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    <p>Your problem is that your step 3 doesn't really make sense. Let me explain.</p> <ul> <li><p>In your step 2, above, as you probably know, you can only really give the customer a good shipping estimate when a delivery address is given. Until then, your estimate won't be as tight.</p></li> <li><p>In your step 3, a payment processor (such as Paypal or Google Checkout) will adjust the order total based on shipping costs. (The details vary, see below for a Google Checkout example.)</p></li> <li><p>After your step 3 is completed, this will complete the order. The processor will report back to your website saying the order is complete with the details. Your site does any final processing. (Your question above says "the customer may choose a different shipping country and therefore a higher or lower shipping cost may be paid" but this does not make sense to me. At this point, the order is <strong>done</strong> -- your site should <strong>not</strong> allow the user to change the shipping address -- unless the user wants to <em>cancel the order entirely</em>.)</p></li> </ul> <h3>Google Checkout</h3> <p>As for details, the Google Checkout API documentation offers many options you will be interested in. Read the "Shipping and Digital Delivery" section of the <a href="https://developers.google.com/checkout/developer/Google_Checkout_XML_API" rel="nofollow">Google Checkout XML API Developer's Guide</a>. These are the two that I think are most relevant:</p> <blockquote> <ol> <li><p>Merchant-calculated shipping - For merchant-calculated shipping, you must operate a web service that calculates and returns shipping costs. Google Checkout will send your service a request containing the buyer's shipping address, the items in the order and the shipping methods that you offer. (You would have previously sent the items and shipping methods to Google in a Checkout API request.) Your web service then calculates the shipping cost for each shipping method and returns that information to Google.</p></li> <li><p>Carrier-calculated shipping - For carrier-calculated shipping methods, you identify one or more FedEx, UPS or USPS shipping methods that you offer. Google will then dynamically calculate the shipping cost for each option based on the total weight of the items in your shopping cart. The carrier-calculated shipping document defines the specific shipping methods that Google supports for each of these carriers. For carrier-calculated shipping options, the default shipping cost is only used if Google fails in its attempt to obtain the carrier's shipping rates.</p></li> </ol> </blockquote> <p>Refer to the documentation for full details. I would hope that option 2 works -- it seems to involve considerably less custom development work.</p> <h3>Paypal</h3> <p>Going through Paypal's docs is rather obtuse in comparison with Google Checkout's. So I'm going to point you in the right direction, but I'm not going to dig through all of it in detail just for you. Check out: <a href="https://www.paypal.com/cgi-bin/webscr?cmd=xpt/Marketing/shipping/EasyCalculateShipAndTax-outside" rel="nofollow">Calculate shipping and taxes</a></p> <h3>Don't Forget Taxes</h3> <p>Bonus Material! Taxes can also vary based on the shipping location. Payment services have documentation that shows you how to do this.</p>
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    1. POPaypal: how to update shipping costs after the payment, as done by Etsy?
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    1. USDavid J.
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    1. COHi James, what you state above is incorrect. According to the paypal express documentation, after the payment authorisation the user is redirected back to the merchant website. The merchant website then take care of issuing the payment capture request. The captured amount may be different from the authorised. See here and also try to test Etsy to see how it works: https://cms.paypal.com/us/cgi-bin/?cmd=_render-content&content_ID=developer/e_howto_api_ECGettingStarted
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    2. COI agree that Google Checkout is better than PayPal. Unfortunately is not the best to setup a marketplace such as Etsy given that a basic requirement is that the merchant is located either in US or UK, which intact is not usually the case
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    3. COOk, I see -- yes, my answer above was simplified and did not account for steps (6) and (7) in the [PayPal Express Checkout execution flow](https://cms.paypal.com/cms_content/US/en_US/images/developer/SandboxECUX.gif).
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