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A Thing When They Save, You Earn

When They Save, You Earn

Some of our readers are familiar with the name CSRSI (Cost Savings and Reduction Specialists, Inc.) as they are merchant service agents. However, it may be news to some readers that CSRSI also provides non-hazardous waste management and consulting services—and this could mean cash for ISOs.

Ross Federgreen, Executive Vice-President of CSRSI, tells us that they have established a program by which ISOs are paid a portion of the setup fee collected from the merchant, in addition to ongoing residuals, simply for referring a new client of the merchant to CSRSI. This program has already proven to be very lucrative for ISOs.

Federgreen tells us that the plan is easy to sell, since every merchant has waste that they need to deal with. Unlike explaining an abstract concept such as transaction processing, pre-paid gift cards, loyalty programs etc., the merchant sees (and sometimes smells) garbage every day. Federgreen says, “It’s like night and day—it’s so easy.”

One Man’s Trash. . .

CSRSI is actively involved in the management of non-hazardous waste removal. The company offers three distinct services:

• Analysis of waste stream content

• Analysis of equipment needs

• Contract analysis and negotiation

With these three separate but integrated functions CSRSI reduces merchants’ costs of non-hazardous waste removal. At the same time, merchants become valuable, “green” community businesses, by more actively participating in recycling efforts and reducing the amount of waste sent to landfills.

Here’s the part you’ve been waiting for: how ISOs can earn money. CSRSI signs a three-year contract with each facility. The terms of the contract include a non-refundable setup fee ranging from a minimum $500 per site (usually for restaurants) to $5,000 per site (usually for major stadiums and arenas). ISOs or sales agents function as independent contractors and receive 25% of the setup fee. Therefore, an ISO can collect anywhere from $125 to $1250, per location, just for the referral and signed contract with the new client. In exchange for the setup fee, CSRSI provides analysis and implementation functions.

During the course of the 36-month contract period, CSRSI reviews the monthly waste bills on a continuing basis, to make sure the location is realizing all the possible cost savings. When they find areas for savings, they share in the savings with the merchants, and so does the ISO. CSRSI collects 25% of the established savings on a monthly basis. These savings are based upon the forward savings determined from the merchant’s base cost.

For example, for a business that currently pays $100 a month for waste removal and recycling, CSRSI would recalculate the fees, renegotiate the contract, and make the waste stream more efficient. In this example, the monthly charge might be reduced to $70, resulting in a savings of $30 per month. The ISO would earn up to 30% of that “savings,” depending on the size of the merchant.

Also, CSRSI collects 25% of all recoveries from previous overcharges. Again, ISOs get 25% of these earnings.

Merchant segments that have benefited from CSRSI include malls, arenas, restaurants, apartment complexes and industrial sites. Federgreen states, “The vast majority of merchants we’ve talked to feel there is room for improvement in this area. We are literally uniformly successful. We’ve dealt with major corporations down to mom-and-pops, to churches and synagogues. There is not a location for whom we have not saved substantial money.” Federgreen continues, “Restaurants are critical. Every restaurant we have has yielded significant results. Any large retailer that has a lot of materials coming in boxes, such as toy stores do well too.” However, every location has garbage so you could approach any of your accounts with this add-on service.

If your merchant is happy with his disposal service and you don’t want to risk alienating him, you can tell him that CSRSI also works with major disposal companies, such as Waste Management, BFI, Allied and Republic to make their services more efficient. “They love us because we help them too. We increase the density of their trucks and that’s how they make money, by having as many picks ups on a truck as possible. They work with us every day of the week and are very responsive.”

How do I get started?

There are no fees required of the ISO. The ISO simply approaches a merchant and asks for basic information, such as what they are currently paying for removal or haulage of their non-hazardous wastes and recycling. The ISO forwards that information to CSRSI. Based upon that information and the description of the property, CSRSI informs the ISO of how much that property would cost to set up. If the merchant finds that fee acceptable, a contract is executed and the setup fee is collected. The ISO receives 25% of the setup fee. “That’s the end of his responsibility,” says Federgreen. “The ISOs are truly out of the loop after that contract is executed and we are funded on the front end.”

There are also retroactive fees from which the ISO can benefit. Federgreen states, “Many times we will find the particular location has been overcharged, such as paying for a 6 cubic yard dumpster and actually having a 4 cubic yard dumpster on site, or being charged for 3 pick ups a week when they are actually getting 2 or 2 1/2.” CSRSI is extremely careful about examining what has been contracted and what is really occurring.

Federgreen also says, “Don’t be fooled into thinking that because a store has a compactor that large savings can’t be achieved.” Many times the compactors are not adjusted correctly, which can affect costs tremendously.” In other words, more frequent deliveries to the dump cost more money.

Where do I sign up?

To start offering your new and existing merchants a chance to cut down on their waste disposal costs, and start your residual stream, call Ross Federgreen, Executive Vice President, at (866) 462-7774 or e-mail Ross at Ross will send you a start-up package and go from there.

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