If you’re trying to start a home staging business, you might be wondering how you are actually going to get paid. This is one of the important steps in setting up a business – determining whether you’ll take checks, cash and/or credit cards.
The ability to accept credit card payments is appealing to home stagers, especially since the amounts you’re getting paid are usually quite high.
Setting up a merchant account, however, is very expensive. Not only do you have to pay a large sum to the bank just to apply for and then set up the account, you also have to pay a certain amount each month regardless of whether or not you have any transactions. In addition to paying these fixed fees when you do make a sale, they usually get to keep about 5% of it.
I don’t recommend you get your own merchant account, but I do suggest you set up a PayPal account for your business that will allow you to take credit card payments.
PayPal is essentially an online bank that allows you to accept and send payments and transfer funds to your regular business bank account. There are no fees to set it up and there are no monthly costs. If you have a client who also has a PayPal account, they can send money from their own account or they have the option to use their credit card instead. This is an easy and less costly solution then having your own merchant account.
Even if your client doesn’t have their own PayPal account, they can still pay you using a credit card through PayPal.
By the way, it doesn’t matter where you live since you can choose the currency you want to use when you set up your account. But beware of switching your PayPal balance between different currencies. Their rates are awful! This is not an issue if you’re doing all your business in one country.
Of course, PayPal will keep a percentage of your sales, but it’s roughly what you’d be paying for your own merchant account through the bank to accept credit card payments. In some cases PayPal takes an even smaller percentage of sales than your bank would with a normal merchant account. But because there are no set up or monthly fees to worry about, I feel it’s less costly to go this route.
Cash is king and if you can get your clients to pay by cash or check you get to keep all your sales rather than giving a percentage over to a bank or PayPal. So that’s always the best route in my opinion.
Home stagers, what has your experience been with using PayPal to accept payments? Or have you been using one of those costly merchant accounts to accept credit card payments? Please share your experiences by leaving a comment below.
Debra,
You must have read my mind. I was just thinking about this this morning. I think that it’s an important service to offer.
I have had a paypal account for some time so I’m going to look into the merchant services.
I noticed that you can add a button to your website for gift vouchers. Could be a good option for Real Estate Agents.
I was checking with Costco. It looks like they are offering some better rates and are possibly even providing the machine this month. I will compare their rate to pay pal and report back.
I love Costco and already have the business level card ($100/year).
A timely post! I use Paypal as well. It’s the most cost effective way when starting out. I love to get checks (or cash), but realize that my clients need an option for using their CC and deferring thier costs.
Paypal is also good for selling your goods, ebooks and other info products online. Makes it easy and secure for people to purchase! I use it for my ebooks, and NatureArt.
I’ve been using PayPal since I started my business and I think it’s great. I just send my customer a PayPal Email Invoice for my services, they pick it up from their inbox, and make their credit card payment in a few easy steps. The PayPal reports I can generate are handy too. Especially at year end tax time.
I always offer my clients the option to pay with credit by using PayPal; however, that said I also always state on the invoice the fact of the extra 5% required by PayPal for the convenience of using credit. To date, all have come up with cash in light of this information.
Great suggestions all, but especially Patricia passing on the extra cost of using a charge card!
Thanks for this information! Online business services saves your time!! The main benefit to each customer is convenience.
Too funny. I just signed up for PayPal’s merchant account yesterday after doing extensive research into the best option that won’t break my bank account. It was a tossup between that and Quickbooks Merchant Services.
I had initially used a different merchant account provider but their fees and costs were too high.
I already had a PayPal account so I’ll see how this goes.
Thanks Debra for yet another great tip!
Kathi Howland
Nicole Interiors Home Staging
Kathi, you’re welcome. Glad I could help!
Thanks for publishing this article. Very helpful for us newbies.
Glad you found it helpful Loi! I think you’ll enjoy this category of articles Home Staging Business Dilemma, there’s lots of good stuff in there!