ECommerce (electronic commerce) is everywhere. It contains both many local businesses and empowers entrepreneurs from all around the world. With the dawn of the internet, the field is growing exponentially every day.
One previous report predicted that by 2021, the ecommerce growth rate would rise by a whopping 14.3% and bring over $4.8 trillion to worldwide sales. And to think that this is just the beginning.
Review of How Does Shopify Work and Monthly Cost For Sellers
Indeed, the concept of buying and selling products and services has changed the business world dramatically. This opens the conversation around the leading ecommerce platform known as Shopify. This global platform supports more than 500,000 businesses in 175 countries. And more than 1.2 million users are actively using Shopify every day.
What makes it one of the top choices for ecommerce business, and what does it do for the consumers? This in-depth review of Shopify will tackle the model, benefits, drawbacks, costs and more. Additionally, this post aims to answer the big question of whether it is an excellent income generator or just an oversaturated platform that needs to be ignored.
ECommerce 101: How Does The Business Work?
First of all, it’s essential to understand the quality Shopify promises businesses and consumers. So far there haven’t been many if any whatsoever, reports or instances of Shopify participating in fraudulent or privacy-threatening issues. As a matter of fact, many amateur and veteran entrepreneurs commend the company for its safe-to-use interface.
Having support and security with a business hosting platform is essential.
It is also hailed as a safe platform on which to purchase and input sensitive information. Many appreciate how the company working behind it takes privacy and security seriously. Their Support Team is also known for being responsive in solving disputes and other technical problems. Of course, this is to be expected from a global company tending to thousands of businesses for years.
How Did Shopify Begin?
It is based in Ontario, Canada. And its model specifically appeals and caters to online retail stores and fast purchasing. Although it was officially launched as an ecommerce software solution in 2006, it began as an online store in 2004.
After being launched, Shopify gained immediate success for its promising entrepreneurial potential. By 2007, the company has already reached $100 million in sales. This is also the same year when the company agreed to switch to a model that charged users a transaction fee percentage of sales.
Then in 2009, they hosted a “Build-A-Business” competition that ended up as a yearly tradition. Perhaps this influenced the model it’s following today. Although it was never intended as an ecommerce hosting program, great success depicts the site’s consistent quality throughout the years.
Since the early years, it has led the field with millions of individuals using the business daily. The company had grown so much that in 2014, it was announced as Canada’s Employer of the Year. Currently, almost anyone in the world can access the full features of Shopify either as a customer or a business owner.
Is Shopify A Decent Option?
Getting to customers with something they can’t find in a brick-and-mortar store is a key component of selling well.
Of course, this Shopify review hopes to answer why the site is acknowledged as one of the world’s leading ecommerce platforms. Indeed, the business has proven efficiency in generating income for many shop owners. Additionally, it has opened both a quick and easy outlet for customers to buy products they wouldn’t find in most physical stores.
Generally speaking, this involves a trustworthy company. It offers immense possibilities for entrepreneurs to connect with more customers than may initially be thought possible. Although they charge a monthly transaction fee, people can’t deny the ease and potential they can experience through the hosting site.
What Does The Shopify Trial Involve?
Shopify had a banner on-site that stated something like, “set up your store, pick a plan later.” Fortunately, this is something that the company stays true to providing.
Shopify trial pertains to the free 14-day period where users can access almost all of the features without paying anything yet.
What’s appreciated about the Shopify trial feature is how it doesn’t require credit card information unless the decision is made to opt for a monthly subscription.
Just understand that the trial begins after signing up and not after deciding to create a store. Basically, the 14-day intro period automatically starts after a person makes their account. Therefore, the tip here is to have some intro shop material ready-to-go beforehand.
After 14 days the individual is given two options. One could either carry on with a monthly plan and set up the store or choose to discontinue service altogether. The good thing is the platform does not take down shops created during the trial period. Instead, these shops will be paused until the creator decides to subscribe to a monthly plan.
Shopify won’t charge the users after the trial period expires. It’s entirely safe to use, and it doesn’t ask for credit card information unless a user goes for a subscription. Although Shopify offers this generous beginning period, interested business owners should know that they can’t establish long lasting stores unless going for a subscription.
