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Shopify says remove Stripe billing or get booted from their app store

624 points by ponny 6y ago

We're a SaaS business currently listed on the Shopify App store. Today we got this stern email from Shopify's 'Partner Governance' team. TLDR: Don't even have Stripe as an option for Shopify users or we'll boot you. Also backpay since Jan 2019. "At Shopify, it is critical to maintain high trust and integrity within the Shopify App Store, so merchants have a reliable place to find solutions to grow their business. During a routine investigation, Partner Governance identified your app [our app] as offering external billing for Shopify merchants and not using the Billing API for all payments. [a couple of images of our cart] As you are aware, all paid apps are required to use our Billing API, as noted in our Partner Program Agreement (Section 3.2 Payments, Point 5) unless express permission is granted by Shopify. Payment information should not be obtained from the merchant directly and all charges should be processed through the billing API. We require that you make the required changes as soon as possible to ensure all future payments are handled through our billing API. This would include redirecting any current merchants to select their plan and re-approve the new subscription through the Billing API and ensuring that all new merchants are billed through the API. Shopify has also recently rolled out an annual subscription feature on the Billing API that makes the yearly subscription event easier on the API. Additionally, we will require a report of the merchants who have been billed outside of the Billing API and retroactive revenue share payment for any/all qualifying 20% revenue dated January 2019 - Present. Once the report has been reviewed, we will reach out with next steps on how to submit the transfer of funds to Shopify via wire transfer." Pretty ironic too when you've got Shopify's CEO tweeting about the unfair 30% cut Apple wants: https://twitter.com/tobi/status/1362411841943711744 https://twitter.com/tobi/status/1362411841943711744

