Four things make up an online store:
1. A "catalog"
Specialized ecommerce providers, such as BigCommerce, Shopify, Quick Shopping CartŪ from GoDaddy.com or Merchant Solutions from Yahoo. have attractive shopping carts, with advanced features, such as zooming in on a product and "you may also like" suggestions, built in.
All of these ecommerce providers give you a "back end" where you can enter your products one at a time, with descriptions, prices, photos, options such as size and color and shipping costs. The products then display on pre-designed pages. You can choose from a wide variety of designs which you then customize with your store name and logo.
2. A "shopping cart"
The shopping cart is the page that displays all the items the shopper has chosen to purchase. The cart segues into the checkout process where the shopper enters address and payment information and makes the purchase.
Simple shopping carts for simple websites
On PayPal you create BUY NOW or DONATE buttons via a simple form and insert them into your page. (See this page for a step-by-step guide to pasting the code in your page.) Your customer is then brought to a simple shopping cart hosted on PayPal.
2checkout is similar to PayPal. You get their buttons, they host the shopping cart. The customer doesn't have to have a PayPal account, and you can accept all major credit cards. Amazon, again, gives you code for buttons to paste on your pages. But the customer must check out on the Amazon website.
The costs are similar for all three: about 3% of the price plus a small transaction fee.
The signup procedure is the hardest part. Be prepared for it to take a couple of weeks from start to finish, and have your bank account information handy.
Ecommerce providers provide a shopping cart on your own website as part of their package. The good ones have done research on how to make the checkout process as smooth as possible for your customers.
3. A secure internet connection
For security, you will need an encrypted connection (one that sends information across the internet in coded form). The simple payment processes like PayPal and 2checkout host the checkout code on their website, so they provide the security. Ecommerce packages like BigCommerce also provide encryption. If you're signing up with a regular web hosting company, make sure they provide encryption via an SSL connection.
4. A payment process
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.
Ecommerce providers have "hooks" that let you connect your shop to one of several of the larger credit card processing companies, as well as PayPal and Amazon. These "hooks" will greatly simplify your store setup.