sha Piuma of Durango, Colo. has worked as an independent merchant level salesperson (MLS) for the past six years. At first he grappled with the in's and out's of the business, but soon developed an understanding of the industry. As a result, he has fostered a successful sales career.

In the following interview, Piuma discusses the state of the industry and the challenges he's faced working in it as an independent contractor. His insight might prove to be helpful to anyone just starting out.

The Green Sheet: What brought you into this business?

Osha Piuma: My mother encouraged me to enter the industry about six years ago. I was lucky in that she and other family members have been active in the industry for many years.

[With their level of experience] it's been very helpful, especially in the beginning, with getting a basic foundation of the business and how it works, and having my mom and a couple of family members helping me with questions that come up and day-to-day stuff. We don't work together; they're in another state. They are in the same sales office, but I am in my own agent office.

GS: What did you do before?

OP: I entered the industry only a few years after graduating from college and had only minimal sales experience. However, I had worked in the restaurant service industry for many years through college, and I think that helped in learning to interact with different types of people.

GS: What other relevant education or experience did you have?

OP: Though not my major in college, I had taken quite a few business courses and always had an interest in starting my own business or something along those lines. The only real prior sales experience had been a brief time selling advertising space for my college newspaper to area merchants. In hindsight, I guess this was pretty good training in cold calling and interacting with business owners.

GS: Do you think you were prepared enough?

OP: [Because] my mom and others are in the industry, I probably had a lot of added help there. Even so, I stumbled through it and just kind of had to figure it out without a lot of hands-on training. I made mistakes, I'm sure. I was probably one of those reps that did a comparison against someone else, and it wasn't probably exactly right. It's the school of hard knocks.

The average independent contractor is pretty much just thrown out there. They sign with an ISO; they sign their agreement, whatever stipulations they have. [The ISO] may give you some basic training, but then you're on your own. You're an independent contractor, it's like "Figure it out; sink or swim."

GS: What would a good training program consist of?

OP: Most of the time the rep doesn't live in the same city as the ISO. The best thing would be completely hands-on training. You go out and ride with someone for a few weeks. There's no shortcuts. Then, back at the office, some detailed [instruction]: This is interchange, these are the rates, you have to learn this. A lot of the big ISOs/processors, they're going to in-house, salaried employees. That is a completely different thing than ... the typical agent/independent contractor.

[What] makes it tough on me, as an independent contractor, is a salaried rep. They are probably in-house and their employer is motivated to keep them there, wants them to succeed, and they probably get more training, hands-on stuff.

GS: What has kept you in the industry?

OP: Though the daily grind of signing new accounts can wear on you, I really enjoy this industry. The sense of being in control of your own success or failure is appealing. I have always found that the more I put into it, the more success I have.

GS: Describe a typical day in your life.

OP: I will be at the office by about 8:00 a.m. [I] take about an hour to check e-mail and plan the day. [I] respond to any pressing merchant issues, then spend whatever is left of the day [going] after new accounts.

This can include following up with previous contacts either in person or on the phone, doing some cold calling on the phone as well as hitting the streets. Typically, I try to quit by about 6:00 p.m., but that doesn't always happen, and I often work six days a week.

GS: What is the industry's most noticeable change since you first started?

OP: The area of equipment sales. We all know that residuals are where it's at in this business. We also know that building that quality residual stream takes time and a lot of hard work. I decided early on that I was after residuals, but the supplemental income from terminal sales and leasing was an absolute necessity while that residual stream was being established.

Within just the past couple of years, I have seen profit margins evaporate on equipment sales, especially now with all the "free equipment" being deployed. Without that supplemental income from equipment sales/leasing, I think it would be extremely difficult to begin as an MLS today.

GS: How do you ensure account retention?

OP: You can't really. You're completely exposed, and it comes down to how well you service that account. It comes down to my level, and if they are a local merchant, [we] meet face to face, and I try to be really on the ball. When they have a problem, I show up.

When they have a minor problem, where they could just call the ISO, I have my personal number listed to say "Hey, I know you don't want to be on hold, or go through an operator; you want me to come in and fix it for you."

Business owners are busy; they don't want to have to deal with that. Depending on the problem, it can get complicated, and they could be on the phone for quite a while.

GS: How should an MLS go about choosing an ISO partner?

OP: That's a big question to answer because when you start you don't know these things, so a lot of times you stumble through until you figure it out. The most important is the contract ... with the ISO. What are the requirements? Are residuals protected, and if so what does that mean?

It's really something that you can't do on your own. You need to have an industry attorney help you negotiate that with the ISO. It's a complicated agreement with different stipulations that could be anything.

Once you get past that, the name of the game is whatever accounts you sign up, keeping them long-term. You need a responsive customer service department for both you and the merchant; you need an overall helpful ISO.

GS: Do you think there will always be street sales?

OP: Currently, [merchants] can't call Visa to get set up; they have to go through a sponsor bank and a processor. They could [go directly to the] bank. We fight all the time trying to get the account, but [if merchants] bank with Bank of America, it's really tough to get the merchant account when they already bank with a sponsor.

However, when a merchant goes directly to their bank for card processing ... the merchant may get a slightly lower rate, but the bank isn't doing the same things with terminals that ISOs are. ... I may have a slightly higher rate, but they're getting free equipment, so it kind of balances out right now.

GS: How should dishonest reps be dealt with?

OP: Say you're an ISO and you hire agents, salaried or independent, and you send them out into the world to bring you deals. Well, once you send them out, you don't really have control over what they say or promise to the merchant. There are ISOs that get caught up in it too and just want the deals and don't really care what their agents are telling the merchants.

It's all about honesty. You can misrepresent anything when you are standing in front of a merchant; there's no one there watching you. You can have them [sign] a lease for the equipment and you can tell them, "Oh, don't worry about it. If you don't like this deal, the equipment, the ISO, then you can cancel anytime."

Well, that's a lie. You can't cancel the lease agreement, but that's [said] all the time.

GS: What are the basic tenets of your business philosophy?

OP:

• Honesty and integrity at all times is mandatory. Even if I think I might lose a sale, I will not allow myself to misrepresent rates or anything else to a merchant.
• Do not expect success to come easy. Wake up every day and make it happen.
• Be serious and professional about your business, but remember to try and enjoy it as well. You only live once.

GS: How would you describe the current state of the industry?

OP: I think it would be extremely difficult to start now as an [independent contractor] MLS. Not impossible, but challenging to be sure. Without much supplemental income from teminal sales, someone new will need to grow their residual stream very quickly in order to survive.

It's tough; it's saturated out there. Even five years ago it wasn't so bad. Now, if I go cold call in my area ... [I] really get a difficult response from the merchant. They say, "I've had five reps in here this week saying they can save me money."

A new business will get bombarded with 10 different mailers. It's confusing for the merchant. It comes down to how you can interact with people. If you interact with them and they feel some sense of honesty with you, that's who I'd go with.

GS: How has The Green Sheet helped you?

OP: Luckily, I was introduced to The Green Sheet and [GS Online's MLS Forum] from the beginning of my career. I use both on a daily basis in an effort to constantly learn more about our industry and to solve issues or answer questions that come up.

GS: Would you have done anything differently in your career?

OP: I am satisfied by my progress so far, but [I] can always improve. If I could go back and do anything differently, I would have taken more business/marketing courses or majored in something like that in college had I known that I would be in this industry.

Although ... I have found enjoyment in the entrepreneurial spirit of this profession and just diving in and figuring out what works and how to continue being successful in an ever-changing environment.