The Shopify trial is recommended for those who’d like to get a general idea of how this program operates. With it, they can add products, install free add-ons, and create initial views of planned stores. Again, the service won’t delete the shop after the trial period regardless of choosing not to opt for a subscription yet. Within the initial period, an individual can grasp whether it’s something to go with or not.
Shopify Advantages and Disadvantages
This review now goes over the Shopify advantages and disadvantages involved. Before anything else, it’s fair to state that running an account is still a form of doing business. One needs account for business time used. And just like with any business, results people will see in their online stores many need some time.
With that out of the way, below are distinct pros and cons of this service platform.
Shopify Advantages
1. Easy To Use and Straightforward
Considering how Shopify began as a solution software, people can expect ease. The ecommerce platform stands on a very straightforward premise that anyone can learn. As for its website-building parts, Shopify enables users to drag and drop shop elements without knowing how to code. This is a luxury that a few other hosting sites don’t offer. It’s probably one of the reasons why this business stands out, as anyone can make a store without being or hiring a website specialist.
2. Wide Selection of Apps and Plugins
Aside from being easy to use, one can be equipped from a massive range of apps and plugins. There are around 4,000 plugins available in the web store. From these, over 1500 of them are free, which is pretty nice for beginners.
These apps and plugins are incredibly versatile, straightforward, and helpful. Entrepreneurs are also given a wide selection of different prices depending on their own budget allowance. The app store has tools for website optimization, package tracking, analytics, live chat support, product listing, and much more.
The most popular plugins are those for analytics, site optimization, and package tracking. With these apps, owners don’t have to hire many employees for any starting business. And if individuals are running low in capital, they can even do everything by themselves with the aid of these small programs.
3. The Customization Options
It’s a given that many business owners wish to control how their site looks and its operating style. This is something that is excellently provided. In Shopify, the user can customize about every aspect of a store. One could add logos, choose designs for buttons, and designate how pages are arranged. Shopify even allows sticking to a color theme that will be distributed throughout the site.
As to what was stated, there are hundreds of apps that make these steps a lot easier for beginners. Even their debut theme or the preloaded Shopify theme is customizable. Customizing a Shopify store does not require any tremendous coding or design skills, unless perhaps wanting something very unique.
4. Low Cost For Beginners
Compared to other sites that offer a similar service, Shopify is actually more affordable in the long run. This is because provided are multiple features that are either free or cheap. Also presented are different packages for different scope and business models for people to choose from.
Shopify taken alone, can act as a website builder, marketing tool, and an online portfolio for creatives. So if one were to sum all costs involved, Shopify might have the upper hand budget-wise. Then again, interested users can measure their compatibility with the platform using the trial option offered.
5. The Wide Customer Reach
Unlike many physical stores, Shopify shops can accept orders from anywhere in the world! Store owners could even possibly have inventory offered in different parts of the world for a lower price. They could market their products in other countries where selling well.
These concepts may involve (but worth it potentially) additional transaction fees that would be charged. The broad reach of this method is definitely good news for the thoughtful business owner. For the customers, this is also beneficial since they can buy products that may be scarce or unavailable in their respective locations.
6. Great for Dropshipping Business
Dropshipping is one of the most lucrative ecommerce business models in the world. This style doesn’t require people to own an inventory or directly ship products to customers. The dropshipping model has allowed thousands of people to generate large incomes.
Now, dropshipping assistance sites like Oberlo and Spocket can easily be integrated with Shopify. This wonderful Shopify ecommerce platform allows owners to instantly add a product from these or other secondary sites into their stores. They can customize the pricing, product descriptions, and shipping fees according to choice. This service convenience offers abundance to those seeking success in dropshipping.
Shopify Disadvantages
1. Slow Results
Some business gurus with passive income streams may make people believe that Shopify is a quick get rich scheme. These influencers are firm in claiming that anyone can generate six figures per month in a short period.
In many blogs however, former shop owners have expressed frustration as their generated revenue didn’t meet the expectations. The reality behind positive business growth is that it involves time. So then it seems to be a given that Shopify doesn’t usually grant instant results for most.
According to high-earning individuals, results of good income were reflected after many months and even years. Anyone interested in pursuing this type of business should always have real world expectations in check.
