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t e-commerce for small business t

Introducing e-commerce for small and medium businesses

If wish to trade from your website you will need a virtual shop which should be just like any other part of your website in its general theme and appearance. Usually, there is a catalogue which allows customers to browse through your products and their details, such as description, weight, colours availability, price, whatever would appear in a hardcopy catalogue, usually with a picture of the product, if relevant.

If you only have a few products or customers are only likely to purchase one product: You may not require a shopping cart as this would complicate matters for the customer.

The advantages an online shop has over a bricks and mortar shop is that there is no need to rent a building to conduct your trading from, staff are not required for customers to make purchases and your customers can order goods from the comfort of their own home or office.

E-commerce solutions and packages come in many shapes and sizes depending on your requirements and budget. There is some thing to suit most business small and large.

So first of all you need to decide do you want to give your customers the choice of paying by credit card? The answer, usually, Yes! Credit cards allow spontaneous purchasing, whilst cheques give the customer time to change their mind about a purchase.


Fully automatic Credit Card system

This allows your customers to browse your catalogue of goods adding items they wish to buy to a virtual shopping trolley (or shopping cart). At any time they may add or remove items from their shopping trolley. Then the customer proceeds to the checkout and enters their credit card details, delivery address etc. confirms the order with the knowledge that their credit card details are safe and secure. They then await delivery. This is typical of most e-commerce systems. However its a bit more complicated than that.

how e-commerce works
  1. Customer browse your catalog of products and add / removes products to and from their shopping cart
  2. The customer proceeds to the checkout and confirm they wish to purchase the products in their shopping cart
  3. The customer provides their credit card details and they are sent to the payment gateway for authorisation. Communications between your website and the payment gateway are secured using SSL technology.
  4. If authorised funds are reserved in the customers account
  5. Funds are transferred from the customers account to your merchant account
  6. Funds are transferred from your merchant account to your business account.

2. When they have finished shopping purchases can be processed by the virtual check-out where the customer confirms the goods that they have in their shopping trolley and that they wish to purchase them. They are then asked for their credit card details, home address and address to which the goods are to be shipped.

If the customer is a returning customer and has bought from your website before, some of there details may be entered automatically such as addresses and names.

3. All communications between the customer and website are secure and encrypted using industry standard 128-bit SSL (Secure Socket Layer) technology. SSL certificates must be renewed every year.

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SSL certificates serve two very important purposes:

  • They allow secure, encrypted communication between your website and the payment gateway.
  • They allow customer to verify you are who you say you are.

Once the credit card has been validated, the details are forwarded to the Credit Card Association (e.g. Visa or Mastercard) via a Payment gateway (payment processing network). The transaction is either authorised or declined depending on the customer's credit limit.

4. If authorised, the funds are reserved to cover the transaction. The customer is then notified and an email sent to the customer to confirm the order and an email sent to your shipping department with details of the goods to ship, quantity of each, and the name and address of the recipient.

5. Once the goods have been shipped, a capture request is made for the reserved sum of money to be transferred from the customer's bank account, to your internet merchant account.

6. Depending on your arrangements with your merchant account provider, your money will be transferred from your internet merchant account to your regular business account, usually once a month.

In order to receive creditcard payments via the internet, you need to set up an internet merchant account. You may already have a merchant account if you take credit card orders already. Banks and other financial institutions are often very selective about who they issue internet merchant accounts too, so if you are interested in a fully automatic creditcard ordering system, you would be wise to research your position before going any further.

Please note not all SSL certificates are compatible with all Hosting services, and not all shopping carts are compatible with all payment gateways and not all payment gateways are compatible with all merchant accounts. So please speak to us first. We can advice you and recommend a tried and tested combination.

So how can Phizzie help?

We can set up the entire e-commerce system for you - no jargon, no research, no problems.

We also use the open source oscommerce catalog and shopping cart software which is free, even for commercial use. But do not be put off by the word free. Oscommerce is better than most off the self e-commerse software and includes a password protected admin area. The savings are passed on to you.

See our e-commerse package. We know it is the most competitive without skimping on quality.

SSL Certificate and merchant account too expensive?

For those who are not ready to commit or do not have the budget there is another way. We can setup an account with a hosted service such as Paypal and integrate their solution into your website.

Hosted Fully Automatic Credit Card Solution

Your website product pages operate as they would in a Fully Automatic Scredit Card System, each product has an "add to trolley" or "buy now" button and the customer can check their shopping trolley and go to the checkout when finished. This all happens from your website. Once the customer chooses to order the goods they have in their shopping trolley they are taken to a payment webpage on a secure server hosted by a service such as Paypal. The disadvantage here is that the customer once they have ordered their goods are taken to Paypals website to complete the order and enter their creditcard details. Therefore the appearance and continuity of the website changes from that of yours to theirs.

Once on Paypals order page the customer can pay for their goods using any major credit card. The money is paid to Paypal who take a percentage of the transaction (usually around 1-2%) and transfer the rest of the monies into your paypal account. Your paypal account is not a bank account it is simply an online account showing all transactions and the total sum paypal has in reserve for you. Once a month (or as frequent as you wish) you can credit your bank account with the sum in your paypal account. Since the actual payment of goods takes place on Paypals secure servers there is no need to pay for a secure server, SSL certificate or merchant account or any other costs normally associated with e-commerce. In fact Paypal has no setup or monthly costs, it only takes a percentage of each transaction. The downside is that customers are taken to a different website to make their payment which looks different from your website and may be confusing for some people. The goods news is that services like Paypal are gaining popularity with businesses and customers so customers nowadays are used to such services as part of the online payment process.

Paypal can also be used to sell single items as opposed to a fully functional shopping trolley system which may be overkill if you only sell as few products or customers are unlikely to purchase more than one product at a time. Using a single item system when you press the "buy now" button you are taken straight to the order page to purchase you product of choice.

Paypal effectively take care of the checkout webpage, payment gateway, SSL certificate and merchant account.

For more information: http://www.paypal.com.

For small businesses or companies testing the waters we would highly recommend a hosted automatic credit card solution like Paypal.

With a Paypal account your customers can pay for goods and services using Mastercard, Visa, Solo and Switch.

Paypal can even be integrated with the opensource oscommerse software (shopping cart and catalog).

Mail order system

This system allows customers print off an order form, which they fill out with details of the goods they wish to purchase from your online catalogue. They then send the order form and payment, usually cheque or postal order, to your business address. The biggest downside to a mail order system is, that it does not allow impulse buying, the biggest upside is, free to setup and maintain and there is not a percentage taken of each transaction.

Semi-automatic creditcard system

This system is the same as the fully automatic system as far as the customer is concerned. They browse your catalogue and add products to their virtual trolley, then proceed to the virtual checkout and pay for the goods using their creditcard. At this point, instead of the creditcard details being automatically verified and funds reserved, the credit card details are stored on the server (in encrypted format) ready for you to download once or twice a day or each order can emailed to you (in an encrypted format). The encrypted orders are then automatically de-encripted. You then need to process the creditcard details manually, using a manual creditcard swipe or online virtual creditcard swipe. Once the goods have been shipped. This allows your customers to make creditcard purchases from your website, but without it costing you so much, as you do not have to pay for a payment processing network or merchant account in order to process your orders. But this would be unsuitable if you to many orders to process manually. However, if you already sell goods from a shop or over the phone and can take creditcard orders in this way it would be easily integrated.



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