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Electronic commerce (e-commerce) refers to the selling of products over the Internet, and e-commerce software is the engine behind these online stores.

E-commerce software is software that allows organizations, and even individuals, to sell online. At one time, e-commerce was all but out of reach for small businesses and individuals, due to banking regulations for online commerce and the cost of setting up a shopping cart. For this reason, many early online businesses simply advertised their products online, with the actual sales being conducted by telephone or through the US postal service.

A shopping cart is an essential part of an online retail store. Successful businesses use shopping carts whose performance is seamless and corresponds well with the company's online catalog, customer service desk, and payment processing gateway. When a transaction is not proceeding as expected by the customer, the likelihood is that the shopping cart will be abandoned prior to completion of a purchase.

Today, most web hosting packages come with a shopping cart, but the default package may not be the best one for a particular business. Online retails need to consider the type of store they are operating, the nature of the target customer base, and other preferences as to the sale of products or services, then decide which of several shopping cart options is the most appropriate.

Shopping cart software packages should allow the online retailer to track and manage product inventory, as well as fulfilling orders. The software package should maintain a product database, track sales, market to customers, and offer the option of a loyalty program or similar incentive. Turnkey packages are available that combine custom or pre-established shopping cart solutions with web hosting companies specializing in e-commerce, banks, and payment processors, as well as e-commerce fulfillment and warehousing operators.

As discussed, many web hosting companies offer e-commerce packages as a hosting option. These may include built-in tools or integration with open-source tools. This may require some work on the part of the new online retailer, who may have to set up a merchant account and payment gateway, then decide which e-commerce software solutions are best for the business they hope to be successful with. However, your business is unlikely to be successful if you require customers to mail a check or call you with their credit card information. Depending on the nature of the business and the customer base, this could work, but you will lose a lot of sales.

PayPal is an option that many small and medium-sized business use, and which larger business may include as a customer option. However, integrating a PayPal shopping cart with the fulfillment part of your e-commerce software can be tricky.

As more and more states are looking to Internet sales for state sales taxes, this is another matter that will need to be considered.

Costs for e-commerce solutions may range from free or really cheap to thousands of dollars a month, depending on individual needs and the choices made by the online retailer.

There are two types of transaction fees to be aware of while evaluating shopping cart and e-commerce software solutions. These are the ones that are charged by the shopping cart and the ones charged by the payment gateway. Payment gateway charges cannot be avoided, as whichever service you choose will charge a certain amount per transaction. Some shopping cart applications will charge a transaction fee for using the app, regardless of which payment gateway you integrate with. In this type of arrangement, the shopping cart vendor collects a percentage of each transaction before the payment gateway collects its fee. Read the small print so that you are not faced with unanticipated charges.

Some shopping carts will charge different rates depending on the amount of bandwidth you require. Online retailers who anticipate high traffic volumes may do best with an unlimited plan or a high bandwidth. Keep in mind that bandwidth charges can be impossible to plan for. Other shopping carts will restrict the amount of storage, limiting the number of product images that can be displayed.

Some shopping cart solutions are designed for the sale of physical goods, while others are better for digital products, such as e-books or downloads, and some are made for the sale of services. Some shopping carts allow for a trial period. This might be a good idea.

Security is hugely important. Make sure your online store and hosting provider offers a Secure Sockets Layer (SSL) certificate or can accommodate a third-party certificate.

In conclusion, before shopping for a shopping cart solution, consider the features that you must have on whatever e-commerce solution you decide on, as well as those that might be nice, but which you could live without.



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