Shopify is a great business tool, but it remains just a tool in the end. A successful store needs time, patience, and dedication. A shop can have the best plugins, yet the business can’t be nourished by these alone. Shopify is just a platform or a mediator to generate income. It’s not meant to be any easy guarantee of financial success.
2. Competition Overall
As expected from alongside a large-scale ecommerce platform, there are thousands of shops actively running today. This can make store building a rather saturated or competitive market.
Be sure to do some research beforehand. One might encounter sites that sell the same product at different prices. It can’t be denied that owners are bound to experience marketing challenges along the way.
This isn’t something that should dishearten. With the correct marketing strategies, determination and consistency, one could use a saturated market advantageously. Viewed from another perspective, a more saturated market means more customers!
3. Demand for More Learning
Easy navigation is one thing. Knowledge of building is another.
It can be pretty intimidating for those entirely new to the site to start a whole online store from scratch. Like any website or social media platform, signing up for an account requires basic website literacy. With the many features listed on the website, people can find themselves lost at times.
For those who really dislike website building, two options are available. For one, they could hire a Shopify website developer from freelancing sites like Fiverr or Upwork for a reasonable price. Or with option two, they could install or purchase a preloaded site theme to quickly get needed elements to begin the storefront.
Although these sound like shortcuts, learning how the platform works before launching a store is strongly suggested. This can empower business owners to have more control and independence before business launch. Also, knowing how things work can help with monitoring the areas that need more improvements. There are also plenty of free tutorials on Youtube. Maybe even enrolling in a Shopify course could bring more profound learning results.
Shopify Monthly Cost
After the 14-day trial, Shopify users are encouraged to subscribe to a monthly subscription. Another convenient feature is their multiple packages are able to accommodate different business needs and budgets. With that being stated, the following are various subscription offers with respective costs (that are subject to change).
1. Shopify Lite ($9 per month)
From its name, this affordable option is excellent for small businesses with just one or minimal products. Shopify Lite is also suitable for artists or public figures who would like a professional website to monetize their services. For just $9, the user can access Shopify’s convenient features such as sending invoices, accepting credit card payments, customer profiles, finance reports, and many more.
2. Basic Shopify ($29 per month)
For only $29 per month, this plan brings almost all the essential features a beginning small business needs. This subscription allows two staff accounts, unlimited file storage, unlimited products, and a Shopify Shipping discount for up to 64%. Basic Shopify is the most common choice for new initiates. This is credited to its comprehensive features found within the low price.
3. Standard Shopify ($79 per month)
The Standard Shopify subscription is the best choice for growing businesses. This allows 5 staff accounts, professional reports, a free SSL certificate, and a Shopify Shipping discount for up to 72%. This choice is highly recommended for stores with a stable amount of new and returning customers.
4. Advanced Shopify ($299 per month)
The Advanced Shopify subscription is great for large-scale stores. This enables the store owner to open 15 staff accounts, get access to the advanced report builder, and many more. Overall, this subscription allows almost every feature available on the platform. It also grants a shipping discount rate of up to 74%.5.
5. Shopify Plus (Customizable)
Usually the payment is around $2,000 for this program. If the business requires more of the advanced features, the rate could change. With Shopify Plus being the highest subscription plan, anyone can expect unlimited access to the abundant features. Unlike the other plans, this one enables unlimited staff accounts, which is helpful for big businesses.
Shopify Transaction Fee
Under this section of the Shopify review, the charged fees per transaction are going to be discussed. However, if one has gone with Shopify Payments for the store, there is no transaction fee to be paid.
The “Shopify Payments” feature is basically a way of accepting payments within the platform. If a seller opts for this, there is no longer need to sign up for a third-party provider. This doesn’t apply to many other physical payment methods such as Cash on Delivery (COD), bank deposits, checks, test orders, or other transactions marked pending.
Shopify Payments is also integrated nicely. Any admin listed in the store can easily monitor transactions. Some store owners prefer Shopify Payments, but the location of customers can end up with this feature being ineligible for much usage. This may end up being one of the reasons for not going with this feature.
Of course if a store wishes not to opt for the payments program, there’s an obligation to pay transaction fees. These fees are listed below.
