Choosing Ecommerce Development Services
Providing a streamlined approach for you to decide how to proceed with your ecommerce shopping cart project is the purpose of this article. With over 15 years of experience building ecommerce websites on a variety of platforms, we can give you a quick overview of the decisions that you will need to make, as well as the consequences of those decisions.
I say it with some trepidation because choosing the wrong partner can have long-term consequences in the ecommerce web development business. There is a real trade-off for useful, ongoing options versus the economies of hiring an ecommerce development company with templated, pre-made sites. With these generalizations out of the way, let’s proceed to the decision making.
Do you already have a shopping cart with products loaded, or will you be starting from scratch?
How you will proceed depends largely on this question. Rest assured, while there is a right answer, there are no perfect situations. You’ll see there are both advantages and disadvantages.
A. Starting from Scratch
Congratulations! You have the pleasure of no restrictions! Rather than being overwhelmed by the number of carts out there, the possible customizations, and the various developers at your disposal, try to rejoice in the fact that you aren’t yet beholden to any of them: You don’t already have products loaded or money tied up in modifications that will simply vanish if you decide to change to a new shopping cart. You also don’t have development to such an extent that you’re stuck with the guys that wrote it. You’re completely free! As long as you have a clear mind about what you need, your cart can be as simple or complex as you desire. Here are a few other advantages to anyone starting from scratch:
- You will be up-to-date with the latest technology from day one, so your site will be secure, fast, and far more usable for your visitors.
- You will be mobile-ready without having to re-theme your entire cart.
- Your online identity is yours to mold into whatever you envision. You are the parent of a newborn internet presence, and the exciting part is laying the foundations for how it will grow and what it will become.
- You can negotiate between developers and software providers with the advantage since, rather than you losing money having to switch to a new system, they lose money if they don’t accommodate you.
So now that the pure exhilaration of your raw power to make decisions has set in, you have one very important decision to consider…
Decision 1a: Do you have special requirements with regard to your cart, or will you be able to work using only the features that come out-of-the-box with a platform?
If you have special requirements, even the most robust cart might not fulfill your needs without modification. And, let’s face it, the only reason to set up a cart is to make your life easier. Anything short of that is pointless. Some examples of the types of functions we’ve coded that did not come standard with their carts are:
- Accepting Net30 payments.
- Adding surcharges for certain situations.
- Shipping certain products only to certain zip codes.
- Offering Tax-Free checkout for institutions.
- Hidden pricing for Wholesalers or Distributors.
Conversely, if you are able to get by with only the functionality provided by your cart of choice, then your life becomes much simpler as long as it doesn’t place undue stress on your business process.
If you do not have any special requirements, proceed to Decision 2: Choose a Cart Type and skip to section 2C: How to Choose.
B. Pre-Existing Cart
The choices for a business that has already gone through the process of setting up a cart aren’t as open as starting from scratch. However, there are still many advantages to be had for the person who already has an online presence:
- You have experience with the process and know what to expect. You have also, inevitably, given some thought as to what you would have liked to have done differently, which will come in handy the second time around. Could you have lived without that crazy mod you shelled out a ton of cash for? Now you know the answer.
- You already have basic systems set up, like your payment gateway, accounting system, shipping carriers, SSL, etc. Even if you move to a new cart, you still have these to show for it.
- Your domain and your pages have history, and that provides a small boost to your website’s SEO value over a new ecommerce retailer.
- You have your products loaded into a cart of some kind. If you did your homework, you should also be able to export or import these into another cart, or at least have a spreadsheet that will make entering products easier the second time around.
- All of your product images, if they are quality, will not need to be retaken. It may not seem like it, but this is huge.
Advantages aside, you’ve got some very important things to consider when working with a cart you’ve invested time and money into. Mainly how much of your investment will you abandon in favor of other advantages and whether it is worth it.
Decision 1b: Should you upgrade and/or redesign your current shopping cart, or migrate to a new one?
This is one of the hardest decisions to make. It is the quintessential fork-in-the-road for eCommerce retailers. Luckily, we’re here to help you figure it out with some important considerations, the first of which is this:
Consideration: It is not necessarily more cost effective to keep your cart where it is than to migrate to a new one.
Reasons abound why this may be the case. Setting aside the fact that even performing a redesign alone still requires a great deal of work, consider the following list of reasons you may want to consider a migration over an upgrade/redesign:
- Your current cart simply may not possess the functionality you require, nor the ability to improve the functionality.
