The question you need to ask yourself before choosing which a company to host your online store is: What's more important for you: lower cost or greater ease of use. Choose carefully, because shopping carts take time to build, product by product.
One of the easiest and most complete packages (though not the cheapest) is available through ProStores, which is an EBay company. The name, the hosting and the site creation tools and reporting are all in one place and it's pretty easy to use. A new player in the market is Shopster. A small basic store is free, then monthly fees go up as you choose to add more products.
Most sites that offer online stores offer a shopping cart as part of the package. Another way to do it, though, is to have the merchant company that collects online payments keep track of the customer's shopping cart. PayPal
, for example, walks you through the process of creating a button for each item on your website, each of which feeds into a shopping cart at PayPal.
If you want a full-functioned shopping cart package that comes with lots of support, try PDG Commerce. The software costs $400 and they will install it and set it up on your own website for you.
For this you'll need an SSL certificate. Your hosting company should be able to help you get one. The process can be a pain, so if they offer to do it for you, let them!
Besides setting up your online store, you will need a company that will accept credit card payments on your behalf. Your hosting company will offer you a "merchant gateway", which will connect you with a credit card processing company, along with instructions on how to set it up. HOWEVER, the credit card processing company has its own fees, sometimes a startup fee, and frequently a monthly fee or minimum as well as a small percentage of each charge.
You can get around this by opening a PayPal account. There are no up front fees, just a small percentage of each payment made to you and a transaction fee, usually about 20 cents. They even offer a simple, very basic, shopping cart builder. They've taken away the biggest drawback to using them, which was the requirement that the person paying you needed to set up an account with them, so the're now the least expensive way to get started.
Once you're up and running (or if you anticipate lots of business from the start), you may want to switch to something other than PayPal. When you have large sales volume, you wind up paying less to a merchant account because they generally charge a lower percentage of the total sale. A relatively inexpensive company is Capital Merchant Solutions, which do not charge an initial setup fee.