posted on June 8, 2001 09:32:50 PM new
I'm not saying WE should charge the buyers the Paypal fees. I'm saying buyers who want to use Paypal should sign up for paypal and agree to pay Paypal the Paypal fees on their purchases. Let them pay the percentage on the purchase price and shipping and insurance.
I'm saying that PayPal is charging the Wrong People.
Although BidPay charges a outrageous fee, they've got the right idea. They charge the Buyer, NOT the seller.
I sell low end items too. My rule of thumb is buy low, sell low, buy more.
posted on June 8, 2001 09:37:22 PM new
ABEbooks.com has an Ecommerce system that the buyer pays a fee to buy the books in this way. Mnay are International---but quite a few are Canada and USA
I get most of my book orders on ABE this way, other than the Barnes and Noble orders.
No complaints from any buyers as far as I know---and I've had lots of repeat buyers too. And if there is a chargeback---ABE absorbs it--it is nor charged to me.
>>>What if the item you are selling is only worth $5.00, and you have $1.50 invested in it? Aren't you going to cover your costs?<<<
Lets see. You spend money on gas to go out and find the item. You spend time to inspect it for defects, clean it, take pictures, list it, send an EOA, package it and take it to the post office.
Hopefully you don't have to purchase an envelope, box or other packaging materials.
$3.50 is not much of a return for your, time effort and other expenses. Your time must not be worth much...
PayPal and other payment services are the real winners here. They make money on the price of the auction, shipping and the handling fees.
[ edited by outoftheblue on Jun 8, 2001 09:45 PM ]
posted on June 8, 2001 09:50:37 PM newI'd pay the fees to use paypal as a buyer.
Well, so would I and so would most people. But as sellers we're not allowed to charge extra for Paypal payments.
The thoughtful buyer who is willing to add $.50 or $1 to their payment probably doesn't realize what the actual cost is to sellers. Take OneCentCDs, who posted here earlier. This fee increase could mean $1000/week to some sellers. And that ain't peanuts.
posted on June 8, 2001 09:52:19 PM new
redskinfan> If you include your costs in the bid price then ebay gets to take out more money and your costs are even more. A voice of reason! Exactly! There is no law of averages here, especially for the smaller seller. Whatever you get for the item no matter what it is, there is the insertion fee, the FVF, the postage, the Paypal fee, the AW fee, the cost of the item, the packing materials, (peanuts, bubble wrap, tissue paper etc)the gas for post office runs and searching for the items, to mention a few out of pocket expenses. I am not a big seller by some standards around here, and since PayPal has started to charge fees, they have gotten over $900 from me. Not much to some, but to me, it would sure pay for a new Dining room window I have been needing for 3 years!
posted on June 8, 2001 09:53:58 PM newheygrape:
I completely agree that PayPay is charging the wrong people. I just don't think it fair to try and charge the bidder AFTER THE FACT for your fees.
If the shoe were on the other foot, and PayPay were charging the person SENDING the money, would you like it if they deducted that amount from what they sent you, or would you hold their item until they sent the rest?
outoftheblue:
Sometimes an item looks like a winner when you are at an auction, and when you get it home and look it up on eBay, you realize it isn't going to do what you thought. All my items are not like that. If they were, I wouldn't be in business long.
But as I have been arguing in another thread, my packing materials are not costing me a penny, and they get shipped directly to my house. My time is compensated in my profits on an item. Sometimes the profits are higher than other, but they can't all be winners (although I would love it if they were)
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Still charging exact shipping fees, and darn proud of it!
posted on June 8, 2001 10:01:26 PM newfurkidmom: But if you don't include those costs, and the item only gets 1 bid, you are out that money, and are operating at a loss.
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Still charging exact shipping fees, and darn proud of it!
posted on June 8, 2001 10:06:18 PM new
In some categories, if you raise your bid price -- and your competitor does not -- your auction is dead in the water.
You won't even get that one bid needed to sell your item.
posted on June 8, 2001 10:07:36 PM new
Seems to me, when running auctions, the goal is to get people to bid. Setting the opening bid where you only expect to get one bid sounds more like a store than an auction.
posted on June 8, 2001 10:08:29 PM new
"I completely agree that PayPay is charging the wrong people. I just don't think it fair to try and charge the bidder AFTER THE FACT for your fees.
If the shoe were on the other foot, and PayPay were charging the person SENDING the money, would you like it if they deducted that amount from what they sent you, or would you hold their item until they sent the rest?"
