Credit Card Processing...is Paypal Truly The Best Way?

Business By sweetlayers Updated 30 Nov 2010 , 6:14pm by Chef_Stef

sweetlayers Posted 20 Nov 2010 , 1:28am
post #1 of 15

So, I was looking at the fees I paid Paypal this year and was floored by how much $ they made off my transactions.

So now I am looking into the credit card terminals and would like to know if any of you have any preferences or suggestions as to whether Paypal is as good as it gets for online buying transactions or if I should get a credit card machine of my own.

Thanks in advance.

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14 replies
-K8memphis Posted 20 Nov 2010 , 1:58am
post #2 of 15

I don't know. I go through my bank and it's ok I guess--for the bookstore I mean. Not bad.

Quickbooks had these killer deals previously that I just hate myself for not changing my point of sale over to QB. But at the time I could not make the time to do so. Change all the inventory etc.

But that's a thought for you. If you use QB or want to--they offer credit card processing that seemed as reasonable as what I have through my bank.

Oh yeah I remember -- I could not switch my gift cards either and that threw a wrench in the works. Anyhow--plus you get Discover too with QB. I only have Visa & MC. Whatever.

Just watch the fine print like a three eyed hawk! No four eyed!!! icon_biggrin.gif

Jenn2179 Posted 20 Nov 2010 , 2:12am
post #3 of 15

I just got credit card processing with EVO. I was happy to see their rates. Cheaper than paypal and my bank. It will be cheaper because there are only a few credit card processors and they are one of them. If you got through your bank they too have to use a processing company.

-K8memphis Posted 20 Nov 2010 , 4:03am
post #4 of 15

I used to work for a major credit card processor and some of the worst accounts ever went straight through them. Especially accounts of people to whom English was not their first language.

I worked customer service and the people who hooked up through a bank got better deals and better service and had a go between with the bank. Had someone watching out for them is how it always seemed.

I'm glad you got a good rate. But there can be hidden fees and headaches, including yearly fees you won't even see right away. There's tons of ways to get screwed.

Everybody has to use a processing company.
EVO is one of many at that level according to this chart I stumbled upon--not endorsing the chart just posting it:

http://www.merchantmaverick.com/merchant-account-comparison-chart/

They have minimums if you don't have the volume, etc. etc. There can be a lot more to it than just the rates.

I'm sure it's not always better to go through a bank but that was my unique experience.

Costco and Sam's offer these services too. Just keep asking if there are any other fees.

Oooh I stumbled on this too--looks like a bunch of good information:

http://www.creditcardprocessing.net/faq/

sweetlayers Posted 20 Nov 2010 , 7:40am
post #5 of 15

Thanks friends. Anyone know if this same equpment can be used to take online invoice transactions?

-K8memphis Posted 20 Nov 2010 , 1:13pm
post #6 of 15

No of course not. You have to have another set up. Like my quote I just got for that is about $25 a month plus $250 set up fee.

But you could take over the phone transactions without the additiional online connection. It costs a bit more per transaction but you can do it that way too.

-K8memphis Posted 20 Nov 2010 , 5:45pm
post #7 of 15

I meant 'no of course not' in the sense that they charge for everything you know about and stuff you don't know about.

But I should qualify that further by saing that my setup that is a straight up retail store--swipe the card type thing hooked to the internet but only available on site with the swiper or manually--this setup would require an online portal to run off a website.

leah_s Posted 21 Nov 2010 , 6:35am
post #8 of 15

I use PayPal for my cake biz and a regular swipe terminal for my B&B. Charges are similar, but PayPal is simpler. With the terminal there are all sorts of small fees hidden until you get your bill. For simplicity, PayPal wins hands down. And my terminal and processing I arranged thru Sam's Club.

Navyempress Posted 21 Nov 2010 , 6:52am
post #9 of 15

I plan on using Intuit. They have different ways to accept payments, even on your phone and you do not have to use Quickbooks, although I will.

http://payments.intuit.com/

Evoir Posted 21 Nov 2010 , 10:12am
post #10 of 15

sweetlayers - can you tell us what percentage of your total sales the fees were over a 12 month period using Paypal? Does the cost increase with the more volume of sales you put through Paypal?

I do 99% of my transactions up front using direct transfer of funds (either by the customer through their bank/financial institution's branch, or online through their online banking services. Although I understand this is not common practice in the USA. There are no fees for either of us this way.

tracycakes Posted 22 Nov 2010 , 1:54pm
post #11 of 15

We use paypal and find it extremely easy to use. It's straightforward and we can accept almost any card. The fees are high, but with credit card, the fewer the transactions, the higher the fee, that's just the way it is. I do know a little about what I'm talking about because I am computer programmer that used to work at a credit card processing company - designed and coded the systems, so I have a bit of knowledge.

cakesdivine Posted 23 Nov 2010 , 4:37pm
post #12 of 15

What I have found in using both I always seem to come back to Paypal. I have been with several different merchant services over the years with all my businesses. We use PowerPay for the studio only because the management program has the POS system in place. We auto draft the credit cards for the monthly tuition. This works well but what we found is that it costs us a little more to use than Paypal did when we first opened a year & a half ago. I only use Paypal for my cake biz, but once the actual cupcake shop is open we will have no choice but to use a swipe based POS system. Probably will go with Intuit for that. I keep hoping Paypal will begin offering a swiper that can hook up via USB for their transactions. That is how Powerpay works for POS items. For invoicing our monthly fees I simply hit a button that tells the program to charge all monthly accounts cards on file and presto...all cards charged with a report telling me which cards cleared and which cards declined. Granted for a cake/cupcake biz that isn't what is needed. But the company does other merchants other than tuition based businesses.

sweetlayers Posted 23 Nov 2010 , 11:35pm
post #13 of 15

Thanks guys. I will take all of this into consideration! You have been super helpful.

cakeshoppe Posted 29 Nov 2010 , 3:47pm
post #14 of 15

I used ProPay.com for my online scrapbook store credit card processing. I liked it. Especially for those who still distrust PayPal.

Now that I am planning on setting up a cake shoppe I will probably use them again. There are fees, but it didn't seem as much as a bank.

I did online credit card processing, and it went into my Propay account where I could have it transferred to my bank account or use a debit card for my propay account, which of course was a quicker way to get ahold of the money. It was nice for ordering products and supplies, because it was easier to keep the money separate.

They do have a credit card reader, which is what I will probably do now that I will have actual customers, and not just online transactions.

I will also offer PayPal for those that want to send a deposit or whatever online.

Chef_Stef Posted 30 Nov 2010 , 6:14pm
post #15 of 15

I use Quickbooks for both our businesses, and I love how the credit cards work with QB, everything's streamlined and headache free for me.

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