- If your cart’s inability to provide a particular function is either driving away customers or making your internal business process slow, it is costing you money all the same.
- There are quite a few carts that do not enable changes to the core files. Meaning you’re stuck with whatever they offer. More on this in the section on Choosing a Cart.
- No matter how much work you put into it, your cart might be slow or take too many steps to purchase a product.
- We say it constantly and we mean it: Never come between your customers and a sale. This includes selecting or sticking with a cart they will abandon in the first 3 seconds.
- Some carts are simply faster than others. You may or may not be using one of them.
- The more customizations you added to your cart, the harder it became to perform upgrades to the platform and plugins – AKA, code bloat.
- Without going into too much detail, every customization you add to the site increases the complication of the code, so every update requires looking through the code to manually blend the newly updated code with the custom changes. Since this requires the undivided attention of a developer, the more you add, the more expensive it can get even after you’ve paid for the initial changes.
- You may be paying monthly costs for a shopping cart that can only be hosted with the developers, and the monthly costs are going up.
- Because you cannot move the cart, cannot keep anything from the cart, and cannot start again without a major investment, some companies take advantage of this fact and raise your rates as high as they can because they know it’ll be hard to decide to start all over again. They also know that every time you decide to stay, the decision to leave gets harder the next time they raise their rates as well.
Not moving to a new cart may seem like a money-saver until you quantify the real cost to your bottom line. To be clear, as developers we have no skin in this game since both re-theming and total migration require developer services. But we find in our conversations with prospective clients that there is a misconception regarding the cost of migration vs re-theme, mainly that re-theming is thought to be cheaper, that causes bad decisions to be made on bad assumptions. Our advice is to shed your preconceptions and give both options their due consideration.
Consideration: Most shopping carts are capable of importing products from most other shopping carts.
Certainly, many retailers choose to stick with the familiar for an obvious reason: There are fewer surprises, and we entrepreneurs don’t like surprises. However, knowing a catalog can typically be imported into a new cart for less expense and time than on your first cart makes switching to a new cart platform an easier decision.
We must be careful to mention that inter-cart imports don’t always go perfectly, but usually they at least get you most of the way. Discussing your migration options with an experienced developer beforehand should mitigate any risk. Never jump in to migrating to a new cart with both feet just because you’re told by the cart creators that it is capable of migrating products! I cannot stress this enough. Many cart creators, especially those in the SaaS business, will say anything to get you to sign with them.
Choose a Cart: SaaS, Open-Source, or Ground-up Solution?
Before you answer that, we’re going to define each of these and go over the advantages and disadvantages of each compared to the others. By the end of this section you should have a good idea of which cart type is right for your business.
A. Cart Types
Given the plethora of shopping carts available, we’ve broken them down into the most basic decision, and one which will affect everything you do going forward, but one which most of your ecommerce peers aren’t even aware of. After all, it wouldn’t make sense to first decide on a cart and then be stuck in a more important, broad category that may not fit your business model, right?
Definition of SaaS
Software as a Service, or SaaS, are those carts that promise a whole slew of features at a low-monthly cost. When you stop paying, the cart stops existing. You may be able to keep an export of your products and customers, but any work you put into the appearance or functionality of the cart disappears forever.
This business model is similar to the idea of leasing a car versus buying one: You never get rid of the monthly payments, but you always have a new car.
Definition of Open-Source
These are carts where there is no charge for using the platform, and where you own the work you put into it. It is developed by anyone who is willing to invest time into expanding the capabilities of the cart. Meaning any developer in the world is a potential contributor, and the best adaptations are the only ones officially adopted into the “core” code (the official version).
Furthering the car analogy, this would be akin to buying a car because it makes more long-term financial sense. Where the analogy doesn’t work is that the manufacturing plant would have to somehow crowd-source the designs for their car and utilize the best version.
Definition of Ground-up Solution
This is software that is built specifically for the purposes of the business they support. They contain only what is required by the business, and everything is tailor-made for that purpose.
In our car analogy, these are the non-mass-produced vehicles that are built for a specific purpose, and which excel greatly at accomplishing that purpose. Unnecessary things like headlights are excluded, and other things like roll bars may be added. These are the custom drag racers or Indy cars of shopping carts.
Consideration: There is a plethora of available SaaS and Open-Source ecommerce options, each with advantages and disadvantages that must be carefully weighed.
Examples of SaaS:
- Magento Enterprise
Examples of Open-Source:
- WooCommerce (on WordPress)
Examples of ground-up software cannot be provided since they are their own, unique software.
