# online store rates.... percentages/etc..



## Binary01 (Jun 2, 2007)

i found this online store that charges 35% per piece for commission and $30 a month for "space rental" and they dont cut you a check for your good until the end of the month...... so you have to send out product and wait for payment for an online purchase...... i dont really like that concept....plus the high commission...... 

you think this is worth the wait/etc.........

i would think that if it was an online order than you should get your money before you ship....

plus it's not like the online store is stocking your goods so why the high rate for commision?

any pros/cons?


----------



## 'cia (Aug 18, 2006)

To better answer your questions and understand the issues, it might help if you gave us the name of the online "service provider" to whom you are referring. 

What services and merchandise will the company provide? From your description, it would appear to be nothing beyond taking your money. 

If you use a fulfillment service (they're all a little different, but in general and for the sake of simplicity) they have stock blank merchandise on to which your custom artwork is printed. They handle payment processing, shipping and returns. Your commission is the difference between the wholesale cost to you and your markup to your customer. You are paid when the sale is final (processed, paid, shipped, and not returned). Some fulfillment providers will give you server space to set up your "shop" at no charge or a small fee. 

With an independent website, you stock your merchandise, pay for web development and server space, you set up a payment processor and gateway which can be as simple as PayPal (an all in one) or use a merchant services provider to process credit card, debit transactions. 

You receive payment for your product at the point of sale. Keep in mind; you must spell out the terms of sale and your return policy. So technically, you aren't paid until after the return window closes. 

Almost all payment processors will charge a transaction fee. I think PayPal charges $0.30 plus 1% if your volume is low and you don't rent the credit card terminal to handle point of sale purchases. In other words, PayPal handles all the paperwork. A merchant account will run about $35.00 per month plus a per transaction fee. As sales are processed, the money is immediately deposited into your business bank account.

Let us know what you’re trying to accomplish and you’ll receive more explicit information.


----------



## Binary01 (Jun 2, 2007)

not sure if i can list the site but basically all they are is an online store...thats it...... product comes from me and i ship it to the buyer...... so the online store is just the middle man/woman.......... 

pm me if curious for store site.....

b


----------



## seibei (Mar 17, 2006)

sounds like the karmaloop kazbah, but maybe I'm wrong.

other things you have to factor in: with online stores, you're getting additional exposure (particularly if it's a prominent store like the Kazbah). A 35% cut in a situation like this is pretty standard; it's just up to you to decide whether it's worth it or not. A $30 monthly fee is probably worth it; that can be made back in a small amount of sales, even with the 35% off the top. 

Also, if you're selling things wholesale, you often sell to a store on credit terms, so you won't get your cut until a month or so after you send the goods - it's just the name of the game.


----------



## Binary01 (Jun 2, 2007)

bingo......................


----------



## Rodney (Nov 3, 2004)

237am said:


> not sure if i can list the site but basically all they are is an online store...thats it...... product comes from me and i ship it to the buyer...... so the online store is just the middle man/woman..........
> 
> pm me if curious for store site.....
> 
> b


There's no reason you can't mention the site as long as you don't own it


----------



## Binary01 (Jun 2, 2007)

it was the karmaloop site... i can understand that the site gets alot of hits....so they say....but i think the commission rate is really high for not doing anything...plus the method of payment too... b


----------



## seibei (Mar 17, 2006)

I figure, if you get in, there's no harm in giving it a shot. The initial contract is six months, and it's a lot of exposure. good luck!


----------



## gccarr8 (May 8, 2007)

It took me a minute to understand their rationale, but this is not a bad concept at all...Think about it. For instance, if John is selling shirts for $10 to retailers, it cost him $5 to make, and the retailer sells it for $20. John profits about $5, which is not bad, but not great either. If John on the other hand, gives merchandise to Karmaloop to sell, they would take $7, and John makes off like a bandit with $13 in his pocket (to what I understand). If you are confident in your product, the $30 monthly fee should not be a problem, plus your product will be displayed in a venue that gets several thousand hits per day. Hey Karmaloop....I'm looking for my cut! (LOL)


----------

