The time has come to take your bricks-and-mortar business online or establish a new e-commerce business entirely. Where do you start?
It’s a question every founder will ask and one that e-commerce expert Iain Calvert tries to answer.
After assisting the e-commerce efforts of brands like Billabong, Quiksilver, and Vogue, Calvert now operates the Boom E-commerce Training site and is a certified Shopify partner.
Here, Calvert addresses some of the key factors founders should consider before locking in with WooCommerce, Magento, Squarespace, Wix, Shopify, or the litany of other providers on the market.
The cost might be your first concern when choosing an e-commerce solution, but the cheapest functional webstore might not be the best solution for your business.
A ‘basic’ e-commerce platform, offering core functionality without too many fancy built-in options, may come with low upfront and ongoing costs.
However, Calvert says the cost of third-party add-ons could stack up as your business grows in revenue and complexity (more on this later).
Similarly, website hosting fees for open-source e-commerce platforms, which might come with a low upfront price tag, could balloon depending on the volume of traffic heading to your webstore.
For entrepreneurs without a tech background, hiring a website manager may be necessary to effectively run an e-commerce site based on open-source software.
In other words, growing businesses can expect growing costs.
The equation is flipped for SaaS e-commerce platforms.
Choosing the wrong plan at the outset may see your business pay for features it simply does not need.
Those platforms can also change prices as they see fit: consider the 34% price hike Shopify handed to business owners on its most basic plan in January this year.
The transaction fees charged by some SaaS e-commerce platforms can also chew into revenue earned through your webstore.
Before choosing an e-commerce platform, consider how much time you want to spend digging through code, organising a website host, and coordinating your third-party services.
The back end is only half of the challenge, too: the platform you choose will dictate the website layouts and themes available to you, and customisation levels can vary.
Platforms that offer ‘what you see is what you get’ (WYSIWYG) customisation, and drag-and-drop components, may be the best entry point for e-commerce newcomers.
“Wix is quite good on the WYSIWYG approach,” Calvert said, compared to Shopify, which is a “little more complicated”.
“It’s not like writing code, you’re essentially editing a theme, and depending on how your theme is set up, it will allow you to control certain things,” he continued.
“Whereas Wix is certainly a lot more freeform, and Squarespace as well: Squarespace is fairly good because there’s lots of different templates that you can use”.
For some businesses with in-house tech teams, a list of must-have features, and a clear strategy, building an e-commerce site from an open-source provider may be the best option.
Calvert likens open-source e-commerce platforms to an F1 car: immensely capable and tuned for high performance, but only in the right hands, and with the experience needed to extract its full potential.
“You can blow up fairly easy, you can go flying off the course,” he said.
“And there’s a few people in the world who can drive really well, whereas the reality is for most businesses, unless something is really customised, a Ford Focus is going to do you right.”
The customer service experience is a key differentiator here, too.
Don’t expect hand-holding from every open-source e-commerce platform provider: the expectation might be that you go to your in-house tech team experts first before asking for assistance!
So you’re leaning towards a platform because of what it can do, right out of the box. What about the things it can’t do, and the functions better served by other SaaS providers?
Here, too, e-commerce founders should consider the wide range of third-party plug-ins, integrations, and automation, and how those specialist functions interact with the core e-commerce platform.
Fortunately, today’s founders can expect the big third-party players to have a wide range of e-commerce integrations.
Consider Klaviyo, the automated email and SMS marketing platform: it offers plug-and-play integrations with Wix, Squarespace, Magento, Shopify, BigCommerce, Square Online, among others, with API access for founders using a bespoke tech stack.
That’s all well and good, but newer and more niche third-party providers may launch with only one or two integrations available.
Cost is also a key concern: third-party integrations often come with separate subscription fees, which can quickly add up.
New e-commerce founders should not attempt to add every plug-in under the sun to their platform, as learning to harness a platform’s out-of-the-box capabilities will build useful experience, and potentially cut down on ongoing costs.
Many SaaS providers will handle the digital security of your website, with the cost of those services wrapped into your subscription fee.
Platforms of this kind, including Shopify, will automatically roll out software updates and security upgrades to ensure your site is up to date.
Open-source platforms like WooCommerce, the e-commerce plug-in attached to the WordPress content management system, operate differently.
A user may report a vulnerability to Automattic, the developer of WooCommerce, which will then create a fix and make it available for download.
“Now, some web hosts will update it automatically so that you’re covered, but many won’t,” Calvert said.
This means e-commerce site managers themselves must create website backups, download the latest security updates, implement the latest fixes, and ensure they cooperate with existing code.
Then there is the matter of ensuring your website hosting provider is reputable and capable of keeping you and your customers’ data secure.
Crucially, third-party plugins, whether for SaaS or open-source platforms, may require totally separate security updates.
An e-commerce website is useless if customers cannot access it, making stability a key concern for any digital entrepreneur.
As discussed, open source platforms may require a business to organise its own hosting solutions, putting the stability of the site in the hands of the hosting provider (and the business’ tech team).
“You essentially need to pick a really reliable web host, and you need to have somebody who’s managing it, keeping an eye on the log files of what’s happening,” Calvert said.
“They need to understand when big email broadcasts are going out, which can lead to lots of orders, like when Black Friday sales are starting to ramp up.”
If you seek another provider to host your site, you should also consider if you want to share server space with other companies, too.
SaaS solutions offer to do much of that work for the business.
However, they are by no means infallible: Shopify experienced a short outage earlier this month, which temporarily disabled its digital storefronts and prevented customers from making purchases.
Shopify resolved the issue after several hours of downtime.
Most e-commerce platforms offer a plan designed for first-timers, with varying potentials for growth.
Some platforms cater to entrepreneurs who want to attach an e-commerce element to their online portfolio or landing page, without making e-commerce the star of the show.
A platform like Wix or Squarespace may be “perfect” for a business owner who primarily wants to showcase their work, with e-commerce sales being a “side bit” to the core website, Calvert said.
“If they want to show off their work, and you can buy something, like it’s a side bit, Wix or Squarespace is perfect,” Calvert said.
“If you’ve got like 30 products, you’ll be fine,” he added.
“But if you start adding more, you get into the hundreds becomes very difficult to maintain.”
Platforms like Shopify offer solutions for solo entrepreneurs all the way up to ASX-listed giants like JB Hi-Fi.
However, bespoke solutions — which might be needlessly complex for a first-time e-commerce brand — may become more appealing once a business hits enterprise scale, Calvert said.
Be warned that transitioning from a hosted SaaS solution to a bespoke platform can be costly and time-consuming in its own right.
Senior Business Journalist
Focused on the small business sector, David’s work covers the political, regulatory, and economic issues facing Australian entrepreneurs. Prior to joining SmartCompany, he was a reporter for Business Insider Australia. You can follow him on LinkedIn.