B. Comparison of Cart Types
In a previous discussion comparing the Pros and Cons of the 3 Main Cart Types, we established that the size of your business is the biggest factor in deciding which cart type to implement. As with everything, however, this guideline cannot provide a black-or-white answer (just as there is no black-or-white with regard to your business). You will need to be an active participant in the thinking process. Fortunately, the chart below and the final part of this section, How to Choose, should provide the tools you’ll need to find the best option for your business. Please take a look at the summary of our cart type comparison below before moving on to the next topic.
Consideration: The size of your business must necessarily have a huge impact on the type of cart that is right for you.
It should come as no surprise that, with a total score of 191.4 out of a possible 248 points, Open-source is the cart type suitable for most businesses. It is lower cost, more robust, and more flexible all around. The fact that so many people use Open-source shopping carts already means fetching the top score is not an anomaly, it is a verification. Stores that have begun on SaaS may find some benefit in moving to Open-source if their needs aren’t quite being met.
SaaS falls in at second due to its fast startup ability, lower up-front costs, and generally worry-free maintenance. Many retailers just starting out will tend to opt for SaaS for the above reasons. Its overall score of 155.8 out of 248 puts it into most considerations for small and medium sized business alongside Open-source options.
Ground-up may fall into last place, but that is because it is a very special type of business that requires ground-up development to exactly meet their needs, while having greater budget flexibility over small and medium-sized businesses. Fetching less than half of the possible points shows it is not the best solution for most businesses. Last but not least, ground-up software does not need to compete with Open-source or SaaS because it is doing fine on its own terms.
C. How to Choose
The information provided in the beginning portion of this section, Decision 2, is provided for reference and is optional, but highly suggested reading. Most of you will skip over 2A and 2B to come directly to this How to Choose section, 2C, and be given an option to determine which Cart Type is right for your business. If you are curious as to how we arrived at our conclusions regarding your business, there is a summary of our reasons after you have followed the list below. For now, please begin at item 1 below.
- If you are a small to medium sized business, continue to #2. Otherwise, please proceed to #11.
- If you do not have what we call “position,” or a genuine uniqueness that distinguishes you from your competitors, please continue to #3. Otherwise, please proceed to #11.
- If you do not have national brand recognition continue to #4. Otherwise, please proceed to #11.
- If you do not have a high level of certainty your products will sell online, continue to #5. Otherwise, please proceed to #11.
- If you do not have a fair level of certainty your products will sell online, continue to #6. Otherwise, please proceed to #10.
- If you have a budget of less than $200k to spend, continue to #7. Otherwise, please proceed to #11.
- If you have a budget of less than $10k to spend, continue to #8. Otherwise, please proceed to #10.
- If you do not have need of specialized functionality that would make your shopping cart experience unique, or you will not be selling products that require special checkout steps or ordering procedure, continue to #9. Otherwise, please proceed to #10.
- Choose SaaS. Please read the corresponding section, C1, for more information.
- Choose Open-source. Please read the corresponding section, C2, for more information.
- Choose Ground-up. Please read the corresponding section, C3, for more information.
C1. Choose SaaS if you are a small to medium sized business and are not certain that your products will sell well. Paying up front when there is a fair possibility that the cart will not succeed doesn’t make sense, right? Should your cart eventually prove worthwhile, you’re going to need to move to a different cart option. The major drawback to this is you will have paid for SaaS with very little to show for it other than establishing your online presence without risking losing a lot of up-front money on an experiment. With this option, you have to be certain you will be able to use only the features the cart provides. If you absolutely need customized functionality to sell your products or services, you’ll want to consider one of the other two options.
Choose Open-source if you are a small to medium sized business and you have a fair amount of certainty your products will sell online. You will benefit in the long term from the up-front cost of paying for your cart with no obligations to continue paying a monthly fee (other than hosting and maintenance) for your cart to exist. Ground-up is simply too expensive to be considered for a regular sized business unless there is national brand recognition or “position,” a genuinely unique quality that distinguishes you from competitors, to guarantee the cost of the cart will be worthwhile. Also choose Open-source if you need customized functionality to sell your products or services but either lack a budget over $200k or don’t enjoy national brand recognition.
If you would like more information regarding Open-source carts and why they are best suited to serve your business, please feel free to read sections 2A and 2B. Otherwise, please proceed to the next section, Decision 3.