Puts 6y ago
I could see a lot of reason why Shopify would more or less be force to do this. If the transaction appears to be initiated on their site they may both be liable for PCI DSS and GDPR.
brauhaus 6y ago
That's more common than you think. If the world is ever dominated by aliens it won't be due to their superior firepower, but because some human accepted their EULA/ T&C without reading.
JMTQp8lwXL 6y ago
This isn't a particularly surprising occurrence, is it? For better or worse, it sounds like them defending their moat: which is exactly what any company would do.
xiwenc 6y ago
Doubt there is anything you can do. Should have read the contract/terms before getting in bed with them. If your business has grown you could evaluate to move off the shopify platform. And figure out best way to handle this fine/charge.
casperb 6y ago
This was always the case with the Shopify App Store. They were more loose in using other payment systems, as long as you payed them their 20% by wire transfer. Since end of 2019 they give that permission to almost nobody. It is also a big piece of the verification process for the App Store. So maybe you added Stripe later and now they found it? Did you have a written waiver that you could charge another way? That is required at least since ~2015.
- ponny 6y ago
  Nah, we've had Stripe since 2013. Added Shopify billing in 2016 (which was a nightmare using their old API). We'll be too small for an exemption/wire transfer method.
zhiQ 6y ago
If in glasshouse, then do not to throw stones.
tmikaeld 6y ago
I'm sorry but Shopify has always been focused on profit and lock-in, which is why they don't allow tools that move customers away from the platform and will stop paying resellers (all) their recurring commission if you don't add enough new customers to the platform every year. And now your stepping on their transaction profits which are substantial, considering the amounts they process.
- lpmusix 6y ago
  wow, they hold seller's data hostage?
  - schappim 6y ago
    Shopify resellers (affiliates), not merchants.
    - boringg 6y ago
      Which makes sense - don't sell data to the shady intermediaries keep it with the merchants. Merchants should own their client list not some developer intermediary who is trying to make money on that data.
melomal 6y ago
The insane growth the stock has had needs to be kept propped up for the shareholders to be happy. More profit = more shareholder value and that's that. Once you IPO, forget about any and all startup grandiose values that was created on inception to help the 'little' guy. Shopify will be the new Yelp with their mafia style tactics.
MattGaiser 6y ago
How exactly did you think Shopify made money?
keithnz 6y ago
Do think this is unjust? I'm a bit confused, I thought that was the whole point/business model of Shopify?
villgax 6y ago
How are you surprised? If you have billing sorted for your SaaS, why do you even need Shopify for?
- teen 6y ago
  plugins, fulfillment, order tracking, the UI. it does way more than billing.
  - system2 6y ago
    Any of those could be arranged with woocommerce / magento / shipstation.
    - jeromegv 6y ago
      If your SAAS wants to integrate with Shopify (which owns a majority of the market for SMBs e-com websites), telling your customers to switch to magento is a no-go.
- mjgs 6y ago
  Generally speaking it is very surprising for a merchant of any product to require that you not use a competing product in order to use their product.
lxe 6y ago
Not a surprising practice, but: > Pretty ironic too when you've got Shopify's CEO tweeting about the unfair 30% cut Apple wants: https://twitter.com/tobi/status/1362411841943711744 https://twitter.com/tobi/status/1362411841943711744 That's pretty hypocritical
- dheera 6y ago
  I mean, Tim Cook wants his cake and the Shopify CEO wants his cake too, so the hippocracy is expected.
  - theodric 6y ago
    Everything started to fall apart when the horses seized power
    - nradov 6y ago
      Roman emperor Caligula supposedly appointed his horse as a consul.
    - throwanem 6y ago
      The legislature and judiciary soon fell to stasis and stagnation. Nothing could be achieved in the face of so many "neigh" votes.
  - roel_v 6y ago
    I saw a movie about that once - think it was called "planet of the mares".
  - spoonjim 6y ago
    At this point I'd be willing to try a hippocracy.
    - itronitron 6y ago
      you and Sandra Boynton both
forgingahead 6y ago
What does this mean? Even if you use the Shopify API but are not on their App store, you have to use Shopify billing?
blueblisters 6y ago
Shopify is really terrible when it comes to partner support. The documentation is terrible and if you want to use their API, be prepared to bang your hand against the wall for their design choices. Partners are not Shopify's actual customers of course, but Shopify wants partners to make up for all the shortcomings of the platform without making appropriate tools and support available. In your particular case, if I understand correctly, Shopify wants you to bill customers for App store purchases through their platform. I don't think that's wrong - most marketplaces expect a cut of the revenue you make off their platform.
- ponny 6y ago
  These aren't purchases via their app store (I don't know if you can even do that?). They're within our webapp using Shopify's billing API to buy stuff. The Shopify integration is just used for discovery (via their app store), login, installation, email integration, and of course billing.
  - throwaway696_ 6y ago
    do you show to the Stripe billing option to all installations (meaning also the ones that came directly from the App Store listing) or only the ones that came through your website / are existing customers?
    - ponny 6y ago
      All. That's the issue they've got. It looks like we're going to have to hide it for anyone that comes in via the App Store. Another problem is we've got 4 products and only one is listed on the Shopify app store. If they log in via product A's listing then buy product B, it seems we must use Shopify's billing for that too.
  - blueblisters 6y ago
    Yes but if you bill them separately using Stripe, that's clearly against their Terms of Service. > The Shopify integration is just used for discovery (via their app store), login, installation, email integration, and of course billing. So Shopify is responsible for generating 100% of your revenue, correct? If you are opposed to a 20% cut of that on principle, how else do you expect them to make money?
globile 6y ago
Worth mentioning Shopify uses Stripe. A few months back they introduced their Shopify Payment Module (at least in Europe) which runs on Stripe, which then overrides and disables the standalone legacy Stripe module. You can't have both, and they don't straight up tell you this when you try their module. They now absorb the commission into their pricing. Once you disable your standalone Stripe integration, it disappears and they only way to get it back is to cry to support.
nudpiedo 6y ago
It’s the TOS, and after some social platforms were kicked out of big Corp hostings and app stores because of Trump’s scandal, I don’t think there is much you can do aside of sucking it up and planning a well thought migration out of their service.
- soulchild37 6y ago
  I don't get why people downvoted you. I make Shopify apps too and I abide to the same TOS. OP clicked "I have read and agree" on the TOS when signing up and they are now complaining that the fees are unreasonable?!
shafyy 6y ago
I'm not a Shopify partner, but it looks like this is nothing new or suprising, and clearly stated in their terms. Why are you suprised or pissed off? Or maybe I don't understand how exactly you use Stripe in connection to Shopify. Can you tell us more about what your app does and how you use Stripe?
- Number157 6y ago
  Because they're paying for a platform to deliver services and the platform then tries to dictate how they run their business. It's questionable at best and should perhaps be illegal.
  - duskwuff 6y ago
    No, you've misunderstood the situation here. OP is not "paying for a platform" on Shopify -- they are not a customer of Shopify running a store. OP is a Shopify partner offering a service to Shopify's clients, through Shopify's own web site, and is expected to pay Shopify a cut of their profits in exchange for being featured this way. This is a standard practice for this type of partnership.
    - doikor 6y ago
      > expected to pay Shopify a cut of their profits A cut of the profits would be really nice actually. A cut of revenue is a totally different beast.
      - boringg 6y ago
        True that! Though then you would get into games of companies hiding profit to avoid paying.
- piyush_soni 6y ago
  Just because Apple also has everything "written down" in their terms, but Shopify CEO is pissed off by them. Also, because they're asking for the commission retroactively for any billing they have done bypassing their API.
jameslk 6y ago
Can you create a private app for each of your customers? I know it would be a lot more challenging and you wouldn't get free marketing from Shopify's app store, but from my understanding private apps aren't subject to Shopify's commission and at least you would have more control over your business. https://www.shopify.com/partners/terms#section-c2-2 https://www.shopify.com/partners/terms#section-c2-2 > Unless otherwise indicated in this Agreement or agreed to by Shopify in writing, under the App Plan, an App Developer is entitled to eighty percent (80%) of the total revenues from the sale of, subscription to or charges relating to the Public Application, with Shopify being entitled to the remaining twenty percent (20%). https://www.shopify.com/legal/api-terms https://www.shopify.com/legal/api-terms > “Public Application” means an Application that accesses the Shopify API via an API Client and that is made available to Merchants either via a URL or through the Shopify App Store, and that is not a Custom Application. > “Private Application” means an Application that accesses the Shopify API via Private API Credentials and is made available to a single Merchant.
- derrickchao 6y ago
  You could in theory, but this requires having each merchant go into their admin and manually grant you scopes and then copy/paste the api key and secret to you. Definitely not a scalable way to go about it.
drsim 6y ago
Or, 'Shopify says follow the terms you agreed to when you signed up or get booted from their app store'
beshrkayali 6y ago
Shopify is a terrible experience overall, and I wouldn't recommend it for anyone looking to start a quick ecom business online, especially if you don't have technical experience _or_ you don't plan exactly what you'll do if you grow over it. I had to work with some clients that wanted to move away from Shopify and I was surprised at how certain types of paccounts are required to access certain parts of the API for their store. For example, you could retrieve orders but not promocodes, or not users, I can't remember exactly now, but they either had to pay more or put up with CSV parsing with limited amount of information and details. These services would probably not have had the "success" they're seeing if it wasn't for these dark patterns they implement to ex(tract|tort) money from their most likely non-technical clientele. With that being said, I don't see a problem in requiring their users to use a specific PSP that makes more business sense for them. But yes, like other have pointed out, it's way up there on the hypocrisy chart to do this while complaining about Apple. Apple's 30% cut is not unfair, neither is theirs.
- smaryjerry 6y ago
  Sadly there aren’t a lot of better options. Spotify has to be the worst bang for your buck option though if you actually have customers. The most basic functionality sucks without apps so you have to get them and sure most apps are “free” until you actually get customers but then you get slammed with fees. Wordpress is similar where if you want it to actually perform like a half decent store you need to pay for a ton of add-ons but it’s even worse because even if you have no customers you have to pay for the addons.
  - beshrkayali 6y ago
    I'm not entirely sure that's true, there are plenty of good options. But none of them are as easy to start with for sure, but it's deceptive. Like you said, basic functionality sucks and for any decent behavior if you have customers you need to know which addons to use and pay for them. There is no reason for them to be free, but at least if you're using Wordpress with addons you're in full control of your customer data. Holding your data hostage to force you to pay more is incredibly hostile. If you're serious about your ecom and you're in it for the long run, it's worth it to pay for a custom solution. Control your code and your customers data.
mortdeus 6y ago
didn't apple just say they are going to cut their charge in half?
thegyppo 6y ago
They don't understand the model where SaaS businesses use Shopify as a billing channel on top of their own subscription model, it's all or nothing - they assume that anything in the app store can only use Shopify billing if the user installs via Shopify, which is fair but their billing API has glaring issues: - App Charges get added to clients bills, you're not getting paid right away (60+ days in some cases) vs getting paid instantly - If someone doesn't pay their Shopify bill, tough shit you're not getting paid - Got fraudulent accounts billing via Shopify? They can use your app then never pay anything - fun - Want to do refunds? Too bad there's no way to do it via the API you have to manually email Shopify then they apply an App Credit (not even a refund) for the customer, then you email them back - Uninstalling the Shopify App cancels billing, so you lose complete control of your normal downgrade process - Payments come via PayPal bi monthly :( There's plenty more, but you're basically losing all the upside of Stripe in exchange for the App Store promotion of your app.
