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With so many payment options available, which methods should you accept? The rule of thumb is to take whatever payment methods your customers offer. This doesn’t mean to suggest that you accept every payment method imaginable (most e-commerce operators shy away from payment in, say, live animals…).

It does mean to listen to your customers and try to be flexible enough to accept any reasonable payment methods that they actually want to use. As you decide, take into account your own financial situation, your demographics and price points. Remember, the methods you choose should match your customers’ needs and buying patterns.

What follows is a brief synopsis of each of the major alternative methods:

PayPal

What is PayPal? PayPal is an online payment processor owned by eBay. PayPal allows customers to create a PayPal account and pay for purchases using their credit cards or bank account. The buyer’s credit card or bank account information is never sent to the merchant – PayPal sends the merchant money instead. This protects the buyer’s information from being shared with endless different businesses and narrows the risk of having their personal information fall into the wrong hands.

Basically, PayPal works for—EVERYONE! Unless you have a good reason not to accept PayPal, accept it. Your customers will thank you.

PayPal Benefits:

• Already integrated with your Yahoo! store

• Rates are comparable to most merchant accounts

• Over 150 million online shoppers use PayPal worldwide

• Privacy: Actual credit card information is only seen by PayPal and not shared with merchants – this protects customers if a merchant compromises payment information

• Typically, PayPal users prefer to pay with PayPal because it gives them a single place to manage all of their purchases

• PayPal also offers express checkout

(Using express checkout, your customers’ information is already saved and populated for them so they don’t have to retype everything again. Because of this, express checkout conversion can be 40% higher than other modes of checkout.)

Bill Me Later

What is BML? Bill Me Later offers financing to your customers. When purchasing through your site and Bill Me Later, your customers are able to purchase high ticket items with no money down and no payments for 90 days!

Who should consider incorporating BML? Merchants who are doing at least $5M a year in online revenue and selling higher ticket items are obvious candidates.

Bill Me Later Benefits:

• Offers affordable payment terms
on high ticket items (jewelry, computers, etc)

• 50%+ increase in average order value, up to 150% when combined with promotional financing

• Easy integration through the industry’s largest payment processors, so authorization and settlement flow through existing interfaces

Google Checkout

What is GC? Google Checkout is a
fast, convenient checkout process that allows customers to buy from you with a single login.

Which businesses are the best candidates? Anyone advertising on the Google Adwords platform with an e-commerce website that is compatible with Google Checkout should consider GC.

Google Checkout Benefits:

• $50 in free adwords

• 21% discount on FedEx shipping

• Free credit card processing (as long as your sales don’t exceed 10 times your Google Adwords spend)

• Google Checkout users click on ads 10% more when the ad displays the Checkout badge and convert 40% more shoppers who have not used the Checkout in the past

• Checkout’s Payment Guarantee protects 98% of Checkout orders on average – when an order is guaranteed, you get paid even if it results in a chargeback

Summing Up

Each of the above methods has its strengths and each should be strongly considered, based on your business. PayPal is widely trusted by consumers who shop actively but want security. Bill Me Later offers credit options which can be particularly attractive to high ticket shoppers. Google Checkout offers the ability to buy with a single login and falls under the highly-trusted Google umbrella. Consider your business, consider your customers and choose accordingly.

If you thought tax season was a trial, e-commerce operators haven’t seen anything yet. By the end of the year, 23 states will be charging e-commerce businesses taxes. Imagine. Different products are categorized differently and taxed differently in different states! But never fear; Solid Cactus and Avalara can make your life easier when it comes to charging and collecting taxes as well as assembling the necessary tax reports.

The problem many merchants on the Yahoo! Store platform encounter is that you need to manually set up all the zip code ranges and add a flat rate or percentage. This is time consuming and must be manually updated when county level, city or municipality taxes change. In Tennessee, the sale of an item is subject not only to the state sales tax of 7%, but the local sales tax on the first $1,600, plus an additional state sales tax of 2.75% on the second $1,600, all of which cannot exceed $3,200 - potentially subjecting a sale to a 9.75% sales tax rate. Confused yet? Here are some other exotic tax laws:

• In Minnesota, non-edible cake decorations are taxable, but edible cake decorations are exempt.

• In Texas, plain nuts are exempt “food,” but once a candy coating is added, they become taxable “candy.”

• In Rhode Island, fruit juice that is less than 100% pure is taxable. Cranberry juice cocktail – a mixture of juice and water, or concentrate — is exempt.

• In Massachusetts, a clothing item costing up to $175 is exempt from sales tax. However, any item costing $175.01 and above is subject to the 5% state sales tax.

• In New Jersey, naturally carbonated water is exempt, but artificially carbonated water is taxable.

