There are tons of options when it comes to collecting money on a website. Each of the options has their pros and cons, and gives you a different level of purchasing experience. The following outlines some of the options that should be considered before proceeding.
Fully Integrated Options
One of the ways to accept online payments is to fully customize and integrate a shopping cart into a website. There are two levels of doing this. The first method is to completely integrate the shopping cart. In this instance the buying experience is designed right into a website with all of the pages and functions happening on your own server. This should only be done for someone who expects huge amounts of sales (i.e. a larger company or organization) because it will require lots of programming and cost to customize and develop, and lays all of the liability and security on you if there is ever a problem.
Thus, the second level of doing this is preferable for most clients where we purchase a shopping cart from an outside source and then integrate this into your website. This allows us to buy into a service so the liability and security is on the shopping cart company, while giving us a level of customization to make your site look very professional.
How this works is in three steps:
1) Shopping Cart – We would need to discuss all of your needs for online purchases from beginning to end. We would then research all of the available shopping carts trying to find one that fits these needs. There are so many options for shopping carts that there is no one cart that fits everyone’s needs. Thus, finding the cart that suits your needs is essential before you even begin to move forward.
Once we determine which cart we are going to use, we would then buy into the cart and work on customizing your account with this company trying to make it look like your website. The idea is to integrate it as much as possible into your site (while still having the actual purchases done on the cart companies website). We would be looking for a cart that is easy to use, takes little to no programming knowledge to setup and use (so that you can run the cart yourself once we are done), and handles all of the transactions on their website so the liability and security is their issue and not yours.
Cart Cost - Typically there is a monthly fee for all shopping carts (between $25 and $100 per month). Sometimes there is an introductory setup fee that they charge as well. Sometimes there is also a transaction fee for purchases. The costs will depend completely on what cart we choose.
Installation Cost – There will obviously be a cost to installing any shopping cart into your website. It is difficult to quote you a price until we know what cart we are using, and what it will take to install it. We’ve used carts that are easy to install that have very few options so only cost a few hundred dollars to get running, all the way up to thousands of dollars for an elaborate shopping cart. It really depends on how easy it is to install and how ornate we make all the options.
2) Gateway – This is the middle man that processes the actual purchases. So, when an order comes in via the shopping cart, it then goes to the Gateway and checks the credit card numbers, authorizes the payment, and handles the transaction. The most common one that we would probably use is Authorize.net, but there are others available on the internet.
Gateway Cost – Authorize.net currently has a setup fee of $99, monthly fee of $20, a transaction fee of $.10, and then other fees depending on what you are doing. These fees are paid directly to the “gateway” site and may vary depending on which company is used, what type of credit cards are processed (for example, American Express typically has higher transaction fees), and what services we need on your cart.
3) Merchant Account - This is the bank that handles the final transaction of the money. Once the order is processed on the Gateway, it is then deposited right into your bank account in a secure fashion. Almost all of the big banks offer Merchant Accounts. Some of the banks have tried hard to make it easier to work with them by making deals with the Gateways (like Authorize.net) so that the setup and billing of these two steps can be done together.
Merchant Account Cost – Each merchant account has a fee structure. Typical costs will range from a minimum of $50 to $100 per month, plus transaction fees (typically around 3%).
Pros: By taking this route, you will end up with a fully integrated shopping cart. When someone goes to buy something they’d be taken to the shopping cart website, but the page would be fully customized to look like your website. They would be paying on a secure server as well. And, the whole process would look like it went through your website so it’s very professional looking.
Cons: This route takes a lot of work to accomplish and tends to be expensive (in the setup, monthly fees, and transaction fees). Setting up this type of cart usually takes a lot of work, time and planning. So, the upfront cost can be expensive. Then, if you add up the cart fees, gateway fees, and the merchant account fees, you will probably be looking at around $150 to $200 per month (not counting transaction fees). Thus, you have to be sure you are going to make enough money through your site to cover these fees before you choose a fully integrated cart.
-------------------------------------------------------------------
Outside Provider Options
Another way to handle this is to choose a company that has all three of the pieces put together into one package. There are a number of places out there that do this including: PayPal, Google Checkout, and Amazon. The one that people know the most is PayPal.
How this works is that these companies have set themselves up to handle the whole scenario. They provide to us shopping cart options with fairly simple code that can be installed into your website. They then handle both the Gateway and Merchant Account elements themselves. All of the liability and security is done through them. Once you get a payment, you simply have to transfer the money directly into your bank account.
How this works is two steps:
1) Get an Account – We would sign you up with an account with whichever company you decide you want to use. It’s a fairly easy process that we can help you with by simply having you on the phone to answer questions. Typically it takes about a half an hour.
Account Cost – There is no cost to signing up with these companies or any monthly fees. Typically these companies charge transaction fees only. PayPal, for instance, currently charges 2.9% + $.30 per transaction (which is comparable to any merchant account).
2) Installation – We can then install buttons and shopping cart items onto your website. When someone clicks on the “pay” buttons they would then be taken to the website of whatever company you chose (like PayPal) and all purchases would be finalize there on a secure server. We can typically customize the buttons or cart to ask whatever questions you want right on the cart. This is fairly easy to install.
Installation Cost – We’ve installed a lot of PayPal carts, and have also done a few on Google Checkout and Amazon. The cost for doing this for around 10 items (whether they be Products, Donation Boxes, …) is typically around $300 to pay for our time. Obviously, the cost will depend on how many items you wish to have put on your site. Beyond that, there shouldn’t be any other installation fees.
Pros: The real positive part of doing this is that it is easy to do and is inexpensive. It’s an all-in-one package, so we sign you up and install it. You end up with a small setup fee to pay us to set it up, and then only have transaction fees when you receive a payment. Another big positive part is that all of the security and liability is taken care of through the outside company. There isn’t even a hint of association to you. It is clear when someone is paying that they are going through something like PayPal and these companies typically guarantee the transactions. Your company won’t even get the credit card numbers. Thus, this is a very safe way to do it.
Cons: Since people are paying through something like PayPal it isn’t as pretty as if we could customize all the pages. There are some customization options, but in its basic form you get your name at the top of the PayPal cart (so it’s obvious they are paying you), but the pages would not be fully customized the way it would be if we created your own fully integrated shopping cart. In our estimation, at this point anyone who has made a payment on the internet knows PayPal, Google, or Amazon, so we don’t see this as too much of a bad thing. But, the extent you want the pages customized is a consideration.
Note: If we are going this route, then we’d suggest using PayPal. Google Checkout and Amazon are good options, but they currently require people to “get an account” when paying. PayPal lets you do it either way where you just pay with your Credit Card or get/use your account.
-------------------------------------------------------------------
Conclusion
The “fully integrated option” is much harder to do and will be much more expensive to setup and run over time. It will get you something that looks a little more professional, but still does send people off to a shopping cart company (i.e. off your site) to pay. The pages will just look more like your site, so will have an extra air of professionalism.
On the other hand, the “outside provider option” is easy to setup and inexpensive in all aspects comparatively. The down side is that you don’t get as much customization so you are accepting the fact that the processing is clearly going through an outside provider. Overall, people are used to seeing this on the internet now, but it is clearly a difference in presentation.
Realistically, the final question comes down to how much you are willing to pay for what level of customization on your site.
