Blog Month: April 2022

  • Importance of Payment Service Providers (PSP)

    What is a Payment Service Provider?

    Customers, in general, want flexibility and choice where possible. This is especially true when looking at business transactions, from a financial perspective. Generally speaking, the more payment options a Business provides their customers with, the more likely the customer is to complete the transaction. Looking at an online payment transaction from the front-end is one thing, however, what about the other side? What happens ‘behind the scenes? Important, strategic choices have to be made regarding what Payment Service Providers to use. This brings up questions such as what exactly is a Payment Service Provider? How do I choose the right one? What are the benefits and drawbacks in general? This article will cover the basics of Payment Services Providers and what to look for.

    Payment Service Providers are essentially an intermedium that connect merchants to more extensive financial systems. This enables companies to accept certain payment methods from their customers such as credit/debit payments. Payment Service Providers make sure to connect all working parties together, customers, sellers, and financial institutions. This allows Payment Service Providers to provide a straightforward paying experience for businesses and their customers through quick and efficient payment processing. In essence, Payment Service Providers are key factors that keep (mostly) E-commerce businesses running behind the scenes.

    Key benefits

    We already mentioned that Payment Service Providers are able to simplify the payment process for businesses/customers. What exactly are the key benefits to using a Payment Service Provider? See then main benefits listed below.

    • Automation

    Payment Service Providers are able to automate payments by functioning as the process operator for your customers’ transactions. This enables you to save your resources and time and in turn, streamlines your transactional process. Well-known Payment Service Providers like PayPal also allow you to set up automated reoccurring transactions when dealing with, for instance, monthly subscriptions. This takes away a large amount of administrative and operative work that otherwise went into completing these transactions manually. This is especially the case for businesses with many returning customers.

    • Reliability and issue-resolving

    Large and experienced Payment Service Providers are deemed as Reliable since they provide guarantees when dealing with shady transactions coming from customers or complex payments. They often stand in for missing revenue caused by unsuccessful payments or handle the issue-resolving process themselves. Disputes are handled by the Payment Service Providers which again, contributes to your resource efficiency as you do not need to handle any sticky situations yourself.

    • Transparency and clear communication

    Most Payment Service Providers are also fully transparent. This means that they allow you complete clarity throughout the whole payment operating process at any time. This, combined with clear and straightforward communication, helps build a strong and reliable relationship with your company. They often provide 24/7 support meaning that issues can be resolved quickly, should they arise. Customers in turn should expect minimum downtime and are less likely to bounce before completing their order.

    Now that you have insight on some of the key benefits of using a Payment Service Provider, you might ask yourself, why shouldn’t I use one? Of course, everything comes with downsides or costs. Payments service providers usually charge you a fee per transaction. Some other Payment Service Providers might even charge additional fees such as initial partnership fees or just a monthly fee.

    Besides the cost, Payment Service Providers help contribute to the reliability and flexibility of your business in general. This is important to keep in mind as the use of a well-known, professional Payment Service Provider often provides strong benefits as mentioned above that outweigh the cost or investment needed.


    It is commonly known that the Financial Technology Industry is growing and innovating at a rapid pace. This results in the introduction of many innovate payment solutions. The paying behavior of customers is changing. You can see this through the increase in completed mobile transactions for instance. The number of contactless payments increase, cryptocurrency has been introduced as an accepted payment in many places, relatively new payment methods such as ‘buy now, pay later’ all these phenomena are strong indicators of the innovative direction Payments and Payment Service Providers are going towards. It is important to keep track of the newest and most popular developments in the Payment world in order to keep up with your competition and maintain a competitive advantage. Many businesses often seek external professional advice to maximize the efficiency of their Payment Providing landscape.

    Would you like to know more about how your Business can improve by staying up to date with the latest innovations regarding Payments and Payment Service Providers? Talk to a ModusLink Expert today by clicking here!


    Fibontix. (2022, 9 januari). Top Payment Service Providers | Key Factors & What to Expect. Fibonatix. Geraadpleegd op 11 februari 2022, van

    Innovative Payment Solutions Across the FinTech Landscape. (2022, 7 januari). FinTech Magazine. Geraadpleegd op 11 februari 2022, van

    The Top 11 Online Payment Service Providers in 2021. (2020, 27 november). WildApricot Blog. Geraadpleegd op 11 februari 2022, van

    What Are Payment Service Providers? – Insights | Worldpay from FIS. (z.d.). FIS Global. Geraadpleegd op 12 februari 2022, van


  • Fulfillment-as-a-Service

    Analyze – Optimize – Grow

    Life is a continuous circle of progress. From the moment we are born we continuously develop through learning and encountering life’s different aspects. This cycle of continuous learning and development is also widely prominent in the corporate world. In order for Businesses to grow and scale they must find ways to improve and optimize, even at peak moments. This usually means businesses are looking for ways to gain a competitive advantage within their current market. A highly attractive way of gaining such competitive advantage is by outsourcing part of your activities that are highly resource intensive. This make outsourcing Fulfillment a great option to look at for many businesses that are looking to scale (Busby, 2019)


