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Education

StreetSmarts SM

The important role of referral partners

By Dee and Emily Karawadra commonplace for service professionals who network
Impact PaySystem together to develop nonbinding relationships to help open
doors and extend value by making credible introductions
ne of the most valuable recommendations we to other service providers or their respective clients.
were given early on in building our ISO was When rules become necessary
to build a solid referral partner channel. We
O took that advice to heart and have worked However, if you do choose to enter into a binding
over the years to build strong relationships with busi- agreement that includes compensation for referrals,
nesses or networks that have, indeed, helped us grow. you need to set rules just as you do for your own MLSs.
Specifically, outline in your agreement how payments will
Using partnerships to grow your ISO or merchant level be made and when the partner will be paid. For example,
salesperson (MLS) business is a smart business practice. will you pay when the sale is made or when you when the
Partnering with other dedicated, reputable professionals merchant goes live?
and companies drives market awareness, associates your
brand with reliable brands, opens doors to new customers, Also, be sure you state in your referral agreements if
and can even provide value-added products and services. the referral fee will be paid over the lifetime of the
relationship or for only the first sale. And articulate
There are different types of referral partners. The level whether the compensation will be a flat referral fee or
of engagement and the agreements entered into to a residual stream. Most ISO/processors have a referral
manage the relationship can often define the success of agreement that they can share with MLSs.
the partnership. Some partners are strictly sales referral
partners: they flip leads over to your organization, and Other types of referral partnerships exist. One example is
you are responsible for courting and closing the business. a scenario in which your partners cross-sell your products
and services to their base of customers in markets they
Some partners remain on a referral only basis throughout have established. They don't need the level of training
the course of the relationship. However, the relationship that your own MLSs receive, but they do need to know the
between your organization and the referral partner can basic capabilities and benefits of the product and services
grow and expand over time if it works in both partners they are bringing to their market, as well as what type of
favor. This first step to test the waters in a relationship company they are representing and referring merchants
often starts with this type of referral partnership. to.

In addition, sales referral partners can be somewhat This means ground-level training may be required to help
informal in nature if you do not plan to hold anyone them better secure their leads and close business. Provide
accountable for the outcome. For example, it is adequate training on all the products and services you

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