Topic: Interesting conversation with a retailer who formerly accepted Bitcoin - page 6. (Read 20153 times)

this is a old post from Bitcoin > Project Development > Post reply ( Re: CoinHub - for business, that accepts bitcoins (shop plugin, safe wallet, trades) )

I have created a crowd-funding project for this at PMF that anyone can donate to

http://www.piratemyfilm.com/projects/378

using one BitPay merchant to help another!

To participate, you can reserve (pledge) shares.  All donations will be collected once the goal is reached.

Can't argue with your figures.  Even if you added a surcharge for BTC payments (and your customers were willing to pay it), the business case for switching cart vendors or developing your own solution to support BTC payments just isn't there.  If there was a straight forward/low risk way for you to hedge your BTC exposure, you could handle the transactions manually...but sadly no such mechanism exists (that I' aware of).  Maybe bit-pay or another BTC payment processor will develop a plug-in for 3dCart...


HAR!  (we all knew that, cos you didn't capitalize the "t" in the first word of the last sentence in the first paragraph in your last post)  


I'd throw some bucks at that...can I donate via Pay-Pal?

Guys, what about creating a donation fund for bit-pay to hire developer who will integrate support for their API for 3dcart?

Yes, but HOW... I would either need to shift my whole cart to a new platform, or do everything by hand (and still pay the exchange fees). Both increase costs. taking bit-pay as an example I only save .59% over pay-pal (16 cents on the average transaction.)

Lets say that I could change carts (or hire a developer) for $5,000. Our average sale is around that 27 dollars I used in the example.  It would take 31,250 bit coin sales to JUST BREAK EVEN! That would take years, even if every transaction that we took shifted to bitcoins. If I processed ten bitcoin transactions a day, it would take 8.6 years to break even. And when I was taking bitcoins last year, I had about 2 a week which would take 300 years!

Even if it just cost me $1,000 to implement bit-pays automated solution it would not be worth it.

Lets look at the math doing it by hand with gift cards... Again, on the average transaction using bit-pay I save .16 cents. So someone I pay $10 an hour would have to be able to get the email notifying us of a bitcoin sale, go into our shopping cart software create the gift card (then sell the gift card from our online store into our POS system so that when we ring up the sale of the goods there is a way to pay for it in POS) and then write an email to the person with their gift card number in there... all in under 1 min... and thats just to "break even".

Bit-pay is a more expensive way to do it, I would not use them unless it was automated, if im going to be doing things by hand anyway, i might as well use a cheaper solution... but as the person pointed out before, there is no real good solution... as mtgox is cheap, but can take two weeks to send the money! I will contact bit-pay and see if they have any interest in developing a 3dcart plug-in-play solution.

EDIT: But maybe im just too emotional to see the true value in bit coins

Looks like the cavalry showed.  

You bit-pay guys keep on keepin on.  The 10+ year adoption assumption is wrong, and y'all will kick it to the curb.



(since I've become an unpaid bit-pay shill, you guys should send me a key chain or sumpthin...thanks in advance)

He mentioned 3dcart - I'm assuming it's this: http://www.3dcart.com/

EDIT: It looks like it actually integrates or plugs in directly to QB, which is actually pretty cool.

Does he take credit cards? If so, he's giving up about 2% of his revenue on every single transaction. If,say, the risk of a 50% loss is 1 in 30 (and it's nowhere near that high), that's equivalent to a 1.7% fee. He's still better off taking Bitcoins than credit cards.

Of course, in reality, the chance of an increase in value pretty much balances out the risk of a decrease in value. If you want essentially zero risk, Tony provides that service.

@nmteaco - what shopping cart are you using?

While we can eliminate the risk of fraud, we do introduce the risk of currency volatility.  So right now we can't get our fees down as low as we would like, but hopefully as the BTC exchanges become more stable we can reduce our fees even lower.  

We can put a direct deposit into a US bank account every day, just like every credit card processor does.  We hold no reserves and money is delivered overnight ACH.  Email me if you need any help since I don't get on the forums as much as I used to.  [email protected]

The current problem is that MtGox has a very long delay on Dwolla transfers. You also have to go through an arduous verification process, and the wait time is 7-14 days and sometimes longer.

https://paysius.com/ has lower fees then Bit-pay, and they pay out to Dwolla, but they also don't support your cart (although there is a php library available). Bit-pay actually pays out via ACH, and actually bypasses Dwolla completely.

I think the current state of merchant providers is that they just need some adoption and growth, and with that we might start to see more extensive cart support, lower fees, and so forth. For a business that can't be guaranteed a revenue stream from Bitcoining nerds, it may not be worthwhile to set up in the first place, but the more places that accept it, the more the word gets out on the street. It's a chicken and egg problem, and it may be 10 years or more before Bitcoin truly becomes mainstream.

That is great! Both in terms of hearing im doing it right, and the currency joke.