- lnenad 6y ago
  I mean shopify payments have a lot of drawbacks but not having refunds is not one of them [1] [1] https://shopify.dev/docs/admin-api/rest/reference/orders/refund https://shopify.dev/docs/admin-api/rest/reference/orders/ref...
  - thegyppo 6y ago
    This is a different API than for App Store billing afaik
  - imafish 6y ago
    Correction: https://shopify.dev/docs/admin-api/rest/reference/billing/applicationcredit https://shopify.dev/docs/admin-api/rest/reference/billing/ap... Also, I have no idea how that API works, because I, like grandparent, always email support when there is a refund request. Why is this not a simple button in the partner admin page?
    - deleted 6y ago
      [deleted]
tomcooks 6y ago
Sorry to be blunt but what do you expect to happen when you breach ana partner agreement you've read and signed? It's the walled path you and other merchants paved, but nothing is stopping you right now from making your own store on a personal site I think? If you need one let me know how I can help you.
- pmx 6y ago
  He's not a merchant he's an app developer with a saas that shopify merchants can use.
  - randompwd 6y ago
    > currently listed on the Shopify App store. so their company developed a plugin for shopifys walled garden app store - which has T&Cs
    - chasd00 6y ago
      Right, and the knowingly violated those T&Cs and got an email about it. Which, by the way, is a hell of a lot nicer than a certified letter from a law firm.
imafish 6y ago
I am a Shopify partner through 3 years, paying 20% of my revenue to Shopify, and every time I have been in contact with "partner support" it has been, to put it mildly, an underwhelming experience. You have to argue your way through an army of outsourced supporters who are equipped with nothing but the public Shopify docs, until you get to a real employee who concludes it with a "sorry, but we can't help". Some of my issues: 1. If you're not American, you will be forced to hand over 3% of your 80% revenue cut to PayPal. (Unless your MRR cut is >$30k) 2. Sometimes Shopify just kills features, which merchants and partners rely on. Sure, we get a notice that the API will change - but how does that help, when there is no alternative way to achieve the removed functionality? I was lucky enough to get through to someone who knew someone at the dev team, but the response was once again "sorry, you're not a priority".
- algo_trader 6y ago
  Off topic: How much of a revenue bonus would be enough incentive to install a specific shopify/plugin/minor-UI-tweaks addition to your store ? 3%? 10% 1%? Lets assume I can convince you we dont share your data or harm your business.
  - imafish 6y ago
    I run an app, not a store :)
    - unnouinceput 6y ago
      Probably he meant in your cart inside the app
- deepstack 6y ago
  Why would any one use Shopify 20% instead of 3 -4 % of stripe? Sounds like Shopify is total rip off.
  - acjacobson 6y ago
    I think the 20% is the fee for Shopify as a whole, not the payment processing fee. Since payment processing is a small portion of what they offer at Shopify its not an apples to apples comparison with Stripe.
tubularhells 6y ago
What is a good alternative to Shopify for a small webstore? I don't want to pay a 20% cut.
- jcheng 6y ago
  IIUC, the 20% cut does not apply to web stores, it's for SaaS vendors who want to offer a plugin to Shopify web store owners, via Shopify's App Store.
- tebbers 6y ago
  I think there's some confusion here. This topic is about developers selling apps via the Shopify App Store, not about how much you pay Shopify to run an online ecommerce store. Shopify charge a monthly fee for their online ecommmerce stores, and they don't take a 20% cut for that.
- kureikain 6y ago
  If you know a bit of coding I would advise to use SpreeCommerce. I used it very succesfully in the past.
  - gitrog 6y ago
    I've been really enjoying SpreeCommerce (based on Rails). You can get away with very little coding if you're happy with the current feature set (which really covers all the basics and then some) and your Payment Gateway of choice is supported by them already or within the ActiveMerchant Payment Gateway options. And then writing your own Payment Gateway integration (like for offsite payments) is really easy too.
- yannoninator 6y ago
  WooCommerce?
  - smaryjerry 6y ago
    WooConmerce runs like garbage and slows the site speed down to a crawl though.
Graffur 6y ago
Not surprising but interesting nonetheless.
tomaszs 6y ago
From a user perspective it is better for me to have one invoice from Shopify, in the right format with all necessary information and with additional tax documents required by law. If I had to set up payments for each extension and go through gathering invoices and documents it would be devastating. So as long as I understand the author I also understand why Shopify wants the billing API to be used. Also easy pay = more users ...
- victorNicollet 6y ago
  On the other hand, if you pay $2000/month for some other service, you may be unhappy with having to pay an additional $500 just to have it connect to Shopify to expose some data.
  - tomaszs 6y ago
    I don't know what costs so much. But I know gathering documentation from multiple small vendors across the world, additional taxes can be more expensive than $500
yannoninator 6y ago
Shopify's subscription apps with their newly released subscription API is also woeful, not surprised of this outcome. The subscription apps on the App Store are suited for physical goods (coffee beans, etc) rather than digital (membership, gift subscription, saas, etc.) which is what is driving the subscription economy. So building a digital membership platform on Shopify makes no sense, unless you consider sending shoes as a subscription to someone on a regular basis a 'digital membership'.
sl120 6y ago
I've used Shopify a few times and it's clear they're trying to be an Apple for e e-commerce. Slick and easy set up with strong lock in and high fees. As a result, I'll advise clients to use Shopify for a POC perhaps but then to put money aside to build their own system when they gain some traction. And I'm starting to wonder if there's a market for someone to build the Android equivalent of Shopify because this pisses me off royally. Especially when non-US customers pay the same fees but have less features for some unknown reason.
- Jsharm 6y ago
  What do you recommend instead?
  - silviorelli 6y ago
    Commerce Layer has a business model with no revenue sharing: https://commercelayer.io/ https://commercelayer.io/
    - Silhouette 6y ago
      I guess maybe you have some connection to Commerce Layer, because you've mentioned them here multiple times now. If you do, perhaps you'd like to tell them that I just visited their site and after a few minutes of reading, I still don't understand what they offer or why it might help me. The pages I saw were full of buzzwords and vague arguments, but had little substance: no high-level explanation of the scope of the product and what functionality it offers, no illustration of how the API works and where it would integrate with the rest of my system, no walk-throughs showing how to build different types of useful functionality with it, no case studies showing the benefits of switching to it. It was a frustrating experience, and they might like to do something about that.
      - mariushn 6y ago
        (not related to parent) Excellent feedback! Thanks Would there be a way to contact you to ask for feedback on another potential ecommerce product? (doesn't exist yet, so that's why there's no link). My email is in profile.
parentheses 6y ago
why are you surprised? shopify is a platform that monetizes selling things. no company would allow the kind of freedom you seek. if that's what you want, build your own website and use stripe. it's not that hard.
addictedcs 6y ago
If you delist your Shopify app from the app store you will not have to pay the 20% monthly commission from the new customers. It also means your app is private, and you will have to invest in your distribution channel now. Shopify stores can install it as a Private App, which means you will need to find new customers on your own. On a different note, I wouldn't recommend building an app that is strongly integrated into the Shopify platform due to a myriad of reasons. Shopify App store will not give you enough exposure to grow your customer base naturally, you will have to invest in your distribution channel anyways, but now you are tied to a 20% commission since your app is public. App store ranking system is heavily tuned towards the rate of installations your app has, which means products that offer free, or very cheap pricing plans are getting to the front page. If you offer free or very cheap pricing you will get inundated with customer support requests. The biggest chunk of Shopify customers, have very little understanding how to run an e-commerce store. Handling these requests will be a nightmare. This also means that the Shopify App store is not used anymore by stores that are running on Professional or Shopify Plus platforms, since it is full of apps that are borderline scam, and they can't find valuable services by a simple search. Shopify understands this as well, that's why they've created Shopify Plus Certified App Store https://www.shopify.com/plus/partners/technology https://www.shopify.com/plus/partners/technology, which is essentially a curated Shopify App store targeting customers who are not afraid of paying money for valuable services. Getting there is not easy since the certification process is not transparent (we've applied but not heard anything from Shopify since then). Also, Shopify integrates new features into its platform every year getting into more and more verticals. This essentially means that if you build an app that provides important e-commerce functionality, Shopify will probably release the same feature integrated natively into their platform. All in all, don't bet on the Shopify App Store distribution channel, it is just not worth it.
- deleted 6y ago
  [deleted]
- throwaway93434 6y ago
  There's a difference between delisting your app from the Shopify App Store and making it private (now called custom). A delisted app still needs to use Shopify's billing system and pay the 20% fee even if you find new customers yourself. If your Shopify app is private (custom) then it doesn't need to use Shopify's billing system but then it can't be installed by more than 1 merchant. So Shopify has basically created a catch 22. If you want your app to be installed by more than 1 merchant even if it's not on the Shopify App Store then you're required to pay them a fee. For reference, Shopify made this change at the end of 2019: https://www.shopify.com/partners/blog/shopify-public-apps https://www.shopify.com/partners/blog/shopify-public-apps
joelbluminator 6y ago
Forgive me for hijacking the discussion but it seems Rails CAN scale right?
amelius 6y ago
Anti-competition laws need an upgrade in this world of platform economies.
mariust 6y ago
Why is it ok in software to pay a 20% - 30% commission? Imagine if your car dealer would ask an extra 30% Ok, ok I get it, it's not a physical product but still people get paid to work on it and develop it, and there are income taxes and all that, but really 20-30%?!?! If you sell a product chances are your profit margin is 20-30% and that it's good, but here in software we have to do a cut for 20-30%, well again 10% it's not going to buy all the fancy tech and spaces in expensive parts of the world.
- evgen 6y ago
  If your profit margin on a software product is only 30% you have absolutely no business being in business.
  - AdrianB1 6y ago
    That does not answer the question and it is a very rude comment.
- deleted 6y ago
  [deleted]
- LukaszWiktor 6y ago
  Unfortunatelly, big corps have the power to impose their own taxes. Google, Apple, Shopify, Upwork, ...
- smaryjerry 6y ago
  It’s not cheap sending a few bytes through the internet. It takes... uh... some storage and bandwidth on the order of several dollars to have a website simply show your app.. yea.. this is what happens when marketplaces have monopolies, even if they are essentially self imposed monopolies by the customers simply being to lazy to search for things elsewhere.
wooque 6y ago
You have to use Shopify Billing for shops that installed your app through app store, but you can have Stripe for apps that installed your app directly through your site for example, that's how business I'm working for is doing. Basically if you want Shopify App Store customers, you have to give 20% to Shopify, but you still have option of acquiring users yourself through your site without app store. Is it fair? Maybe not, but that's a deal. Apple users on the other hand don't have option of installing apps without app store, so comparison is not valid.
- kevincox 6y ago
  This seems pretty reasonable to me. If you don't like the deal you can still target these customers. 20% cut for advertising, billing and other features sounds like a deal that many people would (and do) take. I would be much more bothered by the 20% cut if there was no other way to target these customers.
- victorNicollet 6y ago
  The Shopify terms state that if your application accesses the Shopify API and is used by two or more merchants, then you have to give 20% to Shopify. Do you have any references on there being an exception for apps not installed through the store ? I would be very interested.
