e-Commerce for Small Business: Keeping it simple and inexpensive

by Tom Worthington FACS

Monday 21 May 2001, Queanbeyan, NSW

Sponsored by the Business Entry Point

Some books: Buying and selling on the Internet


e-Commerce for Small Business: keeping it simple and inexpensive (Seminar style presentation - free & low cost ways for small business to simply use the internet for e-payments and other business functions - presented by Tom Worthington, independent e-business consultant, small business owner and author of the book Net Traveller). Date: Monday 21 May Times: 7.00pm to 9.00pm. Venue: William Farrer Room, Airport Motor Inn, Yass Road, Queanbeyan. Access Free - bookings essential.

Request for content

The text of the presentation will be made available on this web site. Examples of small businesses using the internet for e-payments and other business functions are requested for use in the seminar. Examples in the Queanbeyan area would be particularly useful.

Personal Examples Used

This presentation is by an IT professional who runs a micro business. Examples of products and services are given which the presenter has used successfully or which he helped develop and in some cases sell. This is therefore not an impartial assessment of all products available or an unbiased assessment. These products and services may not suit your business and you need to carry out your own assessment.


Paper-last Process

One of the jokes of the IT industry is the "paperless office". By now everyone was supposed to be using electronic communications and so paper would be obsolete in the office. The opposite has happened with more paper being used with laser printers and word processors. However, you can combat this in your own office. Adopt a "paper last" policy: use paper, but only as the last step in a process and only where it is really needed. As well as saving on the cost of paper, printing and postage, this saves on storage and handling of documents.

E-mail can be used for routine business correspondence. Include your e-mail address on all correspondence. Ask people you do business with for their e-mail addresses. Provide brochures via the web or by e-mail. Explain that you accept orders by e-mail and prefer to send invoices by e-mail.

See: How to Read and Write E-mail Messages

Here is what a typical e-mail order to my company looks like:

Date: in the, 23 Mar 2001 20:47:41 +1100 (EST)  
From: porders@xxxxxx.com.au  

Please process the following orders.
          * quote our order number on the invoice
          * quote our order number on correspondence
          * backorder and notify us if unavailable
          * send the exact format requested
          * supply the latest edition unless otherwise indicated

                        FOR AUSTRALIAN SUPPLIERS ONLY
          * If an ABN is not evident on your Tax Invoice when
          * supplying goods, or you are unable to prove exemption,
          * 48.5% of the Invoice value will be deducted from your payment 
            as per ATO requirement
          * Our ABN is xx xxx xxx xxx.
     -------------------------------  O R D E R -------------------------------
xxxxxx PTY. LTD.              ABN xx xxx xxx xxx, ACN xxx xxx xxx x
xxxxx ST, xxxx    NSW   2xxx

TEL: +61 x xxxx xxxx  FAX: +61 x xxxx xxxx
   xx MAR 01      ORDER NO. Txxxx

   PO BOX 13

   Supplier code: xxxxx

    ISBN     Qty   Title & Author
--  ------------------------------------------------------------ ----------
0646391593    1  Universal service?: telecommunications policy in
                 Australia and people with disabilities (Paperback)
                 Bourk, Michael J. & Worthington, Tom  

It should be noted that there is no fancy formatting in the order, just text.

Paper-last invoices

Send your clients e-mail invoices as the first step. This can be a simple text-only e-mail message:

Date: Tue, 03 Oct 2000 09:11:24 +1000 
To: "xxxx" <xxxx@xxxx.com.au>  
From: Tom Worthington <tom.worthington@tomw.net.au> 
Subject: xxxxxx - Invoice for xxxx 

Invoice number: 2000-xx 
Date: x October 2000  

FROM: Tomw Communications Pty Ltd 
PO Box 13, Belconnen ACT 2617, Australia 
A.C.N. 088 714 309 http://www.tomw.net.au 
e-mail: accounts@tomw.net.au 
ph: 0419 496 150  
fax: 02 6262 7954  

TO: xxxxxxxx

Att: xxxxx  

FOR:   xxxxxxxxxxxxx

Price:                      $xx,xxx.00
GST:                         $x,xxx.00
Total including GST:        $xx,xxx.00

Terms: 14 days  

Payment to: 

Bank: xxxxx
BSB Number: xxxxxx 
Account Number: xxxxxx  

Or cheque payable to:

Tomw Communications Pty Ltd  

Some organisations don't like plain text invoices, but will accept a formatted one. In that case you can generate a word processing file which will produce something which looks just like an invoice when printed. Then attach the invoice to an e-mail message. If that isn't acceptable, you can send them the same document via a fax interface.

