Norm Merritt knows how to scale a business.

Now the CEO of the mobile point of sale provider ShopKeep, Merritt previously headed the global outsourcing company iQor and brings with him a few ideas about how to make big money by serving small merchants. He joined ShopKeep in May 2014 as co-CEO, and is now its president and CEO (former co-CEO Jason Richelson is now its chief strategy officer).

Many merchant providers go after larger chain restaurants because it's a more lucrative approach with less work involved. But ShopKeep prides itself on doing the exact opposite, and Merritt "fell in love" with the company after learning about it from a fellow iQor board member.

ShopKeep "was really in need of a leader to bring some professionalism and step it up in terms of scale," Merritt said in an interview with PaymentsSource.

Prior to joining ShopKeep, Merritt had spent two years as president and CEO at iQor. The $500 million business process outsourcing provider had 17,000 employees across 39 centers in seven countries. During his time at iQor, Merritt oversaw four acquisitions and integrated the technology into iQor's system. During the fourth acquisition of Jabil, it was decided that Jabil's CEO would take over to lead iQor.

Since Merritt transitioned to ShopKeep, the number of merchants using ShopKeep has more than doubled. ShopKeep adds more than 1,000 merchants each month, and currently, 18,000 merchants use ShopKeep's point of sale system, which comes at a fee of $49 per month.

"We're ready for the growth that we're experiencing; we have to think ahead and not sit back and hope things don't break," said Merritt.

To deliver on that promise, Merritt expanded out ShopKeep's customer care processes when he came to the company. ShopKeep opened a call center in Portland, Ore., to provide 24/7 support. Operations within the call center changed after Merritt sat down with the representatives and found that they didn't have the correct processes in place for the larger scale ShopKeep was starting to see.

"It was pretty obvious, pretty quickly, that [ShopKeep] had won awards in customer care...but they didn't have processes in place for how quickly they answered phone calls, how long they were on hold, whether they dropped the call," Merritt said. The company now uses 8X8, a Voice-Over-IP business which provides ways to measure these variables.

Merritt also built out a more seamless process for the sales team to connect new customers to ShopKeep Experts, the onboarding and account management team.

Merritt has also taken ShopKeep through its first acquisition this year, with the March purchase of Payment Revolution. The startup's technology became ShopKeep Payments, a customizable payment processing system. ShopKeep is also in the midst of raising another round of funding.

Merritt's “business acumen and experience have proved invaluable at creating external partnerships and optimizing our internal processes while keeping intact what makes ShopKeep so great,” said Richelson. “His resounding passion for our mission and commitment to supporting small business owners is infectious to the whole ShopKeep team.”

Next, Merritt plans to help ShopKeep expand internationally. While merchants in 25 different countries including South Africa, Hong Kong and Israel already use its iPad-based point of sale system, the company plans to add a European office in the next few weeks.

ShopKeep is "really focused on building partnerships with distribution partners … and working through the industry, the ISO channel and various payment processors," Merritt said.

While ShopKeep works with merchants from all verticals, its main focus is on quick-service restaurants and specialty retailers. The average revenue for merchants using ShopKeep is $350,000, said Merritt.

Tablet-based point of sale providers are all racing to establish a scalable operation, said Rick Oglesby, head of research and product consulting at Double Diamond Research.

"Mobile POS systems are growing in popularity because they fit the needs of both merchants and merchant service providers at the same time," Oglesby said. "Merchant service providers are seeking ways to escape commoditization and having cloud-based software that can enable limitless service offerings is the perfect platform from which to do this. Simultaneously, small to mid-sized merchants have been underserved by traditional POS providers, who have focused on larger merchants with bigger budgets. Mobile and the cloud bring down the cost of servicing smaller merchants, and enable this service gap to be closed."

Oglesby said it is particularly advantageous for software development companies to have someone experienced in scaling, because the task involves large upfront costs that are paid back by having a significant number of customers.

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