Electronic Commerce -- a beginner's primer

WASILLA -- Electronic Commerce, or E-Commerce, is the general term for any type of business or commercial transaction that involves the transfer of information over the Internet. This covers a wide range of different types of business, from consumer retail sites, to auction sites, to music sites, to all business exchanges that trade in goods or services. E-Commerce can be utilized not only for business to consumer transactions but also for B2B or Business-to-Business transactions. In the past five years E-Commerce has seen tremendous growth and it is expected to continue to grow at an accelerated rate.

Could your business benefit from an E-Commerce site? Perhaps. First you need a product or service to sell. Then a Web site must be established and a marketing goal determined. Many online businesses do very well, but it is not an 'easy' solution to a business that is already beginning a downward slide. There are often millions of Web sites for any type of product or service. Helping the consumer find your business' site can be a challenge, but with planning and a lot of hard work it can be made to succeed.

The problem for many small businesses is that, while they appreciate the concept of doing business on the Internet, it is hard to determine how to start. Essentially, doing business on the Web can be broken down into five main components.

1. Online store

2. Payment processing -- while it is possible to run an online store without accepting payment online, it is rarely successful.

3. Shipping/order filling -- How will you deliver the goods?

4. Customer service -- Complaints, returns, etc.

5. Promotion -- How will the customer find your site?

There are a variety of free or low-cost options to create an online store. Yahoo Stores were one of the first do-it-yourself Web-Stores and can be an easy way to learn the "lay of the land." QuickEStore is an affordable, server based Web store solution, and LaGarde Storefront 5.0 is an E-Commerce software package that interfaces with Microsoft FrontPage. These are just a few of the options available. Talk with other businesses in the community that operate an online store and find out what system has worked best for them. Don't discount hiring a professional, if you are planning a large site and have no experience with working on the Web.

Payment processing also offers a variety of choices. The following are just the beginning of services available. Authorize.net is a leading payment authorization service for online businesses that accept credit cards. PayPal is a popular Web site payment processing system. ChargebackPrevention.com is a tool to help the merchant avoid or offset charge backs when they occur.

There is a cost associated with running the Web site and there will be additional costs for processing payment. There will usually be transaction fees to your bank by the credit card processing companies as well as fixed monthly fees.

Being prepared to deliver the product and deal with customer service issues involves solid planning. Don't wait until the first sale to develop an action plan for handling delivery problems and damaged merchandise. Being proactive is the best answer to ensure having a well-received Web site.

There is no right or wrong way to start up an E-business, but you can begin by researching what method will work best for your type of business. Electronic commerce seems to be everywhere these days. Yet, as in any facet of business -- it can be a hindrance rather than a help to the business if it is not operated in a professional and cost-efficient manner.