• Basic Plan – 2% Shopify Transaction Fee
• Standard Plan – 1% Shopify Transaction Fee
• Advanced Plan – 0.5% Shopify Transaction Fee
If you work some math, figure out the amount of transactions monthly. If very large, the payments program may work out. If not there yet, paying small fees may top paying for the program.
How Does Shopify Work?
Some of the most basic inquiries have been covered, such as the monthly payments, plan packages, and even the history of the platform.
Now on to how does this really work?
Here’s a brief summarization of Shopify.
Shopify is an ecommerce platform that hosts a business owner’s online selling store. With this, anyone can add products to their Shopify store. They can optimize it to attract more customers, directly manage transactions, communicate with customers, ship items, and many more.
Sellers are also free to add plugins for extra assistance like sending reports, installing live chat systems, finding good products, and marketing. Shopify also enables business owners to sync their physical stores to a Shopify store using Shopify POS. This platform is like a digital office where a seller can hire staff to manage the site and check their inventory.
One’s journey begins with the 14-day trial. Here then, explore the essential tools and features needed to measure what is needed for the store of choice. This 14-day period is where many adhere to advancing the learning curve and getting to understand the basics of handling the store. After this period is over, one goes on to choose the subscription model.
Just like any website, there is need for a domain name, store logo, and other graphics to make the site presentable for future customers. Once that’s done, the launch date can take place.
Shopify has multiple marketing tools to help business owners grow. When a customer places that first order, an instantaneous process begins. The platform informs the owner. After that, the item is shipped from the inventory. Other factors will affect this process, like the customer’s preferred payment option and the shop’s delivery choice. And just like that, the order process is carried out, and the owner generates income.
How Does Shopify Work For Sellers?
It’s best to think of program as an all-inclusive selling platform that’s done online. It’s an all-in-one tool that acts as a storefront, inventory, staff office, and marketing team. After signing up and selecting the best plan, the following are some points every seller needs to know to take the lead in store development.
Shopify Apps
The Shopify App Store offers hundreds of great marketing and optimization tools to make selling as easy as possible. Each platform seller has this great advantage that many other regular store sellers don’t. One could go for well-engineered apps that are specifically meant to target an audience.
Some are free, some cheap, and others remain expensive. Try not to purchase a costly app unless a store’s gain shows consistent results. No one quite wants to waste money on unnecessary apps.
Shopify Website Hosting
Aside from being an ecommerce platform, Shopify is a website hosting software program. This means it materializes the website a store needs to keep a business running. As with most website hosting mediums, people can create their own themes to individual preference. There are also options to purchase a website theme, hire someone to build the same, or just use Shopify’s preset offerings.
Also offered are free security checks and automated software updates for everyone subscribed to any of their packages. This helps take away many of the additional fees related to these functions, since no buying of external tools is required.
Selling Globally
As mentioned earlier, Shopify enables sellers to promote their products globally. Actually, Shopify’s Payment Processing feature is one of the offers that make it stand out. A seller can choose from over 100 payment gateways (excluding Shopify Payments) and accept 133 currencies.
Shopify Shipping
After an order is placed, the seller knows that the next step is shipping. Shopify shipping rates are added by default. This can still be customized by choice. For international transactions, the store admin should research some guidelines on the country before shipping something. Some countries have restrictions and added fees, so it’s better to straighten these details out before shipping.
Shopify’s Basic Structure
This is pretty straightforward. What sellers need to understand is that every package comes with its specific components. Whether it’s Lite, Basic, Standard, Advanced, or Plus, a good revenue will still revolve around the individual’s strategy for their store.
In cases where someone uses this for dropshipping, holding a physical inventory is no longer needed. Still, they can choose whatever payment method they’d like to incorporate for their customers. The platform has few boundaries and whether someone is selling a product (sports attire, makeup, accessories, crafts, etc.) or a service, they can do so easily with this ecommerce platform.
How Does Shopify Pay You?
In this portion of the in-depth Shopify review, the safety issue, how one is paid, bank transfers, and business days will be discussed.
To begin, here are some of the guidelines regarding how cash is transferred to the store owner.
How Can Sellers Get Paid?
After a customer pays, Shopify immediately includes the income in the store’s report. Once the seller decides to cash out, the money moves to the bank account one entered upon signing up. One really can’t officially establish a Shopify account without settling information such as payment options and other bank-related data.
