E-Commerce and Carts
We are pleased to assist our clients with the implementation of an online E-Commerce solution, and provide both custom cart development and full E-Commerce cart integration. To assist you in understanding the options, we have provided the basics to help you make an educated choice about what is necessary. Cart demos are provided at the right column.
When you need to sell online, there are some important options to consider
- Do you anticipate a high volume of sales?
- Will you be selling many items, or a just a few?
- Will your products require custom attribute fields?
- Do you need to provide for coupons, wholesale pricing, worldwide shipping?
- Do you intend to use a Bank Merchant account with an SSL certificate, and dedicated IP hosting?
- Are you selling tangible products, digital goods, or a subscription to a member only area of your website?
In most cases, we find that “All in One” solutions serve most customers best. An “All in One” option provides all the services that are required for credit card processing, which includes a secure server (SSL Encryption), credit card authorization and processing, and transfers of funds to one’s bank. In this regard, PayPal and Google CheckOut are common options. Both are third party processors that shield customer information from retailers. And both have no monthly fee associated with using them, and no setup fee. 2Checkout.com is another common option, used most often for renewable fees such as for hosting.
The other option of course is to get a merchant account through a bank, and considering all the costs associated with it, it doesn’t really pay off unless you have a high volume of sales. Both Merchant Accounts and “All in One” options can be configured to work with most shopping carts and E-Commerce platforms, and by utilizing the API the checkout process can be seamless, instead of the typical redirect to a branded PayPal page.
Here’s an overview of what you can expect
Merchant Accounts:
- Gateway Fee: typically between $10-$20 a month
- Statement Fee: the average is about $10/mo.
- Monthly minimum: The monthly minimum is the amount that your business has to meet each month to keep the merchant account. If the minimum is not met one month then your business has to pay the extra amount.
- Average Discount Rate: The discount rate is the percentage of your sale that the credit card processing company keeps for themselves. Typically around 2.25%.
- Transaction Fee: Typically around .30 per sale.
- Address verification Fee: Verification of a credit card. Typically around .05 per sale.
In addition to these costs, there is the cost of a credit card authorization server (such as Authorize.net); upon my last check they have a $100 setup fee, a $20/mo fee, and other small incidental fees. Then there is the need for a secure server (SSL) and the price will vary considerably for these, but the better ones such as Verisign cost from $100 to $250 yr.. And finally you will need to have a dedicated server hosting environment (which is generally 3 times (or more) the cost of a shared hosting platform). So yes, this can all become very expensive and time consuming to set into place. *Note that some shared hosting accounts provide SSL certificates, but since these are "shared certificates" they are not considered as secure, and they won't work with all E-Commerce options.
PayPal Business Account Fees: As noted, there is not setup or monthly fee. As of 3/20/2012 this is what you can expect. Note that these reflects the purchase amount per monthly sales, fee percentage based upon sales amount, and per transaction fee.
- $0 to $3,000: 2.9% + $0.30
- $3,000+ to $10,000: 2.5% + $0.30
- $10,000+: 2.2% + $0.30
With PayPal business merchant account, a significant advantage is the fact that more people use PayPal than Google CheckOut, and that they offer a range of services and features available that include invoicing, statements, shipping and tax calculations and customer options. For this reason our preference is PayPal.
As for shopping carts, PayPal does have a cart option that can be integrated into a custom built E-Commerce page. In some cases though, this cart may not be "slick" enough, especially if you sell many items and want the contemporary cart experience, wherein user data is stored upon login, etc. If you have done a bit of searching, you will find that there are many, many shopping cart applications available. Of this type there are the "hosted" options, and the "stand alone" options. The hosted options will typically be easier to set-up, will provide free or low cost support, and since this is a hosted solution, they will take care of the security, the hosting, and in many cases the credit card authentication and processing, or provide an easy setup process to integrate these with their service. The stand-alone option will be more expensive initially since they will require the cost of the application if not open-source and it will take time of configure, yet this option will be less expensive overtime since there is no reoccurring fee to use the cart beyond the hosting, SSL certificate (yearly renewal fee), merchant account, etc.
