Click Here to Go Directly to the Story

DECEMBER 9, 1999

By Karen E. Klein

The First Rule of Web Customer Service: Let Them Order by Phone
Some people want an alternative to giving credit-card numbers on the Web

Printer-Friendly Version
E-Mail This Story

My company provides sexual-harassment prevention training:

Once, when the employee is hired
Not sure


Search for business contacts:

First Name :
Last Name :
Company Name :

Search by job title, geography and build a list of executive contacts

Search by Zoominfo

Q: I am in the process of setting up my Web site, and I need to know how I can take credit-card orders over the telephone.

---- C.R., Oceanside, Calif.

A: Although online ordering is a routine matter for many, some people still freeze up when asked to type their credit-card numbers into an Internet purchasing form. This is a particularly serious issue for small retailers, which don't have national brand names. They risk losing sales if customers can't place their orders on the phone.

If you're not anticipating much sales volume at first, you can take orders yourself. You'll need an 800 number, a merchant bank account that allows you to accept credit-card payments, and a system for obtaining credit-card authorization over the telephone. Many companies will sell you a package deal with the authorization service and the merchant account. The company that handles your online order processing can probably set you up to take telephone orders as well.

Total Merchant Services, a Newport Beach (Calif.) order-processing company (, provides touch-tone telephone authorization systems for some of its customers. "We give them an 800 number that they dial into, key in the credit-card number they've been given, the expiration date, and the amount of the purchase. They get an authorization code over the phone," says Don Guy, a sales agent for the company. The setup fee is $350. There are also monthly fees, and the bank that handles the merchant account charges a discount rate on each transaction.

If you anticipate high volume or have neither the staff nor the time to take orders in-house, consider contracting with a call center. Jim Puff, president of Sacramento-based Tele-Direct Call Centers (, says his company uses software to automate the order process. It works like this: His operators record a customer's order, tally it up with tax and shipping charges, take down credit-card information, and send it to another company,, for verification overnight. either authorizes the charge or puts a red flag on the order by the next morning. The e-tailer gets a report each day by fax or e-mail, detailing the orders and their credit-card authorization status. The merchant then either packs and mails the goods or hires a fulfillment house to do so.

"We charge an initial fee of $275 for setting up the software, writing up the script, and programming in a description of the items that are being sold," Puff says. "We also charge the client $195 for a license fee that we pay to ICVerify for their software, and a 35-cent-per-transaction fee, plus $1 a minute for operator time."

Entrepreneurs typically pass on the costs of automated credit-card processing, order-taking, and merchandise fulfillment to the customer in the form of charges for shipping and handling. When looking for an e-commerce service company, compare the fees for setup, transactions, and establishing a merchant account, experts say. You can find companies that process orders by searching with such keywords as "telephone-call center," "credit card processing," or "inbound call center." For more information on such services, contact the Association for Telemessaging Services International Inc., an industry group based in Washington, at (202) 429-5151 or on the Web at

Have a question about running your business? Ask our small-business experts. Send us an e-mail at, or write to Smart Answers, BW Online, 6th Floor, 2 Penn Plaza, New York, NY 10121. Please include your real name and phone number in case we need more information; only your initials and city will be printed. Because of the volume of mail, we won't be able to respond to all questions personally.

Get BusinessWeek directly on your desktop with our RSS feeds.XML

Add BusinessWeek news to your Web site with our headline feed.

Click to buy an e-print or reprint of a BusinessWeek or BusinessWeek Online story or video.

To subscribe online to BusinessWeek magazine, please click here.

Learn more, go to the BusinessWeekOnline home page

Back to Top

[an error occurred while processing this directive]

Media Kit | Special Sections | MarketPlace | Knowledge Centers
Bloomberg L.P.