I don't try to charge people after the fact. I don't advertise Paypal in my auctions and I don't accept PayPal.
And Paypal is deducting that amount now.
[ edited by heygrape on Jun 8, 2001 10:09 PM ]
posted on June 8, 2001 10:09:18 PM newBut if you don't include those costs, and the item only gets 1 bid, you are out that money, and are operating at a loss.
JeeZ! I loose money on an occasional item, but I can assure you that I am not "operating at a loss!"
What's your profit margin not counting taxes, revvassago? I'm running 300-400%.
posted on June 8, 2001 10:17:20 PM new
yep, i think splitting the paypal fees would be fair. i don't agree it's only a convenience to the buyer, although it is that - they get their payment to me quickly and therefore i can ship their item out quickly. they don't have to write a check or go get and pay for a money order, or mail anything to me.
but it's also a convenience to me as a seller - i get the money quickly, and can get the items out of here.
the problem is, as so many others have said, there are now too many fingers in my pie, and with bidding slowing down as well as increases, something's gotta give.
and i'm glad *someone* finally said something about the - to me -perplexing and oft-said 'solution' of building the fees into your start price! that never made sense to me. i suppose if you figured out what you *need* to get to cover all fees (although there is the chicken/egg thing of the higher the price the higher the fees), and leave it at that, it'd work. except. what if that start price is too high to get enough attention? what if that start price is just high enough so you end up with NO bidders in this slow market?
for those of you who are doing well and experiencing no slow-down, i'm happy for you. but not everyone is in that boat. if you'd say to me i'm in the wrong business, you may be right.
posted on June 8, 2001 10:18:15 PM new
I am running nowhere near that, because I am only doing this on weekends (very part time for now.)
I purchase most of my items at auctions and resell them online. Being from a rural area, the selection is not very good. However once in a while a get a good one that skyrockets.
My initial price always covers my costs and gives me a small profit. If it goes higher, great. If it doesn't, at least I made something.
You will never see me listing things for $0.01, because I cannot afford to take that much of a loss. Right now, this is just extra income, and a hobby, but why take a loss if you don't have to? Has ebay gotten so competitive that they only way you can sell an item is to list it for $0.01? I have never bid on a penny auction, and probably never will. As the old saying goes:
"If it seems too good to be true, it probably is."
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Still charging exact shipping fees, and darn proud of it!
posted on June 8, 2001 10:29:36 PM new
revvassago> Yes of course Iagree with you on that. Let's say for an example I buy something for $2.00. I want to make at least the amount I paid for something in the first place x 2, so I would start my opening bid at $6.00. There is my profit at 1 bid. Now I have to white knuckle it to make the costs from the other fingers in the pie, right? and the more the bid goes up on this item, the more Ebay is going to take for their FVF, the more Paypal is going to take for their fee. Also the listing fee, not to mention the other expenses involved in seeing a transaction from start ot finish. So for me, my business, I have to cut out the fat somewhere, and since I cannot do anything about the Ebay fees because that is my venue of choice, I have to cut out the fat somewhere else, right? Paypal happens to be calories I cannot afford to eat anymore!
posted on June 8, 2001 10:35:12 PM newI am running nowhere near that, because I am only doing this on weekends (very part time for now.) One item or a thousand shows a profit or loss, right?
Otherwise, I hear what you are saying and I too purchase items at local auction, shops, and homes for resale. But, I think your price strategy hurts you in the long run. Bidders seem much more willing to bid up items that are started low, versus items that are started near retail or your purchase price. I've seen it over, and over, and over again. It's the thrill of the auction...
But, I believe the real secret lies in the number of concurrent QUALITY auctions running. 300-400 UNIQUE antique and collectibles auctions garners LoTs of attention. Everyting starts a five dollars.
posted on June 8, 2001 10:42:59 PM newMTown, and on a lot of items, at 5 dollars I am already making a nice profit, so I might start it a bit lower, and have all my costs covered right away.
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Still charging exact shipping fees, and darn proud of it!
posted on June 8, 2001 10:45:37 PM newoutoftheblue, I am sure that at some time in the future I may feel it necessary to charge a flat rate or a handling fee, but I still don't think it is right. Even if I end up doing it, I still don't think it is right.
I guess that will make me a hipocrate, won't it?
Edited because my little face got screwed up
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Still charging exact shipping fees, and darn proud of it!
[ edited by revvassago on Jun 8, 2001 10:46 PM ]
posted on June 8, 2001 10:53:22 PM newI am sure that at some time in the future I may feel it necessary to charge a flat rate or a handling fee, but I still don't think it is right. Even if I end up doing it, I still don't think it is right.
