ebay vs audiogon

I'm just wondering here...it seems as if about 90% of A'gon sellers who say they accept Paypal also ask the buyer to eat the 3%.

I've been around this community long enough to know that 3% is HUGE chunk, especially when you consider not many people on A'gon actually have more than 3% profit in the items they are selling (more like -40%). Understandably 3% is A TON for most A'gon users; especially when you further consider that the average transaction on A’gon seems to be somewhere around $1500 which translates into a $45 Paypal fee.

So the question I have is, why is Paypal such a popular a payment method on A'gon?? Is it the pure convenience? Or, is it REALLY because Paypal lets you use a Credit Card to send payments to any Paypal Seller? If this is the case, what A'gon sellers are essentially saying is "I will accept Credit Card payments via Paypal." If that is what accepting Paypal really means, and if that is why A’gon buyers insist on Paypal, then that is a pretty LARGE convenience to the seller (considering the cost of establishing a merchant account) that the seller should be willing to pay for. As a seller, the thing I hate to do is accept Paypal where the buyer is funding the transaction from his checking account and I have to eat 3% when I could have just accepted a cashier’s check for free. So here is the question? Do you guys think that most A’gon buyers who use Paypal are funding their transactions with their Credit Cards?

I'm not sure this is the case. I don’t seem to remember anyone, if my memory serves me well, that would only buy an item from me if I accepted their Credit Card via Paypal. I have only ever accepted Paypal once (small ticket item), because I was under the impression that most people on A’gon typically transact with funds from a checking or savings account (via cashier’s check). Am I missing the boat here? Will I sell my items quicker on A’gon if I accept credit card payments via Paypal?

I, like most Paypal users, signed up back in the day when Paypal was billed as a free service but then somehow along the way I was bumped up to a Premier account and found myself paying 3%, even when my bother would reimburse me for something personal like lunch. That got frustrating, but I do understand the laws of the Credit Card world and in that world NO ONE gets around the 2-3% fee that credit card companies charge you for putting money in your account today when it will take them at least 30 days to collect it from their cardholder.

So again, the real question at hand is, are buyers who use Paypal insisting on Paypal because it lets them put it on plastic, or are A'gon buyers still using Paypal to move funds from their checking accounts and use Paypal mostly for its convenience. If it is the latter, it sounds like we need a Paypal alternative that caters to the flat fee payment mentality we here at A'gon crave.

Treyhoss if I am reading your response correctly, in your experience, people overwhelmingly seem to prefer funding their PayPal transactions with a Credit Card, so much so, that you were forced to abandon your "FREE" Personal Account for a Premier Account and pay the infamous 3%. Again, in my opinion the 3% is reasonable when accepting credit card payments (it's the nature of the beast), but the 3% just KILLS me when it’s a bank transfer. So accepting credit cards is one of the reasons so many people are being pushed into PayPal Premier accounts that levy a 3% surcharge on receiving any funds. PayPal…very tricky.

In addition though, accepting Credit Cards via PayPal is not the only thing pushing A'gon uses into PayPal Premier Accounts. PayPal Personal Accounts have a receiving limit of about $500 dollars/month (though according to PayPal's, website it can vary), so it is my understanding that if you exceed the limit of the personal account they bump you to a Premier account (again charging 3% regardless of the funding source used in the transaction). Again, it seems to me the average cost of an A'gon item is between 1000-1500 which bumps almost all A'gon sellers who accept PayPal into Premier Accounts fairly quickly, and that is probably why so many postings on A'gon include "PayPal adds 3%" I suppose the nature of our hobby and the high ticket price of audio gear will just always put most A'gon users in the Premier Account Category. Therefore the "PayPal adds 3%" isn't likely to be going anywhere anytime soon.

The last item I sold on Audiogon was a pair speakers for $1800. I sent them C.O.D. and it took 21 days from the day I shipped them till the $1800 cleared my checking account. 21 days is kind of a long time to be apart from $1800 or any amount for that matter. Furthermore, with so many bad cashiers checks in circulation, every time I take a cashiers check from an A’gon sale to my bank, the teller always looks at me cross-eyed and reminds me that the check might be bad and that I must wait until the funds clear before they will guarantee the funds. Having said all that, I think I am done with the C.O.D. thing. I’d prefer to receive money exclusively via an electronic payment service like Paypal for speed and convenience but for 3%...I'm not sure.

Jmcgrogan2 you are right! Thanks for the input. I even searched the PayPal site and they explicitly condone the practice of having a Personal account AND a Premier account for this precise purpose. However, it becomes a bit complex because your PayPal accounts must be tied to two separate bank accounts…no two PayPal accounts can be tied to the same bank account (or at least that is my understanding). You are also right that it is a huge hassle to have two PayPal accounts tied to two separate bank accounts but it is a workaround.

However, this “two account” solution begins to breakdown for most A’gon users because most personal accounts have a receiving limit of $500/month before being bumped up to a Priemier account. Personally, I don’t remember buying or selling anything on A’gon for less than $500 (I love this hobby!)

Treyhoss, I totally agree with you. Perhaps the real the person who gets the most convenience out of Paypal is the buyer since they seem to have the last WORD--Not to mention the miles they are probably racking up and the convenience of not having to pay for 30 days.

However, I've got to still take into consideration that a Credit Card (CC) funded Paypal payment means I get my money TODAY (plus the 3-4 business days it takes to download the funds into my actual checking account from my Paypal account).

I guess we all have to remember that the CC Mechanisms of the world were built way before Paypal and were typically only extended to merchants. That is why they call them merchant accounts. Most merchants make a profit on what they sell, and any cost of doing business is usually absorbed by those profits. Merchant have the luxury of dipping into those profits if a customer disputes a credit card charge. The merchant usually takes it in the shorts and goes on...business as usual. Merchants are also a "known quantity" relative to a Paypal user that can accept CC payments with a tremendous amount of anonymity. The CC industry’s VERY liberal "the buyer is always right" dispute policy is a child of an old paradigm that doesn't consider the complexities of pier-to-pier (P2P) transactions conducted through Paypal. I guess what I am really saying is that VISA, MC, and AMEX probably never intended on Individuals being able to accept CC payments. Therefore I think the current system is “broken”.

So again, another paradox I am observing here is that Sellers are most Protected by USPS Money Orders (because you can't stop payment on them) and Buyers are Most Protected by using Credit Card Funded PayPal.

Is there a happy medium in between? The best I can come up with is C.O.D. with a USPS Money Order....Argggg I hate C.O.D. ---too clunky and takes too long to get my funds.