Article

Use the

How ISOs recruit, train, and motivate their independent sales representatives

November 12, 2001

For the Independent Sales Organization (ISO), the front line of operations is where the product meets the merchant - and for most of them, that front line consists of a team of independent representatives.

The independent rep arrangement varies widely from ISO to ISO. Some organizations use a percentage of independents to augment their salaried sales force, while others rely completely on independents.

As with any sales organization, there are inevitably recruits that don't do well and are not able to survive.

Vance Rowland, vice president ofATM America, said his company recruits a large number of representatives each year, but only a small percentage of them end up being productive.

"I'm going to say [we have] 30 to 35 that really do something," he said. "We sign probably a hundred a year, but the people that are really active - I would say about 35." All of ATM America's reps are paid by commission only, Rowland said.

T.J. Hannon, vice president of marketing forHanco Systems, echoed the idea that out of a larger number of reps, only a small handful are consistent sales producers. "We're consistently getting deals from around 20 to 25," he said.

Rowland said that recruiting reps has inherent difficulties that are not present when recruiting salaried employees, or prospective franchisees or licensees. "We do some background checks, but when you're not buying a franchise, when there's nothing at stake, it's really easy for you to quit," he said. "Sometimes we sign them and we don't hear from them again. The most successful ones come to us with some previous experience."

Hannon said that maintaining a higher percentage of successful reps relies largely on providing good training.

"We spend a lot of time with the training process, even though they're independent," said Hannon. Hanco Systems operates in 42 states, and has about 4,000 machines deployed. "It's not the typical 'here's your packet of information, here's the product, go sell.' "

A monogamous relationship?

While some independent reps deal exclusively with the product the ISO offers, many augment their income by simultaneously selling complementary products and services. For instance, an ATM rep might also sell credit card terminals and supplies.

"For many of them, the ATM is one of the products they sell in the niche market they're in," said Hannon. "The ATM is another bullet they have in their gun."

He said that Hanco representatives must sign a "mutual confidentiality/non-compete" agreement, which allows the rep to sell other products and services but requires them to maintain confidentiality and to not sell products which directly compete with Hanco.

Not only can reps sell products other than ATMs, in some cases they can sell ATMs from different ISOs. According to Rowland, ATM America doesn't require its distributors to be exclusive - they are free to carry products from other companies. "We do not have an exclusive contract," he said. "At one point in time we did. We're a Triton exclusive dealer, and we understand that there may be some other makes and models that [a customer] may need."

Rowland said that even though sales reps are not required to be exclusive, many of the most successful ones choose to be - he estimates that virtually all of his 35 "movers and shakers" are voluntarily exclusive. "They understand that if we have someone who we feel is exclusive, we provide them leads," he said. "That's a big incentive to only move ATM America's products."

Beating the bushes

When it comes to finding and recruiting representatives, methods vary widely. The old standby - newspaper classified ads - is still effective. Rowland says that ATM America has had great success recruiting through the Internet. And according to Hannon, his most effective method is perhaps the simplest.

"Believe it or not, it's probably word of mouth," he said. "The reps out there have other people that they've worked with that will come on board. But we advertise in several publications, and it's a combination of things. When we want to target an area, I'll run a newspaper ad in that area. I'll do a 15-20 minute phone interview, then we'll spend about 45 minutes on the phone talking about the programs that we offer."

Keeping the Force Happy

Recruiting and training a sales force is one thing - keeping them happy is another. To make sure that new (and existing) representatives keep working hard and producing results, most ISOs offer rewards and promotions - the carrot at the end of the stick, if you will.

Hannon says that Hanco publishes a monthly newsletter for reps, and the newsletter always includes promotions. The company has larger contests on a quarterly basis - for instance, they recently gave away a trip to Cancun. "That's one of the ways you motivate the sales force out there - you keep them up-to-date on the information, and you give them incentives."

ATM America, too, offers occasional promotions to keep its reps motivated. "We might offer a piece of business equipment for the organization that moves the most terminals over a period of time," Rowland said. "Usually that's a quarterly thing."

Hannon says that for a small minority of Hanco's reps - the top producers - the company might offer employee benefits, which is almost unheard of when it comes to commission-only salespeople. "There are a few out there that have that as a possibility," he said.

Maintaining Control

One of the great hardships facing an organization of independent sales reps has always been ethics. Employees that misrepresent products or deal in a shady fashion can be dealt with much more easily than independents because a company has more inherent control over a salaried workforce. Often, the parent organization isn't even aware of the independent rep's behavior, and if they do find out, the damage is already done.

Hannon sees this as symptomatic of the ATM industry, in particular the industry's loose recruiting practices. He blames the industry's sometimes less-than-stellar reputation on companies whose recruitment philosophy is quantity, not quality.

"That's one of the problems in this industry - having people out there that don't have the right information," he said. "I don't think there are enough companies out there that spend the time that they need to spend bringing the right people on, and making sure they have the right information. That's crucial.

"Those ones that go by the wayside can hurt you a lot," he added, emphasizing that a rep who doesn't produce represents more than just lost potential sales - it represents a loose cannon in the organization.

Rowland, for his part, is optimistic about the future of the independent sales rep. He feels that as the industry has continued to evolve, so has the acumen of the independent representative.

"We're having more qualified people come to us, more people who have experience," he said, "and a lot of these guys are becoming more and more savvy to contracts that companies like us offer to them. So a lot of those guys are starting to shop around the distributorships."

Included In This Story

---

Triton Systems

Triton FI based products • NO Windows 10™ Upgrade • Secured locked down system that is virus/malware resistant • Flexible configurations - Drive-up and Walk-up • Triton's high security standards • NFC, anti-skim card reader, IP camera and level 1 vaults are all options • Triton Connect monitoring • Lower cost

Request Info

Learn More