Question about Pay Pal... Kinda O/T, unless you use Pay Pal...

A few facts I've learned from dealing with Paypal:


1. You can accept payments drawn from bank accounts for no fee with a basic Personal account.

2. In order to accept credit or debit cards, you must upgrade to a Premier account. You cannot do this with the free basic Personal account.

3. Once you upgrade to a Premier account, you will be charged 2.9% + $.30 everytime you accept a payment. Not just for credit cards, but for any type of accepted funds. You can still send payments for no charge.

4. You can only accept up tp $500 a month in payments if you retain the basic Personal account. To accept more, you have to upgrade to a Premier account.

5. You can downgrade your Premier account back to a Personal account once. It is EXTREMELY difficult to do, but it can be done...but only once. If you upgrade again, and then try to go back down, your Paypal account will be cancelled.



Just thought that info might help...I learned most of it the hard way.

 

I built a successful (in my opinion) race parts and fabrication business without accepting PayPal or credit cards. If someone asked about credit cards I explained that if I were to accept that "convenience" I'd have to raise prices 3%, or whatever, and wouldn't they rather save the % than give it to some outsider, like a bank? That was usually the last time the question was asked. Did I miss out on some business....probably. Do I give a ****....NO!

I only use credit cards on rare occasions and never have used PayPal. I'll give my money to the guy running his business and making an honest living, not some room full of "suits" that figured a way to take a piece of the action by becoming my unwanted "partner".

 

I do not use Paypal, & really don't want to. I have a branch bank I have an account in one block away. The post office branch is 3 blocks away, plus I work at the main post office 5 mi.away. My money orders are free at my branch bank & I have never posted my ONE credit card # on any internet transaction, I phone the merchant to see if they accept a credit card for a large purchase if I don't have the money in my checking account[ between paydays]. I really like the the convience of living in the inner city but am tired of the crackheads breaking into my trucks & the yard natzis from the city nieborhood protection dept.

 

As of today (8/19) if you run an ebay auction and state that you will accept Paypal, and the winning bidder wants to pay with a credit card via Paypal, you HAVE to upgrade to the premiere account (I think they will automatically do it for you). They announced this change about a month + ago, and it went into effect today. More info at link (scroll down to the July 15 entry):
http://www2.ebay.com/aw/core/200507.shtml

 

I don't know when it'll happen, but more to the point, do I want it to happen? With Paypal, sure. A compe***or would bring fees down and keep everyone in check, although Ebay could just not allow Ebay transactions at the compe***or's site, so that would put an end to that.

As far as compe***ion for Ebay, I don't think I'd want that. If everything were split up, that'd be two places (or more) I'd have to do a search on every time I was looking for something, with half as many results. And when it came time to sell my ****, there'd be only half as many people searching as there was before (in theory). Less money for sellers and more searching for buyers. I sell alot of **** on Ebay, I'm happy with what I get paid and what I have to pay in for fees, and my customers are happy with their stuff, as evidenced by my feedback. No complaints here.

Also, Fat Hack made a good point about the impulse buyers. I never thought of it that way. That's a good reason for people with money problems to shy away from Paypal, and a good reason for sellers to offer it. If you're a buyer and you don't want to make payments with Paypal, wonderful. No seller is going to turn away a money order. If you're a seller and you don't want to accept payments with Paypal, also fine, but don't expect the same amount of sales/bids that the Paypal users are getting. I would think the increased bids makes up for the fees x10.

 

You could get around this by having a higher handling fee and offering a discount for cash. The gas stations used to do that. They were really charging more for credit cards because they had to pay the 2-3% merchant services, so they just offerered a cash discount.

 

Yeah, that's a pretty common way around it. Advertised price is the "cash discount price". I kinda figured that wouldn't fly with the ebay folks, but maybe I'll give it a try and see what happens.

 

I have seen ebay bidders complaining on ebay discussion boards of ebay sellers who stated: PAYPAL ONLY for payment, and they would NOT accept a Money Order (even a US Postal Money Order). It is unusual but for a few sellers, only Paypal payments are accepted

 

If I had a choice I would have everything be paypal. It is so much simpler to keep track of what is going on. I have had stuff boxed up and setting in the "ebay" room that I plum forgot about. That payment never showed up for. Or always the money orders with no other information come and you have to go slueth around to figure out who sent it. I have tried to do ebay with paypal only and people just don't pay attention, you still get some old fart using his wifes account getting high bid on a Stanley plane or some old tool. Heavy sigh-ok here goes.

 

PayPal ONLY rates right along side guys with "Packing Fees". I then go an bid on another auction. Not everyone lives 2-5 minutes from a postoffice/moneyorder store, I recieved some very nice emails from people out in farm county that I've accepted personal checks from. eBay is fun, no reason to turn it into a coldharted business.

 

I have had a couple bad experiences where PAYPAL has had to go and get my money back...talking about $500. I don't worry much about their fee now...only have to get cheated one time to make it worth while.

 

That's right. I have met some really cool people on ebay and it has for the most part been a good experience for the last 2 1/2 years. I take checks if people ask and never worry, and never been stung. Of course for $50 stuff too, not $5000 cars. My biggest problem now is training newbys. there is a bunch of them and most need someone to hold their hand the first few sales.
I have a $3 packing fee to cover my tape and stuff. It isn't near enough when you spend 1/2 hour building a box for some 30 dollar item that you made $10 on. Or when you have to use $10 worth of gas to get it to the shipper. I usually back off on it when it's something I can just poke in a little box and send it off. Also I include mandatory delivery confirmation out of the 3 bucks.

 

Sam,

The bottom line is… PayPal and Ebay work.

The cost is outrageous compared to what most people would consider fair.

I’m sure that most people don’t truly realize what it actually costs them to do business on Ebay.

Examples: With my ebay stores, listing fees and final sales fees… Ebay’s fees last month ran 6.25 percent of gross sales, includes shipping and handling and sales taxes where applicable. PayPal’s fees were 4.5 percent for a total cost of 11.75 percent.

So you have to make sure that you are charging enough up front to make to make the profit you need.

You simple HAVE to add these fees into the cost of the item before the sale. You will never “make up for it in increased sales” I don’t give a hoot what anybody else says.

These fees are a lot higher than the merchant account fees charge a brick and mortar business. Most retailers are paying around 2.5 percent with all fees included.

Currently 4.6 out of 5 of my buyers use PayPal.

I would never think of not using PayPal.

Al

 

All I can say is PayPal works for me. When I have an item to sell on ebay I usually have it boxed and ready to ship before the auction ends. I get INSTANT CASH with Pay pal and I can ship the item to the buyer immediatly..often the same day the auction ends. No waiting for a check or MO...I've had to wait weeks for my money but not with Pay Pal. When BUYING, I have paid with Pay Pal even when my account did not have enough funds in it...I just make a deposit the following business day. Like I said..it works for me. Oh yea, Ryan just got $50.00 from me for the HAMB Drags raffle thru Pay Pal...$$$ he probably wouldn't have seen without it.

 

If you guys don't mind I have a few questions about paypal. Is paypal linked up to a my bank account? If so, would it be wise to establish another bank account just to handle paypal funds? Do they report your transactions to big brother so you have to pay taxes on every transaction?

Now lets say I sold an item on ebay for way over the actual value & the buyer pays me through paypal then buyer gets item & comes down with "buyers remorse" & makes a complaint that it's broken or whatever or basically trying not to pay for item. Does paypal lockup my bank account & take all my money?

This is just a hypothetical question & maybe I'm thinking of worst case senerios but I'd like to know what I'm getting into if I get a paypal account.

Thanks guys.
Billy