To see part #1, click here: http://ilovekawaiiness.blogspot.com/2012/03/etsy-how-to-paypal-shipping-part-1.html
If you're a high-volume seller, I highly suggest you look into buying a Dymo labelwriter. I bought a Dymo 450 Turbo for $70 including shipping off Ebay in December 2011 and I absolutely love it! It totally rocks! They usually retail about $129.99, but you can occasionally find them on sale at Staples, Office Max, or other office supply stores.
It's very easy to use, I just installed the drivers using the included CD, plugged it in, attached the USB cord to my laptop and it was ready to go. I use it to print my Paypal shipping labels and it's cut down on so much time I use to waste on cutting and taping labels. Just a note, I'm on a Macbook and Paypal doesn't officially support labelwriters for Macs. If you try to print out a label using a labelwriter on a Mac, the label is in the wrong orientation. But never fear, there's a fix! I'm using a workaround that a fellow Etsy member found:
About the workaround:
You have to install a virtual printer (CUPS) that allows Paypal to bypass the instant print feature and gives you the chance to turn the label image to portrait.
After you install it, switch your label printer in Paypal to the DYMO 330 Turbo (which works even if you have a Dymo 450 Turbo) and change your default printer in your system preferences to PDFWRITER (CUPS). This allows you to send the print job to a folder where you can open it in Preview and then print using the DYMO printer and the proper label size. Disable the "auto rotate" and switch the orientation, and voila!As for my labels, I buy the 99019 labels from Amazon. The off-brand that I use currently comes as a roll of 150 for $5.25, and I get free shipping since I have an Amazon Prime membership. They work just as well as the official Dymo labels (which retail for $19.99 for 150).
Paypal rolled out the ability to print USPS first-class international shipping labels back in November 2011, but there were tons of glitches and problems, so they took it away to tweak it. Rumor had they would re-release the program in January 2012 but it's now March 2012 and I still haven't heard anything, unfortunately. Paypal currently only allows you to print shipping labels for USPS priority and express international packages. In the meantime, you can use the USPS Shipping Assistant if you have a PC; unfortunately it's not available for Mac users at this time. It'll print out the customs form + label for you and you just need to add postage. If you want to avoid the line and your post office has a self-service (APC) machine, you can purchase the stamp there and drop it off, easy peasy!
UPDATE: As of April 2013, Etsy now allows any US sellers who accept Paypal or Direct Checkout payments to print USPS Shipping Labels through a partnership with Endicia! This includes USPS first-class international packages, priority regional rate boxes, and priority flat-rate padded envelopes, all of which are options that are missing from Paypal. Here's a link to the FAQ about Etsy shipping labels: https://www.etsy.com/help/article/3107.
Buy in bulk and save! I've bought all of my bubble mailers so far from justpoundsandounces on Ebay for excellent prices:
500 #000 (4x6 inches) = $30 shipped ($0.06 each)
100 #2 (8x12 inches) = $20 shipped ($0.20 each)
250 #0 (6x9 inches) = $27 shipped ($0.11 each)
I wouldn't buy envelopes from the dollar store or Walmart; the price per envelope is really high. You can also shop around online; many Etsy sellers highly recommend RoyalMailers or Uline, which have a huge variety of options for all of your shipping needs, including bubble mailers, poly mailers, boxes, bubble wrap, and tapes. And don't forget, always remember to figure in the price of your shipping supplies into the shipping price that you charge for your items!