Listing on .com Ebay/Paypal conversion rate discrepancies

greeneye

Just going through some recent sales I've had on listings from ebay.com.

Here's an example $180 payment after paypal fees I got $172.68 converts to £85.57 @ paypals exchange rate of 1 US Dollars = 0.495556 Pounds Sterling.

Ebays exchange rate of $172.68 is £87.8399 @ 1 USD = 0.508686 GBP from:
http://pages.ebay.co.uk/services/buyandsell/currencyconverter.html?ssPageName=home:f:f:UK

Not huge but I've just sold over £3000 on ebay.com and it never occurred to me that ebay/paypal would have different exchange rates given they are one and the same.

Lesson learned.

digerati

I always bill my USA sales in USD so no conversion except when I rarely want to transfer some money to a non-USA bank account. PayPal's exchange rate is horrible so you might want to keep your USD funds until you get a decent exchange rate, or transfer it to a good bank (there are a few about) that will exchange it into GBP at a better rate than PayPal's.

greeneye

digerati wrote: »

I always bill my USA sales in USD so no conversion except when I rarely want to transfer some money to a non-USA bank account. PayPal's exchange rate is horrible so you might want to keep your USD funds until you get a decent exchange rate, or transfer it to a good bank (there are a few about) that will exchange it into GBP at a better rate than PayPal's.

So the answer is to have one paypal/bank account set up for .com sales?
Which bank accounts would you reccomend?
Also digerati not at home so can't access my paypal account at the mo (to check normal ebay listings/ paypal payments) but the example I gave above was actually an off ebay sale - guy paid me before I could send a money request. So would I have been better of to send the money request in dollars not convert them and transfer dollars to a bank account with a decent exchange rate?
EDIT: Actually he's Japanese and made the payment in dollars so .....
Is there a setting somewhere in paypal that tells them not to automatically covert incomming dollar payments to sterling and just leave them as dollars in your account?

And also how does this work with euros? 50% of my business is in euros and I've never considered exchange rates to be honest. They just pay and I withdraw but these are listings on .co.uk so probably doesn't apply ?
But I am about to start listing on German/french/italian/spanish ebay sites so I probably need to start considering this?

Why didn't I do a degree in business instead of the silly degree I did do:eek:

digerati

greeneye wrote: »

So the answer is to have one paypal/bank account set up for .com sales?

No need to have a dedicated PayPal account just for USA or USD currency sales.

Login to your PayPal account and under Profile Summary>Currency Balances you select USD and press the Open Balance button at the bottom of the page. Repeat for as many currencies as you want to accept and hold through PayPal. Incoming payments in USD will now stay in USD until you spend the funds to buy in that currency, cash out via USD check or convert to GBP and withdraw to a UK bank account. Several of my banks will convert USD to GBP at the interbank rate without additional fees so they are much cheaper than PayPal. You'll need to ask your banks if they do the same.

greeneye wrote: »

Is there a setting somewhere in paypal that tells them not to automatically covert incomming dollar payments to sterling and just leave them as dollars in your account?

Yes, see above. You'll need to Open Balance in all the currencies you don't want converted. There is also a setting under Profile Summary>Selling Preferences>Payment Receiving Preferences to Block/Accept/Ask Me for payments in currencies in which you don't have a Balance.

greeneye wrote: »

And also how does this work with euros? 50% of my business is in euros and I've never considered exchange rates to be honest. They just pay and I withdraw but these are listings on .co.uk so probably doesn't apply ?

Why use PayPal for Euros? After all there is a free, much more popular option - BIC + IBAN transfer to your UK bank account . No risk of a chargeback or reversal either. Simply give your BIC + IBAN details (which are on your bank statement) to the buyer and request that the transfer use BIC + IBAN, be in Euros with Shared costs. Easy. Fast. FREE!

greeneye wrote: »

But I am about to start listing on German/french/italian/spanish ebay sites so I probably need to start considering this?

