Subject:
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Re: PayPal Changes
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Newsgroups:
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lugnet.market.services
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Date:
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Mon, 9 Oct 2000 18:10:12 GMT
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Viewed:
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1379 times
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In lugnet.market.services, Julie Krenz writes:
<snippage>
> More like OUCH!!!
> Here's the fee schedule:
> ----
> Amount of Incoming Payment under $15 $15 to $500 over $500
> Credit Card payments 25¢ 1.9% + 25¢ 1.9% + 25¢
> Bank Account payments 1.9% 1.9% $9.50
> PayPal Balance payments 1.9% 1.9% $9.50
> The above fees will also apply to international payments made to Premier and
> Business accounts - coming next month!
> ---- • <more snippage>
> Julie
OK, theres a couple of thing about this that bug me... First, PayPal is taking
a variable amount (see above) on an inbound payment. Part of that inbound
payment are things which I would have to pay full amount for (like shipping).
I'm going to use a real example from my sales DB, name withheld to protect the
innocent.
Cost of goods... $78.36
Sold for... $94.69
Shipping... $13.95
Buyer remitted... $108.64
With the 'free' paypal, I would have made $16.33 on that sale. Respectable,
but nothing to write home about. With the new PayPal schedule, I would receive
either $106.58 or $106.33 (depending on weather the sender used a CC or not). My
new net profit is $14.27 or $14.02 (ditto). My actual net profit fell by 13% or
14% ! Part of my loss in net profit has to make up for fixed overheads that I
am charging customers as 'actual shipping charges' BAH! This is not good.
I understand that PayPal has to charge for transactions. But what is happening
here is that PayPal is making it easier by shifting the cost of doing the
transaction from the buyer (e.g. money order) to the seller and doing so by
cloaking it under 'ease of use'.
Small volume sellers are either going to drop PayPal, institute a sliding
handling charge, watch profits erode, or go out of business.
BTW, note that PayPal is taking the same percentage (up thru $500) to move
money from one PayPal account to another as to get it from a Bank Account via
ACH. Talk about watching the profits roll in.
Ray Sanders
#124
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Message is in Reply To:
 | | Re: PayPal Changes
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| (...) Accounts (...) More like OUCH!!! Here's the fee schedule: ---- Amount of Incoming Payment under $15 $15 to $500 over $500 Credit Card payments 25¢ 1.9% + 25¢ 1.9% + 25¢ Bank Account payments 1.9% 1.9% $9.50 PayPal Balance payments 1.9% 1.9% (...) (24 years ago, 6-Oct-00, to lugnet.market.services)
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