On Wed, 16 Apr 2003, Olin Lathrop wrote:

> It sounds like from what you are saying and what I've uncovered so far
> that setting up a full merchant account, shopping cart, web credit card
> validation and related infrastructure it out of reach for a small volume
> seller.

Hence the popularity of PayPal and eBay.

> I rather expected this, but also figured there would be
> businesses out there that service exactly this niche.  One entity could
> set up all that stuff once, then charge a percentage to let others sell
> items thru them.  Incremental setup for an additional seller would be much
> less, and carrying costs would be small because just about all work is per
> sale.  It would seem to me (naively, very likely) that charging something
> like $.50 per sale plus %10 of sale price would be profitable.  Perhaps
> there are very good reasons this is not possible?

I think things are changing, but for one thing if you get a merchant
account your merchant agreement will probably specifically prohibit you
from processing transactions for anyone else.  Also, think about this: If
I process credit card transactions for you, and you cheat the customers,
they will gete their money back from ME, not you, and I'm out the money.
Likewise if a customer decides to cheat you with a fradulent or stolen
card or whatever, I'm out the money - not you, unless you're nice enough
to reimburse me.  If you're in another state or if you are insolvent, too
bad for me.  So there's got to be a LOT of volume to make it worth me
putting up with all the fraud & theft losses.

I have seen many web hosting sites that will do the whole hosting,
shopping cart, etc AND get you set up with a merchant account for a few
hundred bucks startup plus $80-100 per month.  I haven't tried any, I just
use PayPal and have an order form the customer can print and mail with a
check or money order.  If I had a merchant account I'd let them FAX it to
me with their card information.

Dale
--
It's a thankless job, but I've got a lot of Karma to burn off.

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