Nobody’s going to argue on this one, it feels great to get paid. Buying & selling in a physical store is quite easy as transactions are settled upfront. On the other hand when something is sold online, in most cases we don’t get the real money upfront. Cash on delivery sounds pretty good to you right? But if thats the only payment method you use, will anyone buy a gift from you? We are not blessed with Paypal or online bank transfers yet, but we have other ways to settle payments.
Payment Gateways; the intermediaries for handling payments:
You do all the hard work of setting up an online store, spend loads on marketing, a fortune on SEO and so on. After all these you manage to get someone visiting your page who finally wants to buy something. All they want to know at that point is, how are they going to pay for the item and how can they be sure that they will get the right stuff?
Here we are going to talk about how they are going to pay and how this works.
How can they be sure to get the right stuff is a different issue, i wish to write on that later. Also, we are completely ruling out cash on delivery as its only being used because we are new in online trading and this method wont exist in near future.
In short, you have to use an easily available money transfer method which people have confidence in. When you are selling something online, you are in the position where you have less to worry about because the customer has to make the payment first. All they can see is their money going out first. Put yourself in their shoes, you should be able to sense what goes in a new online shoppers mind!
You have to do some groundwork to see what services you need to offer (depending on your audience) and what are the related costs. For example, you wont sell a lot of solar-power units if you only take credit card payments! Solar power units are targeted for people living in the villages and not many of our villagers have credit cards, right?
So, be a wise person and select the appropriate money transfer methods you are going to use and open accounts with those service providers. Nowadays most money transfer service providers offer easy transactions at affordable commissions & quick settlement. The beauty is, you can have accounts with all of them if you wish! If you are worried about managing them, you are probably living in the previous century. Thanks to mobile banking and mobile based money transfer facilities, staying on top of your financial activity is as easy as checking your friends holiday snaps on facebook!
Be informative:
Your store should clearly show what payment methods you accept. Use the service providers logo as that will help customers recall the services easily. Most of them invest heavily in marketing, so your customer probably knows about few already! Most importantly let them know your store terms & conditions. Things like why keep the transaction reference number, how you handle orders, how you prepare invoices, what are your return policies etc should be clearly stated. You have to be professional in making these rules and also make sure you play by them. Trading online is fiercely competitive and there is no place for cowboys here!
Risks of fraud:
The other day I got a message from someone who wants to start selling few things online and wanted to know what if the customer does not want the item after all? Well, unless you are offering cash on delivery (which kind of puts you in harms way) as payment method, you are at the comfort of your home / office to check if the payment has been cleared to your account before even packing the item for dispatch. Things you should be worried about is a buyer making false accusations to exchange an item, trying to return used goods etc. Keep track of what you are sending to whom, make those terms & conditions as precise and informative as possible, you will be able to deal with most issues without any problem.
Safeguards to prevent risks:
Make every customer register an account to order from you. Take as many details as possible. For example take their email address, 2 phone numbers, complete postal address and any other vital information. Also have a field for their “Nick Name” as the delivery man may not find the person by their “Official Name” because they asked the neighbor! Yes, all of these can be falsely given. If someone wants to go that distance to make you send something to a wrong address, they are fooling themselves; not you! Word of advise; don’t send an item to someone living in a hotel room no matter how much they are paying!
Take security seriously:
Use transaction reference numbers for each sale. When a customer pays for an item by any of your accepted payment methods, let them share the unique reference number with you so that you can cross check this at your end. Ask them to provide this information once they have made a payment. Send them a polite Payment Acknowledgement message. Deal with any mismatch / dispute as quickly as possible.
Give your buyer confidence:
You are in business, not in a “Grab & Go Run”. So, give your buyer confidence that they are dealing with professional people. Let them know that you are not looking to sell an one-off item and disappear in the crowd. Give them after sales support, give them the warranty & guarantee on products where applicable. If you are selling an IT product, tell them they can get help in setting them up. If you are selling many, make an Youtube video on how to setup the product and give them the link. There are many ways you can provide support, its your attitude which defines your path. It doesn’t take long for someone to realize your business approach, and if you can prove to be honest and helpful you will go a long way. Those who want to make some quick money by selling anything and everything they can find without caring about the customers, please read no further.
Be prepared to deal with uneven circumstances:
You are doing something new, chances are you will be in new situations. Once I had to deal with an angry customer who wanted me to pay for her new carpet because she bought a cleaning product from my store and when opening the package some of it had spilled on her carpet and ruined the color of it! Be helpful, be polite and be supportive. Most situations can be handled quite easily if you have a positive approach. If it encourages you to know that the once angry lady still buys her cleaning supply from us and has just sent us a lovely christmas card!
Our situation:
Its a bit frustrating that we have online stores, but we do not have completely online payment systems. All I can say is it wont take long for those complete online payment solutions to arrive but nobody has to wait for those solutions as the currently available alternatives work quite good as those. People in other countries have Paypal & online fund transfer facility in their bank account, we have fund transfer facility through our mobile banking account. We have more people with mobile phones than bank accounts, so we can reach more customers to buy online, as simple as it is!
Author:
Hasan Khan, currently manager of a hardware in North London where we sell a wide variety of products ranging from small nails to big power tools. I transformed the business by selling products online.
I love to read, follow Manchester United & trends in technology. My favorite time of the day is when i put my daughter to sleep!
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