  - hermanradtke 6y ago
    You make a private app for each customer.
    - johnbrodie 6y ago
      This has been _specifically_ called out in Shopify's recent emails to partners. If the private apps are essentially all the same, it's considered abusing private apps and they may come down on you at some point. Private apps, in Shopify's eyes, are for something like a consultant whom is building one-off apps for clients, not as a way to avoid the store.
  - 6y ago
rbobby 6y ago
* 20% * Holy cow.
- airhead969 6y ago
  20% of gross is typically 40% of net (since it can't be paid for by anyone else but the merchant) at 100% markup. That's like lending 40% of equity to your electric company. I don't understand why any business would willingly do that other than business ignorance or technical laziness.
BLanen 6y ago
Software has ironically only led to more and more vertical and horizontal integration while evangelists had been predicting the utopian opposite while ignoring the warning signs.
- oblio 6y ago
  Extremistan, see Black Swan by Taleb.
Erlich_Bachman 6y ago
Well... it's in their terms, isn't it? What is the news here?
airhead969 6y ago
I don't understand the basis of this complaint. They knowingly went around the Shopify rev share by using their own payment gateway. Seems like Shopify called them out for misbehaving. Anyhow: For larger shops, self-host and find a good payment gateway. SaaS that takes a percentage will bleed you dry.
- papertokyo 6y ago
  For larger shops, the pricing for SaaS platforms like Shopify and friends is less than 0.5% of GMV. If that's too much, the business has bigger problems that certainly won't be solved by self-hosting or maintaining their own homegrown backend.
55555 6y ago
Kinda funny because Shopify pay is powered by Stripe.
hahahahe 6y ago
I still don’t understand why people use Shopify. And on top of that people equate them to being the next Amazon. Boggles my mind.
- mehphp 6y ago
  Because for all of their faults, it's dead simple to get your on store up and running.
- boringg 6y ago
  As a merchant (not developer) you own your own clients, your storefront and can run seamlessly IRL and online on Shopify - at least thats the pitch. Shopify doesn't suggest to your clients to go buy from another merchant. In the case of Amazon you own nothing so as a merchant you are thrown into a marketplace where Amazon controls everything and Amazon can take your best products and then make knock offs of them and undercut your sales. Totally different companies - not in the same ball park (Amazon is way bigger then Shopify, don't fall for the false narrative)
umen 6y ago
Why not setup store of your own ? and keep all your profite (minus stripe transaction fee)
- Axsuul 6y ago
  There's lots of confusion in this thread. OP is not talking about a Shopify store but rather an app they developed that integrates with Shopify stores.
secondo 6y ago
Don’t try to equate Shopify’s app distribution to Apple’s. They’re not the same. Apple charges commission for your paid application regardless of distribution form because there is only one and you have to use it, the AppStore. Shopify has an optional distribution platform for apps which they charge a fee for. You can distribute your app on your own and avoid the fee.
- victorNicollet 6y ago
  This is absolutely not the wording of the Shopify terms. If your application 1. uses the Shopify API and 2. is sold to more than one Shopify customer, then Shopify takes 20% of your revenue. Presence on the optional distribution platform is not necessary.
- deleted 6y ago
  [deleted]
nickjj 6y ago
Some folks have mentioned that this can't be compared to Apple because as a Shopify app creator you have the option to distribute the app on your own platform to avoid the 20% fee. But in an eco-system driven platform I don't think having a choice matters in the end. If users are trained that the best place to install apps is through the app store and there's a huge marketing effort put in place by the app store that you can only trust apps from that store, etc., etc. then it almost doesn't matter if there's an alternative because users immediately associate non-app store apps as being very bad and should be avoided at all costs. I don't use Shopify currently but I imagine the work flow for adding a new app to your store starts with you searching the app store for whatever type of app you want because it's built into the platform. Then you start narrowing down results based on demo videos, features and reviews until you find something you're happy with. Going outside of the app store doesn't even come up because most app types probably have dozens of decent choices on the app store. Even if you decided to Google around most of the top hits will be apps from the app store because Shopify's SEO is very likely going to be better than yours. The only way someone will discover and use your app outside of the app store is you have already have a massive following and trust that you're not a bad actor looking to do something shady by avoiding the app store (because this is what users are trained to think) and your app is leaps and bounds better than anything that exists on the app store so that users are willing to take the risk to go with your non-official app. That doesn't seem like it would happen very often. Does anyone have a wildly successful Shopify app that's not on the app store? To me this feels like an illusion of choice because yes technically you have the option but realistically the outcome is the same as having no option.
- smaryjerry 6y ago
  That seems to be the case. Even Android allowing apps outside their store to be installed but you have to find 5 more buttons in settings to click to get there causes people to just not do it.
paaaaaaaaaa 6y ago
We (stannp.com) created an app for the shopify marketplace some time ago which helped shops send letters and postcards to their customers. The app would sync recipients with our platform or trigger mail to be posted. The shopify rep said we had to implement their billing API on across our whole platform so they get a 30% (i'm sure it was 30% back then) cut on all transactions. It drove me crazy because I saw mailchip in the marketplace and I'm pretty sure they didn't implement the shopify billing API and give 30% for their subscriptions.
- oatmale 6y ago
  The official mailchimp app was also removed from the Shopify app store for not complying with the terms. Shopify doesn't care who you are, everyone is on the same terms now.
foxhop 6y ago
I built an alternative for my wife called MakePostSell https://www.makepostsell.com https://www.makepostsell.com Right now it only works for digital downloads but I'm planning to build out shipping and local pickup options for physical goods. Currently in beta but my wife is using the platform in production here: https://shop.printableprompts.com https://shop.printableprompts.com The only payment processor at this time is stripe. My thought is to allow people to bring their own domain, Stripe API keys, PayPal, and S3 bucket or digital Ocean spaces (for files, attachments, thumbnails, preview files, and products. I want to disrupt and keep pricing very competitive for small shops (potentially even a free entry-level plan) Hope this helps you feel less trapped. Click the "New Shop" button to try the beta.
- A4ET8a8uTh0 6y ago
  Thank you for sharing this. Having looked into it recently, the current pricing for online merchants is just excessive. Unless you are selling an item with a ridiculous margin, it is hard to keep up. And it isn't just Shopify and companies of the same type. Online marketplaces are about as bad in terms of trying to capture bigger slice of the pie. I will keep watching your project.
- yarcob 6y ago
  Your welcome page doesn't mention VAT, so I am going to assume that you do not handle VAT. This makes your product unsuitable for anyone in Europe. There are other solutions for digital products that take lower commissions, for example FastSpring (would not recommend) or MyCommerce (no experience). They are probably not as sleek as Shopify, but their rates are around 5-9% (depending on how big average orders are), and they handle VAT and invoicing so you don't end up having to pay a lot of back taxes when the authorities audit your business. They are built for selling software, but work just as well for ebooks etc.
  - foxhop 6y ago
    Yeah no VAT at this point but seems like a road map item for certain. I don't give tax advice but in the United States each state handles sales tax and economic/physical nexus on digital goods differently. All of these are on my radar for MakePostSell and all online sellers should educate themselves on the rules for their region.
Shadonototro 6y ago
You signed a contract that explitly says you have to use their billing API You choosed their platform, and you agreed with that, so why do you complain now? EDIT: Title should be renamed to: "Shopify asks users to comply with contract they signed when joining the platform"
- cush 6y ago
  Seriously though. It's proper B2B, not Facebook ads. The fact that the Shopify platform is so customizable that it allows integration of 3p billing says a lot about how they view their customers. Salesforce uses a similar model
rdtwo 6y ago
Shopify billing is such shit that only bots can checkout high demand items. People literally have bots scan all Shopify sites and buy up any In demand item before a real customer can even add it to cart.
aurizon 6y ago
I will never - ever use Shopify again. To extract 20% from a vendor of physical goods is criminal. BTW, I buy zero Apple products either - I will not take part in highway robbery...
- Germanika 6y ago
  As others have mentioned, this post is about Shopify apps, not Shopify stores. I'd recommend doing a bit more research before deciding to boycott a company. They're absolutely not taking a 20% cut from sales of physical goods, this isn't Uber Eats.
  - aurizon 6y ago
    OK, I thought it was like Apple
boris9999 6y ago
How is this a problem? Are all marketplaces bad? Were you forced to sell there? You chose to sell your app on their marketplace and agreed to their TOS and pricing. They provide you with access to their marketplace and you agree to pay them 20%. Were you aware that these are the terms and broke them anyway? It's like an Uber diver who will start charging cash without going through the Uber app to avoid paying Uber. Or maybe start a McDonald's franchise and hide all the profits. Not to mention paying taxes to the government... Apple controls the iOS platform, so it's a different case. Shopify does not prevent you from selling on your own website and taking 100% of the profits.
cush 6y ago
Sounds like you signed a B2B partnership agreement and didn't read it...
boringg 6y ago
If I understand this correctly: this OP partner app (not merchant/store) has been evading the Rev Share agreement with Shopify and is complaining because they got caught and are having to pay back their due? And then they are trying to jump on the furor of Apples 30% rev share agreement to get support from other developers - when the cases are completely different? To me it sounds like this App developer is trying to have their cake and eat it too. FWIW - I am typically on the small developer side of things but this seems like a case of a bad actor trying to couch it in other complaints...
- MrTortoise 6y ago
  tbh i read it more as yet another example of a platform trying to restrict the rigths of its customers to do every other aspect of their business in the way they choose. I take your point - and its probably true. BUT when I use what is essentially a glorified website builder to build a site they don't get to tell me who i can put my money through or dictate anything about how i run my business beyond hosting and the builder. The reality is that it is even more reasons for a business to not build a business that is dependant upon another in this way.
  - boringg 6y ago
    I hear your generic complaint about platforms but in this case the Merchant and actually customers (not third party developer) are the people who should be protected. Partners (third party developers) should have access to provide Merchants much needed services and get paid for that but as I see it Shopify has to regulate what those Partners are doing so that neither their Merchants or Customers are getting taken advantage of. (I.E. avoid any kind of fallout similar to facebooks cambridge analytics level or fraudulent payments). In this case the third party developer was circumventing the user agreement clearly for their own personal gain and potentially putting customer/merchant data at risk, or at the very minimum not willing to pay the terms that they agreed too. At least thats my perspective. In terms of glorified website builder - the level of sophistication on these multi channel e-commerce and IRL platforms, inventory management, taxes etc is actually quite daunting to manage.
kerng 6y ago
This sounds like a phishing mail even, at least the way it's written.
neycoda 6y ago
Kind of hard your tiny text in gray on yellow on a 6" phone screen... HN needs a UI revamp.
colbertpetru 6y ago
They passed the point of no return as soon as they started giving out business loans via Shopify Capital. This backlash against lock-in strategies will continue to dog Shopify.
sergiotapia 6y ago
Are you surprised by this? It's like going on Upwork and offering to charge customers less by direct invoice instead of their Upwork charging service lol come on son
deleted 6y ago
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deleted 6y ago
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624 points by ponny 6y ago