In the meantime, you'll just keep cutting down those Priority Mail boxes & papering over them to use them for First Class shipments to cut your costs, right revvassago?
A lot of folks (especially those at the USPS) don't think that's right, either.
posted on June 8, 2001 10:57:28 PM new
Fee's are a fact of life.
If your in business they are tax deductible.
We dont use PayPal because they dont disclose policies its that simple. We have a monsterous book that came with our merchant account explaining how everything works from disputes and chargebacks to stolen cards, investigations, voice validations, Force's the works.
Statements as to PayPal being cheaper are totally unfounded. Paypal is 1.9% offering Visa/Mastercard + .30 per transaction. The 1.9% is cheaper than our 2.35% we pay... However, we do NOT pay the .30 per transaction. Do the math. Lets say we sell 100 items a week at $10 each. So thats $1,000.
Paypal: 1.9% = $19 + (.30 x 100) or $30. $49 is the fee. Meaning 5 items you sold monies went to PP.
Our card processor: 2.35% = $23.50 + a .25 one time batch closure or $23.75 total, meaning two items we sold went to pay the card processor. Atop that we accept Amex & Discover, atop that when problems Do happen we are in the loop. Someones card declines 72 hours later we try it again and it goes through, or we can try a Force or voice validation. We also get to SEE who's passing us bad cards and ACT upon it. Not be told its under investigation. We dont WORRY that tomorrow due to some whackos claims our account is shut down pending an investigation to which you the seller or the buyer for that matter are totally blind to.
Additionally there are no grey areas, our rights, buyers rights all in place and when disputes occur BANKS handle it not a "merchant", PP IS a merchant, not a bank, not a card processor.
As to costs, as people noted its completely idiotic to say "just raise your bid start price" as thats no guarentee of anything except your merchandise looking that much less attractive to buyers.
You will never see them pass the cost along to the consumer. First off if they did they'd loose buyers hand over fist. Go ahead and put in your emails to winning bidders "pay by nn service and we will add the extra fee's for using the service"... See how many use it. In fact more than likely they wont pay at all at that point.
Secondly, paypal is the merchant as I noted. When the consumer gets their bank statement it says PP, thats legally who the consumer did business with as far as the bank and law are concerned. Just as Walmart or us cannot pass along card processing fee's to the buyer PP cannot either, again, they are the merchant.
There is alot of disinfo out there and 99% of people speaking about merchant accounts and this and that have no clue. They are spewing what others told them. We vend via many sites and have our own merchant accounts, are a business etc. To say the service is cheaper than a merchant account is only true in startup fee's and many a card processor will waive these. They are REAL contracts as well.
Processing wise however no its not cheaper at least than our's as we dont pay that .30 per transaction. The 1.9% is fine, on a $10 purchase thats all of .19 cents, the .30 a shot however can amount to ALOT of money if you do volume. The only other issues are rights and in that regard you waive most both as a seller or a buyer as you are agreeing to not hold the "merchant" libel, PP is the merchant and your agreeing they be arbitor of dispute meaning they control your outcome good or bad. One member also said nothing is FDIC insured, no idea on that.
If your a business its certainly not what you want to use. You wont find a single retail store front in your town or a single "branded name business" on the Internet using them for good reason. If your a private seller then you dont qualify to get a merchant account to begin with so "take your chances".
Theres alot of stuff people dont realize. Most people for example have no idea that all those deposits they are making to bank accounts are tracked and logged. One of the reasons Bush wants to "crack the whip" on the web is alot of people are not disclosing that additional income and paying taxes. Alot of people are purposefully buying goods with the intent for resale for profit, by nature in state definitions your a business whether you think so our not which means you are in a situation of state and federal tax and state sales tax fraud.
Bush told the IRS when he got into office basically its time to crack the whip and ALOT of people are going to be ever so surprised over the coming years when they get hit up for it and all the interest as well.
Years and years back I did some work with two other guys and was told by the business owner all tax issues were taken care of. I made about 19,000 bucks on the project. 4 years later the IRS came at me saying nothing was paid and by the time it was all settled out it was nearly 5 years. I paid nearly 12,000 dollars back to the due to the interest.