There’s nothing to worry about though, as the platform is safe to use. After the seller’s request, it can take around 1 to 3 days before their income is reflected in the account. If the seller didn’t opt for Shopify Payments, what may be noticed is a reduction in their total profit. This is due to the mentioned transaction fees required when money is to be transferred.
Is The Shopify Platform Safe?
Yes, Shopify is safe to use. The hosting software has a built-in analytics feature for the admins to monitor every payment and transaction for transparency. So far, this ecommerce platform has done a nice job with little concern regarding security. And if there are errors, sellers can quickly contact a representative to solve any active dispute.
Is Shopify Slow In Transfering Money?
This question depends on the bank someone is using. Most of the time, it can take around 1 to 3 days. But, some have experienced where it took them a week or more. Shopify explains this is because some banks only work during business hours or even days. These days usually go from Monday to Friday, and many may end around the 5-7pm hours.
So if one is curious why income is taking so much time to transfer completion, it’s wise to contact the respective bank. The most common option Shopify sellers go for is PayPal. Online banking has massive pros when it comes to Shopify. It just works so easily.
Does Shopify Take Money From A Store’s Income?
It’s a yes and no. Shopify doesn’t cut sales since they don’t own what somebody is selling. They also don’t claim any rights to the listed products a seller is marketing. Once someone opens a Shopify store, it’s entirely that individual’s place.
However, Shopify does charge a store if they are using a third-party payment option. Depending on the owner’s package, Shopify may also charge a small fee of around 0.5% to 2% for example. Of course, this calculation still doesn’t include other fees for plugins and the store monthly subscription fee.
How Does Shopify Make Money?
With total revenue upwards of $2.9 billion, it’s a fair question to ask just how Shopify makes the money it does today.
It’s more than just the monthly subscription fees. Aside from the packages, generated income comes via referral fees, transaction fees, add-on payment fees, hardware sales, commission fees, advertising, and website integration. It’s clear that the company is currently working with many sites and platforms, so it’s expected that they’re getting big bucks aside from monthly subscription fees.
How Does Shopify Shipping Work?
Merchants are given the freedom to choose and carry on with their preferred shipping plan. The basic concept of shipping here is centered on three main ideas: shipping carriers, shipping rates, and fulfillment services. How a store operates will rely mainly on these choices.
In this Shopify review, here are things one needs to know about its shipment system and other miscellaneous fees.
Shipping Carriers
Shopify enables its users to select their preferred shipping carriers. For international transactions, the most common choices include UPS, FedEx, and DHL.
These shipping carriers can get the orders in two ways. One, the seller can drop off the packages of fulfilled orders to the shipping carrier. And the other is by scheduling pickups from the seller’s home. Generally, online sellers prefer the second option when sending large quantities of bulk items.
It’s advisable to select a shipping carrier that has a close physical location so going there is easier than not. This may even make things easier to prevent delays and to solve disputes and avoid lousy product reviews.
Shipping Rates
Whether a seller opts for a shipping carrier or a fulfillment service, shipping rates are unavoidable. Shipping rates refer to the additional cost customers are obliged to pay in checking out.
Merchants are allowed to set up their free, flat, or calculated shipping rates. They can set these beforehand and customize rates according to country or zone. The Shopify App also includes plugins that help customers see their total checkout price, including the shipping rate.
Depending on what market a store is marketing to, the seller can choose multiple methods for the customers to complete their shipping rate. These can include various payment methods and shipping options decided beforehand.
Another common practice for Shopify sellers is to state the rules and regulations before allowing a customer to check out with an item. This portion usually includes instructions and disclosures regarding added fees, domestic and international shipping, rates, delays, etc. This is an excellent practice to follow since it makes the whole process more transparent and mutual.
Fulfillment Services
These are usually used for the practice of dropshipping. Fulfillment services are third-party warehouses that pack and ship a seller’s order to their customers on the seller’s behalf. These companies “fulfill” orders, so the shop doesn’t need to own an inventory or warehouse lot. This also takes out the pressure of having employees pack and ship items.
Obviously, it does cost money to streamline business this way.
