eCommerce and Credit Card Processing

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Here at Launch Production, we have given several tips and pointers for successful business startups. In this post, we are going to cover the issue of e-commerce sites.

For those who are unaware, e-commerce sites provide business with a way to sell (and take payments for) products and services over the internet.

For a long time, e-commerce was mainly used by mail-order businesses that didn’t have official storefronts. Providers like PayPal or eMerchant offered shopping carts that companies could attach to their online catalogues, where customers could order and pay for goods.

E-commerce sites don’t have to be restricted to mail-order business, however. Companies with brick and mortar offices could benefit from e-commerce as well. A good site not only improves your web presence, it expands your reach to potential clients outside your local area.

Here are some things to consider when choosing your provider…

Services

Not all sites are created equal, and not every e-commerce site will suit your needs. For example, if you have a consulting business, an Amazon-style catalog site won’t work for you because you don’t have a tangible product to sell. You might do well with a simple registration page for repeat customers.

On the other hand, if you specialize in training materials and kits, you would do well to go with a site that provides a robust catalog with product descriptions, as well as a shopping cart, credit card processing services, and a registration process for repeat customers.

Some e-commerce providers only offer one service, like credit card processing, while others offer a variety of services that allow you to design your own transaction experience.

Make sure you determine what you need, so you can find the e-commerce solution that works best for you.

Fees

Most e-commerce sites charge a fee for credit card transactions. Some providers charge a blanket percentage for all transactions. This percentage can be anywhere from a half a percent to even larger percentages depending on the amount of the transaction. Some providers offer reduced fees, or even waive them, for certain periods of time (like the first six months for new customers), or if you purchase certain equipment from the company, or its partners.

These incentives are usually designed to combine e-commerce with on-site sales. For example, a provider could waive its credit card fees if you purchase a point-of-sale machine from one of their partners, and sign up for their mobile credit card app.

Other companies might charge a monthly rate upfront, for a certain number of transactions within a specified dollar amount, with fees for all transactions beyond the monthly minimum.

The good thing about these fees is that you can deduct them as a business expense on your taxes.

Payments Accepted

Some e-commerce providers only process certain cards. MasterCard, Visa and Discover Card are the most common forms of payment, and any provider you use should be able to process those payments. Cards like American Express, Diners Club, and Carte Blanche International are not as common. If you take a lot of American Express payments, or if you have a lot of international buyers, you need to make sure your e-commerce solution can process those cards.

Being able to provide a wide variety of payment options will increase your potential for sales.

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