What you need to know to start a web business

 

Start your own web businessStarting a web business can seem like a daunting and confusing process. There are so many places offering shopping carts, domain names and other products that it's hard to figure out what the best step is. The first questions one has to ask are:

     --What kind of a web business do I need?

     --How many products or services do I have to sell?

     --How many do I anticipate I will have 6 months and a year from now.

     --Am I selling items that require shipment or are these items the user will download?

Many successful web businesses started off small and with little investment by using eBay. While eBay may be an expensive option for a larger business, due to it's fee structure, it is a great way to test the waters for products you have to offer with very little up front risk. After all you don't need to invest in domain names and shopping carts or the time and effort in setting these things up. Advertising is already part of the eBay experience so your products will be noticed right away. You don't even need a merchant account since eBay's affiliate PayPal is completely integrated into the eBay system. All you need to do is sign up for an eBay account and PayPal account and you are ready to sell. If things go well you might even want to consider an eBay store, which for a nominal fee gives you a shop on their site. Even further, they offer what they call their Pro Stores which is a genuine shopping cart completely tied into the eBay environment. However, no matter how far down this path you go, if your shop is successful -- you are going to want to get your own web site and start marketing your products on your own.

The first thing you need to set up your own web shop is a domain name. There are many companies that will do this for you. Prices are all over the board for essentially the same service. Many of the domain registrars are pricey and use techniques to keep you paying their high prices by making it difficult to extricate yourself from their services. It is always best to choose your domain registrar wisely and get the best possible deal. We have used the services of many of the regist rars out there. After many years we can equivocally recommend GoDaddy and Yahoo as providing excellent service and ease of use. As far as cost is concerned, it doesn't get much cheaper than GoDaddy. for a reliable registrar that is big enough to have confidence that it is in it for the long haul. Of course, part of the decision of who to register the name with is related to where you will host your shopping cart. Both GoDaddy and Yahoo offer their own shopping carts but also make it easy for you to host elsewhere while using their registration services.

Selecting a shopping cart for your business is the most confusing part of this process. There are dozens of competing carts out there each claiming to be the easiest to use and most flexible. The pricing on the various carts also varies from a monthly fee to an outright purchase of the software. Some carts charge a nominal monthly fee but also a percentage of your sales. Which format to use really depends on how much volume you see your business generating. If your business is small and you don't expect it to become very large then perhaps a cart with a low monthly fee combined with a percentage per sale makes the most sense for you. On the other hand, if you expect to have a significant number of sales it probably makes more sense to pay a higher monthly fee and not pay a commission on each sale. We don't recommend a small business purchase their software outright and have it installed on a server. This is probably beyond most people starting out with a web business in terms of technical expertise and maintenance. The nice thing about the pay per month plans is that they are hosted and maintained for you and usually very reliable and trouble free.

As indicated before, both GoDaddy and Yahoo have shopping carts available. The GoDaddy offering is fairly simple to use and could suffice for a startup business. They offer 3 tiers of service and charge a flat fee per month. It is a very inexpensive shopping cart option. If offers integration with PayPal Payments as well as standard merchant accounts which they offer. The Yahoo offerings are based on the minimal monthly fee and cost per transaction model. They offer 3 levels of service depending on the size and needs of your business and integrate with PayPal and other merchant accounts. As mentioned earlier Pro Stores by eBay also offers a shopping cart solution in 3 tiers. They charge a nominal fee per month and then a commission on all sales. The advantage to this shopping cart is it's connection to eBay and ease of selling both on your web site and through eBay, seamlessly.

While one of the above solutions would suffice for a startup and small business we will briefly discuss one of the higher end options available. One of the finest high end shopping carts is that offered by Monster Commerce. They are owned by Network Solutions, one of the higher priced registrars out there. The Monster commerce solution is very robust allowing for complete customization of pages, multiple reports and options, various shipping options, compatibility with PayPal and Google Checkout as well as many other merchant accounts. They charge a flat fee per month and for low volume businesses this could be a significant expense. In addition, many of their features are add-ons to the basic service further increasing the total monthly cost. While this is a high priced cart if you are doing $10,000 or more in sales a month it's high end features will probably be worth it to you in the end.

Finally, we provide the near free option for those just starting out. All you need is a domain name and very basic hosting service. Your total cost per month if you register through a discount registrar like Godaddy is around $4.00 per month. Implementing this free shopping cart requires a bit of work and it is not very flexible. It will take orders and calculate basic shipping and process the credit card. No fancy reports or inventory options. However if you have just a few products to sell this could just be the answer to your web business dreams. The name of the company offering this free cart is Mercantec. Basically, you sign up for their free service and give them your PayPal or Google Checkout merchant information. Then you create a product list on their web site and define your shipping options. You then paste links to the products and the shopping cart onto your web page. These links give your standard web page the look and feel of a shopping cart. The whole process is very simple and clean and is great for a low cost startup business.

 

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