Blog | May 19, 2014

What The POS Channel Can Learn From The Vantiv-Mercury Deal

By The Business Solutions Network


The recent news of the Vantiv-Mercury deal will keep the POS and payments channels buzzing for some time. It’s got us talking here at our office about all the implications. One of my colleagues asked the rhetorical question, “Do our retail and restaurant IT VAR subscribers realize how important they are to the payments industry?” Great question.  Do you?

Plain old payment processing isn’t enough to get a seat at the payments table any more. The various players in the payment’s ecosystem have price-competed to the point where there now has to be "value-add" as part of a payments solution. That’s where you come in.

Business Solutions did a study a while back to learn that retail and restaurant VARs and ISVs retain their merchant processing accounts longer than ISOs and agents. In other words, because your customers get the value of your expertise and are tied to the POS system you sold them, they are less likely to switch payments providers on price alone.

Our study also shows that your accounts do a higher processing volume than those of agents and ISOs. What a bonus! All said, your customers are worth a lot to payments companies and you’re the key to gaining access.

Look beyond the Mercury acquisition and you can find many other deals which highlight your importance. Vantiv acquired Element for not just its technology, but its ISV relationships. The same most likely goes for Global’s acquisition of Paypros. In a short time, many leading ISV-strong payment’s companies have been gobbled up to access their technology and those ISVs and their VARs — along with all the value-add that entire POS ecosystem creates.

All this means that you should never feel like you have to settle with a mediocre processing partner! I’ve spoken with executives at numerous payments companies who tell me they want to start marketing to our readers. Some are serious and have very good plans and impressive solutions for the channel. Some are just looking for a money grab and have no real strategy.

You, and your customers, are important and should hold out for partners that are invested in the channel and helping you grow with fair compensation models and value-added payments technologies. You might have that 5-star partner already. Great. If you have anything less, you’re selling yourself short.