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When is the right time to consider outsourcing or insourcing your eCommerce capabilities ? [Software Vendors]

February 20th, 2010 | No Comments | Posted in article, ecommerce, emarketing

Here is a summary article about a question I received a couple of days ago :

I’d like to hear what you have to say about when is the right time to consider outsourcing or insourcing your eCommerce capabilities ?
This is a question for Software Vendors,By eCommerce capabilities the followings should be considered: payments processing & tax handling, anti-fraud, shopper call center, bits delivery, etc.

Indeed, that’s a good question than software vendors and publishers could consider. Indeed software , shareware , and extended service provides a confortable margin if you have a decent volume of sales. That’s all the magic side of the software market compared to the electronics and hardware market, the cost to produce 1 software copy of 1 millions copies is about the same, only the maintenance, support, and registration cost will be on your volume.
Payments processing is usually depending on a bank, but some website acts both as a bank, reseller, and service providers, so instead of multiplying the provider you can have one to do several key tasks for you. But it has a price.
If you start with your business, and need a very fast integration of a payment method, at least to check if you will have at least your first order. You may consider easy solution such Paypal. Paypal is easy to open, no delay to start, well accepted by users, and the fees is pretty cheap with a fee of 3%.
3% is looking as huge for some newbies, but actually that’s a cost you will have only on the first sales, and without monthly subscription and without the need to give away you last blood exam as you may experience ( I m exagerating a little bit ) to your bank account manager.
As soon as you validate you have really a sale potential, it is highly recommanded to switch a popular payment service provider, you can look for RegNow, Avangate, ShareIt, Plimus, FastSpring, UpClick, SwReg, etc.. ( contact me to have special offer deal and check which one could fit the most your own activity )

Let’s do a list of top reason Why you should Outsource or Insource your eCommerce ?
– Price / commission / fees cost
– Extending the number of paiment methods
– Access new features ( Backup CD, Extended download )
– Access a new affilation network
– Have a specific shopping cart experience
– Complete control of each step of the registration
– Easier customer’s information integration
– Outsourced support for the paiment problems

Are you interesting by a complete and tailored study of this question.  Contact me or leave a question in comments.

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