I agree with the two posters who've already replied; your strategy didn't work not because cold calling doesn't work in your niche, but because your pitch was mediocre at best. (I also know personally someone who built a big merchant account business from cold calling, so it IS effective in your industry.)

Take a look at this book: http://www.amazon.com/gp/product/0470567023/ref=as_li_ss_tl?... -- it's the best book I've ever read on cold calling, and is helping me get over my fears about it (I plan to start a big cold calling push in January.) You'll quickly see the difference between your pitches and the ones outlined in the book.

And I also recommend that you do cold-calling yourself instead of outsourcing it. You'll learn a lot more quickly that way. Once you have an effective script, then you can outsource.