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This page is designed to give you a quick overview of how e-commerce works.
Critical componets for e-commerce
1) Website
Your online connection to your prospects and customers. The design of your site is critical to the success of your business! If it does not look like
a professional, legitimate business - NO ONE WILL ORDER ANYTHING - no matter how great the products you have. If you are serious about doing business on the web, either go back to school and learn html, java, cgi,
etc., or hire a professional to design your site.
2) Merchant account
Bank authorized account which allows you to accept major credit cards, electronic checks, etc. Many banks
will not give you a merchant account if you do business on the internet because they may classify it as high risk. Be careful when looking for a merchant account provider! Watch out for hidden fees, high setup fees,
and other unscrupulous business practices.
3) Payment Transaction Software
Software which actually processes customer order information, address, credit card number, etc. The data is
sent to a credit card authorization network which verifies that the credit card is valid and verifies that the shipping address matches the billing address. A possible warning sign that the card has been stolen is
that the billing and shipping addresses do not match.
4) Secure Server Connection - https://
Link to a special computer which encrypts confidential ordering data for customer protection. You know you
are on a secure server when the URL in your browser says "https://". The "s" stands for "secure.." If ordering information is
not sent via a secure server it can be intercepted by computer hackers.
5) Shopping cart
Software which allows you to accept product orders for multiple products from your website. This software
automatically calculates and totals orders for your customers. Some setup must be done in the html code of your website, and the shopping cart software must be installed on the server which hosts your site or on the
secure server which accepts sensitive ordering information.
You could need more depending on your type of business and how you want to accept and process orders online. Marketing is also necessary.
To
understand how the money actually flows from a customer to a merchant's bank account, click here.
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