Thursday, October 9, 2014

Storenvy Removing Paypal from Checkout Options?

Note: This post has been updated in certain sections.

Today I received some unsettling news: soon Storenvy will no longer allow customers to checkout with Paypal and is switching to Stripe.

To say I'm disappointed is an understatement.  To fully understand why I'm upset about this change here's a little background first.  I have had a Storenvy shop for several months now to sell my polishes after seeing it so widely used through several Facebook polish sale groups I belong to.  I've had a great experience with Storenvy as a seller because with little to no advertising I have sold more polishes in a short time than I ever did in my previous attempts through my blog sale or Live Journal.  With Storenvy there is no email back and forth for several days before the transaction goes through, no invoicing through Paypal, no emails expressing interest when ultimately the person disappears (it's understandable but as a seller it can be frustrating), etc.  It's a simple and seamless way to sell off polishes I don't need.

Right now selling on Storenvy is really supplementing my income and I make my situation work especially now that I have a Paypal debit card where I can instantly transfer funds from my Paypal balance to my debit card as soon as a sale comes in.  From there I can use my  debit card anywhere and for whatever I want.  I also use my Paypal balance from these sales when I do allow myself to splurge on new polish though that is rare.  Getting paid through Paypal is how I'm living right now and it's vitally important I have access to my funds immediately if I need them.

However, now that Storenvy has announced "Stripe is soon going to be the only payment system available for stores to use on the marketplace" I have to seriously consider other options of where to list my polish sale.

For those of you who don't sell on Storenvy, there are two ways transactions go through with a seller--as a marketplace sale and as a custom shop sale.

Here is the custom shop URL for example:

The Marketplace shop is a URL that looks like this:

As I understand it sales made through the first link, the custom shop link, there is no fee to the seller.  Sales made through the second link, the marketplace shop, there is a fee Storenvy charges though I cannot seem to find anywhere what the rate is, if it's a percentage of the sale, if it's a flat fee etc. When Googling, I find articles from when Storenvy first announced the fees but the pages only use the ambiguous and slightly ominous term "soon" in regards to them, not unlike their usage of the word regarding when Stripe will be forced on sellers.

Did they take their cue from this guy?

According to an article seen here "Founder and CEO Jon Crawford says it will be a 'modest amount, less than any retail markup,' likely less than 15%."  But keep in mind that article was posted January 13, 2014.  We're approaching mid-October 2014 here and no clear and mapped out announcement of what fees may be charged to my knowledge has been released.

Again, Storenvy's email says Stripe will be the only system available for stores to use on the marketplace and we've established there is a difference between custom shop transactions and marketplace transactions.  During the discussion on (The Nearly No Rules) Nail Polish Sales group on Facebook someone mentioned the possibility of Paypal as a payment method still being allowed on custom shop transactions.  While I sincerely hope that is the case I'm not sure I could see Storenvy electing that option.

According to several sites about Stripe one of the "pros" of using Stripe is there is no redirecting to another site (like Paypal) with the site's branding and having the customer input their information there. If the goal of switching to Stripe is to avoid the redirect and having to go through Paypal then why would it be allowable on some transactions and not others? The logic isn't there. Secondly, despite my only advertising using the custom store URL and attaching a coupon code to the post so I can track it's effectiveness the vast majority of my sales (including the ones with that coupon code) are marketplace sales.  Sure, it is possible that after clicking on the custom store URL the buyer then clicked on the Marketplace Store link at the bottom of the page but statistics show browsers who turn to buyers prefer to click as few times as possible.  Again, it's not very logical to be presented with the full inventory of a shop but deciding to click another link and be given a different view that doesn't even mark whether the listing is sold out or not.  <---That is a minor design flaw that seems to bug people--marketplace stores don't show if an item is sold out unless you go to that particular listing.  So this makes me wonder if all the transactions labeled as marketplace are legitimate and if not, how much of my income will be affected if Storenvy did decide to allow customers to use Paypal only for custom shop sales.