    The main reasoning behind the attractiveness of outsourcing Fulfillment is that the Fulfillment concept is broad. This essentially means that the number of areas of potential improvement are usually high. By outsourcing your Fulfillment and effectively acquiring ‘Fulfillment as a Service’ Business can gain a strong competitive advantage. This can be achieved as Fulfillment professionals are able to optimize many aspects of the logistical and Fulfillment process from Packaging to Returns, IT systems, Customer Service etc. Many areas of improvement/optimization thus result in many potential ways for businesses to leverage their market value and increase their competitor position. The well-known optimization circle, Analyze – Optimize – Grow is highly applicable here. Companies that are looking to outsource their Fulfillment process should follow these steps in order to do so effectively (Thill Inc., 2021).

    • Analyze

    As mentioned before, outsourcing Fulfillment is highly popular due to the mainly potential areas of improvement. In order to get the best results up front, a strong analysis has to be made that identifies key areas of improvement in the Fulfillment process. This, for instance, could mean a detailed lead time analysis, a performance courier report, return efficiency overview, etc. Professional Supply Chain experts often provide their insight before working with their potential partners. This allows the cooperation to flow smoothly and allows expectations to be met. Once the key Areas of improvement have been identified, the actual optimization commences.

    • Optimize

    The optimization process of course changes depending on the area that requires optimization.

    The main red line within the process is often the same. Professional Fulfillment experts that hold up-to-date knowledge on the current Fulfillment innovations are often very able equipped to implement disruptive measures to drastically improve the Fulfillment process for businesses. The best Fulfillment companies make use of the most innovative technologies such as IoT (Internet of things) e.g., temperature sensors for Cargo loads, AVG (Automated Guided Vehicles) to maximize warehouse efficiency. Common but effective measures are also often implemented such as a more effective returns process, or the implementation of a ‘same-day delivery’ Fulfillment option.

    • Grow

    The most important indicator of successfully outsourcing your Fulfillment process is of course continuous and stable growth. Outsourcing your Fulfillment process should effectively reduce your resource utilization rate and improve the efficiency of your overall business as you are able to focus on other internal aspects. Evaluating periodically will result in a better partnership and will ensure that expectations are met accordingly. An important thing to keep in mind is that knowledge and insight of professional Fulfillment companies should always be considered. A small ‘bump in the road’ can often be overcome by staying with the partner in question and keeping the partnership alive.

    Key benefits

    There are plenty of benefits that come with outsourcing your Fulfillment services. The main one, optimizing resource allocation, has already been covered. A couple of additional benefits are mentioned below.

    Cash flow optimization

    Handling Fulfillment services internally can potentially require a high investment cost. Warehouses need to be rented, Customer service staff must be hired, trucks and other moving vehicles have to be purchased etc. Making use of a Fulfillment provider essentially turns these fixed costs into variable costs as the costs often scale with products/sales moving through the Supply Chain. Making use of a Fulfillment provider can often impact your Cash flow substantially by increasing the cash in hand and reducing fixed costs.

    Tap into new markets

    Looking for competitive advantage will always be a key element that businesses decide to focus on as it yields them the opportunity to outpace competition. The cycle is simple yet highly effective. Fulfillment as a service increases your resource effectiveness by reducing resource intensiveness, in turn allowing you to allocate your resource in a different manner. This opens up doors to diversify by tapping into new markets that provide you new prospects.

    Expertise results in lower costs

    Costs are almost always going to decrease when making use of a professional Fulfimment service provider. This has many reasons behind it. An example would be bulk transport contracting. Some Fulfillment experts make use of their connections which yields them cheaper transportation fares due to bulk consolidation with other loads/companies. In the Transportation sector, volume often means cheaper pricing per kg. Professional Fulfillment companies often know exactly how to leverage this concept which results in cheaper transportation prices overall, thus reducing your costs.

    There are plenty more benefits to using Fulfillment as a Service. Would you like to know how to choose a correct Fulfillment partner, and what to look out for? Read our next Blog article (here). Or talk to a ModusLink Expert today by clicking here!


    Busby, A. (2019, 24 oktober). Fulfillment As A Service, Why The Future Of Delivery Is In The Clouds. Forbes. Geraadpleegd op 26 februari 2022, van editorial staff. (2014, 25 juni). Benefits of Using an Order Fulfillment Service. Business.Com. Geraadpleegd op 2 maart 2022, van

    Roggio, A. (2011, 4 november). 5 Reasons to Consider Fulfillment Services. Practical Ecommerce. Geraadpleegd op 5 maart 2022, van

    Thill Inc. (2021, 21 oktober). Fulfillment Center Pros & Cons. Thill Inc. Geraadpleegd op 5 maart 2022, van


  • What are Merchant of Records (MOR)

    What is a Merchant of Records?