Puts 6y ago

I could see a lot of reason why Shopify would more or less be force to do this. If the transaction appears to be initiated on their site they may both be liable for PCI DSS and GDPR.

brauhaus 6y ago

That's more common than you think. If the world is ever dominated by aliens it won't be due to their superior firepower, but because some human accepted their EULA/ T&C without reading.

JMTQp8lwXL 6y ago

This isn't a particularly surprising occurrence, is it? For better or worse, it sounds like them defending their moat: which is exactly what any company would do.

xiwenc 6y ago

Doubt there is anything you can do. Should have read the contract/terms before getting in bed with them. If your business has grown you could evaluate to move off the shopify platform. And figure out best way to handle this fine/charge.

casperb 6y ago

This was always the case with the Shopify App Store. They were more loose in using other payment systems, as long as you payed them their 20% by wire transfer. Since end of 2019 they give that permission to almost nobody. It is also a big piece of the verification process for the App Store. So maybe you added Stripe later and now they found it? Did you have a written waiver that you could charge another way? That is required at least since ~2015.

ponny 6y ago
Nah, we've had Stripe since 2013. Added Shopify billing in 2016 (which was a nightmare using their old API). We'll be too small for an exemption/wire transfer method.

zhiQ 6y ago

If in glasshouse, then do not to throw stones.

tmikaeld 6y ago

I'm sorry but Shopify has always been focused on profit and lock-in, which is why they don't allow tools that move customers away from the platform and will stop paying resellers (all) their recurring commission if you don't add enough new customers to the platform every year. And now your stepping on their transaction profits which are substantial, considering the amounts they process.

lpmusix 6y ago
wow, they hold seller's data hostage?
- schappim 6y ago
  Shopify resellers (affiliates), not merchants.
  - boringg 6y ago
    Which makes sense - don't sell data to the shady intermediaries keep it with the merchants. Merchants should own their client list not some developer intermediary who is trying to make money on that data.

melomal 6y ago

The insane growth the stock has had needs to be kept propped up for the shareholders to be happy. More profit = more shareholder value and that's that. Once you IPO, forget about any and all startup grandiose values that was created on inception to help the 'little' guy. Shopify will be the new Yelp with their mafia style tactics.

MattGaiser 6y ago

How exactly did you think Shopify made money?

keithnz 6y ago

Do think this is unjust? I'm a bit confused, I thought that was the whole point/business model of Shopify?

villgax 6y ago

How are you surprised? If you have billing sorted for your SaaS, why do you even need Shopify for?

teen 6y ago
plugins, fulfillment, order tracking, the UI. it does way more than billing.
- system2 6y ago
  Any of those could be arranged with woocommerce / magento / shipstation.
  - jeromegv 6y ago
    If your SAAS wants to integrate with Shopify (which owns a majority of the market for SMBs e-com websites), telling your customers to switch to magento is a no-go.
mjgs 6y ago
Generally speaking it is very surprising for a merchant of any product to require that you not use a competing product in order to use their product.

lxe 6y ago

Not a surprising practice, but: > Pretty ironic too when you've got Shopify's CEO tweeting about the unfair 30% cut Apple wants: https://twitter.com/tobi/status/1362411841943711744 https://twitter.com/tobi/status/1362411841943711744 That's pretty hypocritical

dheera 6y ago
I mean, Tim Cook wants his cake and the Shopify CEO wants his cake too, so the hippocracy is expected.
- theodric 6y ago
  Everything started to fall apart when the horses seized power
  - nradov 6y ago
    Roman emperor Caligula supposedly appointed his horse as a consul.
  - throwanem 6y ago
    The legislature and judiciary soon fell to stasis and stagnation. Nothing could be achieved in the face of so many "neigh" votes.
- roel_v 6y ago
  I saw a movie about that once - think it was called "planet of the mares".
- spoonjim 6y ago
  At this point I'd be willing to try a hippocracy.
  - itronitron 6y ago
    you and Sandra Boynton both

forgingahead 6y ago

What does this mean? Even if you use the Shopify API but are not on their App store, you have to use Shopify billing?

blueblisters 6y ago

Shopify is really terrible when it comes to partner support. The documentation is terrible and if you want to use their API, be prepared to bang your hand against the wall for their design choices. Partners are not Shopify's actual customers of course, but Shopify wants partners to make up for all the shortcomings of the platform without making appropriate tools and support available. In your particular case, if I understand correctly, Shopify wants you to bill customers for App store purchases through their platform. I don't think that's wrong - most marketplaces expect a cut of the revenue you make off their platform.

ponny 6y ago
These aren't purchases via their app store (I don't know if you can even do that?). They're within our webapp using Shopify's billing API to buy stuff. The Shopify integration is just used for discovery (via their app store), login, installation, email integration, and of course billing.
- throwaway696_ 6y ago
  do you show to the Stripe billing option to all installations (meaning also the ones that came directly from the App Store listing) or only the ones that came through your website / are existing customers?
  - ponny 6y ago
    All. That's the issue they've got. It looks like we're going to have to hide it for anyone that comes in via the App Store. Another problem is we've got 4 products and only one is listed on the Shopify app store. If they log in via product A's listing then buy product B, it seems we must use Shopify's billing for that too.
- blueblisters 6y ago
  Yes but if you bill them separately using Stripe, that's clearly against their Terms of Service. > The Shopify integration is just used for discovery (via their app store), login, installation, email integration, and of course billing. So Shopify is responsible for generating 100% of your revenue, correct? If you are opposed to a 20% cut of that on principle, how else do you expect them to make money?

globile 6y ago

Worth mentioning Shopify uses Stripe. A few months back they introduced their Shopify Payment Module (at least in Europe) which runs on Stripe, which then overrides and disables the standalone legacy Stripe module. You can't have both, and they don't straight up tell you this when you try their module. They now absorb the commission into their pricing. Once you disable your standalone Stripe integration, it disappears and they only way to get it back is to cry to support.

nudpiedo 6y ago

It’s the TOS, and after some social platforms were kicked out of big Corp hostings and app stores because of Trump’s scandal, I don’t think there is much you can do aside of sucking it up and planning a well thought migration out of their service.

soulchild37 6y ago
I don't get why people downvoted you. I make Shopify apps too and I abide to the same TOS. OP clicked "I have read and agree" on the TOS when signing up and they are now complaining that the fees are unreasonable?!

shafyy 6y ago

I'm not a Shopify partner, but it looks like this is nothing new or suprising, and clearly stated in their terms. Why are you suprised or pissed off? Or maybe I don't understand how exactly you use Stripe in connection to Shopify. Can you tell us more about what your app does and how you use Stripe?