• In Pennsylvania, state and U.S. flags are not subject to tax, but if either is sold with “accessories” (i.e. a pole), the entire purchase becomes taxable.

With many states adopting the Streamlined Sales Tax or SST (http://www.streamlinedsalestax.org/) there will be more rules in which products will need to be taxed. Some changes will be difficult for merchants to manage as they relate to how products are sold. Currently17 states are “Full Members” of the SST:

• Arkansas

• Indiana

• Iowa

• Kansas

• Kentucky

• Michigan

• Minnesota

• Nebraska

• Nevada

• New Jersey

• North Carolina

• North Dakota

• Oklahoma

• Rhode Island

• South Dakota

• Vermont

• West Virginia

• Wyoming

In addition to the 17 “Full Members” several other states are considered “Associate Members,” meaning they’re in line with the SST requirements although the state is not yet in full compliance. They are:

• Ohio

• Utah

• Tennessee

• Washington

The SST rules will affect different merchants in different ways which could make calculating sales/use tax a “taxing” task. Finally, there is a solution.

Solid Cactus has partnered with Avalara, a leading provider of real-time tax calculations and a SST certified tax solution. Among the features of this partnership are:

Reports and Remittance:

Save time and resources by using a single solution, integrated into your financial application to submit one remittance payment. Avalara not only takes care of the forms you need for each jurisdiction where you have nexus, but also remits the liability on your behalf.

Reporting Tool:

Comprehensive and easy to use, Avalara’s reports provide detailed, summary and exception reports to satisfy statutory tax return requirements. Ensure full statutory compliance, superior internal process controls, and best practices for sales and use tax.

Reports:

AvaTax offers a crucial component to sales tax compliance: detailed, on-demand reports provide you with quick access to the information needed to prepare and submit sales tax returns. You can easily and quickly generate reports, which can be exported to the file format that works best for you.

The Shipping Manager integration with Avalara lets you offer features to enhance your business performance and will make your life much less stressful come tax season.

The rate of fraud associated with international orders is over two-and-one-half times that of domestic orders. Merchants also reject international orders at a rate of two-and-one-half times higher than domestic orders.
- CyberSource

No two words set an e-commerce store owner’s blood boiling like “fraud” and “chargeback.” Unfortunately, they’re all too common.

The CyberSource 9th Annual Online Fraud Report estimates that $3.6 billion went to online fraud last year. We’ve all lost our share.

Fraud will continue to grow along with e-commerce unless we stop bad orders before they hit the package car. The question is, how?

Be Wary of Foreign Orders
Merchants surveyed by CyberSource said “the rate of fraud associated with international orders is over two-and-one-half times that of domestic orders. Merchants also reject international orders at a rate of two-and-one-half times higher than domestic orders.”

When I ran our former pet supply division, we had a many international orders and were occasionally burned. We developed a straightforward no-exception international policy:

• International customers must fax a copy of the credit card (front and back) along with a signed copy of the order
• The issuing card bank must verify billing information
• No orders to third-world or developing countries
• Absolutely no orders to Nigeria, the fraud capital of the world

We immediately caught numerous orders before the card was run when customers could not provide information. After we established a relationship with the international customer (at least 2 orders without a problem) we noted their account and streamlined the process.

Shipping to international destinations teaches you which country’s postal systems are corrupt and whose agents steal packages rather than deliver them. You learn which countries let you bypass customs if you mark the package as containing “religious articles.” Sadly, you’ll also learn which countries either hold packages for months or don’t deliver them at all.

Beware of Warning Signs
International fraud may be most prevalent, but we have plenty here at home, too.

The first warning of a fraudulent order is a package with a “ship to” address in a different state than the “bill to” address and is being shipped next-day air. In this case the “perp” will have stolen a credit card. He or she will get the billing address and take delivery at a vacant house, a house known to be empty at a specific time, or an empty lot. Because it’s next day air, the perp stakes out the location, meets the delivery, signs and disappears with the package. Trust me, it happens!

We immediately flagged orders like these and had a CSR contact the credit card’s fraud department to verify if the customer had a valid shipping address on file and if fraudulent activity had previously occurred on the card. We matched the shipping name address to the house registration. Next, we would run the card and match the AVS. Finally, we called the customer for verbal confirmation before releasing the information. It’s not always 100%, but it reduced fraud.

Policies and Procedures Provide Protection

• Always, always, always, use address verification (AVS) with your credit card processor. AVS compares house numbers and zip codes of what you’re sending and what the customers have on file with their card company. If it doesn’t match, proceed with caution. AVS is generally available only for US cardholders in Canada and the UK.
• You are considered a card-not-present merchant and must obtain a card verification number (CVN, CVV2, CVC2, or CID). These three- or four-digit numbers verify that the card is in the possession of the card holder. This verifies, but does not guarantee the card isn’t stolen.