There are some standards in use, and many proposed, for handling electronic orders and invoices automatically. While these look high-tech, underneath they use simple text formats and so you do not necessarily need highly complex software to process the formats. If you are a member of an industry which requires use of a particular set of formats, check if there is a free or low cost version of the software to handle them. Alternatively they may be a low cost web site which lets you send and receive orders, without having to install any software yourself.

Simple Low Cost Electronic Payment

Payment Within Australia

The simple way to avoid credit card fees for on-line orders is to not accept credit cards. If your company deals with retail consumers for small value transactions, then you might have to take credit cards. However, if you deal with other companies (so called B2B or "Business to Business" e-commerce), then credit cards may be an unnecessary expense.

The same direct entry system, used by large companies and government agencies for making payments to, or receiving payments from, large numbers of their employees and clients, is also available to small businesses. For a small charge (about 50 cents) the direct entry system allows you to instruct your financial institution to credit any other account at a financial institution. This can be done easily using Internet banking. Some banks require that a faxed registration from be sent registering accounts you will be paying to. Payments can be transferred to your company account, usually at no charge to you and with no prior registration required.

For my company I give account details on invoices and request direct payment in preference to cheques. Similarly I ask for account details to be able to make payments.

One problem with this system is that it can be difficult to know who the money came from (the so called "Eighteen Character Problem". Systems such as the BPAY electronic bill payment service offered by a number of financial institutions, use check digits to provide better payment tracking information. However, companies must register for BPAY, it may incur an additional charge and require more complex software. One way around this is that some banks issue all accounts with BPAY facilities automatically and for free.

Overseas Payments

Transferring funds to or from overseas is an area where the banks appear to not have caught up with modern electronic pratice. SWIFT (Society for Worldwide Interbank Financial Telecommunication) is a co-operative organisation that operates a network for the exchange of payment and other financial messages between financial institutions around the world. Australian Banks can make payments to overseas accounts (typically called "telegraphic transfer") and receive them, much as with domestic payments. However, while manual processing must be much less for telegraphic transfer my bank charges more (about $35) than for a bank cheque in a foreign currency (about $15). Also unlike domestic transfers there is a charge for receiving a payment from overseas (about $10).

However, SWIFT may still be better for some transactions (and faster) than cheques. To accept international payments ask your bank for its BSB number and Swift/sort code. Currently my bank doesn't allow overseas "telegraphic transfer" from an Internet account, it has to be done at the counter.

Go Wholesale

If your company does sell consumer items then the general public will expect to be able to pay by credit card. There are fully automated on-line credit card systems available. However, you should consider low cost simpler alternatives first.

Dealing with the GST On-line

For many transactions you will need the Australian Business Number of a business. You can search the Australian Business Register (ABR) on-line for a business name, ACN or ARBN. Searching for tomw gives:

Date and time retrieved: 20 Apr 2001 13:31:31
Record last modified on 19 Nov 2000
Register last updated from ATO on 18 Apr 2001
ABN: 17 088 714 309
ABN Status: Active from 01 Nov 1999
Entity Type: Australian Private Company

Main Business

State: ACT
Postcode: 2602
Trading Name(s):


GST: Effective from 01 Jul 2000
Gift Recipient:


088 714 309

It is also possible to apply for an ABN on-line at the Australian Business Register.

Researching Business Proposals On-line

Before sending some of your hard earned money to a company or individual, or before entering into some other business arrangement you can use the Internet to help collect business information to make an informed decision.

The first place to start is with the web site of the organisation. Often this will be on the business card, letterhead or other correspondence (don't forget to put it on yours). If there is no web address (they usually start with "www" or http") then look for an e-mail address. If the part of the e-mail address after the "@" appears to be an abbreviation for the company name (such as @tomw.net.au) then add "www." and try this as a web address.

Check the web address

Type the organisation's web address into your web browser and see if it works. Before looking at the site, look at the address. Most addresses end in .COM or .COM.AU for "commercial" or "commercial Australia", indicating a for-profit company. An address with "GOV" indicates a government entity and "ORG" a non-profit organisation. Look out for odd addresses. Next look at the name of the site: does it match the name of the organisation? If not why not?

