Your choice of ecommerce software is probably one of the most important decisions you make when creating an online store. The ecommerce software can be seen as the equivalent of a stores physical layout. It doesn't matter how well designed your store is – if the layout consists of multiple different levels in a tiny space, ecommerce software cracks in the ceiling and horrible plumbing, you'll be spending more time fixing your store than selling.
There are two options for ecommerce software, using a hosted solution or a licensed software.
Hosted Solutions aka pay as you go
The main advantages of hosted solutions are that the up-front costs are pretty low, many come with easy to use templates and wizards and you can generally expect an on-going series of upgrades. The hosting provider will deal with all the technical issues that you, as a potential business owner, might not understand or care about.
That leaves you, the owner, with a lot more time to deal with the actual business of running the site. It's a very good solution for those who have little knowledge of the IT side and do not have access / do not wish to pay an IT team to deal with it.
Examples of Hosted Solutions include Amazon and Yahoo! Merchant Carts. There are obviously numerous others, from tiny companies with only a few hundred merchants on their software to larger companies with thousands.
The Joys of Ownership
Licensed software solutions generally are run on your own server. You purchase (or download in the case of Open Source solutions) the files and then upload them on your server. You then generally have the right to do whatever you want to the software, especially with OpenSource solutions.
The advantage of licensed software solutions are the joys of ownership – you own it, you host it, you can customise it. The start-up costs are generally quite high (unless you are a website designer by cart software trade, you are either going to have to pay to have the site designed or set-up or both) and on-going debugging is certainly a danger. online store Ongoing fees are however likely to be much cheaper.
Open Source solutions are currently in-vogue, but many Open Source solutions are very buggy and unless well supported by a good community, finding solutions to the software problems can be difficult. On the other hand, you can find solutions yourself – unlike a hosted or fully-licensed solution.
Choices, choices, choices
The ultimate choice is really dependent on your personal skills, your contacts and your inclinations. If you would rather not have to deal with the technical side, then a hosted solution works very well. If you enjoy tinkering with the site, adding new options constantly and fixing things up, a licensed or open source solution might just be the thing. Of course this assumes you have sufficient ecommerce software funds to actually go-ahead with this option solution.
Ongoing cost differences aren't huge really, especially during the start-up phase. Yahoo! Merchants estimates that at $10,000 a month, you would be paying them US$189.95. A decent hosting plan for that kind of volume would cost you about $30. Of course, there's the time cost of fixing bugs and technical support – its anything from $50 per ticket to $100 per hour for technical support.
As an online a board game store, we've gone ahead with Magento (an open source ecommerce solution) since we have both the technical and marketing background to fully utilise the solution. Another, less web savvy business might opt for a hosted solution.
Tao Wong
Starlit Citadel – an online board games store based in Vancouver, Canada.
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