What if I’m a Victim of Fraud?
Usually, you’re out of luck. When a person who had a card used in a fraudulent transaction files a chargeback with the bank, you’re notified and allowed to file a response. Review the documentation with the chargeback notification and file the response even if it appears like fraud. Have it on file. Unfortunately, CyberSource reports that only 40% of chargebacks filed are won. If it’s a clear case of fraud, you won’t win a chargeback. File the paperwork, provide the transaction information and cross your fingers.

Fraud is real and some scams will get through. Still, having policies in place and being diligent are a good start.

How does your business combat fraud?
Contribute your thoughts to our website at our forum.

As employees spend more and more of their workday on the computer, it is crucial to develop and enforce an effective and proper Internet and Computer Usage Policy. There are legitimate reasons for having such a policy and a variety of issues the policy should address.

Personal Internet use costs employers millions of dollars each year in wasted time by employees. To reduce this lost productivity it is important to limit Internet use during working hours to business use only.

Yes, You Need a Policy
Legal liability can arise from inappropriate web browsing, improper posting in forums and on blogs, downloading pirated software, or illegally downloading media files, such as movies and music. Companies can face significant exposure to lawsuits and fines for their employees’ inappropriate actions and an effective policy can help prevent such legal exposure.

Employee Internet use can damage a company’s computer systems and clog their network. A virus entering into a corporate network can have disastrous consequences such as business shutdowns or loss of files. Also, personal use of the Web may use enough bandwidth to seriously slow the network and negatively affect productivity.

Moreover, a company must protect its reputation. Messages published on a message board, chat room or blog using a staff member’s company e-mail can have an effect on the company’s reputation, especially if it contains offensive or inappropriate material.

Developing a Policy
Before implementing a comprehensive Internet and Computer Usage Policy, the company should identify which activities to monitor and manage. Such activity might include web browsing, forum and blog posting, instant messenger use, and down-loading media, software and other associated content while at work or otherwise on the job.

The policy should accurately reflect the company’s procedures in monitoring and managing its employees’ internet and computer use. The policy should stipulate that internet access and other online privileges provided by the company are to be used only for business purposes. The company should state that employees’ use of the Internet and computer system will be monitored for illegal or improper activity. The policy should clearly define what activities are considered improper, and may result in disciplinary action, up to and including termination. The company should state that it may report illegal activities to the appropriate authorities.

Examples of activities to be addressed and/or prohibited in the policy:

• Violating the laws and regulations of the United States or any other nation, or the laws and regulations of any state, city, province or other local jurisdiction;
• Using the company’s system or network to knowingly disable or overload any computer system or network, or to circumvent any system intended to protect the privacy or security of another user;
• Using the company Internet access to commit infractions such as misuse of company assets or resources, sexual harassment, and misappropriation or theft of intellectual property;
• Presenting an employee’s personal opinions as those of the company;
• Browsing websites which contain hateful or obscene content;
• Downloading or distributing pirated software or data;
• Downloading or distributing media files, in violation of copyright or other intellectual property laws; and
• Downloading or installing any software or electronic files without proper authority.

A company may want to include in the policy that the specific websites visited are logged, the frequency and length of time individuals spend viewing websites will be logged, and that if instant messenger use is allowed for business purposes IM’s sent and/or received can be logged and viewed. The policy should also stipulate which employees are to be covered by the policy.

Making it Work
The policy should become part of the company’s employee manual and should be distributed to all employees. If possible, the company should ask all employees sign off on receipt of the policy (or the manual) prior to getting access to company computers or email accounts. By signing, employees are confirming that they are aware of company policies, restrictions and limitations.

Internet and computer misuse and abuse have become too prevalent for companies to overlook. As employees’ daily routines evolve, businesses must be willing to adapt. Developing and enforcing a comprehensive Internet and Computer Usage Policy is a crucial component for business evolution.

Imagine you were kidnapped and dropped in the midst of a jungle. Worse, you’re in hostile territory, you hear guns and people approaching. How do you get out of this crazy predicament?

I bet you’re wishing that Rambo just showed up with all of his survival knowledge, tools, and equipment and helped you get out of this mess.

Where am I going with this? I strongly believe that in today’s fast moving data-driven age, every website owner must have an advanced analytics package. If you don’t, then you
really are lost and you’ll need a Rambo.

The good news is Google is offering an advanced analytics package–FREE! Your favorite price. Google Analytics is an advanced web package which allows you to get a 360° view of visitor behaviors and trends. Go to http://www.google.com/analytics/ and sign up for a free account. A piece of code (provided by Google Analytics) is inserted on each page of your website and you’re good to go. It’s a little more involved for Yahoo! stores, which we will discuss below.