Check the web site

Do the details match what is on other documentation? If you do business on-line via this web site you want to make certain it is actually the same organisation and it is where it claims to be. If the web based business is offshore it can be difficult to obtain legal redress if there is a problem. What are the contact details? Do company numbers match?

Check the company registration

The Australian Securities and Investments Commission provide a free index of corporate and business names which can be searched via the web. This finds company and business names registered across Australia.

A search on "tomw" finds:

2 names found (* indicates former name)
Number Status Name

Selecting the first entry shows a business name:

Extracted from ASIC's database at 09:31:51 on 19/04/2001

F 00091941
Type Business Names
Status Registered
Place of
not available
Jurisdiction Registrar-General's Office, ACT
The second:
Extracted from ASIC's database at 09:30:55 on 19/04/2001
088 714 309
17 088 714 309
Type Australian Proprietary Company, Limited By Shares
Status Registered
of Registered
Canberra ACT 2600
Jurisdiction Australian Securities & Investments Commission
These are the documents most recently received by ASIC from this organisation. Page numbers are shown if processing is complete and the document is available for purchase.
Received Number Pages Description
18/12/2000 08871430K 3 316 (AR 2000) Annual Return Change to Principal Place of Business
316P Change of Name or Address of Officeholder
316L Annual Return - Proprietary Company
15/12/1999 08871430J 3 316L (AR 1999) Annual Return - Proprietary Company
20/07/1999 0E3263651 3 201C Application For Registration as a Proprietary Company
Further information is available by paying a fee to an ASIC information broker on-line, but this is enough to see that the information is at least consistent with what is on the company web site.

Check the web registration

Web addresses are registered in a global database. This includes names and contact details. For tomw.net.au the details are:
Name Status Report

Name: tomw.net.au

This name is configured in the DNS:

Name Servers:

tomw.net.au name server oldent.powerup.com.au
tomw.net.au name server galileo.powerup.com.au

Mail Servers:

tomw.net.au mail is handled (pri=10) by mail.tomw.net.au
tomw.net.au mail is handled (pri=50) by horizon.webcentral.com.au
tomw.net.au mail is handled (pri=100) by enterprise.powerup.com.au

SOA record:

tomw.net.au start of authorityenterprise.powerup.com.au domain.webcentral.com.au(
2001031614;serial (version)
900;refresh period
300;retry refresh this often
86410;expiration period
86400;minimum TTL

tomw.net.au is not in the AUNIC registry.

Querying whois.connect.com.au:

% RIPEdb(3.0.0b1) with ISI/Qwest RPSL extensions

domain:       tomw.net.au
descr:        Tomw Communications (ACN: F 00091941)
              PO Box 13
              Belconnen ACT 2617
admin-c:      TW31-CC-AU
tech-c:       JA1-AU
zone-c:       JA1-AU
nserver:      galileo.powerup.com.au
nserver:      oldent.powerup.com.au
notify:       dbmon@connect.com.au
changed:      net-au-admin@connect.com.au 19990222
source:       CCAIR

person:       Tom Worthington
address:      Tomw Communications
address:      PO Box 13
address:      Belconnen ACT 2617
phone:        +61 419 496 150
nic-hdl:      TW31-CC-AU
notify:       dbmon@connect.com.au
changed:      net-au-admin@connect.com.au 19990222
source:       CCAIR

% referto: whois -h whois.aunic.net -p 43 -s AUNIC -T person,role JA1-AU

Administrator of parent domain net.au is net-au-admin@connect.com.au.

Check the phone book

The White Pages for Australia can be searched on-line. Search engines can be used to look for company and personal names, as well as addresses, phone and fax numbers listed in web pages. This finds not only web pages provided by a company, but also entries from the media and other organisations about the company. A search for "Tomw Communications" finds almost 200 entries, a few of which are:

TomW Communications
Tomw Communications Pty Ltd. TomW Communications was ... 1
August 1999. TomW Communications Pty Ltd. ...
www.tomw.net.au/admin/ - 4k

TomW Communications Pty Ltd - Media Releases
www.tomw.net.au Tomw Communications Pty Ltd - Media Releases. ... Web page by Tomw
Communications Pty Ltd ACN 088 714 309 - Comments to: webmaster@tomw.net.au.
www.tomw.net.au/media/ - 3k

