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Operating An Ecommerce
Store
What exactly is needed from a web host for business hosting?
1. Merchant Accounts:
This should be your first step towards ecommerce, unless you have
chosen to go through a payment facility and are willing to give up a
rather large portion of your sales in fees. The up-front costs of a
merchant account can be hefty for a small business, but the long-term
savings can be substantial.
This is especially true if you are selling big ticket items. For
instance, on the sale of a $300 product/service through a payment facility
you could pay between $20-$45 dollars or more in fees. With your own
merchant account it will probably cost you about $9. With the typical fees
and equipment for a merchant account startup costing about $1,500, you can
recoup that cost rather quickly.
A merchant account comes with a merchant identification number. That is
about all it gets you. In order to process transactions you need either a
terminal (the little box that you swipe your credit card through at retail
outlets) or software that runs on your PC and will dial up the merchant
via your modem, and then process the transaction and deposit the money
into your bank account.
2. Shopping Carts
If you are selling just one or two items on your site you won't have
much need for a shopping cart. A site with a variety of products should
use the shopping cart system because it's the easiest way for your
customers to shop. The easier it is to shop, the more they will spend,
which is exactly the psychology supermarkets use, and exactly how shoppers
are similar whether in a supermarket or scanning through your website. And
the nice thing about electronic shopping carts is that the wheels never go
square, and you don't have to send a clerk out after the store closes to
round up all the carts that have been left scattered around the
neighborhood. So shopping carts are good. But how will they work with your
merchant account and the all-important ordering process?
If the orders placed on your site are to be processed with the
customer's credit card as a sale through your PC or swipe/terminal, then
there doesn't have to be any compatibility between your cart and your
merchant account. The two will work completely independently, each doing
their part of the job.
If, on the other hand, you would like all of your incoming orders to be
automatically processed for you as the customer hits the submit button,
you will need what is called "real time processing."
3. Real-Time Processing
If you're on a tight budget the extra fees involved in real-time
processing might be better used to aggressively advertise and drive
customer traffic to your site. Processing a few orders per day doesn't
take very long and until you find it to be more time-consuming to process
the orders yourself than you like, you are probably better off processing
such orders manually.
If you are starting with a healthy budget and an aggressive promotion
plan you will probably be better off implementing real-time processing
right from the start. Changing order-processing methods can sometimes
result in system hiccups and you don't want anything to slow down your
momentum once you've started. You'll also save money, not having to set up
your ordering system twice.
4. Web Hosting
The web host who is hosting your site can sometimes make a difference
in how compatible your entire site and ordering system are with each
other. This is because for those not using real-time processing, it
doesn't matter who your host is or where your merchant account is located.
They are independent of each other. Orders arrive and you process them. No
interaction between the two is needed.
Problems can arise when you bring a shopping cart AND real-time
processing into the picture. A shopping cart alone won't cause problems
but the cart you choose to use must be compatible with your web host. Some
carts are designed to run on certain types of servers, so when choosing
one be cautious to make absolutely sure you can use it with your current
host. Otherwise you had better be prepared to find a new one.
If you want a shopping cart AND real-time processing the three (cart,
processing, and host) must work together well. Your shopping cart must be
compatible with your host and the cart must be compatible with your
payment processor. With all the different shopping carts, hosts and
payment facilities out there, putting together the right team can be a
real challenge. This is especially true for the newbie who doesn't
understand how it all works and how it all has to work together, or
understands imperfectly but thinks he or she has it all under control when
the decisions are finally made.
In conclusion
Ecommerce can appear simple once you understand how all the components
work together. A merchant account allows you to accept credit cards, your
web host shows your website to the world, your shopping cart helps your
customers order easily and real-time processing processes the orders in
real-time and approved transactions are credited to your merchant account.
All are independent components but they all function together to make ecommerce
work. Find a designer or webmaster who can bring all these elements
together on your site & watch ecommerce work for you.
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