Google Analytics allows you to understand everything that is happening from the visitors’ arrival until the time they order, so that you can make educated changes and improvements to your store. It is a given that if you are serious about making money online, you need concrete data to make educated decisions. It has become imperative for us to analyze each change made to our store, as it has a direct effect on the intended consumer’s behavior. The good old days of relying solely on your traditional hosting package’s analytics or Yahoo! stores’ analytics are over.

Google Analytics gives the e-commerce operator the capability of analyzing key factors such as:

• Total Traffic - Repeat visitors vs. unique visitors.
• Origin of Traffic –Tracking the countries/states of your users.
• Source of the Traffic - Direct, Search Engines, Other referring sites, etc
• Medium of the Traffic - Organic/Natural Results, Paid Search Analysis (One click integration with Google Adwords), etc.
• Keyword Analysis – Keywords used to find your website can help you with evaluating your organic rankings on different search engines.
• Top Pages – Most popular pages within your website.
• Page Performance - Bounce Rates/Exit Rates – people leaving your page/website, time spent by each user, etc.
• Content Drilldown - How the user navigates throughout your website.
• Site Overlay – What part/links throughout your website are being clicked on the most.

To make this even sweeter, with a little bit of code modification Google Analytics can provide key marketing insights for e-commerce stores including:

• Conversion Rates – Broken down by Medium (defined above), time of day, etc.
• Customized Goals – Allows you to specify which metrics you want to measure (e.g. - I want a visitor to land here, and my goal is to lead them here. How often was I successful?)
• Shopping Cart Abandonment – How many people are clicking on the add to cart button but not completing the transaction (Analyzing the breakdown of the cycle allows you to correct the flaws and weak spots)
• E-commerce – It allows you to see how much money each source/medium produced, and from which origin. Also allows you to see which are the top-converting products, etc.
• Tracking other Marketing Initiatives – Such as Email, media/banner placements, Yahoo!/MSN PPC, etc.

The above information is a few clicks and a couple minutes away. It’s also just a glimpse of what can be derived from Google Analytics.

There is a minor obstacle for Yahoo! Store Owners. Unfortunately, due to the Yahoo! store leaving the domain to complete the transaction (after the user adds something to the cart), you need to customize the code in order to extract marketing data like conversion rates, revenue, popular items, etc. The good news is, Solid Cactus is now offering a 20% off for Ebiz Insider readers. This offer is good through March 31st, so go to http://www.solidcactus.com/google-analytics.html and enter the coupon code “Rambo”.

The information is out there, Google Analytics will help you get it and make sense of it, and Yahoo! store owners get a Solid Cactus discount this month only. So–why wait?

Shipping Manager is a hosted solution developed to offer merchants the ability to not only offer real-time rates via UPS but also allows calculations real-time via FedEx and USPS. In addition to the ability to pull real time rates, merchants can also elect to use rate tables as well. This option gives merchants the flexibility to charge shipping costs based on their business needs. This allows merchants to charge accurate shipping rates on the items they sell no matter what method you use.

Customize Your Shipping
Shipping Manager also offers the ability to customize your shipping from the item level. Some of the item levels include marking items as “Free Shipping” so that they are always a $0.00 shipping rate no matter which method of shipping customers choose. You can also specify select shipping methods that are available as free shipping for an item. Box dimensions can be specified to ensure an accurate charge and at the same time items can be specified as over-sized. An “Origin Zip” can be assigned to an item in addition to help calculate a more accurate charge. If your items have multiple boxes you can specify how many boxes the item requires for shipping and you can even include the individual box sizes and weights. Additional Markups can also be added to each item. This adds markups to the shipping rate already calculated by either the real-time rates or the rate table. This type of customization is helpful if you want to make sure you are charging for handling or shipping supplies.

You can also create custom shipping methods. This is extremely useful for merchants who ship very small items or very large items as you can specify minimum and maximum weights, order values and, if you choose, you may include a “Free Shipping” threshold.

Calculate Your Tax Charges
Shipping Manager is also able to calculate tax charges. Merchants can set the Tax Rate as a percent, flat rate or both per state or Canadian Province. Have you ever undercharged tax in a state? Is tax time a nightmare for your business? Need more accurate tax rates? Solid Cactus has you covered. We have partnered with Avalara to offer our clients the ability to calculate real-time tax rates based on the Zip+4. Not only will Avalara allow you to charge accurate, real-time tax rates but it will also offer reporting so you know where you collected various taxes from and how much was collected.