Real Transaction Example from a sale accepted though paypal:

Total: $27.77 sale

Fees:
Paypal: .91 cents (3.28%)

Example of accepting with bitcoin and cashing out at the same bitcoin value:

Bit-pay: .75 cents (2.69%)

MTgox and Dwolla (I used them before; .6% for mtgox and .25 cents for dwolla: .27 cents (.97%)

To me it seems like mtgox and dwolla offer a compelling reason to accept bitcoins. (If you are willing to play the market a bit, you might be able to cash out such as to wipe out the fees incurred.) EskimoBob, there is another reason to accept them, beyond being cheap(er) money transfer, and thats the marketing aspect. If I am the ONLY place in the world you can buy tea with bitcoins, thats potentially a bit deal.

So the only hurtle I have at this point is easy integration into my shopping cart. This is something that authroize.net and paypal have been very good at...

What I did last time was sell giftcards to our store by hand basically. You would send me bitcoins, and I would send you a giftcard code worth the dollar amount of the bitcoins you sent, in essence acting like an exchange myself.

If I decided to do this again, what services would you all suggest and trust? what is the communities opinion of mtgox right now? Is it to much hassle buying gift cards, then waiting until I am able to check my email and create them in our system? (It would seem having it automated is out of the scope of possibility, I dont have enough technical skill to write plugins for my shopping cart).

+1

I concur.



In a nutshell: Sell the points that are important to the merchant, not the points that are important to yourself.

If you are in the business of selling socks and underwear, odds are you care nothing for philosophical and ideological advantages.

If you wan some business to accept BTC, DO NOT! tell them that BTC is a "blaa blaa new currency" but talk about it as a way to transfer currency for 1/10-100th of a cost thy pay for CC, DC etc payments now. Do you know what 5 USD or EUR card payment will cost to a merchant? Find out and weep! 
This "new internet currency" bull shit as to the biggest PR fuck up ever for BTC.
 
 If they get worried about btc-fiat exchange rate, introduce them to a service, that virtually eliminates this risk.
BTC is a low cost and secure way to transfer money with out banks, domestically or internationally.

I think my last post might've given you the wrong impression on a couple of things...

First, I know a little accounting.  I can say with 100% certainty that your handling of BTC transactions within Quickbooks is entirely correct, and I certainly didn't mean to imply otherwise.  What I found humorous was that you happened to represent BTC in your system with Z$ - a currency that was fairly valuable when it was introduced, but was eventually abandoned after hyperinflation made it worthless.  I figured your rationale for choosing Z$ as your BTC proxy had nothing to do with the currency's history, I just found it to be an amusing coincidence.

Second, my use of the term "Magic Computer Money" is nothing more than a reference to a rather silly thread on another part of the forum.

Finally, my inquiry about your accountant was strictly a matter of my own curiosity about his/her reaction to seeing BTC transactions on your books.  None of the CPAs I've spoken with have heard a thing about bitcoin.
_____________________________

IMO bit-pay is a real bright spot in the bitcoin universe.  Too bad they currently lack a plugin for your site's cart software. 

Anyways, thanks again for sharing your thoughts/experiences here.   

Some people buy items with bitcoins that they wouldn't otherwise buy, because they are trying to promote an ideology or bootstrap a microeconomy. Were I a merchant, I would accept bitcoin and post on this forum, simply because it's great advertising.

My take: non-reversible transactions are bitcoin's number one selling point to merchants. I plan to have a product to sell in coming months, and for the reason above, I will not be accepting paypal. I don't want to risk a chargeback with the low margins I will have, especially one 4 months after the transaction. Bitcoin, if nothing else, is THE solution to chargebacks.

Edit: 2nd paragraph has already been addressed...

In 6 years of business I have had one charge back for $35 dollars. (And that was from a sale in my brick and mortar (frame stucco) store ) Thats MY business, I know some other merchants might be dealing with more high risk customers. And maybe for them charge backs are a huge issue, at which point the value proposition for this whole thing would be completely different. I know the talk of the town last year was selling drugs with bitcoin and money laundering.

On a more esoteric level about charge backs (and maybe why I have not had many). I am trying to build good relationships with my customers. If I have a customer who wants their money back, its not an issue of their "power" to demand it back, and my "power" to say no... Its a matter of, "in most instances the customer is right", and he or she gets their money back regardless of if its bitcoin or dollars.

You forgot the most important detail of them all, one I left out on purpose: no chargebacks!
That little detail makes it so much different from Credit Cards/Paypal, and on the long run it will save you money for sure, thus increasing your profit margin.

Ofcourse I have no idea if you have problems and lost profit because of chargebacks.

Yes, though of course bitcoin created those problems in the first place. So its basically making it equal to a credit card, both in terms of price and convenience. Which then of course begs the question I brought up in my early post "why bother at all?". How many new customers would want my product enough to buy it with bitcoins, but not want it enough to buy it with dollars? (especially because there is no market pressure, you cant buy tea elsewhere with bit-coins *that I know about*)

If all else is equal, im geeky enough to want to implement it just for fun and to promote a cool idea... but the larger question here is "why are more merchants not adopting this"... I think its pretty clear.

Bingo!
Well, they take the volatility risk and the accounting nightmare(?) from your shoulders, so that's got to be worth something. Right?