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Now is the Perfect Time to Sell a Cash Discount Program
As merchant volumes have fallen dramatically and residuals are down industry wide, now may be the perfect time to add a cash discount program to your repertoire.
While a Cash Discount Program offers obvious benefits for merchants, the program provides a huge benefit for agents and ISOs as well. If you are an agent or ISO that hasn’t sold a cash discount program before, let us tell you this is a trend that’s not going anywhere.
Why Do Merchants Like It?
There are several benefits that merchants get with a cash discount program. By adding a 4% fee to every credit card transaction, merchants are able to pass the cost of processing on to their customers. For many business owners that represents tens of thousands of dollars a year in savings. What’s more, the predictable nature of the program can save the merchant’s cash flow as well. There’s no big bill at the end of month and no unpredictable fees. Just a simple and transparent model that saves money with every swipe.
Not only are they covering the costs for those that would prefer the convenience using a card, they are rewarding their cash-paying customers by discounting that fee.
But don't they mind the 4% price tag?
Actually, no. Merchants that are saving thousands of dollars per month with a cash discount program are typically less price sensitive when they themselves aren’t paying the fee. In our experience, customers rarely mind the small increase in price in order to utilize the benefits of their credit cards. Even if more of a merchant’s customers pay with cash, it’s not nearly enough to offset the benefits of this program. Besides, how many people really carry cash anymore?
Is it Difficult to Sell?
Short answer: no.
Longer answer: Imagine if you could walk into every merchant meeting and promise to save them up to 100% on their credit card processing fees. Now you’d have their attention.
It also simplifies the selling process for agents, as there is no need to know how to read complicated statements, understand confusing interchange rate tables or find creative ways to save businesses marginal amounts of money. Now, any agent can walk into any business, ask them how much they pay for credit card processing, and tell them they will save them that much.
Not only can it increase new business deals, but it can have a positive effect on customer retention as well. In our experience, 9 out of 10 businesses that try the program stick with it, meaning more happy customers. And for the few that decide not to stick with the program, you can always switch them back to Interchange plus pricing in less than a day.
How Can Agents Earn $10,000/month in Less Than 6 Months?
Not only does a Cash Discount Program make it easier than ever to approach and sell new businesses, agents can grow their residuals much faster as every single deal is more profitable than ever before. With interchange rates that could be as low as 1.5 percent for some merchants, we are seeing average profitability on Cash Discount deals over 200 basis points. Have you ever made 200 basis points on a deal?
With our cash discount program, we have seen agents create a $10,000/month residual stream in less than 6 months. From our experience of training hundreds of agents, it took an average agent 2+ years to create the same residual stream that they can now create in under 6 months. Combined with the other pillars of our business, it’s one of the most powerful offerings on the market today.
Want to earn 5x-9x more money per account?
Consider that an average agent can close 6-10 deals per month once they are up and running. Consider that an average interchange plus commission is about $100/Month/Account. That means after one year, closing 72 deals with a 66% revenue share, an agent could be earning $4,752/month or about $57K/Year. Not bad, but consider that same agent selling exclusively Cash Discount, with average commissions around $500/Month/Account. Closing the same 72 deals at the same 66% revenue share, an agent selling cash discount could have created a residual stream worth $23,760/month or about $285K/Year.
About Merchant Services Done Right
Our philosophy of Merchant Services Done Right applies to more than just the small businesses we are proud to serve. By applying the same principles to our ISO Partner Program, we have created a best-in-class experience for all of our partners. With industry-leading commission splits, our qualified appointment-setting program and access to best-in-class technology at no cost, our partners are able to consistently close more deals, increase their residual stream, and create longer lasting relationships with their merchants. Simply put, our partners make more money with less hassle — we call that Merchant Services Done Right. What are you waiting for?