So about getting paid.  Per Stripe's website, there is a rolling 7-day turnaround to receive payments in a user's bank account. That is painful. In their defense, Stripe has begun to address this problem by offering a rolling two-business-day transfer schedule in the US to most users.  I do wonder who "most users" refer to.  Does the user have to have $X in sales per month/year/whatever?  Keep in mind however if this turnaround time conflicts with a weekend or holiday or (I'm guessing) if your bank takes a while with deposits it will affect how long until your funds are actually available.

Why is this a bad thing aside from you not getting your money when you need it?  There is the potential of adding a needless delay in shipping.  You're waiting for funds to be deposited into your bank account so you can pay for the postage for the order which causes the customer to wait several extra days until they receive a shipping notice.  Shipping times can be extremely important, especially with the holidays approaching and not all shop owners have enough sales to cover upcoming shipping costs before a sale is made.  This is especially true in regards to the higher costs involved with shipping internationally.

This brings me to my next question for this change.  How will buying and printing postage work? When I get an order all I have to do is weigh it, go to Paypal then buy and print the postage directly through Paypal.  This method sends a notification directly to the buyer and I also send a second shipping notice with the delivery confirmation number through Storenvy so there are two accounts of me shipping the order.  It's really easy, takes only a few minutes and is beneficial for both the buyer and me.  Some people may ask "Why don't you buy your postage at the post office?"  One: the cost of postage at a physical USPS store can be $1 and up more expensive and it adds up if you have a lot of packages to send out (plus I don't want to pass that cost along to my customers) and two: I absolutely loathe my local post office for many reasons, mostly customer service and will not go there for anything more than dropping off packages if I can help it.

So there you have it.  I know that's a lot of information so here's the TL;DR of it:
  • Some shop owners are considering leaving Storenvy because Storenvy seems to be taking away Paypal as a payment method.
  • Storenvy will be switching to Stripe which will need your SSN and bank account information to receive funds from sales but possibly only ones labeled as marketplace sales.
  • Transferring funds from these sales can take either 7-business-days or if you fall under the category of "most users" (and I don't have the criteria for this either) you could get funds in 2-business-days--weekends, holidays and your own financial institution's rules regarding transfers aside.
  • There may be more but I forget.
What do you guys think about this change?  As a buyer will using your credit card instead of Paypal deter you from buying on Store Envy?  As a seller do you like the new Stripe system?

A comment in the Storenvy Community Facebook group has suggested sellers would no longer receive marketplace sales unless the seller signs up for Stripe.  I didn't read it that way but looking at the language used in the original email particularly "...we want to make don't miss out on any future orders!" it makes sense.  I honestly didn't read it that way and apparently I wasn't the only one.  But again as someone who receives a vast majority of orders marked as marketplace sales this still severely affects me and others who are in the same boat.  Also the marketplace is currently used as an incentive for sellers to open a shop on Storenvy.  To me the image of Storenvy and the Marketplace is that it's one big indie community out for the little guy and small business.  It's a more personal take on online buying and selling with a huge emphasis on being accessible to a wide variety of fun, interesting, modern, bohemian and unusual brands that people wouldn't find while on their trip to their local mainstream mall. To take that away if they don't want to use the Stripe system seems unfair.

UPDATE 1/28/2015:
Now that Stripe has launched I've written a new post that breaks down what the Marketplace and Stripe are as well as how it affects customers and sellers.  Make sure you read that post here.

1 comment:

  1. I'm storenvy shop owner and I am leaving Storenvy since stripe doesn't support my country. I don't have friends in US to cooperate with me open a stripe account and still using storenvy marketplace. I hate it, but I admit that I can't no anything.

    I hope someday there will be marketplace like etsy and ebay for small business.

    Do you have review about Luulla? iOffer? Bonanza? Wanelo?