Shopify and Shopify Plus have become leading ecommerce platforms, powering over 1 million businesses worldwide. While merchants often focus on the base platform costs, understanding the true total cost of ownership (TCO) is crucial for long-term success. This blog post will explore the often-overlooked aspects of the Shopify and Shopify Plus cost structure, guiding you through the various expenses that contribute to the TCO. By the end, you’ll have a comprehensive understanding of the financial considerations involved in running a Shopify or Shopify Plus-powered online store, empowering you to make the best choice for your business.
Understanding the Base Costs
Table of Contents
A. Shopify Plans and Pricing:
Shopify offers three main plans, each catering to different business sizes and needs. Let’s break down the pricing and features of each plan:
1. Basic Shopify Plan:
The Basic Shopify plan is ideal for small businesses or startups looking to establish their online presence. This plan includes all the essential features needed to run an online store.
Monthly Cost: $29 per month
Features:
Online store with unlimited products
Two staff accounts
24/7 customer support
Sales channels (online store, social media, marketplaces)
Discount codes
Free SSL certificate
Abandoned cart recovery
1. Shopify Plan:
The Shopify plan is suitable for growing businesses that require more advanced features and additional staff accounts.
Monthly Cost: $79 per month
Features:
All features included in the Basic Shopify plan
Five staff accounts
Professional reports
Gift cards
Lower credit card rates and transaction fees
3. Advanced Shopify Plan:
The Advanced Shopify plan is designed for larger businesses with higher sales volumes and a need for advanced reporting and third-party calculated shipping rates.
Monthly Cost: $299 per month
Features:
All features included in the Shopify plan
Fifteen staff accounts
Advanced report builder
Third-party calculated shipping rates
Even lower credit card rates and transaction fees
See now: 10+ Best Shopify B2B Apps to Leverage Your Businesses
B. Shopify Plus Pricing:
Shopify Plus is the enterprise-level solution offered by Shopify, tailored for large businesses with complex requirements. Unlike the standard Shopify plans, Shopify Plus pricing is custom and varies based on the specific needs of the business.
1. Custom Enterprise-Level Pricing
Shopify Plus offers a custom pricing model, which means the cost is determined based on various factors such as the size of the business, sales volume, and specific requirements. This flexibility allows businesses to get a tailored solution that meets their unique needs.
2. Typical Shopify Plus Pricing Range
While the pricing for Shopify Plus is custom, it typically ranges from $2,000 to $40,000 per month. The cost may vary based on the level of customization, additional features, and support required by the business.
Additional Costs to Consider
While the base subscription costs provide a starting point, there are several other expenses to factor into the total cost of ownership for a Shopify or Shopify Plus store. These additional costs can have a significant impact on the overall financial investment required to operate your online business.
A. Transaction Fees
One of the significant ongoing expenses associated with running a Shopify or Shopify Plus store is the transaction fees. These fees are charged on each sale or payment processed through the platform.
Shopify's Transaction Fees:
Shopify charges a transaction fee ranging from 2.4% to 2.9% + $0.30 per transaction, depending on the subscription plan. For the Basic Shopify plan, the transaction fee is 2.9% + $0.30, while the higher-tier plans offer slightly lower rates.
Basic Shopify Plan: 2.9% + 30¢ per transaction
Shopify Plan: 2.6% + 30¢ per transaction
Advanced Shopify Plan: 2.4% + 30¢ per transaction
Payment Gateway Fees:
In addition to Shopify’s transaction fees, you’ll also need to factor in the costs of your chosen payment gateway. Shopify Payments, the platform’s built-in payment processing solution, charges a fee of 2.4% to 2.9% + $0.30 per transaction, depending on your Shopify plan. If you use a third-party payment gateway, the fees can vary, but are typically around 2.5% to 3.5% per transaction, plus a fixed per-transaction fee.
B. Themes and Apps
The visual appeal and functionality of your Shopify or Shopify Plus store can be enhanced through the use of premium themes and apps. Essential apps may include:
SEO Optimization Apps
Email Marketing Apps
Inventory Management Apps
Customer Support Apps
Optional apps can include:
Advanced Analytics Apps
Social Media Integration Apps
Cost of Premium Shopify Themes:
Shopify’s theme store offers a wide range of premium themes, with prices typically ranging from $180 to $350 per theme. While you can find free themes, investing in a premium theme can provide a more polished and professional look for your online store.
Explore now: Top Successful Shopify Plus Stores You Can Learn From
Expenses for Essential and Optional Apps:
Shopify and Shopify Plus offer a vast ecosystem of apps that can extend the capabilities of your store. These apps can range from essential features like abandoned cart recovery to optional tools for marketing, customer engagement, and inventory management. The costs for these apps can vary, with some offering free plans and others charging monthly or one-time fees, typically ranging from $5 to $50 or more per app.
