Paypal Fee increase 2.6% for small sellers

[babylonfuture]

This morning I got this in my email...

I guess they are preparing for the seperation and need to increase their profit..

Next month we’ll be making some changes that we want to bring to your attention.

• We’re introducing a new tier of lower pricing for sellers with a monthly sales volume between $2,500 and $5,000. The rate for this tier will be 2.2% + fixed fee. • For sellers with a monthly sales volume of less than $2,500, the standard rate will be changed to 2.6% + fixed fee. We’ve also changed the standard rate for all other types of commercial transactions. • For sellers using Website Payments Pro and whose monthly sales volume is over $150,000, we have amended the rate for cross-border transactions to 2.5% + fixed fee. • We’ve clarified when our Seller Protection Policy does not apply. • We’ve made some changes to our Privacy Policy.

The changes will automatically take effect on 12 February 2015

[digital*ghost]

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@digital*ghost wrote:

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I was just referring to the increase from 2.4% to 2.6%.

0.2% is 16% of 2.4%, so the actual increase in the rate is 16%. Just like if someone charges a 10% commission on something, and increases that to 15%. The person paying the commission is charged 5% more, but it's an actual 50% increase in fees.

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Wait a minute... my maths is totally wrong. 

It's a less than 10% increase. 

Oops. 

[mbselections00]

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@babylonfuture wrote:

This morning I got this in my email...

I guess they are preparing for the seperation and need to increase their profit..

Next month we’ll be making some changes that we want to bring to your attention.

• We’re introducing a new tier of lower pricing for sellers with a monthly sales volume between $2,500 and $5,000. The rate for this tier will be 2.2% + fixed fee. • For sellers with a monthly sales volume of less than $2,500, the standard rate will be changed to 2.6% + fixed fee. We’ve also changed the standard rate for all other types of commercial transactions. • For sellers using Website Payments Pro and whose monthly sales volume is over $150,000, we have amended the rate for cross-border transactions to 2.5% + fixed fee. • We’ve clarified when our Seller Protection Policy does not apply. • We’ve made some changes to our Privacy Policy.

The changes will automatically take effect on 12 February 2015

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I have checked, but cannot find any mention of the actual Fixed Fee amount - so does that mean we can safely assume it remains at $0.30 ?

[gec2002]

While probably not too greedy, inflation has done the job for them over the years.  Over 10 years an item costing $100 should now be approx $130 (inflation rate 2.7%).  The only thing they are down on is their fixed amount of $0.30 which you  could argue should be increased to $0.39.  In that time Paypal has expanded enoromously, there should be some economies of scale, so we should be seeing a drop in the rate not a small increase.

For Paypal and eBay Greed is still good.

[the_pooze]

What I fail to see is why Buyers (who get definite benefit from using PayPal as a payment option) don't carry some of the fee burden as well as the Sellers who are effectivley forced to offer it when using the eBay platform.

This would make it very similar to a traditional auction where the Sellers pay comission to the auction house and the Buyer generally pays a "Buyers Premium".

From my viewpoint as a Buyer who uses PayPal I would accept paying a nominal 0.25-0.5% "Service Fee" for using the PayPal service as it's really just an "insurance premium" in my mind.  Also, as my preferred method of making payments I can understand a "user pays" system, it's sort of how the world works these days.   

[digital*ghost]

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@gec2002 wrote:

While probably not too greedy, inflation has done the job for them over the years.  Over 10 years an item costing $100 should now be approx $130 (inflation rate 2.7%).  The only thing they are down on is their fixed amount of $0.30 which you  could argue should be increased to $0.39.  In that time Paypal has expanded enoromously, there should be some economies of scale, so we should be seeing a drop in the rate not a small increase.

For Paypal and eBay Greed is still good.

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Not necessarily - the inflation theory only works if people are actually getting $130 for items they were getting $100 for 10 years ago, and that's not necessarily the case. 

It also doesn't account for costs that may not be covered by any increase in gross processing value - PayPal's costs aren't anything I'm clued up on in any way, so I just make the point that not all angles might be considered via inflation.

In many instances, the buyer is the one who is paying PayPal fees. They only come out of payments I receive, and they are factored into my costs, so they're not an out of pocket cost for me at all - my buyers pay them when they pay for their items. (I do recognise that for the casual eBayer selling household items and the like, the fees cut into what is typically a max value acheived - i.e. an item could get $50 anywhere, but because the item is on eBay and paid for with PayPal, the seller doesn't get $50.00 ... but that's a tradeoff most people make the choice to make for listing on eBay and accepting PayPal). 

[van_werkhoven]

Oh come on guys. The whining is getting a little much now. When was the last time paypal increased it's fees?

If your profit margins are so tight that 0.2% will break you, perhaps you need to reconsider your stock and sale price.

[the_pooze]

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@van_werkhoven wrote:

Oh come on guys. The whining is getting a little much now. When was the last time paypal increased it's fees?

If your profit margins are so tight that 0.2% will break you, perhaps you need to reconsider your stock and sale price.

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I agree but, I think the main reason it's sticking in the craw of many is not the fact of this modest increase but, that it's come on the back end of all the recent stupidity of 21 day holds, 180 day money back guarantee, etc, etc.  Without all that has preceeded this modest increase I reckon it would have passed through with barely a murmer from anyone.

[kizacks]

Paypal is owned by Ebay (they've re-structured that arrangement now) but Paypal is Ebay, Ebay is Paypal.....the question isn't whether 0.2 breaks you, it's when Ebay's invevitable fee hike kicks in this year , along with another auspost fee increase amongst other 0.1%er's, that's what's breaking people. What has already broken a lot of people were the previous fee hikes which included taking a commision off our postage. Also, Ebay continually breaking laws and illegally holding funds for 21 days. Where do we draw the line?

Customer support on Ebay is getting worse, everything is automated, extensive staff cuts, what staff they do have are overworked and underpaid etc

Sellers are being oppressed under this current dictatorship, morale is low, yet we're expected to lift our game (big box seller being immune to this) while Ebay continually takes short cuts in most aspects of their business.

[davidc4430]

it really makes me so happy your doing so well. yes some sellers are just ordinary people not large sellers and once all the fees and charges are taken and you pay for all the packaging stuff and do the drive to the post office to post the items, you discover your giving your items away. so excuse me if i say its just not worth it.

[van_werkhoven]

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@kizacks wrote:

Paypal is owned by Ebay (they've re-structured that arrangement now) but Paypal is Ebay, Ebay is Paypal.....the question isn't whether 0.2 breaks you, it's when Ebay's invevitable fee hike kicks in this year , along with another auspost fee increase amongst other 0.1%er's, that's what's breaking people. What has already broken a lot of people were the previous fee hikes which included taking a commision off our postage. Also, Ebay continually breaking laws and illegally holding funds for 21 days. Where do we draw the line?

Customer support on Ebay is getting worse, everything is automated, extensive staff cuts, what staff they do have are overworked and underpaid etc

Sellers are being oppressed under this current dictatorship, morale is low, yet we're expected to lift our game (big box seller being immune to this) while Ebay continually takes short cuts in most aspects of their business.

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Very soon they wont be owned by ebay, they are not ebay, or at least wont be as of later this year, they will be two entirely seperate entities. Ebays fee increases are irrelevant of paypals at this point.