    Upcoming Businesses often struggle to generate growth. However, once these Businesses are able to consequently and steadily grow, scaling is the next big hurdle. Scaling effectively requires very different strategy than growth generation. Businesses that can scale accordingly often show activities that are indicative of correct Resource allocation and optimization. There are plenty of ways that contribute to Resource optimization such as optimized inventory planning, well-designed CRM (Customer Resource Management) software, correct Marketing Strategies etc. Businesses use a variety of these ways to their advantage, aiming to scale together with their respective growth.

    One-way that contributes to the scaling of businesses is a phenomenon called ‘Merchant of Records’. Now, what are Merchant of Records exactly?

    As mentioned before, excessive growth often comes naturally with extra work. More orders need to flow out the magazine, backend/frontend customer service increases, different management decisions etc. Payments and the handling thereof increase as well. Depending on the business type, this might result in complex increase in resources needed to facilitate the extra work required. More payments, chargebacks and refunds need to be processed. Tax documentation complexity increases. Pricing negotiation becomes more difficult. Even Transfer pricing agreements might change. All this work requires extra Resources, or better Resource allocation.

    One-way companies optimize their Resource allocation regarding Payment services is by utilizing a Merchant of Records. A merchant of record (MoR) can be defined as an entity that handles the selling of goods or services to a customer. Companies can be their own merchant of record, but you can also outsource this work to entities that sell goods or services on behalf of a business and, by doing so, take on the liability related to the transaction (Collier, 2021).

    A merchant of records essentially provides freedom by lifting the burden of tax and payment compliance (issues). This helps a business to focus its resource on activities that are prioritized to increase growth and generate further scaling such as product improvements and R&D (Research and Development).

    As mentioned before, a company can choose to be its own Merchant of Records or choose to outsource. Outsourcing gives strong benefits when scaling is difficult. Outsourcing a professional and experienced Merchant of Records essentially relieves the burden of performance on all Incoming/Outgoing Payment activities. Well-Established Merchants of Records of course provide complete Transparency at all times. See the picture below for a simplified visual of the Merchant of Record process.

    Figure 1. Merchant of Records visual)

    As scaling is often difficult for many companies, lifting the burden of Financial operational responsibility through Outsourcing a Merchant of Records enables increase in focus and commitment that in turn, strengthens scaling and growth. According to Fortunly (2022), 71% of financial service executives outsource or offshore some of their services and 78% of businesses all over the world feel positive about their outsourcing partners. These statistics further reinforce the positive benefits by outsourcing and outsourcing financial services across the world. Further statistical research suggests that the outsourcing market for financial services will only continue to expand as time goes on.

    Tapping into new Markets

    ‘Identify à adapt à evaluate’ is a known cycle that implies the work ethic required for continuous improvement. Making use of the benefits of outsourcing a Merchant of Records enables more internal resources to be allocated to continuous improvement to stimulate further growth. Companies often use the gained resource efficiency generated by outsourcing to tap into new Markets and expand their customer base.

    According to Wunker e.a. (2011), one of the greatest contributing factors of success to any business is a company’s ability to capture new markets. This can be related to new products, customers, industries etc. Tapping into new markets is a great way to generate additional sources of profit and gain competitive advantage.

    Merchants of Records can often help with this as they are able to analyze the financial data once a Market entry has been made. For instance, Let’s say you outsource a Merchant of Records. Doing so has resulted in you being able to focus on allocating resource to expand your current customer base by tapping into a new Market. Research suggests that Germany might react positively towards your latest product, given a few improvements. As a result, you make the needed product adjustments and release a variant for the German market. The Merchant of Records now continuously provides you with highly detailed performance data that allows you to track, analyze and evaluate your operations within the German market (from a financial standpoint). The Merchant of Records enables you to keep your focus and facilitate your growth.

    As mentioned before, many successful businesses Outsource at least part of their financial operational activities to optimize their practices. Would you like to know more about how your Business can implement a professional Merchant of Records? Talk to a ModusLink Expert today by clicking here.


    Fastspring. “What Is a Merchant of Record (And Why Should You Care?)”. FastSpring, 23 december 2021,

    Fortunly. “15 Must-Know Outsourcing Statistics for 2022”. Fortunly, 9 februari 2022,

    —. “15 Must-Know Outsourcing Statistics for 2022”. Fortunly, 9 februari 2022,

    Mansfield, Dani. “What is a merchant of record en why use an MoR as a solution for payments?” Paddle, Geraadpleegd 9 februari 2022.

    Meir Amzallag. “What Is A Merchant Of Record: How Does MoR Cut eCommerce Risk?” PayPro Global, 23 november 2021,

    Suess, Emily. “4 Tips for Growing Your Business by Tapping Into New Markets”. Small Business Bonfire, 2 januari 2013,

    Wunker, Stephen, e.a. “Achieving Growth by Setting New Strategies for New Markets”. Ivey Business Journal, 13 februari 2015,

    —. “Achieving Growth by Setting New Strategies for New Markets”. Ivey Business Journal, 13 februari 2015,