Show Customers Their Shipping Rates
Solid Cactus also will be offering a new tool to help shoppers see the shipping rates before they even add an item to the cart. Far too much shopping cart abandonment occurs because of shoppers adding an item to the shopping cart just to see what the shipping charge is on it. To help combat this, Solid Cactus offers a Shipping Calculator which can be integrated on the Yahoo! Item Page. When a shopper is thinking about buying an item, he or she will be able to enter in their zip code and instantly see the shipping charges for all methods on that item. Now shoppers will know exactly what they will be paying before they even add the item to the cart. Conversely, if you don’t want to show all your shipping methods on the item page, you don’t have to. You will be able to specify which shipping methods and costs to show on the item page.

Shipping Manager from Solid Cactus can help you customize your shipping, calculate your tax charges and show customers their shipping rates. Want to get Shipping Manager integrated into your Yahoo! Store? Want to talk in more detail about its functions? Give Solid Cactus a call at 888.361.9814.

If you’d like more information about Avalara, visit: http://www.avalara.com/

As consistent as the swallows returning to Capistrano or the buzzards to Hinkley, Ohio, our friends at the shipping companies celebrated the New Year with yet another hefty price increase…

If you’re paying published rates to ship packages, stop here, pick up the phone and immediately call your account rep. NOBODY pays published shipping rates.

This annual ritual forces business owners to re-examine their shipping policies each year and find ways to pass on these additional costs to the customers.

On average, UPS and FedEx raise their rates 5% a year and continue to tack on fuel surcharges. In 1994, shipping a 5lb. bag of pet food from Pennsylvania to California cost about five-dollars. Today, that price is nearly double and rising.

I’m going to tell you things the shipping companies don’t want you to know. I promise they will save you money!

The Power of Negotiation — If you’re paying published rates to ship packages, stop here, pick up the phone and immediately call your account rep. NOBODY pays published shipping rates. UPS, FedEx, and DHL are all fighting for your business, so play one against the other to negotiate a discount schedule.

Provide your account reps with a breakdown of how many packages you ship to each of the shipping zones and the weights the majority of those packages. They’re going to ask for the breakdown to do a study, so have it ready.

Ask all three carriers to make proposals. Most will offer a flat discount across all weights and zones and some may include varying discounts based on zones and weights. Then ask for an additional performance discount that takes off an extra point or two if you meet package commitments.

When they come back with proposals, it’s time to negotiate. Play one company off the other to learn just how deep they’ll go to get your business.

If you ship many oversize packages and get whacked with OS surcharges; they can be negotiated to a lower rate or adjusted to a different weight tier.

Service Refunds — Did you know that if an air package doesn’t arrive on the specific day by a specific time, you can get a refund for the shipping cost? Air was always a guaranteed service, but now carriers are doing it with ground as well. There are cases where the carriers won’t pay the refund, for instance if the package is delayed due to weather. However, the majority of late packages can be claimed.

Most carriers offer reports either online or in their software that publish “exceptions” – packages that did not meet service standards. Take the time to call those packages in and ask for a refund if they were delivered late. Carriers are on time 98%, the remaining 2% is money in your pocket.

If you ship a lot of packages, there are third party companies that will do the recovery for you, but they usually take half of the proceeds.

Insurance — This is perhaps the biggest rip-off in package shipping. By default, each package you ship is insured for $100. Is additional insurance worth it? If you’ve ever filed for a refund for a package that was damaged or lost, you know what a headache it is and carriers usually won’t pay anything close to the value of the package. Paying for additional insurance is your decision, but in my opinion it’s an unnecessary expense that you will hardly ever have to use.

Rate Shop — Just as you shop for the best discounts, rate shop among all three before shipping. Many times you will see that one carrier is less expensive than another for a certain weight or zone. There are some third party shipping software programs available that allow for rate shopping. Software provided by the carriers don’t allow this feature, but with a little creativity or the introduction of a third party system, you can save money by rate shopping on a per package basis.

Don’t become complacent — Shipping rates will never go down, so be diligent. If you have significant changes in shipping volume (upwards of course) that is not seasonal, renegotiate your rates immediately, don’t wait for your contract to be up. Most carriers will do a one year contract with discounts, review it each year and shop the carriers.

As a supplement, please find below some other ideas I’ve researched which will help you pinch the all important shipping pennies….

AFMS Logistics Management Group’s Managing Director Rick Collins explains, “The announced rate increases of 4.9% for Ground and 6.9% for Air from FedEx and UPS masks the true impact for many shippers. The base rates may average the announced increases across the board; however higher zone express shippers could experience increases in the 9%-10% range. Additionally, surcharges are increasing up to 20% in some cases. Surcharges for irregular and large packages are up 8.3% to 12.5%. Commercial remote add-ons are increasing 7.1% and residential fees are up 5.4% for Ground.”

