How Much Does It Cost to Run A Shopify Store? (Realistically)
[featured-image]
Shopify is a boon for businesses around the world. It gives them a platform to showcase their products and services to a wider platform thus increasing their chances to be successful. However, you cannot rush into this process as it comes with ongoing costs. So before buying a Shopify Store, make sure that you have at least a rough estimate of the upfront and ongoing costs to manage your cash flow.
I promise you that by the end of this post you will find out about the cost of owning a Shopify Store and each factor that affects your budget.
Before we begin to know that it is always advised to invest the least amount possible until you are sure that the Return on Investment will be more than your initial investment.
To understand the costs involved in setting up your Shopify Store let’s see how it works.
Setting Up Your Store
This section tells you how you can set up your Shopify Store.
Knowing the procedure will help you understand the costs associated with each step better. So without further ado, these are the steps to create your very own Shopify Store:
- Sign up for a Shopify account by filling the form.
- After entering the required details click the ‘Start Free Trial’ button.
- Enter a unique name for your store and then add a few details like country name, address, and contact number.
- Select some suitable options as per your business (if you have products, what type of products, and do you aim to sell them?)
- Click on ‘I’m done’.
- Customize your store by selecting from different themes.
- Add products that you’ll be selling.
- Mention how you plan to deliver products or services and pay taxes.
- Go ‘LIVE’ with your shop by adding a domain name.
- Voila! Your Shopify Store is now ready.
Setting up a Shopify store is similar to registering on any other website. Just fill out the details and then click on the ‘submit’ button. Within minutes you can have your account (shop in this case) up and running.
Also know that Shopify offers a 14-day free trial to help business owners get a glimpse of the experience waiting for them. After the free trial ends the minimum cost of a Shopify Store is $29. So use this 14-day trial to scale all the functionalities and see if an online store is a viable option for you. To get the best ROI it is necessary that you manage to include all the necessary functionalities to your Shopify Store and still manage to keep the costs minimal. In simple terms, don’t go overboard.
Let’s now see the different factors that will affect your budget throughout your Shopify journey.
7 Factors that Impact Your Setup Cost
To get a rough estimate of what/how much your Shopify Store may cost, I have some advice for you.
Don’t compare the setup up and ongoing costs of your Store with other businesses on Shopify.
Take a look at your expenses and check the cost of the features you’ll require. The cost of running a Shopify Store differs based on the type of business. What costs one store owner some amount may cost another owner a lot more/less.
1. Domain Name
For businesses that want to leave a good impression on customers, having a custom domain name is a must. Shopify does provide you with a free domain name but that ends with .myshopify.com, it makes your store look unprofessional in the eyes of visitors. You can buy domains from Shopify but they are quite expensive (at least $14/year).
Why get a Custom Domain?
The easy option here will be to buy a domain name through Shopify and manage everything on a single platform. But the easier option isn’t always the right choice.
Consider this, you want to delete your Shopify Store but continue using the domain name.
Scenario 1: Domain Name Purchased through Shopify
In this case, store owners will not be able to use their previous domain names on a different platform. Shopify takes away the URL provided to you (free or paid). The yearly payment for purchasing a domain name from Shopify will be $14 but you do not get complete ownership of the domain. So if you decide to part ways with your Shopify Store, you cannot redeem the domain name.
Scenario 2: Domain Name Purchased through Third-party Providers
When you buy a domain name from a domain name provider, you can use it on any platform. Use it for your Shopify Store and if you decide to delete your Shopify Store the domain name will still be available for your use. This method offers you a lot of flexibility and is much more cost-effective if you choose the right provider. You can get a domain name for as low as $1.3 per month from providers like Namecheap.
2. Shopify Store Plan
The next factor that affects your finances is the Shopify plan that you select. At present, Shopify offers store owners three plans to choose from—Basic Shopify, Shopify, and Advanced Shopify. Each of these plans is aimed at different types of customers but includes a plethora of functions important to run an online store.
Basic Shopify
The most affordable plan offered by Shopify for startups/beginners. At $29 per month, you get a fully functional standalone online store to showcase your products.
Features and Functionalities
- A website version of your store that performs different functions.
- Ability to sell multiple products at once.
- Unlimited storage.
- Two staff accounts i.e. You can log in from 2 accounts.
- 24/7 chat support.
These are just some of the features that you will get with your Basic Shopify plan.
Shopify
All Shopify plans are designed similarly with a few additional features added to the premium plans. The second plan offered by Shopify is simply called ‘Shopify’ and is priced at $79/month. The add-ons you will have complete access to are:
- Gift cards.
- Reporting services.
- Lower transaction fees.
Advanced Shopify
The most premium plan Shopify has in store for you is its Advanced Shopify plan. You can get your hands on features like custom reports and real-time carrier shipping for $299 every month. This plan is suitable for established brands that can sell products or services worth more than their investment.
For those who are not entirely sure about starting a shop online, you can take advantage of Shopify’s 14-day free trial to scope out the features and settle on a plan that best suits your needs.
3. Transaction Fees
Every sale that you make will be charged with a payment processing fee when using methods like Stripe/PayPal. But if you use Shopify’s payment processor, the cost will be lower than when you use generic payment processors. Another benefit of using Shopify Payments is that you’ll be charged for every transaction and not on a per-item basis.