There has been a recent push I read of at Wired news for all these payment services and banks that have more than avg activity to try and legislate that they must report all of it to the IRS. I dont think it will happen. But according to GW Bush the IRS is getting zapped out of HUGE amounts of money due to online sales and unreported incomes and I'd guess as early as next tax year gonna be ALOT of unhappy campers in Cyberspace as he has basically told the IRS "Do what you need to do to collect every dime entitled" so its back to IRS of old instead of the more "passive" one we had during the Clinton years.
Signed: WhyNot!
posted on June 9, 2001 12:55:34 AM new
revvassago- I used to start my auctions at the amount I needed to make a small profit. However, I found that many of them would close without bids. I still lost money (not to mention time) by relisting over and over again.
I now subscribe to the $1 NR strategy, and I have to say that it has been a lot better for me. I don't want merchandise hanging around forever, I need to turn it over fast. If given a choice, I'd rather sell to a buyer at a loss than have it sit around indefinitely, with me losing more money to ebay with each relist. (At least in that case I have a happy buyer, and a possible repeat customer who remembers the bargain she got). But I rarely lose money on an item.
To add my 2¢ worth to the PP discussion, I have never used it and have never felt that I needed to. I am lucky enough to sell in a high-traffic category, where NO ONE is going to let my items go for $1...paypal has nothing to do with it.
I definately know about starting a bid for $1.00 at a an auction. But, if it's something I want and I know what it's worth, I'll start my bid at a higher amount. If a collector wants an item, they'll go the limit.
posted on June 9, 2001 07:31:42 AM new
Despite my ranting yesterday (and I still believe they're thugs and liars), I'm not closing my account. I'm adding a fifty cent handling fee to my auctions.
Why?
The most important reason is that I checked with my bank, and not only do I have to jump through hoops and open a business account to get a cc account with them, but I'd have to have about 75 transactions per day and do daily deposits and a nice long list of other hassle type stuff to get a thirty cent swipe fee plus 2.2%.
I really like the convenience of PayPal. I know a lot of posters say it doesn't hurt their business not taking it, but there's just no way to really know. Last month, I passed on bidding on two items in the over $50 range because the sellers only took checks and MO's. I like the protection of purchasing w/my cc, and want to give that to my customers. (I don't pass on the small stuff if the seller doesn't offer cc.)
I also don't want to jump to citibank's new thing or any other freebie that will just do the same thing as PayPal has as soon as their customer base is large enough.
Let's face it. Corporate Amerika isn't a place for great minds to do great things in an exciting capitalist arena. It has become a place for mediocre drones to put out as little as possible for a good bottom line for investors who don't even take the time to learn what their investing in, nor to even learn to read the quarterlies.
PayPal is just another small thorn. My main gripe with them isn't their fees. It's their lies. I treat my business relationship with them as such. I'm cautious. I don't let a large balance build. They don't have access to my main checking account, etc. Not 100% protection, but come the time I'm the one who gets screwed, it will be minimally.
I was never one of those sellers who started with 100% sell through and $10k/month in sales on eBay. I started with about a nickel in my pocket, blundered my way through and find that now, I make more money every month, and fewer mistakes. My belief is that if you want to be a business, you have to take credit cards - that's why every b&m does.
For hobbyists, it's just another fee, and I can totally see why you'd dump it.
Last month my sell through rate was over 90%, with approx 5 K in sales.
I didn't offer CC payments on a single auction. [with the exception of BidPay]
A number of those auctions ended between $100-200. I've also sold numerous items in the $500-1000 range, and some over $2,000.
Not one of those high bidders asked about paying with their CC.
I even went so far to ask some of those high rollers if they had their CC registered on eBay, and not a single one of them did.
They told me they would NEVER trust eBay with their CC #.
Maybe it depends what you sell?
IMHO I think sellers that refuse to accept personal checks on high $ items hurt themselves far more than those that refuse to accept CC's.
posted on June 9, 2001 10:20:36 AM newglassgrl - (if you're still following this thread...)
You can become Unverified again by removing your bank account information from your PayPal profile. I did that accidentally a few months ago (back when there was a big panic about AuxPal signups) and I've been Unverified ever since.
posted on June 9, 2001 11:13:41 AM new
Yes, buyers SHOULD pay PayPal fees. Do it this way (as Ann Landers says) and "kwitcherbeefin"!!!
1. Increase your s/h fee to include PayPal fees based on your estimate of the closing cost.
2. OFFER A S/H DISCOUNT FOR CHECKS/MO'S/CASHIER'S CHECKS!!!!
Your "increased" fees will probably be in line with other sellers, and I bet you'll end up getting more checks in the mail from people who want to take advantage of the discount.