Shipping prices will continue to rise with oil prices. As a result, merchants must consider strategies for cost-cutting. Here are some options to consider:

• Look for ways to use USPS to your advantage.
• Consider package weighing, and remove any inserts if they push the package into a higher bracket.
• Investigate any savings you might accrue by opening a second warehouse to put you closer to a segment of your customer base.
• If you plan to use free shipping as an incentive, re-evaluate the value of the minimum dollar order and how it may affect your transportation costs and see if it must be increased.
• Review whether you should specify shipping charges for certain heavy and oversize products.
• Beware of the $6.15 Ground residential minimum charge.
• When considering various marketing and merchandising strategies, make it part of your overall plan to increase the average order value so that your shipping cost does not appear as such a large percentage of your smaller to average-sized orders.
• Review your policies for giving free freight on return merchandise. It may be a policy you can change.
• Consider contracting the services of an experienced transportation consulting company to teach you where to look for savings. If you’re a big enough concern, you may want to hire an internal specialist dedicated to lowering your costs.
• Another factor to assess is how important your account is to the local shipping depot or hub. It is often the case that smaller accounts are actually more important than management might realize, given their relative volume.
• Zone skipping. This might be a better option for your business if cost is a bigger factor than delivery time for your residential shipments. A carrier will sort your packages and haul them to the closest post office and the Postal Service will deliver the packages. This can improve your delivery time over that of standard USPS delivery at a cost that is less than standard FedEx, UPS, or DHL residential shipping.
• Hundredweight or multi-weight pricing often applies for shipments of multiple packages to a single location. Under hundredweight pricing, multiple packages being shipped to the same destination are rated as a shipment at a rate per pound instead of a rate per package equation unless the rate per package is less expensive. Express shipments greater than 100 lbs. and ground shipments exceeding 150 lbs. are eligible for hundredweight pricing.
• Manage your surcharges. Certain surcharges are higher for residential packages because of the standard residential and fuel surcharges. Address correction charges can be especially costly at $5 per package for ground shipments and $10 per package for express shipments. Also, many lightweight shipments in larger boxes, such as clothing, are often subject to dimensional weight charges, which take package dimensions as well as weight into account.
• Consider contracting with one provider for all your shipments. DHL, FedEx, and UPS usually provide increased incentives based on the volume of revenue and shipping you do with them. These are in addition to standard discounts which shippers provide and are meant to encourage you to use one provider for all your shipping. These earned discounts can be more difficult for seasonal shippers to achieve, but you can make your case. If you are a seasonal shipper, be sure to discuss your situation with your account representative to ensure that an adequate earned discount program is designed for you based on your particular activity.

Resource Links

• MultiChannel Merchant: Combat Rate Increases
• MultiChannel Merchant: Five Tips for Lowering Costs

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By: Scott Sanfilippo scotts@ebizinsider.com

Welcome. You’ve got competition.

Boundary-scanning is an age-old method of scoping out the competition. For instance, if you were opening a restaurant, one of the first things you’d likely do is start eating out at all the other local restaurants. How is the service? Do they have specials? Is the place clean? Is the food tasty? How varied is the menu?

The same techniques can work when it comes to opening or operating an e-commerce business. You have a world of research at your fingertips when you land on a competitor’s webpage. If you suspect that a competitor is outperforming you, spend some time on their site and figure out where you can improve. You can also find weak points in the competitor’s service to learn where to put your strength.

Remember: It is important to stand out and be unique with your own e-commerce venture, so use competitors only as a reference and learning tool, not as a place to get content and ideas.

Here are some boundary-scanning tips to use when checking out the competition:

Scan the Website - Do a web search to seek out competitor sites, specifically sites that have higher rankings than yours. Checking out a competitor website may seem like a no-brainer, but you have to look below the surface. Just because the site may have a cool logo or look flashy does not mean it functions well or makes for an easy shopping experience. Spend some time going through the site, click around. Are the products easy to find? Are the product descriptions–descriptive? Assume the role of a consumer. Jot down your likes and dislikes. See where you may have an edge. Share your findings with your web developer and find out more about features you’d like. Ask questions, too. The competition may have a feature that looks great, but decide if it would benefit your site.

There is a great tool called MarketLeap at www.marketleap.com, which allows you to compare your link popularity with up to three other URLs.

The About Us and Career Pages on any e-commerce site can be very telling. The careers page can give you a glimpse into the size and growth of the company. Are they hiring? The About Us page can give information on the history of the company, where their roots are, what other companies they may own, what professional associations they have and more.

