“Open Source eCommerce Has Officially Evolved” was boldly declared on a blog post announcing the release of Magento version 1.0.

Since 1997 I have worked on a variety of eCommerce systems and for the last several months have been working with Magento. While Magento is very new and lacks the maturity of some of the more established eCommerce solutions, I do agree that Magento has taken open source eCommerce to the next level.

Here are the top 4 reasons why I feel Magento has changed the game:

1. Solid Business Model for Free Software
2. Gifted Designer in Development Team
3. Incredible Community Outreach
4. Brilliant Framework Under The Hood

Solid Business Model

Many open source projects start off with a bang and fizzle out. If the backbone of the project depends on a few passionate developers donating their time with no financial incentive, their commitment to the project is often unsustainable.

The company behind the Magento project, Varien, has setup several ways to monetize their open source project.

• Professional Services (installs, customizations, etc.)
• Commercial Support
• Commercially licensed extensions that offer new functionality.
• Certified Partners Program (other companies pay annual fees to be listed as an offical partner)

Varien CEO Roy Rubin says “Magento is at the core of Varien’s business model”. This statement suggests longevity and stability for the Magento project, critical factors that potential users look for before investing time in an open source project.

By having a for-profit company back the open source project, developers are guaranteed paychecks and have access to resources that other commercial development teams have. This allows them to release commercial quality software without charging for licenses.

Gifted Designer

Drop-dead gorgeous graphic desgin.

The most obvious way Magento has set itself apart from other open source eCommerce projects is the drop-dead gorgeous graphic design.

Most open-source projects looks like the interface was designed by an engineer for other engineers. Magento made the right move by making talented designer Minu an integral part of the development team.

Check out the beautiful screenshots at http://www.magentocommerce.com/media/screenshots.

Community Outreach

Less than a month after the first production release of their software, the Magento online community boasts 14,905 registered users with 351 members currently logged in as I write this post.

Magento has done a fantastic job of integrating their community tools into their website. A single sign-on gives access to Wiki, Forums, Bug Tracking, & Sub-project development groups.

Members of the Magento development team can be found answering questions on the forum, updating entries in knowledge base, and occasionally providing free training via live webcasts.

The Framework Under The Hood

Not only does Magento look sexy, but it was built on a solid object-oriented framework.

As an eCommerce consultant I felt that if I wanted solid code I needed to use a Java-based enterprise solution like OFBiz or Opentaps. But sometimes that was overkill for simple little cart projects and I’d end up using crappy free php carts with spaghetti-like code.

Magento now offers a solution to fill that middle-ground vacuum. Based on the Zend Framework, the code is all PHP so doesn’t require a special application server like the java solutions do and should run on almost any simple hosting solution.

The code can be easily customized using rewrites of existing code to a local repository of customized codes. This keeps custom code separate from base code and simplifies upgrades.

Magento code is object-oriented, so classes inherit all of the methods from the parent class they are extending and you only need to define the methods you’re adding or modifying. No more cloning vast amounts of code.

Other PHP developers have told me that learning the Magento framework was a big paradigm shift
for them, but any developer with a java web application background should be able to dive right in.

Stay Tuned For Free Giveaway

Sometime in the month of May, I’ll be announcing a contest for free setup of a Magento Cart with a free year of hosting, compliments of Bizlift. If you’ve wanted to try selling something online, this will be your chance.

** Update **
Sorry for the delay on announcing the contest.  I’m working on becoming a certified Magento Partner.  We’ll announce the contest shorty after the new 1.1 release due out in July.

If you have any questions of comments on Magento, please let me know below:

Are you opening a new web-store? Perhaps starting a Timothy Ferriss style 4HWW “muse”?

If you are launching an online store with the anticipation of being wildly successful, this article will explain why open source enterprise software is right for you.

Enterprise Software vs Shopping Carts

Enterprise Software provides tools for managing all aspects of your business.

A typical online shopping cart handles only the ordering part of your business. It might also have basic support for inventory and customer service.