Number157 6y ago
Because they're paying for a platform to deliver services and the platform then tries to dictate how they run their business. It's questionable at best and should perhaps be illegal.
- duskwuff 6y ago
  No, you've misunderstood the situation here. OP is not "paying for a platform" on Shopify -- they are not a customer of Shopify running a store. OP is a Shopify partner offering a service to Shopify's clients, through Shopify's own web site, and is expected to pay Shopify a cut of their profits in exchange for being featured this way. This is a standard practice for this type of partnership.
  - doikor 6y ago
    > expected to pay Shopify a cut of their profits A cut of the profits would be really nice actually. A cut of revenue is a totally different beast.
    - boringg 6y ago
      True that! Though then you would get into games of companies hiding profit to avoid paying.
piyush_soni 6y ago
Just because Apple also has everything "written down" in their terms, but Shopify CEO is pissed off by them. Also, because they're asking for the commission retroactively for any billing they have done bypassing their API.

jameslk 6y ago

Can you create a private app for each of your customers? I know it would be a lot more challenging and you wouldn't get free marketing from Shopify's app store, but from my understanding private apps aren't subject to Shopify's commission and at least you would have more control over your business. https://www.shopify.com/partners/terms#section-c2-2 https://www.shopify.com/partners/terms#section-c2-2 > Unless otherwise indicated in this Agreement or agreed to by Shopify in writing, under the App Plan, an App Developer is entitled to eighty percent (80%) of the total revenues from the sale of, subscription to or charges relating to the Public Application, with Shopify being entitled to the remaining twenty percent (20%). https://www.shopify.com/legal/api-terms https://www.shopify.com/legal/api-terms > “Public Application” means an Application that accesses the Shopify API via an API Client and that is made available to Merchants either via a URL or through the Shopify App Store, and that is not a Custom Application. > “Private Application” means an Application that accesses the Shopify API via Private API Credentials and is made available to a single Merchant.

derrickchao 6y ago
You could in theory, but this requires having each merchant go into their admin and manually grant you scopes and then copy/paste the api key and secret to you. Definitely not a scalable way to go about it.

drsim 6y ago

Or, 'Shopify says follow the terms you agreed to when you signed up or get booted from their app store'

beshrkayali 6y ago

Shopify is a terrible experience overall, and I wouldn't recommend it for anyone looking to start a quick ecom business online, especially if you don't have technical experience _or_ you don't plan exactly what you'll do if you grow over it. I had to work with some clients that wanted to move away from Shopify and I was surprised at how certain types of paccounts are required to access certain parts of the API for their store. For example, you could retrieve orders but not promocodes, or not users, I can't remember exactly now, but they either had to pay more or put up with CSV parsing with limited amount of information and details. These services would probably not have had the "success" they're seeing if it wasn't for these dark patterns they implement to ex(tract|tort) money from their most likely non-technical clientele. With that being said, I don't see a problem in requiring their users to use a specific PSP that makes more business sense for them. But yes, like other have pointed out, it's way up there on the hypocrisy chart to do this while complaining about Apple. Apple's 30% cut is not unfair, neither is theirs.

smaryjerry 6y ago
Sadly there aren’t a lot of better options. Spotify has to be the worst bang for your buck option though if you actually have customers. The most basic functionality sucks without apps so you have to get them and sure most apps are “free” until you actually get customers but then you get slammed with fees. Wordpress is similar where if you want it to actually perform like a half decent store you need to pay for a ton of add-ons but it’s even worse because even if you have no customers you have to pay for the addons.
- beshrkayali 6y ago
  I'm not entirely sure that's true, there are plenty of good options. But none of them are as easy to start with for sure, but it's deceptive. Like you said, basic functionality sucks and for any decent behavior if you have customers you need to know which addons to use and pay for them. There is no reason for them to be free, but at least if you're using Wordpress with addons you're in full control of your customer data. Holding your data hostage to force you to pay more is incredibly hostile. If you're serious about your ecom and you're in it for the long run, it's worth it to pay for a custom solution. Control your code and your customers data.

mortdeus 6y ago

didn't apple just say they are going to cut their charge in half?

thegyppo 6y ago

They don't understand the model where SaaS businesses use Shopify as a billing channel on top of their own subscription model, it's all or nothing - they assume that anything in the app store can only use Shopify billing if the user installs via Shopify, which is fair but their billing API has glaring issues: - App Charges get added to clients bills, you're not getting paid right away (60+ days in some cases) vs getting paid instantly - If someone doesn't pay their Shopify bill, tough shit you're not getting paid - Got fraudulent accounts billing via Shopify? They can use your app then never pay anything - fun - Want to do refunds? Too bad there's no way to do it via the API you have to manually email Shopify then they apply an App Credit (not even a refund) for the customer, then you email them back - Uninstalling the Shopify App cancels billing, so you lose complete control of your normal downgrade process - Payments come via PayPal bi monthly :( There's plenty more, but you're basically losing all the upside of Stripe in exchange for the App Store promotion of your app.

lnenad 6y ago
I mean shopify payments have a lot of drawbacks but not having refunds is not one of them [1] [1] https://shopify.dev/docs/admin-api/rest/reference/orders/refund https://shopify.dev/docs/admin-api/rest/reference/orders/ref...
- thegyppo 6y ago
  This is a different API than for App Store billing afaik
- imafish 6y ago
  Correction: https://shopify.dev/docs/admin-api/rest/reference/billing/applicationcredit https://shopify.dev/docs/admin-api/rest/reference/billing/ap... Also, I have no idea how that API works, because I, like grandparent, always email support when there is a refund request. Why is this not a simple button in the partner admin page?
  - deleted 6y ago
    [deleted]

tomcooks 6y ago

Sorry to be blunt but what do you expect to happen when you breach ana partner agreement you've read and signed? It's the walled path you and other merchants paved, but nothing is stopping you right now from making your own store on a personal site I think? If you need one let me know how I can help you.

pmx 6y ago
He's not a merchant he's an app developer with a saas that shopify merchants can use.
- randompwd 6y ago
  > currently listed on the Shopify App store. so their company developed a plugin for shopifys walled garden app store - which has T&Cs
  - chasd00 6y ago
    Right, and the knowingly violated those T&Cs and got an email about it. Which, by the way, is a hell of a lot nicer than a certified letter from a law firm.

imafish 6y ago

I am a Shopify partner through 3 years, paying 20% of my revenue to Shopify, and every time I have been in contact with "partner support" it has been, to put it mildly, an underwhelming experience. You have to argue your way through an army of outsourced supporters who are equipped with nothing but the public Shopify docs, until you get to a real employee who concludes it with a "sorry, but we can't help". Some of my issues: 1. If you're not American, you will be forced to hand over 3% of your 80% revenue cut to PayPal. (Unless your MRR cut is >$30k) 2. Sometimes Shopify just kills features, which merchants and partners rely on. Sure, we get a notice that the API will change - but how does that help, when there is no alternative way to achieve the removed functionality? I was lucky enough to get through to someone who knew someone at the dev team, but the response was once again "sorry, you're not a priority".

algo_trader 6y ago
Off topic: How much of a revenue bonus would be enough incentive to install a specific shopify/plugin/minor-UI-tweaks addition to your store ? 3%? 10% 1%? Lets assume I can convince you we dont share your data or harm your business.
- imafish 6y ago
  I run an app, not a store :)
  - unnouinceput 6y ago
    Probably he meant in your cart inside the app
deepstack 6y ago
Why would any one use Shopify 20% instead of 3 -4 % of stripe? Sounds like Shopify is total rip off.
- acjacobson 6y ago
  I think the 20% is the fee for Shopify as a whole, not the payment processing fee. Since payment processing is a small portion of what they offer at Shopify its not an apples to apples comparison with Stripe.

tubularhells 6y ago

What is a good alternative to Shopify for a small webstore? I don't want to pay a 20% cut.

jcheng 6y ago
IIUC, the 20% cut does not apply to web stores, it's for SaaS vendors who want to offer a plugin to Shopify web store owners, via Shopify's App Store.
tebbers 6y ago
I think there's some confusion here. This topic is about developers selling apps via the Shopify App Store, not about how much you pay Shopify to run an online ecommerce store. Shopify charge a monthly fee for their online ecommmerce stores, and they don't take a 20% cut for that.
kureikain 6y ago
If you know a bit of coding I would advise to use SpreeCommerce. I used it very succesfully in the past.
- gitrog 6y ago
  I've been really enjoying SpreeCommerce (based on Rails). You can get away with very little coding if you're happy with the current feature set (which really covers all the basics and then some) and your Payment Gateway of choice is supported by them already or within the ActiveMerchant Payment Gateway options. And then writing your own Payment Gateway integration (like for offsite payments) is really easy too.
yannoninator 6y ago
WooCommerce?
- smaryjerry 6y ago
  WooConmerce runs like garbage and slows the site speed down to a crawl though.

