2009 was a tough year for small business. Two-thirds of respondents characterized the recession’s effect on their business as “negative.” Almost one-quarter of respondents characterized the impact as “very negative.”

Not surprisingly, 34% of respondents said that managing cash was their biggest challenge last year. (Maybe they are not using an integrated cash flow spreadsheet, such as the one we have available for free at BusinessMorgue.com??) What is surprising is that 24% said that, in retrospect, they should have done more sales and marketing. (Hmm…that doesn’t sound like the small business owners I know…)

Read TD Bank’s press release here.

The merchant services industry is a competitive one, and account reps. are very good at getting themselves endorsed by local chambers of commerce and other business groups. Speaking from experience, I can tell you that an endorsement is not the best way to select a payment processing solution. This is because these accounts have relatively complex terms and conditions, and no one setup is the universal answer for all businesses. Therefore, the best way to proceed is to interview as many service providers as you can.

North American Bancard (NAB) is a relatively well established payment service provider based in Troy, Mich. The company services more than 100,000 businesses with a full slate of payment services, including the traditional credit and debit card solutions and other offerings like business cash advances, gift card/loyalty card programs, electronic processing and check verification services.

NAB processes more than $8 billion in transactions annually, and so has the scale to offer 24/7 customer service, among other things. Round-the-clock customer service is super important if your business is open during nontraditional hours or if you only have free time during nontraditional hours. Most small business owners fall into one or both of those categories.

NAB’s scale also makes the company relatively easy to research. You can view a few different online resources to learn more, including:

1. North American Bancard Wikipedia Page
2. North American Bancard Company Profile
3. North American Bancard Blog

When you review a service provider’s blog or profile page, you are basically looking to understand the business’s position in the industry. Is the company big enough to handle your needs? Or is the company too big, such that you won’t be an important customer? You also want to know that the company offers the services you need now, and those you may need in the future.

Blogs and other additional resources, unfortunately, are not available for all providers. By comparison, the first payment processing provider we used in our business had no website, no blog, and little means of contact. I had a phone number that someone would answer between 9:00AM and 5:00PM, but that was it. We selected them based on a chamber endorsement, and eventually regretted making the decision too quickly. There are two huge reasons you’ll want to avoid making the same mistake:

1. You will probably incur contract cancellation charges for prematurely switching providers.
2. Merchant account reps. like to cold call. You want to be confident in your service provider, so you aren’t doubting or regretting your decision every time a competing provider calls you. Chances are, you don’t need any more problems to solve, right?

To learn more about NAB, visit the resources above or the company website at www.nabancard.com/

Before we get into where Wix falls on this spectrum, let’s talk about how you would use a free website. This is a service that’s targeted to individuals launching hobby sites and solo entrepreneurs launching micro businesses. For those who need to keep their launch costs to a minimum, the free site can be a decent option. But there are drawbacks, and you shouldn’t go down this road unless you are comfortable with those drawbacks.

First, truly free websites come with ads on the pages. Whether those ads negatively impact your business really depends on what business you are in and how you are using the site. Check out your competitors’ sites to see what they do. If you are trying to sell something on your site–particularly something that’s readily available elsewhere–think about the sales impact of having competitors’ ads on your pages.

Second, if your site takes off, you will eventually want to transition away from the free platform. You may not be able to take your site’s design with you and you may not be able to redirect the free site. If you can’t redirect it, you will have to contact all of your customers and give them your new URL. That can get expensive, and could result in lost business.

Free sites by Wix

I am not personally a fan of free websites in general. The issue I have with them is that the site designs are boring and not adaptable. Wix breaks this mold with a full selection of modern, flashy templates. The templates are organized by category, and the offerings include eCommerce sites, business sites, consulting sites, real estate sites and several other hobby- and interest-oriented categories.

You can preview the templates, but you have to register on the site to launch the editor. You can also build your site from scratch, using Wix’s editing tools.

Another nice feature is the detailed tutorial section, complete with how-to videos.

Premium upgrade

Wix also offers a premium upgrade, in the event you grow out of the free version. With the premium service, you can get rid of the ads and use your own domain name. You also get extra storage and bandwidth, plus access to Google analytics data.

But that’s theory. In practice, the decision to set up a merchant credit card processing service isn’t always a no-brainer. It’s important, first, to understand how you would use a merchant account. Do that analysis upfront and, if you decide to proceed, you will be better prepared to select the right service provider.

Questions to ask

What are your sales channels?

