Choosing an E-Commerce Provider

For business owners going into the realm of online e-commerce, it can be a very exciting and yet, daunting task. IT can make and break even the sturdiest or hearts. In 2006, a report estimated consumers spent over $102 billion online at e-commerce sites in the U.S. alone. This does not include online auction sites, travel or other corporate entity sites. This is the best time, if ever, to be on the receiving end of this global "gold rush". All though the economy is on the down turn, online sales are still solid.

Having an online store requires a lot of planning and research of potential products and services to be made available. Setting up and maintaining inventory, taking orders from customers and making delivery on time requires more the rule than the exception today and requires more than a traditional web hosting provider.

Focusing on the right e-commerce solution and one that fits your business and not the other way around is what I am brining to the table. There are approximately 400 different shopping carts for e-commerce and with such a wide choice, where do you begin?

The first thing you need to figure out is whether you want to purchase a license or have a hosted solution for your shopping cart. There are pros and cons to both but it all boils down to time and resources. Do you have time and resources to implement your cart on your own or do you want someone else to bear that burden?

Licensed carts - having a licensed copy of a shopping cart requires you to choose among the masses of products, install it on your web server and configure it to integrate with your website. You own the software (code) and can modify it in any form or fashion to your hearts content. It also means that all features and upgrades, you have to perform yourself which can become a double edged sword.

Any problems with the security or features of the shopping cart, falls the business owner to rectify and in a timely manner also. Remember, time is money! If there is a team that is assigned to this task, they have to be "spot" to ensure that it is ALWAYS functional. Shopping carts must also be PCI (Payment Card Industry) DSS (Data Security Standard) compliant.

Hosted carts - a hosted solution handles all aspects of the cart for you. From setting up and integrating it into your site, maintenance issues, security during check out, 24/7 monitoring, tech support and free software upgrades. Any bug fixes and emerging situations, they will handle. It is maintenance free and allows you, the business owner, to focus other more important aspects of your business.

Bottom Line: Buying Or Renting - Costs plays the dividing factor in most, if not all online businesses. You are here to make money, right?!! The tricky question here is to decide which is cheaper and how much control do you want to retain.

Having a licensed cart means a significant up front capital invested in the product initially but small monthly fees for the months ahead. A hosted cart requires higher monthly fees for its use.

A licensed cart is like having a car. It is yours and you can go anywhere, drive anyhow (once you stay within your country limits) and do anything with it, because it is yours. But as with an asset, when problems arise, you are the one to fix it. A hosted cart is similar to renting a car. You are limited on how you drive and most times where you go with it but and problems that arises, you can carry it in and you suffer no out of pocket expenses.

For the "greenhorn business" man (now starting out entrepreneur), a hosted shopping cart will be easier to manage and with success later on, a licensed cart will be an option. This will allow the business to grow and acquire experience.

These are just the bare essentials an e-commerce web site must have to start off online. There are many more features but you can start of from these four points.

1. Your website must be PCI DSS compliant. This was developed by the major credit card (CC) companies (notably: Visa, MasterCard, American Express) as a guideline for processing online payments using CC to reduce online fraud and various other security vulnerabilities. This is critical for your business success.

2. Secure checkout procedures. If your clients have a bad experience at your checkout line, it can mean earning a bad reputation and eventual little or no bottom line. Using SSL certificates on your website will reassure your customers experience a safe and secure environment. Actually, no one will want to shop at your store id it does not have a SSL certificate. Well, unless the card was fraudulently obtained.

3. If you are using a hosting provider, ensure that they also reliable. Do your home work and look for reviews from any hosting provider before you sign up with them. Most important is their support line! If they say it works 24/7, call at some on Godly hour once, for "assistance" and ensure it is a real person. It may sound bad but it will save you a lot of problems in the end.

4. Customer support. This builds upon the last point. If your hosting company has poor support, how can you provide an exceptional service to your customers?

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