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At anywhere from $50 an hour to $7,000 per week, sales consultants do not come cheap. But many ISOs view their services as money well spent.
Using a consultant typically costs less than hiring an executive with comparable expertise to fill that role. That would take six figures, a relocation package, a piece of the company and likely a headhunter's fee, observers say.
Some ISOs see hiring sales consultants as a way to step back from the daily grind and learn new techniques. "When you're out there pounding the pavement all the time, and you don't come back to sharpen the ax, you're not as effective," says Bill Ryken, vice president of global sales at NxGen Payment Services, a Whitefish, Mont.-based ISO.
For new agents with no experience in the payments industry, consultants can provide the step-by-step primers necessary to get started.
Sales consultants also can help ISOs acquire the expertise to enter new markets. Examples include ethnic merchants serving booming demographics, such as Laotians, Mexicans and Pakistanis, and vertical markets, such as health care. In the case of vertical markets, sales consultants can train new agents who have a sales background in another business but no knowledge of the payments industry.
"A consultant could be very valuable in helping the ISO to expand [its] product offerings, gain access to new sales channels or get a foothold in new, previously unexplored vertical markets," says Tony Morrison, co-founder and chief financial officer for Integrity Payment Systems, a Des Plaines, Ill.-based payment-services company.
Evaluating Value
ISOs and their consultants should agree on what to expect from each other before they start working together, experienced ISOs say. Next, both parties should agree on ways to measure success throughout the engagement. "It's very important the consultant gets honest feedback early and often," Morrison says.
In the engagement's early stages, ISOs can find it hard to determine whether the consultant is on the right track. "In the very beginning, it is very difficult to gauge whether a consultant would properly fit with a particular ISO or organization," says Ted Svoronos, who oversees e-commerce at Group ISO, an Irvine, Calif.-based ISO.
Soon, the ISO starts to understand what challenges the consultant should address, Svoronos says. "Professionalism, understanding, respect for each other [and] the willingness to work well together are also key factors in setting up this relationship," he says.
Quality versus Quantity
ISOs also can measure a consultant's value by monitoring the accounts the sales staff starts bringing in-not just in terms of sheer quantity, but quality, too, says Integrity's Morrison.
"The ISO should be looking at the quality of the merchant and how well the incremental merchants fit into the ISO's portfolio," he says. "Certainly the ISO needs to be looking at the profitability and attrition rates associated with merchants derived from the consultant's efforts."
Some ISOs also look for ways to ensure the consultant thoroughly trains agents-particularly new ones.
If newly signed merchants still have lots of questions and complaints, the agents need more training, Morrison says.
Proper training helps agents and merchants avoid frustration, while guarding against the need to staff call centers to field the additional questions.
"Educated sales agents are agents that stick," says Pat Reed, president and CEO of Merchant Management Systems Inc., an Ashland, Ky.-based ISO. "If not properly trained, they open you up to heavy call volumes for misrepresentation."
Finding the Right One
ISOs recommend a variety of sources for finding sales consultants, but references stand out as especially helpful. "A great place to start is the ISO's sponsoring bank," says Xavier Ayala, vice president and director of national sales at Humboldt Merchant Services LP, a Eureka, Calif.-based ISO. "Industry trade publications are also a great resource."
Networking-particularly at trade shows-is another common tactic that can work well, observers say. "Networking probably garners the most success," says NxGen's Ryken.
Other ISOs agree trade shows not only offer opportunities to find consultants but also provide face-to-face encounters that help identify serious candidates. "Trade shows are a key meeting ground," says Merchant Management Systems' Reed.
Word of mouth is another option for finding good consultancies and avoiding ineffective ones, observers say.
Whatever the approach, finding the right consultant can prove challenging. "It takes a lot of time to thumb through possible candidates and pick and choose those which you feel would best benefit the organization and the industry," says Group ISO's Svoronos. "You can find candidates in different fields, as well."
Consultants that want to have their own businesses are looking for recurring revenue streams and are willing to be compensated for the time and effort that they put into an endeavor are decent candidates, Svoronos says.
Some ISOs say steep fees do not always mean a consultant will prove more effective.
Look for an expanded version of this article in the September/October issueof ISO&Agent magazine, arriving in a few weeks.