C. Custom Development and Integrations
For businesses with more advanced requirements or the need for a highly customized online store, the costs of custom development and integrations can quickly add up.
Hiring Shopify Experts for Customization:
If your business requires custom features, functionalities, or integrations beyond what’s available out-of-the-box, you’ll need to hire Shopify experts, such as developers or agencies, to handle the customization work. The cost for this can vary widely, depending on the complexity of the project, the experience level of the Shopify experts, and the location of the service providers.
Integrating with Third-Party Systems:
Many businesses need to integrate their Shopify or Shopify Plus store with various third-party systems, such as accounting software, CRM platforms, or inventory management tools. The costs for these integrations can include both one-time setup fees and ongoing subscription or transaction-based charges, depending on the specific systems and the level of integration required.
By considering these additional costs, you can gain a more comprehensive understanding of the total financial investment needed to operate your Shopify or Shopify Plus-powered online store.
Hidden Costs and Unexpected Expenses
A. Site Maintenance
Addressing Security Vulnerabilities:
As with any online platform, Shopify and Shopify Plus stores can be vulnerable to security threats, such as data breaches, hacking attempts, or malware infections. Addressing these security issues, whether through platform updates, app patches, or the assistance of security professionals, can incur unexpected costs.
B. Customer Support and Training
Providing effective customer support and training for both your internal teams and your customers is crucial for the success of your Shopify or Shopify Plus store, but can also result in additional expenses.
Providing Support to Internal Teams:
Ensuring that your employees, such as marketing, sales, and customer service staff, are well-versed in the Shopify platform and its features can require dedicated training and support resources. This can include the cost of hosting training sessions, creating instructional materials, or hiring Shopify experts to provide guidance.
Educating Customers on Using the Platform:
Helping your customers navigate the Shopify platform and understand how to effectively use your online store can also require dedicated support resources. This can include maintaining a comprehensive knowledge base, offering live chat or email support, or providing personalized assistance to customers who need help with specific tasks or features.
Calculating the Total Cost of Ownership
When determining the overall cost of operating a Shopify or Shopify Plus store, it’s essential to consider a variety of factors that can contribute to the total cost of ownership (TCO). By taking a comprehensive approach to calculating the TCO, you can make more informed decisions about the viability and profitability of your online business.
A. Factors to Consider
The key factors to include in your TCO calculation for a Shopify or Shopify Plus store include:
Base Platform Costs:
Subscription fees for the Shopify or Shopify Plus plan
Potential costs for upgrading or scaling the plan as the business grows
Transaction and Payment Processing Fees:
Shopify’s transaction fees
Payment gateway fees
Themes, Apps, and Custom Development:
Costs of premium Shopify themes
Expenses for essential and optional apps
Fees for any custom development or integrations
Maintenance, Support, and Training:
Costs of keeping the store and apps up-to-date
Addressing security vulnerabilities
Providing support and training for internal teams and customers
B. Example TCO Calculation for Shopify and Shopify Plus
To provide a more concrete example, let’s consider the total cost of ownership for a small to medium-sized business using the Shopify and Shopify Plus plans.
1. Shopify Advanced Plan TCO Calculation:
Assumptions:
Business chooses the Shopify Advanced plan at $299/month
Average monthly gross merchandise volume (GMV) of $100,000
Utilizes Shopify Payments as the payment gateway
Invests in a premium $280 Shopify theme
Requires 5 essential apps at an average cost of $20/month each
Spends $5,000 annually on custom development and platform maintenance
TCO Calculation:
Base platform cost: $299/month x 12 months = $3,588/year
Transaction fees: 2.4% of $600,000 (annual GMV) = $14,400/year
Payment gateway fees: 2.4% of $600,000 = $14,400/year
Premium theme cost: $280 (one-time)
App costs: $20/month x 5 apps x 12 months = $1,200/year
Custom development and maintenance: $5,000/year
Total TCO: $3,588 + $14,400 + $14,400 + $280 + $1,200 + $5,000 = $38,867/year
- Seamless integration with enterprise-level ERP and CRM systems: Shopify Plus offers robust integration capabilities, allowing store owners to connect their B2B e-commerce platform with their existing enterprise-level systems, such as ERP and CRM solutions.
- Comprehensive reporting and analytics tailored for B2B operations: Shopify Plus offers advanced reporting and analytics features specifically designed to provide store owners with deep insights into their B2B sales performance, customer behavior, and operational efficiency.
