OK, say you rarely sell anything on Ebay. You sell an item for $1,000, and the buyer pays with paypal. Question: How much are your <b>total</b> ebay fees for this transaction (Assume you put in a picture or two, but don't make it a headline item), and how much are your <b>total</b> paypal fees? Thanx.
Ebay fees depend on the starting bid. It will cost $0.20 plus $0.35 for gallery image (I recommend the gallery image) with a starting bid of less than $1.00. Total Insertion (listing) fee is only $0.55. You will save money by listing the item at $0.99 and let the bidders bid it up. Then there is final value fee if it sells. More info http://pages.ebay.com/help/sell/fees.html PayPal fees: 2.9% + $0.30 USD. A $1000.00 transaction will cost about $30.00 in PayPal fees.
I sold something on e-bay for $1200 Total fees from e-bay and paypal were in the $65 range, taking roughly 40% of my profit.
Or $19.30. If you become "PayPal Preferred", you will automatically get 1% of your PP fees as an instant cash back (= deposit to your balance), every time you use your PP MasterCard as a credit, not debit, card. That means with signature in person, online, on the phone -- anything but PIN. Your effective PP fees are reduced to 1.9% (for new sellers). http://www.paypal.com/cgi-bin/webscr?cmd=xpt/auctions/PaypalPreferred-outside http://www.paypal.com/cgi-bin/webscr?cmd=_help-ext&eloc=0&loc=3236 Because that card is by far the best way to access your PP account, worldwide, there is probably no logical reason for anyone not to spend a few seconds to become "PP Preferred". Even if you only sell stuff once in a blue moon... you don't need to be an "active seller", contrary to still published eBay rules at the 2nd link above.
If you sell frequently on eBay, I wouldn't use paypal. They are known for locking up people's money for years without any explanation. As a matter of fact, the are facing several lawsuits for this practice. See more info here: http://www.paypalsucks.com/ I actively sell on eBay and no longer use PP.
I use bidpay and have a merchant account. It is a difficult situation. Buyers love paypal. Unfortunately, frequent sellers usually end up hating them. If you have a higher enough volume to justify the costs, I would recommend getting your own merchant account. If not, the only other alternative I would recommend would be bidpay. Bidpay is not great, but it is the most reliable service for sellers. Getting a merchant account would be best. Buyers seem to trust sellers with merchant accounts. I know that sounds weird. I guess a merchant account makes a seller look more legitimate.