[SLUG] [LINK] Microsoft Windows to disappear within two years ...
... two years, Media Release . Tomw Communications Pty Ltd - Media Release Microsoft
Windows to disappear within two years - Says Cyber Sooth Sayer http://www.tomw ...
www.slug.org.au/lists/archives/slug/2000/May/msg00864.html - 9k -

Newsgate: uk.transport.buses: Drive double-decker bus for the ...
... tomw.net.au/nt/uk.html -- Tom Worthington FACS tom.worthington@tomw.net.au Director,
Tomw Communications Pty Ltd ABN: 17 088 714 309 http://www.tomw.net.au PO ...
www.newsgate.co.uk/uk/uk.transport.buses/msg05802.html - 6k

I-cubed Web Accessibility Summit 2000
... 10.05am - 10.35am Morning Tea. 10.35am - 11.25am Tom Worthington, Director
Tomw Communications Olympic Failure: A case for making the Web Accessible. ...
www.webaccess.iii.rmit.edu.au/program.html - 6k

The University of Melbourne Library - Giblin Economics and ...
... MICHAEL J BOURK ; EDITIED [SIC.] BY TOM WORTHINGTON. Belconnen, ACT : TomW Communications,
www.lib.unimelb.edu.au/collections/ecocom/newbookslist.html - 25k

Don't Waste Money on Computer Technology

While computers and telecommunications (called collectively "Information technology" or IT) can enhance business processes, they have to pay their way. Many in business assume that using a computer or the Internet will automatically make their business more efficient; it will not. What buying IT will do first of all is increase costs. Before spending on IT you must make a business case that it will either reduce costs overall or increase revenue. Also you must asses that the risks involved are acceptable. Many, perhaps most, IT projects fail and produce no benefit to the organisation at all.

Small business can least afford high costs of IT and failed projects to implement it. This talk concentrates on free and low cost technologies which minimize risk. These particularly suit small business, but could be applied to any business.

e-mail lists

A simple and effective way to keep in contact with staff, clients and other interested parties is with e-mail lists. Effective use of lists is made by the Australian Computer Society. There is specialized software which large organisations install on their own Internet servers and some ISPs provide lists as part of a web service, however, the ACS uses the free advertising supported list service Yahoo! Groups. This service provides for closed groups (by invitation only) and lists where only you can post comments. An archive off all messages posted can automatically be kept and subscribers can be prevented from sending large attachments to messages. Using a list can save on sending out routine material by mail or fax and save maintaining subscription lists.


You can minimize Internet costs and make it more business-like by switching off many of the fancy features. Set your e-mail program to only download the first 25 kbytes of each message. This will chop off the end of large messages and attachments, which you probably don't want and may contain a virus. If you want the rest of a particular message you can ask the e-mail package to download it the next time it collects mail.

Tell your web browser to never check for newer versions of stored pages. The browser will download each page only once and keep a copy of it. If you think the page may have changed, you can ask the browser to get a fresh copy.

Invest in Training First

The computers and networks used by IT experts and large corporations are the same as those used in small business. The difference is the level of expertise available to exploit the technology. The best investment to make in in training.

You might decide that you don't need to do training you can just pay someone to do it for you. However, even those in large companies need to understand something of how computers and the Internet work, so that they can understand e-commerce business strategies.

Don't Buy a Big Computer

If you already own a computer, then you probably have enough. As a travelling IT consultant I use my lap-top for most of the day every day. A portable computer lasts me about 18 months of intensive use, after which the screws fall out, the case cracks and the hard disk stops working. I buy the base model and keep using the same software year after year. New software takes effort to learn and probably needs a more powerful more expensive computer to run on and probably does more than I need.

Backup: One area in which to invest is a backup device. My computer breaks occasionally and then I rely on a copy of my data copied to an external medium. Floppy disks are not big enough for backups in most instances. I used to use Zip disks but now use CDROM-R (writable CD ROM disks). High quality CDROM-R disks cost about $5 each and I use about one a month.

Works suite: Your computer probably came with a suite of "works" software: word processor, spreadsheet and simple database. There are works suites produced by several software companies and before buying anything more see if this will meet your needs. I use one such suite for my routine word processing and spreadsheet work. It can exchange files with more sophisticated (expensive) packages. As well as saving money the simplified packages are easier to use, because they do less.

