Should that be multiply like fruit flies? Hmm.
Yesterday I wrote:
PayPal are not following accepted industry procedures or risk standards. I have been told that when PayPal have all the planned reserve accounts in place on eBay they will be requiring them on websites.
Low Hanging Fruit
Also yesterday, I read on the PayPal Blog how happy and excited they are that JP Morgan did an in-depth report on PayPal. Communications Specialist Anuj says
“It’s great to see that J.P. Morgan believes in PayPal’s ability to continue our phenomenal grow (sic) as an alternative payment platform. They believe the business could be worth around $9 billion by 2011 (based on $4 billion revenue). You can check out the full report here.”
Here is a little screen shot from the PayPal blog..
One of Auntie May’s favorite aphorisms is
“The fruit seldom falls far from the tree”
PayPal being fruit of the eBay tree it is interesting but not surprising to see that ‘BaySpeak is spoke’ there too. Here is the whole quote from the JP Morgan study (bolding is mine).
Increasing on-eBay penetration remains a driver. The maturation of
PayPal in international markets can be a key catalyst for increasing penetration, as the low-hanging fruit on the domestic site has largely been picked. Further, expanding credit offerings to make PayPal a viable option for higher-ticket items can help offset sluggish GMV growth.
I wonder how eBay sellers listing on the US site like being referred to by an analyst as low hanging fruit? Easy pickings are you?
Wisegeek.com says “In business, sales professionals, especially those who are just entering the field, are encouraged to seek out the easiest customers first, which sales managers may call low hanging fruit. Competitors may spend more of their time seeking out the higher commission sales of higher “customer branches”, leaving the low hanging fruit behind for others to claim.
But low hanging fruit can also be seen as a negative, since the picker understands how low the quality of the fruit can be and picks it anyway. Someone who consistently chooses the immediate gratification of low hanging fruit could be seen by others as lazy or unambitious.
Critics of the low hanging fruit business model point to the examples of real fruit harvesters. Orchard workers routinely begin picking at the highest point of a tree, where the fruit has been exposed to the most sunlight and is usually the ripest. It makes sense to pick the low hanging fruit last, since it requires more time to ripen. In a business or social sense, it also makes sense to avoid low hanging fruit if a little more effort and time would result in a much better payoff.”
Fruit falling from the tree
I found this in the comments on eBay INK Blog, please note that Michael says he does NOT sell on eBay, he operates his own independent website Air Beds Unlimited using PayPal Payment Pro.
Rotten fruit makes a bitter harvest
A bitter harvest indeed, especially for our Canadian colleagues who simply do not have the choices we US based sellers do. If any Canadian readers know links to applicable Regulatory Agencies in Canada I would appreciate your sharing in the comments.
I believe that PayPal have forgotten that they are not a bank in the USA, that they are licensed as money transmitters in most states. PayPal is not even a Merchant Account Processor, they are merely a payment gateway, the middleman, there is a big difference. Keywords in Michael’s comment 20% - 60 days. Not exactly the 5% for 30 days mentioned by Chris Brown in his PayPal Blog post dated June 8th 2009.
There are things that you as an independent website operator can do to remind them of that. You can find more information here.
Up to you! Sit and wait for the man with the chopper to come and chop off your head or do something to cut them off at the knees instead.
Y’all come back!
As a bruised and fallen “canadian” fruit, I am sorry to say that we are not in as responsive a “state” as you U.S. citizens are. I fear that talking with any gov’t up here is useless. We never did fight for our freedom, and are still “british subjects”, that should say it all.
Our only choice is simple, today we trade off paypal for a bank, another day a bank for a merchant account provider, try to use encrypted card-readers for in-house sales (like smartswipe), and generally muddle along. Our government is more concerned with using eBay and Paypal to track down sales taxes than with how they handle money. Even Canada Post has sold out to eBay offering special discounts ONLY available to ebay sellers online at ebay. (thus ebay makes money on the sales of boxes, AND on shipping, AND on sales, AND on sales taxes — eBay uses the Canadian gov’t lackey, not the other way around).
Actually, we live in “suckerland” I think. eBay, Bell Canada, Rogers, all have their way with us, and like loyal british subjects we “smile and wave”.
But, hey, it’s home. We don’t expect much from it, a simple living is enough.
Luckily, with a solid B&M operation, we can bow out of online sales if required.
Cheers.
Posted by vince jelenic on July 5th, 2009.
I’m still on the hunt for a good payments system, alternative to POS terminals and paypal.
in today’s installment, came across intenetsecure.com, a canadian cc processor, takes online merchant accounts.
To my surprise this is one of the clauses on sign-up.
https://www.internetsecure.com/AppForm.asp
RMRF
Rolling Merchant Reserve Fund, if required, will be assessed during the underwriting process.
Led me to thinking.
Perhaps the hoopla over paypal coming in and applying rolling reserves now on businesses is because they didn’t perform any form of “underwriting” in the past? Of course internetsecure reserves the right to “review” the underwriting status of any business in future, at their sole discretion.
There are two simple rules governing behaviour.
1. Take something away from someone and they will appreciate it so much more when it is returned to them. (example: screw around with listings and titles on a sales venue, break sales, fix it, then get accolades for such prompt service and attention to customers)
2. Apply any new rules or restrictions on a previously unfettered service, or good, and watch the sparks fly.
(example, hard to get a user to buy a service they once had for free)
My guess is the backlash on paypal’s reserves amounts to rule 2 being applied. Won’t we all be so much happier when rule 1 gets re-applied? I’m betting on that.
I dunno, maybe just me, but I don’t see many “good guys” out there, just a choice between bad ones. I don’t see paypal’s moves as overly bad, in general.
cheers.
Vince.
Posted by vince jelenic on July 17th, 2009.