Analyze the accepted forms of payment in your current and prospective sales channels. For example:

1. Online retailing to any customer type generally requires some form of credit card processing service, either through a direct provider like North American Bancard or through a third-party provider like PayPal.
2. Door-to-door selling usually involves cash or check.
3. Direct mail sellers tend to accept check and credit card.
4. Storefront, consumer businesses vary in accepted forms of payment. The decision to accept credit cards should depend on the average sale and the composition of the store’s walk-in traffic.

Who are your customers and target customers?

Credit card processing capabilities are often more important when you are selling product (rather than services) to consumers (rather than businesses). If you sell t-shirts on your Web site, you won’t make many sales if you ask your customers to mail you a check. On the other hand, if you are mowing lawns or repairing computers for your neighbors, your customers might be more comfortable paying in cash.

Business customers, particularly larger corporate entities, tend to pay their service providers via check. This varies by industry and company size, of course. If you aren’t sure, ask your customers to specify their payment preferences.

The other factor to consider is where your business is headed. Do you have plans to go after new customer groups? Check out what the competitors are doing in that space; if they accept credit cards, then you need to as well.

What is your average sale amount? How tight are your margins? How flexible is your pricing?

Credit card processing comes at a cost. If your average sale is tiny or your margins are thin, it can tough to absorb those extra fees. Your options are:

1. Adjust your pricing
2. Accept a lower margin in return for higher sales and lower AR. Make sure you set sales and AR goals, and then track your performance against those goals.

What are your average monthly sales? What percentage of your customers can you convert to credit card payments?

A portion of your processing fees will be composed of monthly minimums. You’ll have to estimate what your average monthly credit card sales might be for two reasons. One, it helps you determine the bottom line impact of accepting credit cards. And two, it helps you understand the terms offered to you by prospective merchant service providers.

Choosing to accept credit cards is like any other business decision: you have to do your homework to identify the right course of action.

Like other subscription-based sites, Amazon WebStore uses templates and widgets to jump-start the site design. The user, however, has a substantial amount of control over the site’s look and feel. Custom images, java script and CSS can be implemented within the templates. Template master pages can be modified at any time, so that site-wide design changes are applied quickly.

The WebStore also incorporates features that have been shaped by Amazon’s years of online selling experience. For example, users can set up their WebStore with a high upsell cart, mini cart and best sellers. SEO features on the site include descriptive page names and metadata overrides.

The aspect of WebStore that Amazon is really pushing, however, is the low start-up cost. As noted above, online retailers can build an Amazon WebStore stores with no IT investment at all. Amazon’s even offering a 30-day free trial. The catch is that there are fees involved (of course), both monthly and per-transaction. More specifically, those who don’t use Amazon’s other business services must pay 2 percent per transaction plus $24.99 monthly to use WebStore. Users also have to accept Amazon’s payment processing fees, which are slightly more competitive than PayPal’s fees, except for small transactions. In short, online retailers could end up paying as much as 4.9 percent per transaction, plus the $24.99 monthly.

Now, using Amazon’s WebStore should reduce hosting costs and, possibly, improve conversion rates. The users who will really find this solution appealing are those that can reduce or eliminate IT staff by using WebStore.

The WebStore solution actually gets more interesting when you consider Amazon’s supplemental marketplace and fulfillment services. Those who combine WebStore with an Amazon.com presence and Amazon’s fulfillment services can run an online retail store without even getting their hands dirty. The extra services come at a price, but in return entrepreneurs get a lean, semi-automatic business structure.

I note the fame of Twitter only to make the point that the microblogging platform has solidified its place in modern communication practices. And that means that people are probably using it to talk about your business, your industry or your products/services. If you’re not convinced of that last point, go to Twitter’s home page, type in a general term for your industry or product category into the search box and hit enter.

See?

Now the results you get from running that search may not be particularly helpful to you. Chances are, they are mostly comprised of your competitors in the act of promoting themselves. If you scrolled through the results pages, you might eventually find someone asking for a solution to the problem that your product or service solves. That would be the ideal marketing opportunity, wouldn’t it–to present yourself to a target customer at the very moment she needs your help? It doesn’t get any better than that.

The problem is, it’s going to take you way too long to find that tweet. So here’s a better alternative, known as the “anyone know” search. I first read about the “anyone know” search here, at searchengineland.com. The implementation of an “anyone know” search is pretty simple; just type in “anyone know” along with your product name into Twitter’s search box. Note that when you search, “anyone know” should be in quotation marks, but the name of your product or service should not be. For example, I typed in “anyone know” copywriter and immediately saw several tweets from people who were looking for copywriters. These are legitimate prospects for me, and all I have to do is sign in and hit reply to make contact.