This is a good idea for dropshipping and for those businesses where the products exceed the warehouse capabilities. Thus, requiring a fulfillment company to do the packing and shipping is smart. Examples of fulfillment services include ShipMonk, RedStag Fulfillment, and FedEx Fulfillment.
While fulfillment services sound convenient, this option is usually incorporated within the dropshipping model as of great importance. Fulfillment services can be risky for businesses that aren’t dropshipping stores since the owner can’t fully control the speed with which these companies ship, the quality of various products, and a few other concerns. So if a business owner would like to get more hands-on with a store, perhaps the old-school shipping style may work better.
What’s The Best Way to Ship Shopify Orders?
There’s no “one-size-fits-all” in any business. However, there are universal considerations that can help business owners. First, they have to specify the countries to which they ship items. This way, they can establish their rates and stick with them if desired.
As for the best shipping method, there really isn’t one that is best, as this is situational. But if one prefers to manually handle orders, a shipping carrier might be best. For those who dropship or dislike the idea of handling shipments, a fulfillment company might work better.
Give consideration beforehand to the method of shipping for the long-term.
How Does Shopify Dropshipping Work?
This Shopify review made mention of dropshipping many times. So what is this term exactly? Standing as one of the most lucrative and quick-growing business models out there, dropshipping is no stranger in the ecommerce world.
Basically, its model revolves around retailing or selling products without a physical inventory in stock. Here’s a short summary of how Shopify dropshipping model works.
1. The seller activates their Shopify account.
2. The seller plans the products or offers they are going to include. This step also includes clarifying which audience or areas their shop is going to cater to.
3. After finding a product with potential, the seller will now look for a third-party supplier, wholesaler, or manufacturer. This step will take the most time since it requires product comparison, research, and quality testing such as getting samples.
4. The seller will communicate with the third-party supplier regarding the proposal. If the third-party supplier agrees, the process is almost complete.
5. With the products settled, the seller can now finalize the store. This step can include the marketing process where the merchant runs ads through Google, Instagram, Facebook, and other platforms.
6. Once a customer orders a product, the third-party provider will ship the item from the inventory to the customer. So, the merchant will only act as a “middleman” between the supplier and the customer.
7. After the order is fulfilled, the supplier gets a complete purchase. The Shopify store owner generates income through the profit margin.
Shopify Dropshipping Tips
The Shopify merchant earns a percentage, the third-party provider gains their income, and the customer gets their order delivered. Sounds easy and perfect, right? Not really.
As stated earlier, many people assume that Shopify dropshipping is a quick “be a millionaire” scheme. Don’t be fooled by this straightforward model. It seems simple but it carries plenty of complicated aspects. In fact, it may be riskier than other business models that seem more difficult.
With that, here are some helpful Shopify dropshipping tips for the beginner.
• The third-party provider is the foundation of every merchant’s success. A lot of people like to go for AliExpress to scout their products. While it’s the easiest choice, the question of quality could become a problem to overcome. As much as possible, it’s better to establish a mutual relationship with the third-party provider instead of just going for just any ecommerce company. Sometimes, suppliers are better than wholesalers.
• Specificity helps. Upon starting a Shopify dropshipping business, it’s wise to decide whether the shop is a one-item store or a multiproduct store. Obviously, one-item stores only sell one product, whereas multiproduct stores sell more than one variation or multiple products altogether.
• Notifying the customers about their shipping or tracking progress is highly noticed and appreciated. There are plugins in the Shopify App Store that do this for sellers.
• Advertising plays a crucial role. Depending on what kind of product a seller has available, the advertisements should fit the criteria of the audience. Aspects like age, gender, area, and interests are essential details in running ads. This helps avoid wasting money on ads that don’t work.
• Make sure that the store is functional. Check the buttons, payment options, and the overall response of the website. Regardless of how well the product is made, customers will click away if the website is too inconvenient to navigate.
The Final Verdict: Is Shopify Worth It?
This Shopify review has covered all the vital aspects of what’s it like running a store. Undoubtedly, Shopify holds massive potential for passive income and an excellent entrepreneurial career. Its plugins and services can make the process of selling faster, more efficient, and more convenient.
Above other things, Shopify does not nourish a business by itself. The most critical aspect of running it is still the person or team behind the store. With the right attitude, patience, and research, anyone can fulfill their financial goals through Shopify.
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