Look Before You e-Leap

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Look Before You e-Leap

 

PlatformGraphicE-commerce is growing 23 percent per year as 51 percent of Americans prefer to shop online. Yet 46 percent of small businesses do not have a website. “Is selling online right for your business?” asked Eduardo Lugo of the Small Business Development Center at a seminar on e-commerce.

“You have to do your homework, just like you were opening a restaurant or retail location. It revolves around your target market,” Lugo said. “I don’t like people to get taken advantage of when they set up an e-commerce site, but I see it every day.”

Opening an e-commerce site is equivalent to opening a new location, with the attendant questions, complications, staffing and time requirements. The seminar, hosted by the Lower Valley Hispanic Chamber of Commerce, highlighted the steps and options involved in the process.

First, research is required. Does your target market buy online? Does your competitor sell online? Do you have staff to support internet selling, including running the website, handling sales and shipping? You have to decide if it is worth the investment.

The three dominant online marketplaces are eBay, Amazon and Etsy, Lugo said. The accompanying table shows how much they charge vendors for listings, credit card transactions, etc. In exchange, these full-service marketplaces provide secure encryption, payment gateways, shopping carts and hosting.  

MarketplaceGraphicThird party vendors – businesses like yours – make up about 40 percent of Amazon sales volume. Businesses with excess inventory often get rid of it on eBay, which is known for its accurate shipping charge calculator and shipping label generation. Etsy focuses on vintage or handmade products and supplies. Google gives valuable analytics, including who your competitors are and keywords for searches. It takes around 30 minutes to set up as a vendor on Amazon or eBay.  

If you prefer to have more control, you can build your own e-commerce platform/website two different ways. The first is with a content management system that has easy-to-use templates. ”You create and modify content and change designs,” Lugo said.

Popular self-hosted platforms, such as WordPress, Joomla! and Drupal, offer search engine optimization, online help and the capability to embed graphics, videos, maps and apps. These do-it-yourself websites need to link up with a reputable web host that provides security features and the technology and visibility to get your website viewed on the internet. GoDaddy, Bluehost and HostGator cost about $100-$150 per year.

A custom-built website will cost more and need more of your attention as you work with web designers, developers and implementers to “open your new branch.”

“It’s like hiring a house builder. Check their references,” Lugo said. “Make sure you own the final design, site content and the domain name.” Again you will need to arrange for web hosting.  

Website security is essential. It is your responsibility to protect sensitive customer data from hackers via strong firewalls, daily backups, encrypted data, monitoring and testing networks. “Larger, reputable host companies usually take care of all this,” Lugo said.

Both content management systems and custom-built websites have to establish payment gateways and perhaps merchant accounts. PayPal and Google Checkout are the equivalent of a credit card machine. PayPal collects the money from a transaction and transfers it to your account. Shopping cart software manages your inventory and provides structure for you to sell online. Examples are Drupal Commerce, Magneto and WooCommerce.

“It’s easier with hosted software and less time consuming,” Lugo said. Several providers, such as shopify.com, offer all-in-one solutions with built-in components, basic reports and multiple payment gateways.

Another major element in online sales is shipping and handling. “Packaging can make or break a transaction, a relationship. It may be your only interaction with customers,” Lugo said. Consider including a thank you note or follow up with a product sample.

Customer service must include timely responses and FAQs on the website. Other options might be online chat, interaction on social media and being available via email and phone.  

Remember your website is like another branch of your business. You can’t set it up and walk away.

Freelance writer Eileen Mattei was the editor of Valley Business Report for over 6 years. Her articles have appeared in Texas Highways, Texas Wildlife Association, Texas Parks & Wildlife and Texas Coop Power magazines as well as On Point: The Journal of Army History. The Harlingen resident is the author of five books: Valley Places, Valley Faces; At the Crossroads: Harlingen’s First 100 Years; and Leading the Way: McAllen’s First 100 Years, For the Good of My Patients: The History of Medicine in the Rio Grande Valley, and Quinta Mazatlán: A Visual Journey.

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