Try it out for yourself and let me know what you find.

An outside perspective can facilitate more balance in your business. And the more experienced that outside perspective is, the more effective it will be at helping you move your business forward. Unfortunately, an experienced perspective comes at a cost. Further, you may be unsure of what type of help you need: do you need to hire a strategy consultant, a marketing consultant, an assistant?

In these situations, a reputable business coach might be the right investment. An effective business coach can do more than address an immediate problem; he or she can help you achieve focus, make effective decisions, and communicate successfully with your customers and employees.

Finding a good business coach

Business coaches are everywhere; some are good at what they do, and some are not. To help you distinguish between the two, here’s a review of the site of an experienced coach, JM Perry.

JM Perry is not solely focused on business coaching, but specializes in the broader category of Life Strategies. Business is a sub-focus, however, as demonstrated by the testimonials on the site. They include praise from high-level executives from Amazon.com, Jaguar Land Rover, Accenture, Staples, and Charles Schwab & Co. If you click over to JM Perry’s Life Strategies Blog, you can get a taste for JM Perry’s philosophies. You will also see that these philosophies are as applicable to business success as they are to life success.

The company’s services include consulting, executive coaching, keynote presentations, classroom training and off-site, adventure training. The adventure training courses, which include white water rafting, sailing and golf, focus on team building.

The site also has a store, where you can buy packaged solutions, such as audio programs and workbooks. You can also sign up for a free e-mail newsletter.

Investing in a good business coach often pays for itself. Investing in an ineffective business coach, however, is an entirely different story. If you are considering retaining a business coach, take a close and careful look at the coach’s Web site. Make sure the site demonstrates expertise and experience. It should also give you some low-cost or even free options to preview the coach’s philosophies.

If your answer’s yes, you’ve probably already seen a zillion articles outlining the latest and greatest sources of Web traffic. Heck, I’ve probably written a zillion articles on the topic. Well, guess what? It’s time for a reality check.

As Internet marketers, we get so involved in the process of staying “in the know” that we can sometimes overlook the big picture. And often, it’s the big picture that shapes our future success. So let’s take a step back now and assess the landscape: where does Web traffic really come from?

Web traffic is comprised of three broad categories:

• Search engine traffic
• Referral traffic
• Direct traffic

Search engine traffic can be bought via pay-per-click, sponsored listings campaigns. Free search engine traffic, on the other hand, must be earned. Since the search engines guard their algorithms carefully, there is no accepted list of what factors determine whether your site is worthy enough to rank well in organic search. Anyone who tells you otherwise is lying. Factors that are believed to be of importance include site content, incoming links, site age, page load speed, internal links, and quality/type of coding.

To capture a sizeable and sustainable amount of organic search traffic, you need two things: time and focus. If you don’t have time, then you need money. You’ll use that money to pay someone to identify the most profitable keywords, optimize your site and manage a long-term link building campaign.

If you need search engine traffic fast, you’ll have to buy it. You can keep your per-click costs down by selecting your keywords carefully and writing very strong ad copy. Google in particular won’t hesitate to raise your minimum bid if your ad is generating a below-average click-through rate.

Referral traffic, that is, traffic to your site from a link placed on another site, can also be free or purchased. You can buy referral traffic by purchasing a text link or graphic ad on a high traffic site. If your ad is compelling enough, users will click through. Free referral traffic is a by-product of having juicy and unique content. If you write something that people find enormously interesting, other sites will link to it; they may even tell their visitors directly, “hey, check this out.”

I’m going to state the obvious here, but bear with me. Referral traffic is transported from another site to your via incoming links. Incoming links also inform search engines on your site’s content and popularity. This is why a link-building strategy is a must: it can generate modest traffic in the immediate term, but will have more impact over the longer term as your organic search performance improves.

Direct traffic is just what it sounds like; users type your URL right into the navigation bar. Direct traffic results from your off-line marketing and brand-building activities. You pass out your business card at trade shows, you put your URL on a billboard by the 405 freeway, you have your domain tattooed on your forehead, etc. If you are fortunate enough to have a generic domain name, you may get some type-in traffic too. (Type-in traffic isn’t meaningful for most sites; this juicy and unique article has more information on that. )

When you look at the big picture, two strategies rise to the top of the efficiency scale: content development and link-building. Granted, this isn’t new advice, but staying focused on these basics keeps you from coming down with a distracting case of shiny object syndrome.

