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E-COMMERCE EXPLAINED: PART 1


 
E-commerce or Electronic commerce is the purchase or sale of products and/or services over the Internet. Typically it’s regarded as the sales aspect of the electronic business and deals specifically with financing and payment of business transactions. 
 
Typical E-commerce sites contain these basic functions:
 
Shopping Cart
 
 
To have a Shopping Cart, your site needs a database. Shopping carts allow your clients to select items from your website in a "virtual cart" and then view and modify the order before putrchase before purchase. A feature QECART is a One Page Checkout.
 
The site will display one page and everything is on this page. The client doesnot have to regiser then come back to checkout then refresh the page to calculate shipping and then go to the checkout page to finalize the sale, Everything is on one page and automatic.
This makes the pruchase of products on your site much easier for the client.
 
 
 
Shipping Module
 
When selling products, you will need to ship them to those who have made a purchase. There are a few different ways of calculating the shipping costs.
 
1. Flat Rate Shipping - This is when the website charges a flat fee for every item purchased. You should consider how much it will actually cost for you to ship a majority of your items and create a fair price for both you and your client.
 
2. Zone Shipping - This is when you can charge different rates for each specified zone. For example if you were to sell a product to an individual in the same city as you, the shipping should be relatively inexpensive. However if they live outside the city, or outside of your local area, the shipping will probably be higher..
 
3. Live Shipping Cost Calculation - With Live Shipping, your website takes its postal code and compares it to that of the customer, along with the volume weight of the parcel. The site now takes the information gathered, calculates the proper shipping costs and then inserts it in the invoice section of your checkout page.
 
It is possible to have more than one shipping method so the client can have a choice.
 
 
Payment Gateway
 
Payment Gateways are services run by financial institutions that allow websites to connect to them and process credit card payments. There are two ways that a credit card payment can be processed.
 
 
A Payment Hosted Page is where the website directs the user to the payment gateway’s website and the payment is processed on their website. The second method is when the pay page is hosted on your website. To have a page on your website it must be placed on a Secure Socket Layer or SSL. Additionally, you must purchase a Certificate of Authenticity or COA.
 
Why is this necessary? When the website tries to process a credit card payment it first sends out a signal to the payment gateway asking for permission. Signals between payment gateways and your website must be secure. The payment gateway then sends a signal to the issuer of the Certificate of Authenticity to verify a valid transaction request.
 
The company that issued the certificate then sends a signal to your website and confirms the encrypted code, if the code is properly placed then your website gets the OK. This ensures that your website is truly legitimate. The credit card company then receives a signal to continue the processing of the payment. This all takes place in a matter of seconds.
 
Some payment gateways offer both types of credit card processing. PayPal Standard for example, the customer goes to PayPal's website and it makes the payment on their site. A problem that may come up here is when the customer goes to PayPal's website it looks like they have to sign in to PayPal to make the purchase but they do not. This confuses a number of people and potential customers, some customers may think that they cannot pay here because they do not have a PayPal account.
 
PayPal Standard is the easiest payment gateway to get approved for. All you need is a credit card and a bank account. The advantage to PayPal Standard is that you do not need to have an SSL or a Certificate of Authenticity because PayPal has these features on their website already.
 
To use PayPal on a payment page that is hosted on your website, PayPal will need to conduct a credit check on you and your business.  Once approved, you will need to purchase a Certificate of Authenticity and set up an SSL. The advantage to this is that your customer does not leave your website and go to another web site to make a payment.
 
You will need a Certificate of Authenticity and will have to setup a SSL. Some payment gateways also charge a monthly fee for using their service. PayPal Pro charges a fee of $35.00 per month. This fee also includes a web terminal that allows you to process phone-in orders. Companies such as Paymentech, Moneris, and others also offer both solutions.