Make a Purchase - You may not want to give your competition money, but think about it. If you purchase from your competitor, you will be rewarded with some great information. You will participate first hand in the total shopping experience from that website. You will get to see how smoothly the transaction goes, if the order arrives when promised and in what condition and how the item is packaged. If you want to delve further into the investigation, return or exchange the item and see how that process works as well. As a bonus, you will get an up close and personal look at a competitor’s item.

Call Customer Service - How is the competition treating your customers? Call the customer service line with a question about a product. Ask a question where the answer is provided on the website just to test the rep’s knowledge. Customer service is a crucial link between website and consumer and something you should provide at the highest level. So, see how your competition is handling it.

Check Social Networking - Check MySpace, Facebook, Digg, blogs, etc. to see how active your competition is in social media. In this more laid back atmosphere you may find some great information such as gossip, customer feedback and news.

Add a Google Alert - Get real-time updates on what your competition is up to. Add their name to your Google Alerts. This will provide you with information from various news outlets and blogs.

Of course, the goal in e-commerce is to build your brand. However, having a handle on what the competition is doing and how they are doing it will provide important information and better enable you to improve your business.

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By: Donna Talarico donnat@ebizinsider.com

Diversity. Remember that topic? It seems that all the buzz about diversity which seemed to appear in every business publication in the earlier part of the decade has quieted down a bit. Maybe that’s because most of the major corporations have jumped on the diversity bandwagon. With 98% of the Fortune 250 actively promoting their diversity on their websites and in their policies/trainings, diversity seems to pale next to whatever today’s sexier topic seems to be.

So the 500 biggest companies in America are on the right track. Great. Now, what about everybody else? Diversity is important to small business, too. There are a variety of things small business owners can do in the area of diversity. But, before we get too far into this – there are many definitions for diversity, so for this article let’s agree that we’re talking about groups of people who share a specific interest. Let’s also add a condition that the group we’re discussing has some degree of social liability. That means that another group could discriminate against them or exploit them. Agreed? Good.

Recruiting & Retaining Diverse Employees Recruitment: If you are actively seeking to attract a diverse workforce, your advertising should extend beyond traditional recruiting sources. You will want to branch out with your recruiting efforts into ethnic publications, community centers, colleges, church groups, and local career office apprenticeships, scholarships to target, employ, develop and grow both local and non-local applicant pools. Offer relocation assistance, this will help attract a larger audience. Advertisements should include a reference to being an equal opportunity employer.Retention: Educate and train your employees by promoting diversity. Have fun activities such as ethnic food and dress and custom days. Create staff bios with photos to showcase everyone’s diverse multi-cultural backgrounds. Conduct information sessions to educate your staff about strategic workforce plan and workforce diversity initiatives. Keep processes and policies consistent across teams so one person is never singled out. Encourage and facilitate team members to support and respect each other, accept differences and accept diversity. Be understanding of each other. If you create an environment in which people enjoy going to work, retention will never be a problem. By Ed Stanchak eds@ebizinsider.com

Diversity and Your Organization. Take a look at your organization and see where opportunities are to embrace diversity. Setting the culture of diversity has helped our company succeed. In fact, you could make the case that we were diverse before we were a company and that we became a company as a result of that diversity. Here are some ways to make your organization more diverse!

Get Management to Buy In. As with setting any precedent – it starts at the top. Your executive management needs to embrace diversity. Setting a strong diversity policy and a “zero-tolerance for intolerance” is an important step.

Encourage Employee Participation. Allow your team members to attend diversity events. If your company has enough employees, create a volunteer diversity council. It’s an important part of employee satisfaction. Even one day a year where each employee brings in an ethnic food to share is a step in the right direction.

Keep Diversity a Part of Your Marketing and Web Presence. Show your employees’ photos on your webpage, and include your diversity statement on your “about us” page.

Encourage Supplier Diversity. When possible, use minority-owned businesses to show your commitment to diversity outside your company, too.

Think Outside the Diversity Box. It is a fact that, in business, embracing diversity and inclusion provides advantages that increase your company’s competitiveness. When it comes to segmenting by market, many times you’re actually dealing with diversity. A good test for this is to ask the question, “Has the group I’m targeting been made fun of in a situation comedy or on a Late Night talk show?” I’ll explain.

For example, you’re probably not going to see ads for winterizing windows in this magazine. It’s not the correct market. On the other hand, you might expect to see an ad for optimizing Microsoft Windows. Why? eBiz Insider is using diversity targeting. eBiz Insider is tagged as the magazine for e-commerce professionals, therefore we know the majority of readers are power computer users. You could also make the assumption that many readers are self-proclaimed geeks, or are at the very least “geekier” than the general population.

