Michael Roebuck's Blog

Having a home based or online business means you need a way to process payments from your customers. Accepting credit cards is absolutely necessary if you want to accept payment online. Imagine what would happen if you allowed customers to place orders on your website, but then required them to mail a check or money order before they could finish their purchase? Chances are, you'd lose every customer to your competitor's website where they could finish their purchase immediately by entering their credit card details for payment.

Choosing a payment processor or merchant account for your business can be overwhelming - you want to choose the one with the features you need and that will charge you the lowest fees. Luckily, you have many options and a variety of payment processors that offer different features that should accommodate whatever industry your business is in.

Merchant Account Options for Internet and Home-based Businesses

Home-based and internet businesses have a number of options for accepting credit cards from their clients. Where as retailers use a card reader to accept credit cards face-to-face, an internet business needs an online method for securely accepting cards as payment. Internet business owners can choose between a merchant account with a banking institution, independent sales organization or third party payment processor. Many merchant account providers have high approval rates, even with less than perfect credit ratings of applicants, and offer a variety of special features and options for an internet-based or home-based business.

Third Party Providers

When you use a third party provider to accept credit card payments, the customers payment gets deposited into a merchant account that works with the third party provider. Then you can transfer the funds to your bank account. This process can take several days from the time the customer pays and the time you can access the money and if you choose a fraudulent business as the third party provider, you may not see the funds from your transactions. Do your research carefully if working with a third party provider rather than a merchant account directly, to ensure they are a reputable business.

Merchant Accounts with Banks

When you open a merchant account with a bank, you have the confidence that the banking institution is secure and dependable. Online businesses may have a harder time opening a merchant account with a traditional banking institution however, as they are seen as a higher risk than a retailer with a physical location. You're also more likely to find yourself with a closed merchant account if you have charge backs from your internet business.

Independent Sales Organizations

For new businesses or business owners with less than perfect credit, using an independent sales organization is a good option for accepting online payments. Most of the time this type of organization is going to charge higher fees than other methods of accepting credit cards, but it's a good option for businesses who need to establish their credit before they can get other forms of merchant accounts.

Getting Paid from Credit Card Payments

When your customers pay for their purchases with credit cards, the funds are automatically moved from the merchant account to your business bank account. Fees are charged by the bank, third party processor or independent sales organization. The higher your sales volume, the lower the fees you'll be charged.

You have a number of choices for accepting credit card payments. Make sure to weigh your options and the fees each option charges before making a decision for which company to use as your payment processor.

Labels: credit, merchant, payment, processor

I was eating lunch at the Hotel here in San Jose and decided to check email from my phone. I received a blog post that really caught my eye. Scott Smigler of Exclusive Concepts had written a great article on why Yahoo Store was the best e-commerce platform.

Scott's company is like mine and they are also a Yahoo Partner. Anyway, I highly recommend you go and read his article titled: Yahoo Store | The Best E commerce Platform for SEO.

I don't want to copy any of his text because it's a new post and I want to be sure Google picks his article up first. But in my opinion, it's a good read all but one major flaw.

He specifically states Yahoo Merchant Solutions is a great platform if you plan on or are doing a minimum of $500,000 annual sales. I respectfully disagree. Yahoo Merchant Solutions is an excellent platform for EVERYONE, with no suggestion of minimum annual sales. Where else can you have an easy to design website that includes a secure shopping cart for $39 month? He does mention it's scalable so as your business grows you can access more features but for the new person starting out, it's an excellent vehicle. We too looked at other platforms and seriously considered designing eBay ProStores at one time but no-one, and I mean No-One comes close to what Yahoo Merchant Solutions offers. As Scott mentions, That probably explains why 1 in 8 e-commerce sites are hosted by Yahoo!

So, great story Scott! I enjoyed reading it. And maybe you placed a minimum to ward off the low end design clients. The ones who want a site like Amazon for $300. That's OK. We have a $299 package and can work with them! (No Amazon though. Not even close for $299)

If you are on the fence about if you should use Yahoo Merchant Solutions, Go read Scott's article!

Labels: merchant, solutions, yahoo

Cyber Monday. The biggest on-line shopping day, named because this Monday is the on-line equivalent to Black Friday; the largest shopping day of the year. On-line merchants were expecting a great day and we were prepared to make fast web site updates as merchants needed to make quick tweaks and updates to there sites. Unfortunately, Yahoo Merchant Solutions had a hiccup. Or maybe it was a Heart Attack.

I'm not going to bash Yahoo. Others are going to do enough of that for me. We all know Yahoo had issues. We all had a false sense of security and most of all, we all lost money. How much money? It's unknown as of this post, but the Yahoo Shopping Carts were down for most of the day so you can do the math.

What does this mean for Yahoo? Will clients jump ship? I certainly hope not. While this is certainly a problem and serious money has been lost, it is not a regular occurance. We very rarely have problems with Yahoo and they are always operational. I've been monitoring sites every 5 minutes for years now and can only remember one instance where a client site went down because of Yahoo: (Early April, 2004. PAIX telephone line issues.)

I still believe that if we owned our own servers and this happened, we'd be on the phone with outsourced techs trying to resolve it or the one IT person would be trying to figure it out. It would probably take days to resolve and happen more often. I would guess that Yahoo has more than one IT guy and there are probably numerous people with lots of letters after there names working very hard at fixing this. Yes, Yahoo is going through troubled times and yes, this outage is a serious problem, but as a whole, Yahoo has been very stable. Before you jump on the Yahoo bashing wagon which I'm sure will appear, think about all the good things that happen because of Yahoo. It's still early and we won't know the full effects of this problem for a while yet. That aside, I imagine we'll muddle through. Hopefully Yahoo has learned something and this won't happen again and hopefully we'll be able to create some sort of backup system. But think about this: Where else can you get so much with a scalable solution that benefits the small guy? Yes, there is other competition, but there isn't any other like Yahoo!

Don't know what happened to Yahoo? Here is a Link to Bill Hartzers' Blog with links to various news stories.

Labels: black, christmas, cyber, friday, merchant, monday, solutions, thanksgiving, yahoo