Eager to get your share of the billions of dollars in Internet commerce? There are some pretty hefty costs in setting up an e-commerce website. But there are some resonably-priced alternatives too.

It is estimated that 9 out 10 web purchases are made with credit cards, so having cc capability is a necessity in many cases.  However it is very likely that accepting credit cards will cost more than the combined design and hosting costs of the rest of your site.  The cc capability fees will also continue yearly.

There are a few ways of handling transactions online.  It is up to you to review your needs, goals, and finances in order to determine what method(s) of online payment will work best for you.

There are a few things to consider before you commit to an e-commerce site.  One, is that you will never be able to compete with the major players on the basis of price.  They will always get a better deal and offer a better deal. You must focus on other aspects of consumer shopping such as personal service.  Your best bet is to define and pursue a niche market.  The "big boys" go after the big markets.   Fortunately, this leaves many smaller specialized markets that amount to quite a lot of potential revenue.  I've also noticed a tendency for successful small e-commerce sites to be consumed by the major players.  This can be very profitable for the small site owner.

Credit Cards

    If you currently can accept phoned-in credit card orders in your store (you have a "card-not-present" account), you can have your online customers phone-in their orders. Or you can have them fill out an order form and submit it to you for processing. Their order info will be held in a secure file online and you must log into it then retrieve and process their order. Doing this will require a secure server to handle the sensitive cc info. It also requires the development of an order form and the programs to process it.  You may also desire a shopping cart if selling multiple items. Taking phone orders is the least expensive route, followed by an online order form.

    Then there is full online cc processing. To do this you will need the online cc services of your current bank if available, or of an online cc processing company.

      One of the most popular online cc service providers is CardService International. Their fees:

      CardService International**

      Set-up fee

       

      $95

      Discount Rate

       

      2.75%

      Transaction fee

       

      $.35

      Monthly minimum

       

      $25

      Monthly Cust. Service fee

       

      $10

      Monthly Gateway fee

       

      $35

      Internet CC Processing Solution

       

      $995

      So the minimum monthly cost with no sales would be 25+10+35=$70.  The yearly cost with no sales would be $840 (70x12months) + $995=$1835.  The first year would also have the $95 set-up so the first year would be $1930 not counting transaction fees and discount rates. The discount rate is essentially another transaction fee as a percent of the sale.  They  process the cc transaction, deposit the funds in your account, and you fulfill the order. You will still need a secure server, a security certificate from Veri-Sign (around $300/yr) or Thawte (around $150/yr), and probably a shopping cart/catalog (from HCD).

       

      A better option is found at iCat.  iCat offers a "Commerce Cart" solution which includes a shopping cart, secure server, and cc processing.

      iCat Commerce Cart**

      # of items

       

      monthly

      yearly

      up to 100

       

      $100

      $1000

      up to 250

       

      $150

      $1500

      up to 500

       

      $200

      $2000

      up to 1000

       

      $250

      $2500

      All you need is an online catalog in your website. This is the route I recommend.

      Phone Orders -put a phone number (preferably an 800-) on your site for taking orders.  You need to do this even if you have full credit card capabilities on your site since some buyers are still not comfortable with using cards online.

    PayPal -allows the secure transfer of funds via e-mail. It works like this, you set up an account with PayPal, your customer also sets up an account.  Payments are easily transferred between members. Customer pays PayPal using their credit card on PayPal's secured server.  Their payment is transferred to your PayPal account.  You fulfill your customer's order.  You have PayPal send you a check.  It's ideal for person to person transactions, no credit info is transferred between payer and payee. To find out more or to sign up, use the PayPal banner at the bottom of this page.  Customer orders can be placed with an online order form and forwarded to your e-mail.  When you receive confirmation of payment you fullfill the order.

 

Checks and Money Orders - the old stand-bys from the days before our credit card madness.  Remember how it used to be? Fill out an order form and send it in with your check. Not near as convenient as credit cards but hey, it still works. 

COD - Cash On Delivery. They order, you send, they get it and pay the delivery company, you get paid.

**These are guides to the respective companies prices, they are not quotes, are subject to change, and may not be current.  Prices do not reflect any additional HCD items that may be necessary for your site such as order forms, shoppintg carts, product listings, catalogs, etc.  Prices do not reflect HCD fees for setting up and integrating your e-commerce solution into your website.

 

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