posted on September 15, 2003 05:05:18 AM new
I am thinking about opening a merchant account as I am in the beginning process of opening a website/store and found one that is much cheaper than paypal.
Does anyone here ONLY accept credit cards thru their merchant account? If so, are your sales still the same? Do you think people prefer paypal vs a regular web checkout system? I found a place that has a set up for your ebay customers to be able to checkout thru your storefront (allowing them to add on to their original order) and that way, I don't have to toggle back and forth between paypal and my auction program now... and save money at the same time. I am only worried that some will not buy if paypal isn't accepted although I still offer credit card payments.
I know there are a lot of ebay sellers that do this, such as The Sharper Image and their sales seem high (even with high negative ratio.)
Any thoughts, ideas, tips would be greatly appreciated.
Thanks
Brenda
posted on September 15, 2003 06:09:55 AM new
If it were me I would put a line in my TOS (depending how long yours is - don't bury it among all the small print) "I can take instant payments through paypal, but for credit card payments please email me directly for instructions"
Or something like that.
Which merchant did you find for your credit card processing. I'm working with a guy at my bank right now and his rates seems high. He's faxing me an application today, but from what he said on the phone his rates are 2.5% + 35 cents. He does say no application fee, no statement fee, and no set up fee.
posted on September 15, 2003 06:59:57 AM new
some ebay bidders do not want to give their cc data to individual sellers,so paypal is their prefer online payment.
dont forget now they can purchase buyer insurance with paypal
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posted on September 15, 2003 08:10:40 AM new
Would many buyers really want to give their credit card info to an unknown ebay seller? Heck, a lot of them won't even give it to Paypal.
-------------- sig file ----------- President John F. Kennedy said, "There are three things which are real: God, human folly and laughter. The first two are beyond our comprehension, so we must do what we can with the third."
posted on September 15, 2003 09:23:17 AM new
If something is a LOT cheaper than paypal, you need to look for the catch. There are a LOT of unscrupulous companies out there. I know when I started, I got taken paying for expensive software. I am still using it 7 years later, so I guess it has paid for itself by now, but they sold it to me as a lease, not a purchase, and kept charging me a few months after I thought I had paid for it, and would be still charging me today if I did not notice what was happening. Anyway, something that is cheap may not always be what it seems. I have both a merchant account and paypal, and both are about the same rate. I clearly state I offer both in my auctions, but people rarely pay with their credit cards. I have that mainly for my consulting business, but if I was just selling online I would definitely cancel that in favor of paypal.
posted on September 15, 2003 11:15:19 AM new
there is usually a minimum discount for visa/mc ,like 15-25 dollars a month.
and the chargeback fee can be hefty,i have seen 50 dollars.
also how long does it take them to deposit the proceeds into your bank account??
since you do not seen the physical card,you need a virtual terminal where you can key in all the data and check the return codes,if the address he gives you come back as not the same as the one with the credit card issuer,you need to do some further work.
also how good are they in helping you resolve chargeback issues??
-sig file -------The thrill is gone!!
posted on September 15, 2003 11:20:31 AM new
I have done a lot of research into merchant accounts for some articles I wrote and during this research I opened 7 to find out about the hidden costs. There is no such thing as a free lunch. Costs include
application fee
setup fee
annual fee
gateway setup fee
monthly gateway fee
statement fee
transaction fee
avs fee
batch fee
percentage
closing fee (most accounts make you sign up for 3-4 years and there is a hefty fee if you cancel)
What I recommend for someone starting out is a Propay account. It is not a real merchant account and it has limits, but unlike paypal, the customer sends you their credit card info and you enter the charge so to the customer it looks like you have a merchant account. Some customers think that a seller with a merchant account is more trustworthy than a seller with just a paypal account. When you start hitting the limit on your propay account, it is time to start thinking about a real merchant account.
posted on September 15, 2003 01:43:26 PM new
Thanks for all the great responses..here is what I found. I am thinking about going to www.shoppal.com and they offer authorize.net (which I hear is great.) and the fees aren't hidden...but I do over $10K a month and am expaning to where I will offer about 4 times the items I offer now. My items are very cheap items so people very very rarely take advantage of paypal's guarantee and insurance isn't offered since the items aren't breakable. I give my personal guarantee for delivery.
