With the online retail industry growing worldwide, many entrepreneurs and companies are joining in and starting to sell online. Start-ups, small and larger enterprises benefit greatly from the ability to sell via the Internet to a larger audience
The most common question heard by professionals and technology consultants is what type of solution to use for shopping carts and ecommerce. This is an important question for any size operation.
It is a question that many entrepreneurs and businesses cannot answer themselves, simply due to lack of experience and knowledge. Industry professionals with enough experience are more qualified to outline the pros and cons, in regards to open source ecommerce vs. hosted ecommerce.
Which Ecommerce Solution is Best?
This question is asked at some point by most, who enter the online retail and ecommerce industry. There is not a direct and simple answer to this question. It is not the right question to ask for many organizations. Why? The right question should be “What is the right ecommerce solution for the particular situation of the business.
A business or entrepreneurs have to consider a couple factors when deciding. It mostly depends on the budgets available, organizations technology knowledge and time available, as well as requirements and goals of the organization.
Not all ecommerce solutions are the same and many have restrictions, different features, and structures of operation.
Open Source Ecommerce Vs. Hosted
There are some clear differences between open source and hosted ecommerce solutions. Here is a brief breakdown of those differences to gain a better understanding of options and key benefits.
Hosted Ecommerce Solutions
The main reason why organizations and entrepreneurs choose hosted solution is because of cost. Hosted solutions have very low setup and startup costs. In many cases, an individual or company can avoid any development costs upfront. They can simply just sign-up for an account and get started.
Development skills or graphic design is not needed, since most of hosted ecommerce solutions come with template websites that can be quickly deployed and launched. In many cases, all ecommerce financial merchant services are managed and in the name of the hosted ecommerce solutions provider. The individual or company is not required to get their own merchant services.
The host provides technology support and all future upgrades are managed and implemented by the hosting provider. This enables the entrepreneur or business to be hands-off and just focus on their business.
The largest downside for hosted ecommerce solutions is the fact that these solutions are extremely limited in flexibility, scalability, and customization. Also, the entire operation sits on a foreign platform. This means, not owned by the operator (business).
Open Source Ecommerce Solutions
Open Source ecommerce software solutions are free to use by the software developers and makers. There is no cost to acquire and use the ecommerce shopping cart and software application. Nevertheless, this option tends to be the more costly ecommerce solution for entrepreneurs and companies.
The cost can rise quickly for this type of solution in comparison to a hosted or managed solution. There are setup, design, and development costs involved right from the beginning. The cost varies from application to application because of the complexity and time requirements to develop the website, implement shopping carts, and merchant services.
Even with the increase in cost, this tends to be for most people and organizations the better solution. It gives the business the most control, flexibility, and long-term value. It is similar to owning vs. leasing when it comes to cars. Leasing is great due to less upfront costs and maintenance requirements, but there is no ownership and long-term benefits.
Making the Decision
Choosing the proper technology setup for ecommerce websites is an important decision to be made. Depending on the situation and objectives of the business, options should be carefully reviewed. For individuals and organizations that are not sure and would like to avoid mistakes, technology consulting services are available with experts that can elaborate on the differences and review jointly the best options.