Complete e-Commerce Solutions for Small Business

Helping you find the right e-Commerce solution (and a primer in online transactions)

• A secure website (you probably already figured that one out by now)
• Shopping cart software to collect customer, order, and payment information
• A merchant account to accept credit cards (or even debit cards and checks)
• A payment authorization gateway account to authorize payments and send them to your merchant account
• A bank account (again...you probably already knew this one)

How online transactions work in a nutshell

1. A customer visits your website and decides to purchase something.
2. The customer selects the items they want to purchase, adding them to the shopping cart.
3. When the customer is finished, they checkout by adding their personal and payment information (this is still your shopping cart) and then submits the information to be processed.
4. On submission, your website's shopping cart software transmits the order information to the payment authorization gateway.
5. The payment authorization gateway authorizes the transaction (accepts or rejects it).
6. If the the information (personal info, form and amount of payment) is authorized, an authorization code is then sent to your merchant account. If it is rejected, then the customer stays on your website, where they can validate or enter a different payment method or account (item #3)t.
7. The merchant account attempts to reconcile the transaction by sending a request for funds to the customer's bank or credit card company and transferring the money into your bank account. If the request is denied, then the customer goes back to #3.
8. Once reconciliation takes place, the merchant account sends notice back to your payment authorization gateway that the transaction has been completed and you will be paid by the customer's bank or credit card.
9. The payment authorization gateway stores the information for you and sends confirmation to you and your customer.
10. The money is transferred from the customer's account to your account.

Your options - Hosted e-Commerce Solutions versus having your own Shopping Cart

1. You can sign up and pay for a monthly service where all the components mentioned above (even the website) are included.
2. You can purchase your own shopping cart software for your website and sign up for the other components separately. Gateways and merchant accounts typically charge monthly and transaction fees.

Common Advantages and Disadvantages of a Hosted Online Merchant Solution

• An all-in-one solution that is usually pretty easy to set up
• Usually provides templates to create a site if you don't have one
• Provides a web-based interface to manage products
• The technology is hosted, managed, and supported by another vendor (i.e. not your responsibility)
• An inexpensive solution in the short term (inexpensive doesn't mean the best or most profitable)

• If you have a website, the transaction portion takes place on the vendor's website, so the transaction is not transparent to the customer.
• The templates provided may not be sufficient and may not be compatible with your brand or look and feel of your website.
• The solution may not provide the level of flexibility or customization your product or service needs to be sold effectively.
• The solution may not provide important marketing capabilities such as contact management, search engine friendly pages, site analytics, or cross-selling capabilities

Common Advantages and Disadvantages of Owning a Shopping Cart

• Good shopping cart software is very robust, offering excellent marketing capabilities to increase sales, foster repeat business, and help you get found in search engines.
• Good shopping cart software is powerful, flexible, and allows for easy product management, shipping, and inventory control.
• Seamlessly integrates into existing website design and order processing is completely transparent to the customer.
• You own the shopping cart software, so you can customize it if needed.
• You can receive and manage extensive website analytics to measure traffic, customer behavior, and conversions.
• Shopping cart software is usually a one-time purchase, so the longer you're in business, the lower your total cost of ownership.
• Can manage wholesalers, affiliates, and channel sales.

• You own it; it's your responsibility. However, the software vendor should provide support for their product.
• Although not usually very difficult or expensive, shopping cart software needs to be installed and integrated into your website and set up to work with your payment gateway.
• You have separate software, gateway, and merchant accounts to manage...although this can be a good thing if you choose to change software or hosted solutions because you won't have to get new gateway or merchant accounts.
• It costs more up front.
• You will need to provide a secure website using an encrypted SSL certificate. This could be an added expense if you otherwise do not need one.