tored Value Systems, Inc. (SVS), a wholly owned subsidiary of Brentwood, Tenn.-based Comdata Corp., acquired a minority interest in ProfitPoint, Inc. on July 27, 2004.

ProfitPoint specializes in providing and managing loyalty and gift card programs. Its target market is small- to medium-sized retailers and restaurants; it employs 35 people at its headquarters in Franklin, Tenn.

SVS' parent company, Comdata Corp., employs 1,400 people around the world and is a wholly owned subsidiary of Minneapolis-based Ceridian Corp.

SVS has provided electronic gift cards and other card-based transaction programs that international retailers rely on to generate customer loyalty and increase sales for years; the company introduced the first-ever magnetic stripe gift card to shoppers in 1995.

SVS has accounts on the level of Gap, Target, Pottery Barn and K-Mart, so why the interest in ProfitPoint, which typically works with smaller retailers?

According to Profit Point CEO Vaden Landers, the attraction is the layering of services with existing relationships and the move toward the middle market the partnership will allow both companies.

"We have things they don't," Landers said.

"They have the top end of the market. Our primary focus is loyalty management for merchants with one to three locations, moms-and-pops, who typically do less than $1 million a year in sales. SVS wants to enter that small- to mid-sized market. They'll be able to take advantage of our distribution channel and loyalty management tools, as we both work toward the middle."

Landers encourages any ISO struggling to get its reps to sell loyalty and stored value to call him.

Establishing strategic relationships with other companies, including processors, can free the ISO's agents to sell the products they know and leave the loyalty to ProfitPoint.

"It's our specialty," he said. "Working on their behalf, we can easily go into an existing base and nurture their merchants. That lets their sales force do what they do, and let's us do what we do. We will help them put gift and loyalty cards into the hands of their merchants' customers."