2. Shopify Plus Plan TCO Calculation:
Assumptions:
Store sales revenue: $2 million per year
Average order value: $75
Transaction rate: 2%
Shopify Plus monthly subscription fee: $2,000
TCO Calculation:
Shopify Plus Subscription Fees
Annual Subscription Fees: $2,000 x 12 months = $24,000
Transaction Fees
Transactions per year: $2 million / $75 = 26,667 transactions
Transaction fee rate: 2.15% + $0.30 per transaction
Annual Transaction Fees: (26,667 x 2.15%) + (26,667 x $0.30) = $57,233
Payment Gateway Fees
Assumed payment gateway fee: 0.5% of total sales
Annual Payment Gateway Fees: $2 million x 0.5% = $10,000
Fraud Protection Fees
Assumed fraud protection fee: 0.1% of total sales
Annual Fraud Protection Fees: $2 million x 0.1% = $2,000
App Fees
Assumed average annual app fees: $5,000
IT/Developer Support
Assumed annual IT/developer support: $20,000
Total Annual TCO:
Subscription Fees + Transaction Fees + Payment Gateway Fees + Fraud Protection Fees + App Fees + IT/Developer Support
= $24,000 + $57,233 + $10,000 + $2,000 + $5,000 + $20,000
= $118,233
This example demonstrates how the various costs associated with running a Shopify store can quickly add up, highlighting the importance of carefully calculating the total cost of ownership to ensure the long-term profitability and sustainability of your online business.
Navigating the complexities of ecommerce can be a daunting task, especially when it comes to understanding and managing the various costs associated with running a Shopify or Shopify Plus store. That’s why working with experienced Shopify partners can be invaluable.
These partners can provide expert guidance on optimizing your store’s operations, identifying cost-saving opportunities, and developing strategies to maximize the profitability of your online business. By leveraging their expertise, you can ensure that your TCO remains within your budget and that your ecommerce venture continues to thrive in the ever-evolving digital landscape.
Shopify Development Service of BSS Commerce
With over 11 years of experience in the ecommerce industry, BSS Commerce has developed extensive expertise in Shopify and Shopify Plus development. Our team of seasoned experts has successfully delivered hundreds of Shopify and Shopify Plus projects for renowned brands across diverse industries, from fashion and beauty to electronics and home decor.
What Sets BSS Commerce Apart?
BSS Commerce can help Shopify merchants reduce their total cost of ownership in several ways:
Integration Expertise: BSS Commerce has extensive experience integrating Shopify with various third-party applications, systems, and services. Our team can help you seamlessly integrate Shopify with tools like ERPs, accounting software, CRMs, and more. This can help streamline operations, reduce manual data entry, and eliminate the need for costly custom integrations.
Managed Services: BSS Commerce offers a range of managed services, including Shopify store management, content updates, SEO optimization, and more. By outsourcing these tasks to the BSS Commerce team, you can reduce the need for in-house staff, saving on salaries, benefits, and overhead costs.
Optimization and Consulting: The BSS Commerce team can provide strategic guidance and optimization services to help you streamline your operations, improve efficiency, and reduce unnecessary expenses. This can include recommendations on inventory management, pricing strategies, marketing campaigns, and other areas that impact the overall cost of running the business.
Scalability and Growth Support: As you grow your businesses, BSS Commerce can help you scale their operations and infrastructure in a cost-effective manner. This can involve migrating to more powerful Shopify plans, implementing advanced features, or expanding into new sales channels – all while ensuring that the total cost of ownership remains manageable.
Technical Expertise and Support: BSS Commerce employs a team of Shopify experts who can provide ongoing technical support, troubleshooting, and maintenance services. This can help merchants avoid costly downtime, data loss, or other issues that can significantly impact their total cost of ownership.
To help you have the most profound, accurate and quick analysis, we are proud to offer a free 60-minute consultation with our team of eCommerce experts. Our consultants have over 10 years of experience in the industry and have successfully implemented thousands of projects for renowned brands from 150+ countries around the world
During this consultation, you’ll have the chance to tap into our extensive knowledge and gain valuable insights that can help you take your eCommerce business to new heights. We’ll take the time to understand your unique business needs, challenges, and goals, and then provide tailored recommendations and solutions to help you achieve your objectives.
Don’t miss this opportunity to unlock the full potential of your eCommerce business. To schedule your free 60-minute consultation, please click here
Read more Shopify case studies:
Conclusion
Operating a Shopify store requires understanding the total cost of ownership (TCO). While the base platform costs may seem straightforward, hidden expenses and unexpected costs can significantly impact profitability. Carefully analyzing and calculating the TCO, including direct and indirect costs, allows for more informed decisions, cost savings, and long-term sustainability. Evaluating TCO alongside other factors like platform features and scalability is essential to selecting the right ecommerce solution for your business goals.
Unlock Your eCommerce Potential with Our Shopify Solutions
With Shopify and Shopify Plus Development services, our team is here to guide you every step of the way. We understand the unique challenges of the eCommerce landscape and are committed to helping you navigate it successfully.
Contact us today to learn more about our Shopify solutions and how we can help your Shopify store thrive in the world of business-to-business e-commerce.
