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There comes a point in your company’s lifecycle when you must decide between outsourcing your ecommerce operations or continuing to keep everything in-house.
It’s a loaded question that most businesses should not approach lightly since the wrong decision can have drastic implications for the success of your business. Some organizations prefer the autonomy provided by having someone in-house that can quickly respond to ecommerce emergencies as they arise, while others prefer to leave the responsibility to an external resource to handle altogether.
Making the “right” decision will depend on your particular setup, as well as your company culture and your anticipated growth in the future. While we can’t give you a definitive answer to this question, we’ll do our best to give you information about the pros and cons of each strategy so you can make the best possible decision to meet your company needs.
In-House Ecommerce Solution
Yep, it’s exactly what it sounds like. Having an in-house solution means your company invests resources into building an ecommerce solution for use exclusively within your organization. Your team is responsible for its regular maintenance but the system is built specifically to meet your current needs.
The Pros of Having an In-house Ecommerce Solution
Complete customization — One of the perks of moving your ecommerce operations in-house is that the solution is geared specifically to meet your business needs. Let’s face it, no one knows your business better than you do. An in-house solution is built specially to meet the needs of your organization, without any extra features to bog down your operations.
Readily accessible staff — Having a dedicated team to maintain your ecommerce platform means that your company can troubleshoot issues as they arise. If something awry happens, your business has the opportunity to correct the problem internally without having to worry about time-zones or remote workers.
Keep costs under control — An outsourced agency can mean big bucks, especially if you’re just getting your footing. It’s possible that you can’t afford to use an outside agency, particularly if you’re not going to see an immediate return on your investment for their services.
The Cons of In-house Ecommerce
Time-consuming — There’s a lot of merit in “going about things on your own.” But is your business spending your time wisely by building your own in-house ecommerce solution? Managing an online store requires a significant investment of developer time – a key resource that could potentially be better allocated towards improving your core business and product offering.
Lack of expertise — Ecommerce can be complicated, especially if you’re thinking about extending your operations overseas. Proper Tax/VAT compliance, chargeback management, and payment processing are all key areas that need to be properly managed to ensure that your entire ecommerce operation runs smoothly. Failing to do so will often result in legal issues and costly fees that may undercut your revenue potential. If your company does not already have in-house talent that can already handle this, you’ll have to focus on bringing in talent that can.
Security issues — Data breaches at huge corporations such as Anthem and Target have spurred customers to take a greater interest in how merchants handle their payment information. Companies selling digital products and software online must be sure to comply with proper PCI standard (PCI DSS) to protect cardholder data.
Outsourced Ecommerce Solution
Outsourcing your ecommerce solution means that you’re putting your ecommerce into the hands of a team of experienced professionals who aren’t within your organization, but are putting their expertise and knowledge to work for your company. Let’s break down the pros and cons of an outsourced ecommerce solution.
The Pros of Outsourcing Your Ecommerce Solution
An extensive knowledge base — An outsourced ecommerce solution team spends their days on one thing and one thing only: ecommerce. Compare that to your in-house team, who all too often are squeezing your ecommerce solution issues in between product development and business management. A reputable outsourced ecommerce solution team will have the know-how to take your organization to the next level. They could even help you scale your operations globally too!
Time-saving — Reduce your time to market and start achieving your revenue potential faster. Partnering with a full-service ecommerce platform like FastSpring can enable you to configure your online store in minutes, all without having to invest considerable time creating your own ecommerce solution.
Security solutions — Complying with payment security standards and local laws is easy when you have an external partner handling compliance on your behalf. Give your customers peace of mind when they shop using FastSpring’s secure checkout and reduce costly chargebacks with our robust fraud management services.
Access to a variety of payment methods — Your customers aren’t confined to one geographical location, so why should your business? Allowing shoppers to pay using their preferred payment method is one way you can eliminate friction during checkout and boost the conversion rate on your online store. FastSpring’s ecommerce platform comes fully equipped with support for over 20+ currencies and a variety of alternative payment options – allowing you to collect global payments effortlessly.
The Cons of Outsourced Ecommerce
Finding the right partner — How can you be sure that the outsourced ecommerce solution will do what they promise they’ll do? It’s important that you carefully assess any agency or solution prior to signing on with them. You’ll want to be sure that your new partner has the skills and technical capabilities to support your business needs and keep up with the latest ecommerce trends.
Budget constraints — It’s not uncommon for companies to overspend on an outside ecommerce solution. However, if you’re proactive about sharing your concerns with your agency from the start of your relationship, and judiciously choose where and how you want their assistance, it’s possible to get the help you need at a price that is more in-line with your budget.
You’re not their only customer — Unfortunately, if the ecommerce solution is really great, it’s unlikely that you’re the only company they’re servicing. If you have a small issue or a question, understand that it may take some time for these requests to be handled. Again, it’s important to check out the agency’s customer service record. Determine how committed they are to aiding you quickly and efficiently before you sign on with them.
The State of Ecommerce Today
Ecommerce is not a set it and forget it kind of endeavor. Changing rules and regulations around proper compliance, evolving consumer preferences, and an increasingly competitive global marketplace mean that companies must focus on creating innovative products and designing seamless ecommerce experience in order to succeed.
To learn more about the forces shaping the software industry and how it is changing the way companies sell software online, download our free ebook: 3 Reasons Why Now Is The Time for Full-Service Ecommerce.