So why would you need more than a basic shopping cart?

1. Room To Grow

Moms buy clothes their teenagers can grow into.

You should do the same with your web store.

As a teenager, I went through a growth spurt one summer. I grew an inch each month.

My mother bought pants several inches too long and would hem the cuff. As I continued to grow she’d let down the cuff inch by inch.

Moms buy clothes their teenagers can grow into. You should do the same with your web store.

Early in my career a boss explained that trying to upgrade a business’s information system while keeping it running is like trying to change the tires on a moving car. The company was moving from a hodge-podge collection of apps to a more robust solution. They actually had to shutdown for a few days to make the switch.

Having to shutdown to handle growth is a good problem to have. But it can be avoided with a little foresight.

Several of my clients have enjoyed explosive growth in recent years. Our open source enterprise solutions have played a vital role in achieving and handling that growth.

These clients started their business running on a scalable system that they could grow into and that would continue to grow with them.

Several years ago I setup Apache Open For Business (OFBiz) for Citydeals.com. The shopping cart had a trickle of orders for the first few months as online sales slowly picked up.

Eventually it reached the point where we had a multi-server load balanced solution handling 1000+ views per minute during peak periods.

It’s performed so well in its own metro area that parters are anxiously opening up new markets nationwide.

Citydeals originally used OFBiz as a shopping cart. They now also use it for the following:

• Customer Service team tracks who last talked to customer, what was resolved, and when that contact happened.
• Sales team uses a CRM/SFA module from Opentaps.
• Management tracks inventory levels and views sales reports.
• Accounting reconciles sales, returns, inventory transfers, etc.
• Partners have a portal to check on consignment sales and reports.

The entire company with 30+ employees and hundreds of partners use this system to run the business.

The Citydeals founder has often expressed amazement and appreciation for the software. Time after time he has requested new functionality and I could happily inform him that it already existed in the system or could be made available with a little bit of tweaking.

2. Available Anywhere

I setup OFBiz for an endurance supplement company over 5 years ago. Now they’re the king of their niche. They sponsor the top Cyclists and Triathletes in the world. Their product is carried in hundreds of retail stores, they have international distributors all over the globe, and the direct sales from their website is cranking.

Apache OFBiz is web-based so works with any browser. The two owners are able to login from home and place orders and check on the fulfillment process and look-up customer/order notes.

They also painlessly switched from one fulfillment center to another. It was as easy as disabling old logins and creating new ones, then trucking the goods over to the new warehouse.

A web-based enterprise solution like OFBiz is perfect for business owners that want to outsource to virtual assistants or other service providers without being tied to them for life.

3. The Price is Right

My clients love that OFBiz saves them a ton of money in licensing.

I’ve launched eCommerce solutions for corporations ranging from a VoIP pioneer with 300 employees to a $1 billion/year world leader in their market. I worked with expensive high-end Oracle systems and was recognized by IBM as the first to commercially deploy their eCommerce solutions on an AS400e midrange server.

When I left the corporate world to go self-employed I couldn’t afford those advanced systems that cost 6 to 7 digits. But I was frustrated by the poorly built open source shopping cart software that was available.

Then I found OFBiz and was floored by the elegant service-based architecture. It was open, free and built with solid framework, data model, and accounting practices.

My clients love that OFBiz saves them a ton of money in licensing. They love that it’s wide open and they don’t have to wait for software vendors to add functionality. They can hire any java developer to make the changes they want.

OFBiz is java-based so will run on almost any type of server. It is database agnostic, so will run on any major database. There is no vendor lock-in with this solution.

Summary

• Open Source Enterprise Software is a great solution for small businesses looking to grow.
• Web-based solutions allow you to run your company from anywhere and outsource to anyone.
• Open Source Enterprise Software is much more cost effective for small businesses than commercial software.

Stay tuned next week for a follow-up post titled “Wide Open - Apache OFBiz Reviewed”.

If you have any questions on this article, please leave a comment below.