When considering which option is best, it is important to look at the ability to customize the look of the cart application, especially if you have an existing website that you wish the cart to integrate effectively with, and if the cart provides dynamic jQuery image previews, thumbnail scrollers, and other advanced viewing options. There are other considerations as well, such as payment gateways provided for, and product attributes (size, color, weight, custom fields, etc). And you will need to decide on tax and shipping. Tax will be defined by the tax codes of the state, but if you are intending to ship worldwide then you may wish to have a flat fee associated by country. Of course weight and size can also be a concern, so it is important to spend some time considering the best way to handle this. As for the shipping options, there is UPS, USPS, Fed Ex, and Worldship (though there are others less common ones); not all carts support all shipping options, so when considering the best cart application you need to look at the features set to define the best one for you. Note that some shipping carriers may provide an online integration option to have packages picked up automatically, package slips printed out at your location, the tracking of shipments, and shipping costs defined by address and weight. I suggest checking into these options with the common carriers if these are important considerations for you.
OK, so assuming you have your product list with images ready, have identified the options (attributes) for the products, have defined the shipping costs, and how to ship, you will need to look at the Cart from an administrative perspective. Firstly, it is easy to work with? Many carts are, but some either have too few options, or so many options that navigating the application is anything but easy. You should also consider options such as the ability to provide coupons with or without bar-codes, coupon codes, wholesale pricing, discounts for multiple item purchases, tracking of sales, tracking products/inventory quantity (having an excel file .csv upload/download option is important to many), and tracking of customers. There will likely be other considerations that are specific to your own needs, so when assessing the carts make a defined listing of what you want and/or need, and evaluate the cart based upon this (and of course compare the carts features side-by-side). And lastly, you need to evaluate the cart from the visitor/user perspective. Firstly, there is the “Add to Cart” functionality, the “Checkout”, and the “Returning User”. Most carts provides similar features in this regard, though some will provide features such as “Wish Lists” in addition to account functions such as looking up previous orders, changing user details, etc. You should also consider the visual impression of your cart. Does it have a product slider, does it use jQuery for enhanced product image views? Are there other features that you’ve seen that you would like?
Of the many cart options the important thing is to search the review sites and read customer comments before choosing one. Also, wherever possible do a test drive. In this regard, I would recommend downloading the “free trial” if one is provided and trying it out on your own server, or try out the demo on their server if no other option is available. I would never purchase any application without trying it at least in part. Note that some carts will not always work on a given server, be it the PHP version required (for example, your server may have PHP v. 4 installed, but the cart requires PHP v. 5), or other functionality needed such as IonCube (used to restrict application to a single domain for licensing – most shared hosting servers don’t provide support for it). And finally, pricing varies a lot on carts. So I would suggest taking some time to assess “many” carts before you make a choice, and consider all that I’ve noted above, for once you’ve made the purchase you need to be confident that you spent your money wisely.
Finally, I don’t suggest going with a “hosted” option. There is no reason to pay a monthly fee to use a cart on someone else’s server, and a lot of possible downsides since any time you allow someone else to manage your site you run the risk of them “holding you hostage”. Good carts can be typically purchased for under $300, and the open-source options are often the best way to go since they have a large development community, so security is often better with these carts than the commercial ones. In this regard, always backup your site and database regularly since no cart, or database driven website will be 100% secure.
And while I do think having a designer to assist you with making the right choice is a good idea, don’t assume that the designer will know the absolute best option available. Most designers are familiar with a few carts, and those are the ones they will go to for client websites. But this is not to say that the carts they suggest are the best for your specific needs. And where possible, learn as much as you can, do what you can, … why pay a designer for what you can do yourself, since after all, once the cart is online it will be “you”, not the “designer” who will be working with it daily.
OK, so considering the stand-alone options that are available, we typically prefer to use open-source carts such as OsCommerce, CubeCart, or Zen Cart, and the Joomla Cart VirtuMart. The advantage of these is that there is a large development community behind them, which allows for a broad selection of add-ons, and because of their openness and popularity, there is very good security associated with them. That being said, we have worked with many commercial carts as well, which include CS-Cart, Interspire Shopping Cart, and X-Cart.