Speaking of which, Geeks aren’t protected from discrimination under any federal or state laws and there are plenty of examples of geek exploitation out there. Think of the film “Revenge of the Nerds” or the sitcom character Steve Urkel. Are there jokes about geeks on “The Daily Show” or “The Tonight Show”?

Remember, Diversity is more than race, color, religion, gender, sexual orientation, etc. It’s about differences and celebrating what defines our individuality.

Ways to Embrace Diversity
Create a “Diversity Statement” and include it in your employee manual.

Allow employees flexible dates for religious holidays.

Set a “Zero Tolerance for Intolerance” policy.

Sample Diversity Statement:

• ABC Inc. is committed to hiring and promoting the most qualified persons into available positions.
• ABC Inc. provides all applicants and employees with equal opportunity in recruitment, selection, appointment, promotion, training, delegation, discipline, and separation.
• ABC Inc. shall foster a work environment that is fair and impartial in all of its relations with all persons, regardless of race, color, religious creed, age, sex, ancestry, sexual orientation, gender identity, national origin, AIDS or HIV status, veteran status, or non-job related disability.
• ABC Inc. shall make every effort to hire and promote minority groups and women and to involve them in every level of employment and decision-making.
• ABC Inc. will make reasonable accommodations to meet the special needs of qualified applicants or employees.
• ABC Inc. will not tolerate any type of harassment including sexual harassment and will take all steps necessary to prevent any and all harassment from occurring.
• ABC Inc. believes that the full benefits of diversity will come only when we adopt an attitude of inclusion. We must welcome every individual as a respected member of the team who contributions are critical to the success of our organization.

By: John Dawe
johnd@ebizinsider.com

Fresh off the holiday season, you probably sold and received gift cards. Last year consumers spent $73 billion on gift cards. Approximately 5-10% of the cards sold are never redeemed. Did you know there are some states with laws that require you to report unused cards and certificates? This raises some questions gift card sellers should be addressing:

1. How do I track gift cards?

A. Each card/certificate should have a unique identifying number.

B. Each card/certificate sold should have a start date or in using a “credit card” certificate, should have a written start date.

C. Each card/certificate should have an expiration date or the words “or as required by law”.

D. If selling different cards/certificates for different promotions, be sure to have a code to identify the card sold for each promotion.

E. Track the certificates that are actually redeemed.

F. Keep a list of outstanding gift certificates.

G. If possible, get the customer name and address purchasing the gift card. Consumers may be reluctant to part with that information, but it is very helpful when the gift card goes unredeemed.

2. How do I stay legal and report unused gift cards?

With the increased number of gift certificates sold over the past several years, state governments are taking notice. Many have established “escheat laws” as it pertains to abandoned property including gift certificates.

In the simplest terms, “escheat” refers to the process through which property that is, or is deemed to be, unclaimed or abandoned becomes property of the state after a certain period of time. All states have escheat laws that, while being similar, are all somewhat different. Each state defines how long property must be unclaimed before it is considered abandoned. Most states have a three to five year period before the gift certificate is considered abandoned. The chart below shows some examples of how the laws differ by state, according to the “National Conference of State Legislatures” website.

With each state looking to increase revenues without increasing taxes, some states have established “Unclaimed Property” reporting where depending on the state, corporations and businesses now are required to file “Unclaimed Property” returns and submit payments for the unclaimed property, which includes unused gift certificates. Most states require that gift certificates carrying a partial amount must also be turned over to the state. Reporting is done on an annual basis.

The penalty for violating the gift certificate law can result in severe penalties, including fines, multiple damages, and attorney fees.

Should you request more information, you can visit the National Conference of State Legislatures at www.ncsl.org. Here you can access each state’s statutes regarding abandoned gift certificates. Learn the laws that apply to coupons where you do business now, that way you will be able to avoid any unwelcome surprises later. eBiz

The list below shows some examples of how the laws differ by state, according to the “National Conference of State Legislatures” website.

California - Gift certificates purchased after 1997 are not subject to escheat. The escheat law does apply to any gift certificate that has an expiration date and that is given in exchange for money or any other thing of value.

Connecticut - Gift Certificates do not escheat to the state.

Pennsylvania - The consideration paid for a gift certificate or gift card which has remained unredeemed for two years or more after its redemption period has expired and for five years or more from the date of issuance if not, redemption is specified.

Utah - A gift certificate greater than $25 that remains unreconsidered for more than five years after issuance is considered abandoned. The amount considered abandoned is the price paid for the certificate itself.

West Virginia Gift certificate, three years after the thirty-first day of December of the year in which the certificate is sold, but if redeemable in merchandise only, the amount abandoned is deemed to be 60 percent of the certificate’s face value.

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By: Patty Sleboda pattys@ebizinsider.com