MSIS - E-Commerce

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There are two main cost considerations when adding
e-commerce to your web site:

1. The first fee will be dependent on the number of items and complexity of the shopping cart. MSIS has a minimum fee of $375 to set up a simple single page listing of 1-5 products for your cart. The price for this work is always bid based on the scope of the entire job.* Some shopping carts may also be assessed a monthly service fee depending on the type of storefront created.

2. In order to accept credit cards as a payment method on your web site you need to have a merchant account. The exception to this rule is if you use a service that will process payments on your behalf such as Paypal, 2Checkout.com, or Internetsecure. This is a viable and affordable alternative for low volume merchants.

* NOTE:
Shopping carts and storefronts are only bid in addition to a web design contract.

Please read on so that you can better understand the options.

Merchant accounts
A merchant account is not a business checking account. It is a special facility that is arranged with a credit card clearing bank that allows you to process card transactions through their facilities. In general, as internet merchants you are required to declare to the acquiring bank who gives you this facility that that is how you trade. In many cases you will also have to pay higher rates than offline businesses such as shops or restaurants who obtain a signature from their customers.

The mechanism for obtaining a merchant account varies from country to country. In the US merchant accounts are sold by third party vendors, in the same way as many other financial services. You are not required or expected to use the same bank for any other purpose so you are pretty much free to use who you like. In general the best place to start searching for a merchant account is at the websites of the payment gateways, for example, Cybercash and Authorize.net.

Costs The cost and ease of obtaining a merchant account varies from country to country. In the past the US has probably suffered some of the highest set-up costs (more than $500) but that is changing now. Always check the hidden costs such as minimum monthly charges or flat rate maintenance fees.

Sample Cost Summary of a Merchant Account
To set-up a package with a Standard Class service merchant account, it can cost you around $350 to start. Don't forget to add this to the minimum $375 set up of your shopping cart as listed above.

The merchant account maintenance fees are $20-30 per month. The discount rate is very low at 2.42%. Each transaction will cost an additional $0.60 in total. Add into this any web site maintenance fees that you will have for your web site and you can see that costs can reach $75-$100 a month for a merchant account in maintenance fees and a minimum of $700 for the initial creation of the shopping cart/SSL services.

*This is only for the shopping cart/e-commerce section of your site and does not inlcude any other web site design. This is an estimate only and a formal bid is always required prior to accepting any work.

If your sales are not forecasted to cover this you may want to read on.

Third Party Payment Processors
As an alternative to using your own secure server set-up to collect check and credit card details, you can use a third party payment processor.

Although I list the following companies I make no commitment to link to any particular service. There may be additional fees involved with setting up clients with these services so a formal bid that is approved in writing by the client is required prior to accepting any e-commerce job.