Shopify fees explained: plans, payment rates and hidden costs

The short answer

Shopify charges in two ways: a monthly subscription and a payment processing fee on each order. On the Basic plan in the US, an online card payment through Shopify Payments costs 2.9% + $0.30, so a $40 order pays $1.46. The plan itself is $39 a month, or $29 a month if you pay for a year up front.

Shopify doesn't take a sales commission as long as you use Shopify Payments. If you use a different payment provider, it adds a transaction fee on top.

Shopify plans and card rates

There's also Starter at $5 a month, which lets you sell through social media and links but doesn't include a full online store, and charges a much higher fee per sale. Shopify Plus starts at about $2,300 a month for large businesses. Card rates are different outside the US and for in-person sales; your own rates are listed under Settings > Payments in the Shopify admin.

Payment fees vs transaction fees

These two names confuse a lot of new store owners:

• The payment processing fee is the cost of handling the card payment. With Shopify Payments, it's the card rate in the table above. It applies to the full amount the customer pays, shipping included.
• The third-party transaction fee is an extra percentage Shopify charges only when an order is paid through an outside provider instead of Shopify Payments. You pay it on top of that provider's own processing fee.

For most small US stores, Shopify Payments is the cheaper option because it avoids the second fee entirely. If Shopify Payments isn't available in your country, add the transaction fee for your plan to every order when you price your products.

The costs people forget

• Apps. Reviews, email marketing, upsells and subscriptions are often paid apps with monthly fees. They add up quickly.
• Themes. Free themes are fine for most new stores. Premium themes are a one-time purchase.
• Your domain. A custom domain is a small yearly cost, but it's still a cost.
• Chargebacks. If a customer disputes a payment, you can lose the sale and pay a dispute fee.
• Currency conversion. Selling in several currencies can add a conversion fee to those orders.
• Marketing. Unlike a marketplace, Shopify doesn't bring you buyers. Ads, influencers and email all cost money or time.

Turn monthly costs into a per-order number

Monthly costs are easy to ignore when you look at a single order. To include them, add up your plan and app subscriptions and divide by your monthly orders.

Monthly costs per order = (plan + apps) ÷ orders per month

Say you're on Basic at $39 and pay $36 a month for apps, so $75 in total. At 60 orders a month, that's $1.25 per order. Add it to the $1.46 payment fee on a $40 order and Shopify is really costing you $2.71 on that sale. At 20 orders a month, the same subscriptions cost $3.75 per order.

When to upgrade your plan

A higher plan only saves money once your sales are big enough for the lower card rate to cover the higher price. Going from Basic to Grow saves 0.2% of your online card sales, which is $0.20 per $100. Grow costs $66 a month more on monthly billing, so you'd need roughly $33,000 a month in online sales to break even. On yearly billing the difference is $50, or about $25,000 a month.

Plans also differ in staff accounts, reporting and shipping discounts. If you need those features, they can justify the upgrade sooner. If you don't, stay on Basic until your sales clearly pass the break-even point.