Graffur 6y ago

Not surprising but interesting nonetheless.

tomaszs 6y ago

From a user perspective it is better for me to have one invoice from Shopify, in the right format with all necessary information and with additional tax documents required by law. If I had to set up payments for each extension and go through gathering invoices and documents it would be devastating. So as long as I understand the author I also understand why Shopify wants the billing API to be used. Also easy pay = more users ...

victorNicollet 6y ago
On the other hand, if you pay $2000/month for some other service, you may be unhappy with having to pay an additional $500 just to have it connect to Shopify to expose some data.
- tomaszs 6y ago
  I don't know what costs so much. But I know gathering documentation from multiple small vendors across the world, additional taxes can be more expensive than $500

yannoninator 6y ago

Shopify's subscription apps with their newly released subscription API is also woeful, not surprised of this outcome. The subscription apps on the App Store are suited for physical goods (coffee beans, etc) rather than digital (membership, gift subscription, saas, etc.) which is what is driving the subscription economy. So building a digital membership platform on Shopify makes no sense, unless you consider sending shoes as a subscription to someone on a regular basis a 'digital membership'.

sl120 6y ago

I've used Shopify a few times and it's clear they're trying to be an Apple for e e-commerce. Slick and easy set up with strong lock in and high fees. As a result, I'll advise clients to use Shopify for a POC perhaps but then to put money aside to build their own system when they gain some traction. And I'm starting to wonder if there's a market for someone to build the Android equivalent of Shopify because this pisses me off royally. Especially when non-US customers pay the same fees but have less features for some unknown reason.

Jsharm 6y ago
What do you recommend instead?
- silviorelli 6y ago
  Commerce Layer has a business model with no revenue sharing: https://commercelayer.io/ https://commercelayer.io/
  - Silhouette 6y ago
    I guess maybe you have some connection to Commerce Layer, because you've mentioned them here multiple times now. If you do, perhaps you'd like to tell them that I just visited their site and after a few minutes of reading, I still don't understand what they offer or why it might help me. The pages I saw were full of buzzwords and vague arguments, but had little substance: no high-level explanation of the scope of the product and what functionality it offers, no illustration of how the API works and where it would integrate with the rest of my system, no walk-throughs showing how to build different types of useful functionality with it, no case studies showing the benefits of switching to it. It was a frustrating experience, and they might like to do something about that.
    - mariushn 6y ago
      (not related to parent) Excellent feedback! Thanks Would there be a way to contact you to ask for feedback on another potential ecommerce product? (doesn't exist yet, so that's why there's no link). My email is in profile.

parentheses 6y ago

why are you surprised? shopify is a platform that monetizes selling things. no company would allow the kind of freedom you seek. if that's what you want, build your own website and use stripe. it's not that hard.

addictedcs 6y ago

If you delist your Shopify app from the app store you will not have to pay the 20% monthly commission from the new customers. It also means your app is private, and you will have to invest in your distribution channel now. Shopify stores can install it as a Private App, which means you will need to find new customers on your own. On a different note, I wouldn't recommend building an app that is strongly integrated into the Shopify platform due to a myriad of reasons. Shopify App store will not give you enough exposure to grow your customer base naturally, you will have to invest in your distribution channel anyways, but now you are tied to a 20% commission since your app is public. App store ranking system is heavily tuned towards the rate of installations your app has, which means products that offer free, or very cheap pricing plans are getting to the front page. If you offer free or very cheap pricing you will get inundated with customer support requests. The biggest chunk of Shopify customers, have very little understanding how to run an e-commerce store. Handling these requests will be a nightmare. This also means that the Shopify App store is not used anymore by stores that are running on Professional or Shopify Plus platforms, since it is full of apps that are borderline scam, and they can't find valuable services by a simple search. Shopify understands this as well, that's why they've created Shopify Plus Certified App Store https://www.shopify.com/plus/partners/technology https://www.shopify.com/plus/partners/technology, which is essentially a curated Shopify App store targeting customers who are not afraid of paying money for valuable services. Getting there is not easy since the certification process is not transparent (we've applied but not heard anything from Shopify since then). Also, Shopify integrates new features into its platform every year getting into more and more verticals. This essentially means that if you build an app that provides important e-commerce functionality, Shopify will probably release the same feature integrated natively into their platform. All in all, don't bet on the Shopify App Store distribution channel, it is just not worth it.

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throwaway93434 6y ago
There's a difference between delisting your app from the Shopify App Store and making it private (now called custom). A delisted app still needs to use Shopify's billing system and pay the 20% fee even if you find new customers yourself. If your Shopify app is private (custom) then it doesn't need to use Shopify's billing system but then it can't be installed by more than 1 merchant. So Shopify has basically created a catch 22. If you want your app to be installed by more than 1 merchant even if it's not on the Shopify App Store then you're required to pay them a fee. For reference, Shopify made this change at the end of 2019: https://www.shopify.com/partners/blog/shopify-public-apps https://www.shopify.com/partners/blog/shopify-public-apps

joelbluminator 6y ago

Forgive me for hijacking the discussion but it seems Rails CAN scale right?

amelius 6y ago

Anti-competition laws need an upgrade in this world of platform economies.

mariust 6y ago

Why is it ok in software to pay a 20% - 30% commission? Imagine if your car dealer would ask an extra 30% Ok, ok I get it, it's not a physical product but still people get paid to work on it and develop it, and there are income taxes and all that, but really 20-30%?!?! If you sell a product chances are your profit margin is 20-30% and that it's good, but here in software we have to do a cut for 20-30%, well again 10% it's not going to buy all the fancy tech and spaces in expensive parts of the world.

evgen 6y ago
If your profit margin on a software product is only 30% you have absolutely no business being in business.
- AdrianB1 6y ago
  That does not answer the question and it is a very rude comment.
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LukaszWiktor 6y ago
Unfortunatelly, big corps have the power to impose their own taxes. Google, Apple, Shopify, Upwork, ...
smaryjerry 6y ago
It’s not cheap sending a few bytes through the internet. It takes... uh... some storage and bandwidth on the order of several dollars to have a website simply show your app.. yea.. this is what happens when marketplaces have monopolies, even if they are essentially self imposed monopolies by the customers simply being to lazy to search for things elsewhere.

wooque 6y ago

You have to use Shopify Billing for shops that installed your app through app store, but you can have Stripe for apps that installed your app directly through your site for example, that's how business I'm working for is doing. Basically if you want Shopify App Store customers, you have to give 20% to Shopify, but you still have option of acquiring users yourself through your site without app store. Is it fair? Maybe not, but that's a deal. Apple users on the other hand don't have option of installing apps without app store, so comparison is not valid.

kevincox 6y ago
This seems pretty reasonable to me. If you don't like the deal you can still target these customers. 20% cut for advertising, billing and other features sounds like a deal that many people would (and do) take. I would be much more bothered by the 20% cut if there was no other way to target these customers.
victorNicollet 6y ago
The Shopify terms state that if your application accesses the Shopify API and is used by two or more merchants, then you have to give 20% to Shopify. Do you have any references on there being an exception for apps not installed through the store ? I would be very interested.
- hermanradtke 6y ago
  You make a private app for each customer.
  - johnbrodie 6y ago
    This has been _specifically_ called out in Shopify's recent emails to partners. If the private apps are essentially all the same, it's considered abusing private apps and they may come down on you at some point. Private apps, in Shopify's eyes, are for something like a consultant whom is building one-off apps for clients, not as a way to avoid the store.
- 6y ago

rbobby 6y ago

* 20% * Holy cow.

airhead969 6y ago
20% of gross is typically 40% of net (since it can't be paid for by anyone else but the merchant) at 100% markup. That's like lending 40% of equity to your electric company. I don't understand why any business would willingly do that other than business ignorance or technical laziness.

BLanen 6y ago

Software has ironically only led to more and more vertical and horizontal integration while evangelists had been predicting the utopian opposite while ignoring the warning signs.

oblio 6y ago
Extremistan, see Black Swan by Taleb.

