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If you are selling a product or a service, e-commerce might be a smart way to do business.

Internet Commerce

E-Commerce is about selling products or services over the Internet.

If you are selling a product or a service, e-commerce might be a smart way to do business. Over the Internet you can reach a large number of customers.

E-Commerce Systems

It is not a very good idea to build your own e-commerce system. Some (larger) companies might do it, but we will not recommend it if you run a smaller business. Building an e-commerce system is a complicated process, with the potential for a lot of errors.

You might buy a ready-to-use system and run it on your own server. Many systems are available on the market today, and most of them will cover your basic needs for order management and processing. But again, if you are not familiar with hosting your own web site, starting with an e-commerce site is not the right thing.

The best solution, in our opinion, is to find a hosting provider that offers an e-commerce solution.

Hosting Providers

E-commerce covers a very huge range of products. With different hosting providers you will find anything from very simple to very complex solutions.

Most providers will offer a simple and inexpensive solution that allow you to run your own "virtual store".

Your Checklist

  • How does it handle customers?
  • How does it handle product catalogs?
  • How does it handle orders?
  • How does it handle inventory?
  • How does it handle back orders?
  • How does it handle shipment?
  • How does it handle accounts?
  • How does it handle billing?
  • How does it handle payment?
  • How does it handle foreign currency?
  • How does it handle credit cards?
  • How does it handle taxes?
  • How does it handle security?
  • How does it handle integrity (encryption)?

Also check if the most time-consuming tasks are automated. Look for automated billing, invoice handling, accounting, and report generation.

Before you sign up a contract with any hosting provider, surf some other e-commerce sites on their servers. Find out how it works. Actually try some shopping and see if you get a good feeling. Also compare the other sites against yours, to see if it looks like you have the same needs. Contacting some of the other customers is also a valuable option.

Tax Issues

Taxes is a complex issue for most on-line stores. Especially VAT (Value Added Tax).

If you are selling on-line, you will most likely be in the export business.

Trading with different countries is easy, but tax issues might be tricky. Exporting goods may not be the subject of VAT in your country, but often your customers will have to pay their local VAT when they pick up the goods.

In addition, there will be the issue of income tax for your shop, depending on how you report your income from sales.

Before starting an on-line store, be sure to consult your tax adviser.

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