021. We wish appreciate all the industry leaders who participated in this Q&A.

Ben Abel, BAMS

There were several things which I think helped us successfully navigate the perils of 2020. First off, several years ago, we transitioned to a heavily remote model, and by the start of 2020, I’d estimate at least 70 to 80 percent of our team was already working from home (WFH). Because of this, when we decided to move most of the remaining team to WFH, the infrastructure and workflows were already in place, enabling us to do so with very limited impact to operations.

Secondly, while we initially were heavily rooted in restaurants and hospitality due to our proximity to Manhattan, we’ve diversified our target verticals over time to include some that have prospered significantly during this time. Because of this, while we did see some impact to our portfolio, it was far more manageable than how I’ve seen some friends in the industry be affected.

Lastly, we found it important to be responsive to the specific needs of companies during this time. The way that many businesses dealt with their customers had changed, and it was necessary to be responsive to that in the value proposition we were driving our sales conversations with. This could have been contactless payment options for retail operations, online ordering set up for restaurants or emailed invoices for our B2B partners.
With the gift of foresight, I think the most obvious answer would be to have purchased some stock in Zoom. Frankly speaking, I’m quite proud of how our organization has handled the pandemic, both in terms of how we’ve handled employee and merchant relations. I feel confident in saying the strategies we applied on both fronts have been successful, and the only thing I think truly could have been improved in our approach, like my prior Zoom comment, would have been to implement them sooner. For example, if we had ensured every restaurateur had online ordering up and running prior to the restrictions to indoor dining, we could likely have ensured that they were better prepared financially for when they did face those limitations.

Steven Feldshuh, Betterpay

This year has certainly been the most challenging year since I have been in the business, which is 20+ years. Approximately 1.5 years ago we rebranded our company name from Merchant Choice Payment Solutions East to Betterpay.

With the rebranding we also decided to invest heavily in marketing and creating a brand, and developing our own identity. Obviously, no one expected that COVID-19 would interrupt and bring challenges to every level of our organization.

The first thing we recognized was that we would have to work remotely. This wasn’t an easy task and required our people to adapt to working remotely, and not have the office energy surrounding them that you get in an office environment. We are fortunate in that we have great people that quickly made the adjustment. Next, we had to reconfigure how we were going to deploy some of the terminals we work with and solved that by shipping terminals to someone’s home. Boarding applications and rearranging of agent support required some major adjustments as well.

The biggest issue was getting our sales partners to understand why application approvals, equipment deployment, and overall customer service and technical fixes would take longer. Both processing entities that most of our business goes to also moved their peronnel to their homes. Due to this change, customer service and technical support response times increased. The concept of same-day approvals and deployment turned into next-day. Receiving VAR sheets, and gateway setups also went from one day to a few days, so setting new expectations created disappontments, and the word “rush” disappeared.

Most of our sales groups are face-to-face folks, which led to a drop off in new business, given that lots of businesses either closed or didn’t wish to have visitors. Given that we couldn’t solve the business closure issue, we focused on developing in our Betterpay portal a user friendly e-sign capability for all applications and forms. This gave all of our people the ability to send out a completed application for signature and avoid the face-to-face time spent handwriting an application. Adoption of using the e-sign program is increasing, but of course we wish everyone would use it.

We also spent considerable time developing marketing materials on all of our product offerings that our sales groups could use. We made a conscious decision not to compete with our agents with a direct sales force, so all of our literature is designed with only our sales partners contact information.

Additionally, we realized that by growing our agent base, and educating and training some qualified new people, we could make up for some of the loss in application volume that we hoped was only a temporary situation.

Our company is on solid ground due to cutting back expenses and increasing revenue from our new sales partners. I do expect until we get past at least the first quarter of 2021 that we will not see any positive change in our production.

Our plans call for continued recruiting and training. Most of my day is peronally spent in that area. We also have plans to increase our marketing, and after the holidays, to hire additional people because, based on the response we have received from our agent/office program, we need to be prepared to be able to handle an expected large influx of new business starting in the second quarter of next year.

I do believe we reacted well in protecting our staff and moving everyone to their homes. By the time we resume going back to our offices, I know our people will be ready for that and will be glad to be back.

Challenges that lie ahead will be no different than what we have experienced for years. There will always be new companies out there to compete with. There will always be new technology to learn. The key for current and new people entering this industry is to find a comfort level with a company that is open, has full reporting, has a simple way of doing business, but is willing to continually educate you and present products that help grow your residuals and commissions.

We all have different business models, and ours is focused on the long-term residuals. At least for the foreseeable future, we need to continue being patient and not beat up the customer service person or tech person on the other end of the phone conversation. We need to remember that everyone is dealing with family issues associated with COVID-19, whether it is someone being sick, children doing remote schooling, a loss of a job or the lack of normalcy. If we focus on helping each other, and continue to push hard in business, we will be fine.

Jared Isaacman, Shift4

When COVID first hit, we quickly adapted our operations and shifted development efforts to focus on products that would help our customers address pandemic-related challenges. This included the release of QR Pay for contactless payment, QR Ordering for contactless restaurant ordering, SkyTab for curbside takeout and delivery payments, SkyTab Online for online ordering, and various other solutions.

