Using Paypal is fine if you're talking about a small store with a very limited product selection. In other words... you're just getting your feet wet. But to really be seen as a legitimate retailer, you'll need to accept more than Paypal.

When you just start out, you won't be able to negotiate for very good rates. You'll have to take what's out there... and be careful going for any merchant offering you rates significantly lower than others... there's definitely a catch. And when looking at the rates... really study them... the most important rate is what is the most expensive rate i the proposal (usually business and affinity cards). That's the rate that matters.