The good

Cost. The Payvment cart is free to use. While there are other free shopping cart scripts out there, none install with a single snippet of code. This aspect of the Payvment solution is likely to appeal to smaller online merchants who don’t have an in-house or on-call webmaster.

Facebook integration. Payvment makes a Facebook storefront app, which can be integrated with its Web-based shopping cart. With the Facebook app, merchants can quickly install a storefront on their Facebook page; this provides maximum visibility for the products and an easy shopping experience for potential customers. The Facebook storefront can also be used on a standalone basis, which may appeal to online retailers who already have another cart system installed on their site.

Design-friendly. The cart can be installed to an existing Web site without making major changes to the site’s design. Visually speaking, the primary changes would be the addition of “add to cart” buttons next to the products. The shopping cart itself remains hidden until a customer clicks on an “add to cart” button; at that point, a pop-up appears to show the customer what items are in the cart. The customer can click a check-out button on the pop-up whenever he’s ready to complete the transaction.

Portability. Say the customer leaves the site without completing the purchase. The selected items remain in the cart. If the customer navigates to another site with a Payvment cart, he can add more items from the second retailer. When he’s ready, he can check out once and complete the transaction with both retailers at the same time. This is the most unique aspect of the Payvment solution. Unfortunately, it’s not a relevant feature until Payvment can get its shopping carts deployed all over the Web. In other words, if only a fraction of one percent of e-commerce sites use Payvment, what are the chances the user will ever see his shopping cart again?

Affiliate link support. The cart can be used to process in-house products as well as affiliate products. If a user clicks on an affiliate link for which the Payvment cart is deployed, the item just goes into the cart. The user can then continue browsing the site and adding more items to the cart. A merchant with a targeted selection of affiliate products may realize increased revenue as result, because the user is kept on the site longer. Without the Payvment cart, the user would be redirected to the product page on the first click.

The bad

PayPal only. The cart is built to work with PayPal only. Merchants, particularly the established ones, often have access to less expensive methods of payment processing. New online merchants may not mind using PayPal at first. But there comes a point in the revenue growth trajectory when PayPal is no longer the best option. When the merchant grows out of PayPal, that merchant also grows out of Payvment.

Add to cart buttons. OK, yes, the Payvment cart installs with a single line of code as noted above. But there’s a huge caveat. The merchant must create custom “Add to cart” buttons for each product. The shipping cost for a product is specified within that code; the merchant defines a flat rate for one piece and an additional flat rate to be applied when the user buys more than one of the same item. This is limiting for a few reasons. First, the merchant must define a single shipping rate for all customers, domestic and international. In practice, this probably means the domestic customers end up paying more for shipping, because the merchant won’t want to lose money on international sales. Secondly, the customer is assessed a separate flat rate for each separate product purchased. If the customer buys a deck of cards, a toothbrush and a pair of earrings, he is assessed three separate shipping charges–which is likely to total more than a shipping charge calculated on the entire order. More robust shopping cart programs sum the weight of the products purchased and use that number to calculate actual shipping costs with a specified shipper.

Further, if the merchant experiences a change in shipping costs for any reason, each product button must be rebuilt to reflect that change.

A related issue is that the Payvment cart does not appear to offer any type of inventory tracking mechanism. Therefore the merchant must track items in stock separately; when a product sells out, the button must be manually removed from the site.

Merchants can write the button code manually by modeling it from a sample provided by Payvment, or they can use Payvment’s auto-builder. The latter looks to be foolproof. The sample code, however, is problematic. As of this writing, there’s an error in Payvment’s sample affiliate link (one of the variables is spelled wrong) and so it doesn’t work.

Comparable to other solutions. With the exception of the affiliate link support, Payvment’s cart, as of right now, isn’t all that much different from checkout solutions offered by PayPal and Google Checkout. Now if Payvment could realize some saturation across the Web, then the portability of the cart becomes a factor. But is saturation realistic for a solution that isn’t appropriate for large retailers who have a lot of SKUs? The only thing Payvment has going for it in this regard is the Facebook app. If that takes off, then Payvment might have a chance.

The ugly

Compatibility problems. I tested Payvment’s cart on a Joomla-based site with affiliate product links. Frankly, I couldn’t get it to work properly–even after I corrected the flaw in the sample code. It appeared there was a javascript conflict. In this case, using the Payvment cart would have required detective work and, possibly, fundamental changes to the site–which goes against everything Payvment’s pitching.