Free readers: Occasionally you will need to be able to read files you are sent which your works program can't read. Major software companies, including Microsoft, provide free viewer programs over the Internet for reading files from their packages. I use the Microsoft Word and Excel viewer programs and the AutoCAD Computer Aided Design viewer program for engineering drawings. As well as being free these programs are much smaller than the full editing packages taking up less disk space on your computer. Also because of their limited functions it is more difficult for a virus in an imported file to affect your computer.

Don't upgrade: The latest version of a software package is unlikely to significantly improve your business profitability. Installing the package, learning to work it and dealing with all the problems it causes on your computer will distract you from running the business. My pratice is not to install a new operating system on my computer, I use the one it came with. I only upgrade software when there is something it does which would help my work.

Do you need a computer at all?: Some very small businesses may be able to get along without a computer at all. You might just have your own data on disk and borrow a computer or rent some time on one at a community center or cyber cafe.

Don't Buy a Big Network

Access to the Internet is a very useful business tool, but you probably don't need much access. The Internet was designed as a heterogeneous ad-hoc fault tolerant network. That means just about any brand of computer will do, you don't necessarily need a full time or fast connection.

When travelling I use a mobile phone connection for checking my e-mail. This operates about the speed of modems ten years ago (9.6 kbps). This is by today's standards very slow and expensive. However, if I am careful it works quite well.

A normal dial-up modem and Internet account should be adequate for many businesses. In 1995 I provided the web site for the Department of Defence's Operation Kangaroo 95 using an ordinary modem and lap-top computer while on holiday.

Use a web hosting service

Unless you are running a large or very specialized business, there is no need to run your own web server from your premises. Running a web server needs specialized skills, a computer which is operating all the time and a high speed link to the Internet. My company uses Web Central, a web hosting company based in Brisbane, which hosts the company web site on its computers.

Invest in a Domain Name

Many internet service providers will provide some web space to clients for no extra charge. The catch is that your web site will be tied to the web address of the ISP company, such as www.ispco.com.au/company. If you have gone to the trouble of registering a company name, then you should also register a corresponding web domain name for the company. This provides a web and e-mail address for the company which you can then take with you if you move ISPs. My company has:

Companies generally have a .com (about $33 annually) or .com.au (about $135 for 2 years). Rules are stricter about what a .com.au name can be and the name that needs to be derived from a company name.

My company uses a service which provides 10 email boxes (for addresses such as info@tomw.net.au, sales@tomw.net.au) auto-responders and forwarders to send messages elsewhere, SSL security for protecting credit card and other client details, detailed statistics on web site use to see what web pages are being read, private FTP facility for uploading the web files, extra passwords so support staff can maintain the web site, 20 megabytes of storage space and 500 megabytes of data transfer per month.

This is more than enough Internet service for a micro to small business. A micro business can use the facilities to appear much larger. As an example my company has lots of e-mail addresses for information, sales, web master and so on, but these are all forwarded to the one address for me to read. Potential clients can fill in on-line forms for more information and they can read one of hundreds of pages of information on-line. Clients are provided with non-public web pages for their information only.

Examples of Successful and Not-so-Successful E-commerce and Web Sites

Seminar attendees will be invited to submit their business web site, or one they like for analysis on-screen during the second half of the seminar. The web site will be displayed live to the audience and the techniques discussed above will be used to examine how successful the site is.

More Training

For those wanting to learn more about e-commerce the Queanbeyan Business Enterprise Centre has recently signed up as an AUSeNET Business partner offering two training workshops:

  1. Putting the Internet to Work for your business: a three hour face to face workshop aimed at small and medium sized businesses who are either unaware of electronic commerce (e-Commerce) or who view it as a low priority. The purpose is to de mystify e-Commerce and provide information on the "why" of e-Commerce, to enable the attendee to make decisions on identifying opportunities for their business.
  2. Getting more out of the Internet for your business: is aimed at small and medium sized businesses who have already seen some business advantage in embracing e-Commerce as part of their business strategy
    • Organisations that are using the Internet to find valuable business information
    • Organisations that use a web site to attract new business
    • Organisations that offer client-access to their databases via a web site
    • Organisations using the Internet for business transactions

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See also:

This document is Version 1.5, 20 May 2001: http://www.tomw.net.au/2001/esb/

Copyright Tom Worthington 2001