Here are the fees they list:
Setup Fee (One time fee) $150.00
Merchant Account Setup Fee $50.00 - $150.00
Business Checking Setup Fee $0.00 - $30.00
Total Setup Fees $200.00 - $300.00
Recurring Fees:
Monthly Fee $20.00
Annual Fee $0.00
Merchant Account Monthly Fee $10.00 - $30.00
Business Checking Monthly Fee $10.00 - $30.00
Transaction Fees:
Transaction Fees .10 per transaction + 2 - 3.5%
Limitations:
Per Transaction Limits * N/A
Monthly Limits * N/A
Customer Requirements None
Merchant Requirements Business Checking Account, Merchant Account, Registered Business Name
Payments Accepted Visa, M/C, Amex, Discover, Diners Club
Payment Process Seamless Real Time Approval using ShopPal Secure Server and Authorize.net gateway
Any ideas or thoughts would be great. As far as I can tell it would still be better than the $600+ I am paying to paypal for such small items.
posted on September 15, 2003 01:59:47 PM new
Alwaysfun: Those rates sound awfully high. Even for a low volume seller. As a high volume seller, you should be able to do much better. You can read the article on my site
www.ccs-digital.com/merchantact.asp
and then get in touch with either sun-merchants.com or intelli-collect.com (or why don't you compare both?) either one should give you a much better deal. Sun-merchant does have a requirement that you can't be 100% Internet. If you have ANY walk-in sales or mail-order sales, then you qualify.
And though I am no fan of paypal, the rates you quoted are higher. Paypal's maximum is 2.9% + 30 cents and with higher volume and you can get some rebates back, you should be paying even less than that.
You may want to see if you can pay a little less and get just the Visa & Mastercard and drop the others. In 13 years of business, I think I've lost TWO sales by not taking Discover. No ones ever even ASKED if we accept Diners Club. Amex is nice, but it is pretty expensive to offer.
-------------------
Replay Media
Games of all kinds!
posted on September 15, 2003 02:51:43 PM new
with your kind of volume,you can get paypal premier or business account with 2.2% plus 30 cents transaction fee,all you have to do is to give them 1k business per month to qualify.
you can apply online at their site.
as for your merchant account application-does 10 cents include online verification??
such as authorisation,approval and address verification,cvv code ??
how fast do they depesoit your money,it should be within 48 hours and you did not mention chargeback fee,how much,this is where things can get nasty.
many merchant account providers are pretty fed up with internet merchants,once there are a few chargebacks,they start holding back some reserve and slow down the deposit time.
i agree with the others,keep shopping,you can do better
-sig file -------The thrill is gone!!
posted on September 15, 2003 02:53:34 PM new
discover has its own website where merchants can process discover cards free.
amex is nice if you have high dollar,foreign orders,you can call amex office and verify foreign cardholders.
but most people use mc/visa/
-sig file -------The thrill is gone!!
posted on September 15, 2003 02:53:59 PM new
This is giving me something to think about. My average sale is only $4.75 and a lot of them are as low as $1.99 so the $.30 for each transaction is killing me. So on the average I am paying about 9.2% to paypal. Luckily some people are mailing payments but it is more convenient for them and I to accept online payments.
This whole website deal is so new to me... I don't know if I should try and build it myself or go with someplace like shoppal.com
What are you guys who own websites doing? How did you get started? I think the unknown is what has kept me from building a site but I know it would be profitable if I could just figure out how to start.
posted on September 15, 2003 03:28:51 PM new
In my case, I just run our website orders through our store merchant terminal. We have a real retail store with a terminal purchased/run though our regular bank.
Other thanb Paypal, I've never tried any other option.
Again, I'm very much anti-Discover-Card. Who do you think pays that "cash back" money? The sellers, that's who!
-------------------
Replay Media
Games of all kinds!
posted on September 15, 2003 05:55:28 PM new
amzn zshop is 40 dollars a month for 40,000 items and you can use amzn one click to accept credit card .
you can look into the fee,but other than fee,it is not a good site to drive traffic to .
can you bury paypal fee in shipping and handling??our local dollar general store does not accept credit card.
-sig file -------The thrill is gone!!
posted on September 15, 2003 08:30:42 PM new
I would have to agree with the others, Your volume does get you the 2.2 rate with paypal and I believe its 25cents per trans, if you do their little debit card deal you get 1.5 back, so it is quite comparable, I have had both and I actually prefer paypal, and use them exclusively now their customer service has been good to me (I know others will disagree there I sell winter sports gear with the average sale being $180-$250 volume of 50K plus per month in the winter, in the summer when its quiet I don't worry about monthly fee's etc.
posted on September 16, 2003 05:38:14 AM new
paypal transaction fee is still 30 cents with premier or business account,it is the discount rate which comes down from 2.9 to 2.2%.
paypal is still a good deal,30 cents include online verification and transferring balance to your bank account is free.
propay charges a fee for balance transfer .
her problem seems to me that her buyers spent 1.99 for an item and want to use their credit card,dollar general store does not accept credit card and some of local dollar store just say 5 dollar minimum for credit card purchase,do you blame them??
-sig file -------The thrill is gone!!
