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Heartland Payment Systems Inc. executives told analysts yesterday they see no reason to change the company's sales structure in the face of increasing competition and dealing with the repercussions of a security breach to the Princeton, N.J.-based processor's networks (CardLine, 1/20). Heartland released its fourth-quarter 2008 and fiscal 2008 results yesterday (CardLine, 1/24). Heartland had 1,116 relationship managers at the end of the year who directly interact with merchants, up 4% from the 1,119 a year earlier. The processor's account-manager staff separately totaled 293, or 22% more than the 229 total at the end of 2007. Heartland employs its sales staff instead of using independent contractors, which means Heartland does not have to share the fees its charges merchants. "We have a very proven hierarchy in our sales organization that hasn't changed for many years," Robert H.B. Baldwin Jr., president and chief financial officer, told analysts. "We take all those middlemen out of the system." Robert O. Carr, Heartland chairman and CEO, said no "key" salespeople have left the company because of the breach. The retention rate for salespeople employed at Heartland at least two years was 93.5% in 2008, Carr said, adding none have left so far this year. The definition of "key" salespeople is broad, Carr said. Instead of 80% of business brought in by 20% of the staff, as Carr says is often used as a rule-of-thumb, at Heartland approximately 46% of the sales staff accounts for 80% of the business, he said. "We're obviously going to watch this closely as we go through this year," Carr said. "Our salespeople will be getting some stones thrown at them by the competition, and that's not any fun. It's a tough business always."