Bank transfer (or Überweisung, Transfert bancaire, Transferencia dentro, Trasferimento bancario, etc...) is the standard way of getting paid in Europe. Also be aware that you'll need to list in the local language and be able to answer queries, otherwise it's pretty straightforward. Also be aware that eBay might not be the largest auction market in a country. Ricardo/QXL is significantly larger in many European markets...

greeneye wrote: »

Why didn't I do a degree in business instead of the silly degree I did do

Don't know as I'm not a psychic. I studied at the School of Hard Knocks, University of Life... which prepared me for an interesting time ;-)

greeneye

Digerati your a clever guy/gal. ;+)

As for taking euro payments via bank transfer only tried this once with an Italian. Had listed as paypal only but said OK if she would pay the fees at her end for the transfer. It ended up costing her 30 euros for a £90 payment (I insisted she sent the money in sterling not euros) she said she usually had to pay around 3 euros for european transfers.
She was cool about it and I've done plenty of business wiith her subsequently (via paypal). But I'd pretty much put the idea of europeans paying via bank transfer to bed.

I'm aware that when making transfers the sender has the option of:
Them paying fees/Splitting fees/Reciever incurring fees. But never established what these fees would be for each option.

Is it simply that Natwest is a bad account to have for recieving IBAN payments or did the fact I insisted on sterling affect her costs?
Would be good to find out the best UK account and which option for the sender to select (for fees) when making a transfer.

I'm actually moving to portugal later in the year but was thinking I might keep all my ebay/paypal related stuff with UK banks.

Also got all my listings pre written in languages I need and they are pretty self explanatory but got access to translators if needed. Will check out ricardo/QXL wasn't aware they were big in europe but what I sell only appears to be on ebay from google searches.

digerati

greeneye wrote: »

As for taking euro payments via bank transfer only tried this once with an Italian. Had listed as paypal only but said OK if she would pay the fees at her end for the transfer. It ended up costing her 30 euros for a £90 payment (I insisted she sent the money in sterling not euros) she said she usually had to pay around 3 euros for european transfers. She was cool about it and I've done plenty of business wiith her subsequently (via paypal).

Had she sent you the equivalent to your GBP total in EUR (Euros €) then she would only have paid €3 for the transfer and you would have paid nothing at the UK end. Many in the UK don't understand the ramifications of EU/EEA directive 2560/2001, namely that they can accept bank transfers in Euros from the EU for FREE.

I'm sure most MSEers are thrilled about paying rather hefty fees to PayPal for the privilege of being paid in GBP, and taking on the associated risk of a chargeback, SNAD, etc. (Yes, I'm being sarcastic.)

greeneye wrote: »

I'm aware that when making transfers the sender has the option of: Them paying fees/Splitting fees/Reciever incurring fees. But never established what these fees would be for each option.

Options for SWIFT or BIC transfers are OURS (sender), SHARED (split) or THEIRS (reciever). To qualify for free (or low cost) cross border bank transfers within the EU/EEA, the payment must be in Euros with shared costs and use recipient's BIC + IBAN details - eg. BIC: NWBKGB2L, IBAN: GB29NWBK60161331926819... Costs (if any) will be the same as the corresponding domestic transfer - therefore FREE for most bank accounts in the UK.

greeneye wrote: »

Is it simply that Natwest is a bad account to have for receiving IBAN payments or did the fact I insisted on sterling affect her costs? Would be good to find out the best UK account and which option for the sender to select (for fees) when making a transfer.

You chose wrongly and made the sender incur unnecessary fees. Had she sent the equivalent in Euros you would have received them without deduction; also she would have saved €27. Note that NatWest/RBS charge £1 for an advisory letter of IBAN transfer credit which you can opt out of. Almost any UK bank account can accept BIC + IBAN transfers for FREE. Conversely, as the UK didn't adopt the Euro, there are no cheap banking facilities for sending BIC + IBAN transfers to the Eurozone for free; most UK banks charge between £7 to £30 to make transfers. (I have an EU bank account so I never pay to send BIC + IBAN transfers.)

greeneye wrote: »

Also got all my listings pre written in languages I need and they are pretty self explanatory but got access to translators if needed. Will check out ricardo/QXL wasn't aware they were big in europe but what I sell only appears to be on ebay from google searches.

A good idea is to create a list of FAQs in the different languages so you can answer most Frequently Asked Questions quickly and keep the overhead of dealing with buyer's queries to a minimum.

When selling internationally you need to do loads of research and keep in touch with the target markets to keep abreast of the latest trends and patterns. One market often lags another, so if you see an item - say selling well in the UK, then you can probably list it in other Euro markets that follow UK fashions or trends. Other markets like France sometime more closely follow the US market.

Ricardo/QXL is huge in some markets, but there are other online auction venues out there in the European markets. Also you should check for items on some of the European search engines as they are just as popular as Google.

greeneye

Digerati as always your a star thank you.