E-Commerce Essentials

But Wait, There's More...

While customer service, marketing and site maintenance are where you'll want to concentrate the bulk of your efforts, your preparation doesn't end there. Another important consideration: fraud prevention.

E-tailers have taken many steps to ensure their customers feel secure when making online purchases. But little focus has been given to protecting e-tailers from unscrupulous shoppers. Credit card fraud remains a growing concern for e-tailers, says Steven Peisner, president of Shared Information Systems (http://www.nochargebacks.com), an Internet fraud prevention company.

How can it occur? "Electronic shoplifters," as Peisner likes to call them, place an order on your Web site using a credit card. Then they call their credit card company, claiming they never received the goods or didn't request them. The result? The retailer typically ends up eating the loss, plus gets charges a $15 to $25 chargeback fee by the credit card company. Just two or three chargebacks per month can quickly add up, putting a substantial dent in your profits.

To protect online retailers, Peisner's company offers a Web-based service, http://www.nochargebacks.com, which provides access to a database of credit card holders with prior chargeback requests, to help you decide whether to accept a transaction. There's a $50 to $95 application fee and a monthly subscription charge of $15, plus 25 to 35 cents per transaction. E-tailers offering high-ticket items will especially want to consider this service.

In addition, if you plan on doing business in different countries, you'll need to be aware of possible taxation issues, language barriers, and order processing and shipping logistics. Government regulation remains an increasing concern for e-tailers as well. Congress is currently considering a number of bills regarding privacy, Internet taxation and company e-mail marketing policies. Expect these issues to strongly impact your electronic storefront in the coming months.

Is your head swimming yet? Certainly, all this gives you plenty to think about. But being informed could save you from potential problems down the road, increase your sales and improve your chances for success.

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