Expand your business with e-commerce

Businesses that sell over the Web need an e-commerce package to help display products and collect and manage payments securely. Several kinds are available, from simpler, preconfigured packages, such as PayPal and CCNow (typically suitable for very low-volume sales), to higher-end custom offerings, such as MerchantPlus, Hostway, Brinkster, and Homestead, that let you accept credit cards over your own secure Web site and process a much higher number of transactions.

Here are some things to know before committing to an e-commerce solution.

1) Go with a prepackaged solution if your needs are modest
PayPal and CCNow might not look as flashy or give you all the bells and whistles of a custom e-commerce package, but they can be perfect for sole proprietors selling CDs, crafts, artwork, and so on. You'll typically pay nothing up front, as well as lower monthly fees of $10 to $20, in exchange for a portion of each sale (about 3 to 9 percent). If you want your business to look more established, however, go with a dedicated e-commerce site package.

2) Choose a solid vendor
Does the company have 24-hour support? What kind of backups and system redundancy does it offer?

3) Look at the online features
Do you get a wizard-driven setup with multiple store templates, or are you on your own? Can you import a catalog database you already have, or will you have to enter every product manually?

4) Look for wholesale customer flexibility
Vanessa Landegger, owner of a New York City-based retailer, uses MerchantPlus e-commerce system ($1,500 to $3,500, depending on configuration, plus $150 maintenance per month) handles all of her online transactions; about half are directly with online customers, and the other half are through wholesale outlets. "Each wholesale customer's profile already includes a credit card and payment terms," Landegger said. "They just enter the shipping address and selected product. Their credit card is charged the wholesale price. Drop-shipping is integrated into MerchantPlus. They're just another customer as far as the system is concerned."

5) Get the right extras
Shopping carts and a secure socket layer (SSL) for credit cards are a given. What about coupons and gift certificates? Can you run special promotions? What about integrating with Froogle and other shopping search engines? Can you set up automatic shipping calculators for FedEx, UPS, and USPS (most do not)?

6) Expand into new markets
MerchantPlus set up Landegger with a second online store on behalf of her distributor in the U.K. The whole process took just five days from purchasing the co.uk domain name, to modifying the product descriptions and going live. About 40 to 45 percent of her wholesale inventory gets sold through U.K. distributors.

7) Give your e-commerce a human touch
Don't rely only on technology alone. Derek Sivers founded CD Baby, one of the largest independent online CD retailers with a catalog of more than 100,000 artists. Sivers programmed his own e-commerce solution back in 1997 when few prepackaged products were available. He advises prospective e-commerce vendors to add a human touch to their Web site, no matter how sophisticated it may be otherwise, in order to foster customer loyalty. "Our site reaches people at an emotional/personal level, instead of just at a business level," Sivers says. "When someone can tell they are talking to a real person, even while browsing the site, they can feel a connection to you that they would never feel to some cold discount engine."