Choose Ground-up if you have national brand recognition, are a large-sized business, or are highly certain your products will sell online. If you have national brand recognition and/or what we call “position,” which is uniqueness that distinguishes you from your competitors, you shouldn’t be afraid to invest in a great shopping cart. You’ll be more satisfied with the results, and so will your customers. If budget is a question, you will be able to find investors because you know your cart will succeed. If you have neither position nor brand recognition, choose one of the others. Enough said.
If you would like more information regarding Ground-up solutions and the advantages they provide to businesses like yours, please feel free to read sections 2A and 2B. Otherwise, please proceed to the next section, Decision 3.
Consideration: Depending on the types of products you carry, some carts may be better suited to your online catalog than others.
Will You Sell Digital or Physical Products or Both?
Digital products carry no stock. Nothing has to be shipped. Very little customer service intervention is required with the right setup. The only thing you have to worry about if you exclusively sell digital products is protecting intellectual property and fast download speeds. Whichever shopping cart you choose, make sure the server you put it on is fast and secure, and especially ensure the cart has methods to protect your digital products.
Physical products carry a lot of headache, one of which is managing inventory. Most open-source carts have some form of inventory export, but they typically require additional plugins that are not cheap. SaaS isn’t much better as they will charge you an additional monthly cost that, too, isn’t cheap. The other consideration is printing shipping labels and managing tracking numbers. These functions don’t usually come with the default cart, so choose wisely if you expect to ship a lot of products on a daily basis. Make sure you pick the cart that best suits your operation rather than fitting the operation to suit the cart.
Are You a Reseller or Manufacturer?
For resellers, the margins tend to be low enough that opting for the simplest cart with the least amount of money upfront is usually the best decision. So for many resellers in this predicament, SaaS cart types work best. The drawback is both the greater long-term expense that eats into already narrow profit margins and the lack of ability to create a unique checkout process that best suits the types of products being sold. For resellers with greater positive cash flow to start, open-source may be the better investment.
Manufacturers, by contrast, have it much easier. They set the retail price, and the products sell for whatever price the manufacturer deems necessary. Their only price competition is other manufacturers creating similar products. For nearly every manufacturer, either a robust open-source investment or an enterprise level, custom built shopping cart makes the most sense.
Consideration: If your business relies heavily on selling through 3rd Party websites like Amazon and eBay, choosing a cart with inventory export is imperative.
Will Someone in Your Organization Have the Skills to Enter Products, or Will You Need to Pay For Product Entry Services?
Product entry should not be taken lightly. It seems simple to the uninitiated, but the entire process of building your online catalog influences the cart’s performance at launch. If you aren’t prepared to take product entry extremely serious and really dig down to learn how each piece of information makes or breaks a page, then you’re rolling the dice.
Consideration: Both your time and your organization’s time is valuable, so in some cases it may be more frugal to save yourself the effort and pay to have the products entered by a professional.
You may be able to save yourself training, avoid confusion, limit any risk of incorrect entry becoming a liability for your cart’s performance, and speed up the process by hiring a developer to complete this process for you, whether as an agency or as a direct employee.
In-house or outside agency?
Deciding whether to pay a company that specializes in developing ecommerce sites vs hiring a permanent team to do so within your operation is not an easy decision. If you hire an outside agency, you will get real experts that can walk you through every step of the process and boil things down to only that which is important for you to consider and leave you free to think about your business rather than your website. The obvious downside is that agencies tend to be more expensive than an in-house development team. They may also have biases regarding which types of carts they recommend. Try to recognize when they are making a case for a cart that does not suit your business.
Conversely, an in-house development team requires someone within your organization to recognize and procure qualified individuals. If things don’t go according to plan, the team doesn’t have enough experience, or the project doesn’t seem to progress quickly enough, it will be up to you to recognize this. SaaS is not a relief from this fact of life, either. While SaaS tends to have shorter ramp up to launch, it still requires people with technical knowledge of shopping carts to facilitate.
Consideration: Even a SaaS will require someone with some form of technical knowledge to load, configure, and maintain your catalog.
To decide between hiring in-house versus an agency, use the following guidelines:
- If you have some knowledge of shopping carts already, have a clear vision of what you’d like from your cart, are or have a good project manager, and are able to recognize talent for development, hire in-house.
- If you have little to no experience or knowledge of ecommerce or how it should work for your business, but have a budget of around $10,000 or more and a great product, or if you absolutely need the best cart for your business, hire an agency.
- If you both have little to no experience with ecommerce and are not sure you’d be able to hire the right people, or if you don’t have a lot of budget to work with, hire an ecommerce consultant to help you make informed decisions.