| eCommerce 101- Accepting Payments from
Your Customers
As a new business, you will need to decide how your
customers will pay you for the services you are providing.
Some of the most common methods of e-commerce for web
hosting companies include:
Credit Card Payments – Most
customers will want to pay via credit card because
it is the quickest and most convenient way to pay
for their services online. This means that you will
either need a merchant account, or a third party service that allows you to accept
credit card payments without having a merchant account.
If you are just starting out you will want to keep
in mind the fees that you will pay for each option.
With your own merchant account, you can expect to pay
an average of $35.00 - $50.00 per month in merchant
fees depending on the amount of sales you are producing.
With a third party service such as 2checkout, you may
pay less in fees per month but the per transaction
fee may be higher.
PayPal – Many customers find
PayPal convenient to use and more secure than giving
their credit card information away to every company
that they shop with. Pay Pal is a third party service
that allows you to accept credit card, check and
PayPal transfer payments without the need of a merchant
account. The only drawback is that the customer must
be a registered member of PayPal in order to use
the service to pay you.
Online Checks – This can be
a VERY risky way to accept payments from customers
on the internet. Even with the security services offered,
there is really no way to guarantee that someone is
not going to write you a “bad” check on
the internet. There are services such as “qchex” that
we recommend if you want to accept checks online
which are very easy to use and convenient but you
should definitely think about whether it is worth
the risk to accept checks. Docu-Type will accept
checks ONLY after a customer has established a good
payment record with us for at least six months. We
also charge a $25.00 fee for any checks that are
returned for any reason. This has worked well for
us but we have had our share of fraudulent check
payments in the past, prior to these policies being
put into effect.
Now let's look at these options a little closer:
Credit Card Payments - How to obtain a Merchant Account
In order to accept credit cards directly, you will
need a merchant account. This allows you, the
merchant to accept credit card payments from your customers.
Local Banks: You can get a merchant account through
your bank but they are usually very apprehensive about
internet companies and their rates can be much higher
than other merchant providers who specialize in internet
companies. Once you have been in business for awhile,
we recommend taking your last three statements from
your current merchant account provider to your bank
to see if they can give you lower rates than you currently
pay. If they see that you have a good history
with few chargebacks, they may be able to offer you
lower rates.
Internet Merchant Account Providers: These
are companies that specialize in providing internet
merchants with merchant accounts. Their rates
can be somewhat higher than a local bank, but they
have a 98% approval rating where banks have a much
lower approval rating. You also do not have to
have great credit to obtain a merchant account through
these providers. Some of the most commonly used
merchant account providers are:
Costco - http://www.costco.com (Click
on "services" and
then under the heading "Services for Your Business",
click on "Merchant Credit Card Processing")
Costco usually has lower rates than other providers
but you must be a member to apply. (It is
probably worth the yearly membership fee to Costco
if the rates are indeed lower than other providers)
PayStone - http://www.paystone.com/
For a more extensive listing of providers, please
visit Her Ecommerce.com's Merchant Account Provider
Review
Other Payment Solutions
You can still accept credit card payments without
a merchant account, but you will pay higher fees on
a per sale basis. However, for smaller companies
who do not have a lot of sales on a monthly basis may
find it more cost effective to use a third party service. Some
of the most commonly used third party payment solution
providers are:.
2CheckOut
This is a highly recommended service. Your customers
do not have to sign up for anything to pay you using
this service. It is very affordable to sign
up as well.
Qchex - http://www.qchex.com
This service allows your customers to send you
an electronic check which you can then print
out (on check paper) and deposit in your bank
account. They also
provide invoicing solutions as well.
Pay Pal - http://www.paypal.com
This is a quick service which allows you to start
accepting credit card payments immediately after
signing up. It
is said to be the world's number one online payment
service, with over 31 million members worldwide.
There is no charge to sign up and the fees charged
per sale are very affordable.
Shopping Carts
As you may already know, Docu-Type Web Hosting offers
several free shopping cart solutions to all of our
web hosting customers but we will also mention a few
other popular shopping carts as well.
- osCommerce Cart -
Free with all Docu-Type Web Hosting's Web Hosting
Plans
- Agora
Shopping Cart - Free with all Docu-Type
Web Hosting's Web Hosting Plans
- CubeCart -
Free with all Docu-Type Web Hosting's Web Hosting
Plans
Tools & Other Resources
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