The rates are slightly different for all three Shopify plans. Let’s see the advantages of using Shopify’s payment processor ‘Shopify Payments’.
Advantages
- It allows you to accept payments from any major credit card.
- Integrates directly to your store’s cart/checkout.
- Accessible from the Shopify dashboard.
- Quick and easy to use interface.
Shopify’s flexible interface allows you to accept payments from over 100 payment processors. Some payment options can be integrated into the site while some must be managed externally. These external payment processing options can be difficult to manage.
I recommend using PayPal as an external payment processing alternative as it charges 3.9% + $0.30 per transaction. However, my first recommendation will always be Shopify Payments because of its low transaction costs. What processor you settle for is up to you this is only my advice to minimize your expenses.
4. Marketing Campaigns
When running a business the most important part is marketing. You can run marketing campaigns for free and gain a few followers or you could invest in paid campaigns to get maximum results. You can set up various marketing campaigns that include Email Marketing, Content Marketing, Search Engine Optimization, and many such marketing strategies.
Don’t let the cost of these marketing campaigns deter you from its advantages. They have the potential to drive in more customers to your store than any of the free marketing tools. The best marketing strategies are those that include extensive social media marketing, SEO, and email marketing services. The best part is that these campaigns are objective-centric i.e. If you want to boost either conversions or engagement, you can.
Social Media Marketing
Facebook and Instagram are two of the most popular social media platforms. Digital marketers use such social media platforms to power their marketing strategies and generate the best results. These campaigns can be optimized easily to allocate more/fewer resources to them based on their performance. It is also possible to cut an ad if it does not generate a positive ROI.
Email Marketing
You got the customer to buy your product, great. But how do you know that they’ll come back to you when they need to buy the same product. How can you ensure that they do not forget about your store when they wish to buy products you previously offered them?
Email marketing is a great way to retain customers or get the attention of new customers. Keeping in touch with your customers even after they’ve made a purchase can help you improve sales.
Search Engine Optimization
By entering certain keywords to the content that you publish in your blog posts or your product details you can improve the ranking of your store on search engines. If your ad is placed on the first search engine result page it increases the chances of people clicking on it.
5. Apps
Note that this factor is optional and your shop will function just fine without downloading additional apps (paid or free). However, if you have specific requirements Shopify lets you install additional applications that perform the function that you wanted. So, what’s the catch? The catch is that you can download apps from the Shopify App Store only. Shopify has an entire library dedicated to apps that perform specific functions and meet additional requirements of store owners.
If you need the extra feature, search through the library for free. There are many free apps available and even more paid applications waiting for you to install them.
Apps are optional, sure they expand the functionality of your store but are nothing but an added expense. So if you want to save money then avoid going overboard with paid applications. A Shopify Store is well-equipped with all the basic features and functions required to run an eCommerce business.
The paid apps have a monthly fee attached to them that Shopify charges along with its plan cost every month. A wise approach will be to begin without any additional applications and buy one only if it is necessary.
6. Theme
An added cost to your budget is purchasing a premium Shopify theme. By default, the platform offers store owners many free themes that are professional and easy to use. However, if none of these free themes suit your taste or lack in functionality that you need, opt for a premium theme.
Most of these themes incur a one time cost but a few come with a monthly or annual fee. So this is a variable cost that depends on your choice and can be very easily avoided.
There are themes designed to specifically perform certain activities like enhance conversions, boost engagement and so on (Like this theme view it here). Based on your business’s requirements, pick a theme that includes all the necessary functions you need to run your Shopify Store. So, buying a premium theme can set back your expenses from $0 (if you select a free theme) up to $147 (for a premium theme). This is an optional factor that can affect your Shopify Store’s set up costs.
If you plan on buying a Shopify theme make sure you check out my 13 Best Converting Shopify Themes Guide.
7. Training Course
So, the final cost you may want to add to your budget is a training course. You don’t need to get a course however, if you doing paid ads and don’t know what your doing, you can seriously end up losing a TON of money. It may seem like a waste but, it can save you a ton of money and time. Although it’s all up to you.
If you want to avoid these extra charges, you can always find a YouTube video to show you across the platform. This is a free alternative than paying for a training program for Shopify. However, if you are looking for a one-stop solution to get advanced training of the different sections of the platform a training program is a great choice.
There are multiple eCommerce courses that you can choose from which makes it difficult to select one that covers all the necessary fields that you require. What makes it more difficult is that many of these online courses charge users an extensive fee which adds to the overall expenses of your business but are not worth the time and effort.
But not all the courses are worthless. It takes some time and research to find out the best course that fits your budget and requirements. I have reviewed over 50+ shopify courses on here and the most affordable and value packed one I recommend to anyone is eCom Elites. You can read my review on eCom Elites 2.0 Here.
Conclusion
Starting a Shopify Store without considering all the costs accompanied with it can turn into a disaster and eat up all your savings. The key here is to invest smartly and only in functions that are needed to run your online store. If it is possible to make do without a premium function, it is best to avoid it if you wish to stay true to your budget.
The best option is to search for different and cheaper alternatives to fit your requirements and budget. However, the bare minimum I recommend you start out with is $500 because you need money to spend on ads and such.
Running a Shopify Store takes up a lot of time, money and effort so it is advised to invest in one only if you are equipped with funds to cover all the expenses that tag along with it.