In addition, we launched shift4cares.com, an online resource for the industry. We shared our transaction data on the site to draw attention to the devastating impact the pandemic was having on restaurants, hotels and other businesses. Through this site, we also sold gift cards for our merchants to help them bring in much-needed revenue as lockdowns impacted their business operations. Shift4 matched 5 percent of all gift card sales to further help these hard-hit businesses. Additionally, we waived fees and offered various special promotions to provide financial relief for our customers. Lastly, we were fortunate to be able to take Shift4 public this year to help strengthen the company’s balance sheet.
Overall, I think we did a good job of adapting to the challenges of 2020 given the circumstances, but there are certainly some things that we might have done differently knowing what we now know. First, we never would have had all of our staff on desktop computers. Having to transition everyone to laptops in order to shift to a work-from-home environment was a significant operational challenge. Luckily, we were able to pull this off pretty quickly, but in hindsight, we should have switched everyone to laptops years ago. We also would have made additional investments in the operational resources needed to support the considerable growth we saw during the spring and summer as payment volume rapidly recovered and overall customer demand increased from the low point in late March/early April.

We’re still expecting COVID to have an impact on businesses through Q1, but we anticipate a sharp increase in volume as the vaccine proliferates and pent-up consumer demand begins to be realized. We do think that a lot of the technology and products that have emerged during the crisis will continue to have relevancy well into the future, such as contactless solutions, QR code payments and ordering, online ordering, and mobile solutions.

The convergence of software and payments is one of the defining trends of the industry right now. We have seen this play out with the rise of vertically integrated platforms like Shopify, Square, Toast, Clover and many others. As this trend reshapes the payments landscape, SOs and agents will need to adapt their business model in order to succeed. ISOs that have not adopted software and technology-driven solutions will find an ever shrinking addressable market. It’s critical to embrace integrated payments in order to thrive in this new environment.

Maurice Griefer, Maverick Payments

We are all counting down the days until this chaotic year is finally over, hoping 2021 will return to normalcy or some form of it. Everyone was thrown a nasty curveball when the pandemic hit, but as I write this (the day after Thanksgiving), I think our company rebounded very well in the second half of the year as we regained focus and got adjusted to this new pandemic lifestyle.

We are very fortunate to have a diverse portfolio with clients in many different industries, but I think what helped us the most to weather the COVID-19 storm was that we are focused more in ecommerce than brick and mortar. Therefore, when retailers and restaurants closed, we didn’t take too much of a hit, and we were ready to help these clients seamlessly transition to a card-not-present environment, which we have a lot of experience in and manage very well in terms of quick onboarding and risk management.

I noticed a lot of processors tighten up, too, and close merchant accounts in higher risk verticals like travel, so we received an influx of leads and new applications from merchants that we probably wouldn’t have come across if it weren’t for the pandemic. For many opportunities we got this year, we were just in the right place at the right time. As simple as it sounds, too, just being there for your clients and going the extra mile for them to ensure they are minimizing interruptions and downtime has helped us tremendously. If it weren’t for our hardworking and dedicated team, I’m sure we would be in a much worse position.

This is a tough question because there was so much uncertainty when the pandemic struck, but I think we probably could’ve prepared for it sooner, especially with having our team work remotely. I think a lot of people didn’t want to believe it was going to get as bad as it did, so not preparing or creating a contingency plan because you think this is some type of media hoax probably hurt a lot of business owners. We could have started to reach out to customers sooner just to check in and see what their plans were and extend our support. We hired a lot of new staff this year, but I think we could have also tried to do that sooner since it takes time to train new employees and get them situated. Regardless, our team has done a phenomenal job adjusting, wearing more hats as needed, working overtime, and doing whatever else is takes to keep merchants and partners happy.

I do not think next year will go back to normal completely, so the biggest thing for us will be continuing to help merchants shift toward implementing contactless and card-not-present sales channels. We actually launched our new proprietary payment gateway this year, too, so we are very excited to get this rolled out. An interesting thing I think a lot of us saw relatively early on were businesses implementing “COVID-19 surcharges.” Credit card surcharging has been gaining momentum of late, and I think consumers are much more open to paying a little extra to help support their local merchants. I expect to see surcharging become even bigger next year as business owners look for ways to minimize payment acceptance fees as much as possible as cash usage declines. I also believe "buy now pay later” options will become more available, so this is something we’ll be making sure we can offer clients. For the most part, next year we will sort of continue as normal, staying proactive with new trends while keeping an eye out for the latest pandemic shifts, too.

Looking at the various statistics of how much the pandemic has accelerated the digital economy, things are moving quickly, and if you’re unable to keep up, you will be left behind. To be successful in the payments industry, you will certainly need to be aware of trends and have the proper tools and resources to offer your merchants so they can succeed.

I think a lot of us forget we are consumers, too, which we should always be mindful of. For example, if you have a great experience buying something in store or online, mention that to your merchants so they can offer the same experience or payment method. Although this is nothing new, payment professionals should continue growing their networks, strengthening relationships and making customer service a top priority if it isn’t already. This year has reminded me of the importance of relationships and the power of your network.

Allen Kopelman, Nationwide Payment Systems Inc.

I feel lucky that we have a pretty diversified portfolio and not that heavily invested in card-present merchants or have a large concentration in restaurants. The restaurant industry took a big hit, and the restaurant business is going to have to continue to make adjustments. There is a loss of revenue due to some of the volumes being offloaded to food delivery apps. Many bars and hotels are closed—revenues reduced. There is hope that this will end after vaccines are widely distributed.

Not sure you can go back and look at this and say ... oh, I wish I could have done this or that. One thing for sure is that we made a move to cloud storage and remote phone—after Hurricane Wilma—we made initial changes with the phone, email and storage. All of those moves helped out so we could manage our business remotely.

Fintech. Everyone needs to be in the fintech business: integrated solutions, getting information from all of our vendors to expand offerings.

We will have to see what change or regulations we will face when a new administration is in charge. Advice for anyone in business: pick up the book Who Moved My Cheese? Be ready to pivot. You can't sell the same way any longer, and you need to learn new skills.

The Green Sheet Inc. is now a proud affiliate of Bankcard Life, a premier community that provides industry-leading training and resources for payment professionals. Click here for more information.

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