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Table of Contents

Lead Story

CFPB, prepaid companies both dealt blows

Patti Murphy

News

Industry Update

One year in, reviews mixed for EMV in U.S.

CFPB issues rules for reloadable prepaid debit cards

World Payments Report 2016 released

3DS 2.0 adds tools, expands framework

Features

Update - Apple Pay in-browser launched on September 13th

Get ready for biometric payments

Wearables not yet must-have multipurpose tools

Views

Myths in winemaking terroir, ACH payments

Brandes Elitch
CrossCheck Inc.

Reboot your payments outlook

Dale S. Laszig
DSL Direct LLC

Education

Street SmartsSM:
Industry vets round table wrap-up

John Tucker
1st Capital Loans LLC

GDPR's right to be forgotten impacts all business

Lori Schrameck and Celine Rodriguez
CSR Professional Services Inc.

Happy first birthday EMV: the safe, the slow and the numbers

Evi Triantafyllides
PAAY

Company Profile

BillPro Pty. Ltd.

New Products

50-state MSB status in 30 seconds

MSBStatus.com
Adam Atlas Attorney at Law

Digital commerce suite for ISVs, developers

Fuzse ecommerce suite
Fuzse LLC

Inspiration

Take another look at direct mail

Departments

Letter from the editors

Readers Speak

Resource Guide

Datebook

Skyscraper Ad

The Green Sheet Online Edition

October 24, 2016  •  Issue 16:10:02

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Street SmartsSM

Industry vets round table wrap-up

By John Tucker

For the retail, restaurant, service and hospitality industries, two main options exist for managing POS transactions: an electronic cash register or a feature-rich POS system. This article wraps up commentary on the topic from members of GS Online's MLS Forum, who discuss the role of feature-rich POS technology for merchant level salespeople (MLSs) now and going forward.

MLS Forum member empire reminded us of Harbortouch Chief Executive Officer Jared Issacman's early vision for the POS market, stating, "I was at a meeting in March 2006 when Jared discussed at length how POS and integrated technologies would be the 'new frontier' in the business and how counter-top payment terminals would gradually be replaced by full scale POS systems.

"The moms and pops would be replaced by their computer savvy sons and daughters taking over/getting into the business, causing the natural evolution to more integrated payments. POS system manufacturers/dealers would become competitors and force an even more fervent battle for real estate than ever before. Well, if you don't know yet, it's here. 10 years later, he was not wrong."

Indeed, Isaacman led the way in 2004 with the industry's first wide-scale free terminal program; he led the way in 2011 with the industry's first wide-scale free POS system program, which allows merchants to acquire a new feature-rich POS system in exchange for only small monthly and quarterly service fees.

POS is the future

Forum member Mariusz continued the commentary, stating, "POS is the future and merchants who use POS tend to stay with you for a very long time for the following reasons: it is expensive to change their entire POS system, it is expensive/time consuming to ISOs/MSPs currently programmed within the POS system, and not every ISO/MSP can integrate with specific POS systems, which eliminates about 50 percent of the competition.

"I have merchants who use POS systems and who have been processing with me for 8 to 10 years."

"The truth is that if you want to survive in this business you need to be able to offer not only credit card processing, but software that provides additional benefits to merchants and at the same time additional revenue to you." He added that as we migrate to a more technical world of processing and the infrastructure becomes more complex, it's crucial to have a partner who has a closed processing environment offering something others cannot.

"The Market is evolving," Mariusz wrote, adding that new POS system companies enter the market every day, though few survive, and new virtual terminal gateways are created mostly in-house by major ISOs/MSPs, eliminating the need for third-party virtual terminal gateways. "But we will still survive," he said. "I still sell and win, and continue to build a successful portfolio despite all this. Find your niche and you'll thrive.

"Diversify and broaden your product offering, and most importantly keep educating yourself about the changes in the industry and its trends. Change is inevitable. Adapt and keep moving forward. Change makes the world go round."

Relationships need work

Talking about partnerships between ISOs/MSPs and POS system manufacturers, Steve Norell wrote that most independent software vendors "are naïve" when it comes to bankcard processing because they don't take the time to approach an ISO/MSP or an MLS to form a relationship with fair, transparent pricing and boarding. "No matter how many times I have tried to point this out, they just can't seem to get the message," he noted. "So this is where we all are, and the end is nowhere in sight."

Steve Norell had more to say about the pitfalls and promises of selling POS systems. View the full conversation in the MLS Forum's "Street Smarts" The Second Discussion (POS Systems) thread to see comments from him and others that we don't have room to print here.

In response to Steve Norell, DatacapSys wrote, "Managing conflicts of interests with your business partners/relationships is one of the most critical keys to success. … The point is that sometimes you just have to make choices that make sense for you and follow that path. … The companies that figure out how to cooperate with each other, stay in their own lanes and maintain reasonable margins on both sides of the fence are going to be winners going forward. It's all about managing conflicts of interest between the business partners."

In the next edition of Street SmartsSM, I will touch on marketing strategies, common market challenges and strategic planning tips to help you hit the ground running as you rebrand into this complex technology sales marketplace.

John Tucker is Managing Member of 1st Capital Loans LLC, as well as an M.B.A. graduate and holder of three bachelor's degrees in accounting, business management and journalism. Tucker also has over nine years of professional experience in commercial finance and business development. You can contact him by email at tucker@1stcapitalloans.com or by telephone at 586-480-2140.

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

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