Erlich_Bachman 6y ago

Well... it's in their terms, isn't it? What is the news here?

airhead969 6y ago

I don't understand the basis of this complaint. They knowingly went around the Shopify rev share by using their own payment gateway. Seems like Shopify called them out for misbehaving. Anyhow: For larger shops, self-host and find a good payment gateway. SaaS that takes a percentage will bleed you dry.

papertokyo 6y ago
For larger shops, the pricing for SaaS platforms like Shopify and friends is less than 0.5% of GMV. If that's too much, the business has bigger problems that certainly won't be solved by self-hosting or maintaining their own homegrown backend.

55555 6y ago

Kinda funny because Shopify pay is powered by Stripe.

hahahahe 6y ago

I still don’t understand why people use Shopify. And on top of that people equate them to being the next Amazon. Boggles my mind.

mehphp 6y ago
Because for all of their faults, it's dead simple to get your on store up and running.
boringg 6y ago
As a merchant (not developer) you own your own clients, your storefront and can run seamlessly IRL and online on Shopify - at least thats the pitch. Shopify doesn't suggest to your clients to go buy from another merchant. In the case of Amazon you own nothing so as a merchant you are thrown into a marketplace where Amazon controls everything and Amazon can take your best products and then make knock offs of them and undercut your sales. Totally different companies - not in the same ball park (Amazon is way bigger then Shopify, don't fall for the false narrative)

umen 6y ago

Why not setup store of your own ? and keep all your profite (minus stripe transaction fee)

Axsuul 6y ago
There's lots of confusion in this thread. OP is not talking about a Shopify store but rather an app they developed that integrates with Shopify stores.

secondo 6y ago

Don’t try to equate Shopify’s app distribution to Apple’s. They’re not the same. Apple charges commission for your paid application regardless of distribution form because there is only one and you have to use it, the AppStore. Shopify has an optional distribution platform for apps which they charge a fee for. You can distribute your app on your own and avoid the fee.

victorNicollet 6y ago
This is absolutely not the wording of the Shopify terms. If your application 1. uses the Shopify API and 2. is sold to more than one Shopify customer, then Shopify takes 20% of your revenue. Presence on the optional distribution platform is not necessary.
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nickjj 6y ago

Some folks have mentioned that this can't be compared to Apple because as a Shopify app creator you have the option to distribute the app on your own platform to avoid the 20% fee. But in an eco-system driven platform I don't think having a choice matters in the end. If users are trained that the best place to install apps is through the app store and there's a huge marketing effort put in place by the app store that you can only trust apps from that store, etc., etc. then it almost doesn't matter if there's an alternative because users immediately associate non-app store apps as being very bad and should be avoided at all costs. I don't use Shopify currently but I imagine the work flow for adding a new app to your store starts with you searching the app store for whatever type of app you want because it's built into the platform. Then you start narrowing down results based on demo videos, features and reviews until you find something you're happy with. Going outside of the app store doesn't even come up because most app types probably have dozens of decent choices on the app store. Even if you decided to Google around most of the top hits will be apps from the app store because Shopify's SEO is very likely going to be better than yours. The only way someone will discover and use your app outside of the app store is you have already have a massive following and trust that you're not a bad actor looking to do something shady by avoiding the app store (because this is what users are trained to think) and your app is leaps and bounds better than anything that exists on the app store so that users are willing to take the risk to go with your non-official app. That doesn't seem like it would happen very often. Does anyone have a wildly successful Shopify app that's not on the app store? To me this feels like an illusion of choice because yes technically you have the option but realistically the outcome is the same as having no option.

smaryjerry 6y ago
That seems to be the case. Even Android allowing apps outside their store to be installed but you have to find 5 more buttons in settings to click to get there causes people to just not do it.

paaaaaaaaaa 6y ago

We (stannp.com) created an app for the shopify marketplace some time ago which helped shops send letters and postcards to their customers. The app would sync recipients with our platform or trigger mail to be posted. The shopify rep said we had to implement their billing API on across our whole platform so they get a 30% (i'm sure it was 30% back then) cut on all transactions. It drove me crazy because I saw mailchip in the marketplace and I'm pretty sure they didn't implement the shopify billing API and give 30% for their subscriptions.

oatmale 6y ago
The official mailchimp app was also removed from the Shopify app store for not complying with the terms. Shopify doesn't care who you are, everyone is on the same terms now.

foxhop 6y ago

I built an alternative for my wife called MakePostSell https://www.makepostsell.com https://www.makepostsell.com Right now it only works for digital downloads but I'm planning to build out shipping and local pickup options for physical goods. Currently in beta but my wife is using the platform in production here: https://shop.printableprompts.com https://shop.printableprompts.com The only payment processor at this time is stripe. My thought is to allow people to bring their own domain, Stripe API keys, PayPal, and S3 bucket or digital Ocean spaces (for files, attachments, thumbnails, preview files, and products. I want to disrupt and keep pricing very competitive for small shops (potentially even a free entry-level plan) Hope this helps you feel less trapped. Click the "New Shop" button to try the beta.

A4ET8a8uTh0 6y ago
Thank you for sharing this. Having looked into it recently, the current pricing for online merchants is just excessive. Unless you are selling an item with a ridiculous margin, it is hard to keep up. And it isn't just Shopify and companies of the same type. Online marketplaces are about as bad in terms of trying to capture bigger slice of the pie. I will keep watching your project.
yarcob 6y ago
Your welcome page doesn't mention VAT, so I am going to assume that you do not handle VAT. This makes your product unsuitable for anyone in Europe. There are other solutions for digital products that take lower commissions, for example FastSpring (would not recommend) or MyCommerce (no experience). They are probably not as sleek as Shopify, but their rates are around 5-9% (depending on how big average orders are), and they handle VAT and invoicing so you don't end up having to pay a lot of back taxes when the authorities audit your business. They are built for selling software, but work just as well for ebooks etc.
- foxhop 6y ago
  Yeah no VAT at this point but seems like a road map item for certain. I don't give tax advice but in the United States each state handles sales tax and economic/physical nexus on digital goods differently. All of these are on my radar for MakePostSell and all online sellers should educate themselves on the rules for their region.

Shadonototro 6y ago

You signed a contract that explitly says you have to use their billing API You choosed their platform, and you agreed with that, so why do you complain now? EDIT: Title should be renamed to: "Shopify asks users to comply with contract they signed when joining the platform"

cush 6y ago
Seriously though. It's proper B2B, not Facebook ads. The fact that the Shopify platform is so customizable that it allows integration of 3p billing says a lot about how they view their customers. Salesforce uses a similar model

rdtwo 6y ago

Shopify billing is such shit that only bots can checkout high demand items. People literally have bots scan all Shopify sites and buy up any In demand item before a real customer can even add it to cart.

aurizon 6y ago

I will never - ever use Shopify again. To extract 20% from a vendor of physical goods is criminal. BTW, I buy zero Apple products either - I will not take part in highway robbery...

Germanika 6y ago
As others have mentioned, this post is about Shopify apps, not Shopify stores. I'd recommend doing a bit more research before deciding to boycott a company. They're absolutely not taking a 20% cut from sales of physical goods, this isn't Uber Eats.
- aurizon 6y ago
  OK, I thought it was like Apple

boris9999 6y ago

How is this a problem? Are all marketplaces bad? Were you forced to sell there? You chose to sell your app on their marketplace and agreed to their TOS and pricing. They provide you with access to their marketplace and you agree to pay them 20%. Were you aware that these are the terms and broke them anyway? It's like an Uber diver who will start charging cash without going through the Uber app to avoid paying Uber. Or maybe start a McDonald's franchise and hide all the profits. Not to mention paying taxes to the government... Apple controls the iOS platform, so it's a different case. Shopify does not prevent you from selling on your own website and taking 100% of the profits.

cush 6y ago

Sounds like you signed a B2B partnership agreement and didn't read it...

boringg 6y ago

If I understand this correctly: this OP partner app (not merchant/store) has been evading the Rev Share agreement with Shopify and is complaining because they got caught and are having to pay back their due? And then they are trying to jump on the furor of Apples 30% rev share agreement to get support from other developers - when the cases are completely different? To me it sounds like this App developer is trying to have their cake and eat it too. FWIW - I am typically on the small developer side of things but this seems like a case of a bad actor trying to couch it in other complaints...

MrTortoise 6y ago
tbh i read it more as yet another example of a platform trying to restrict the rigths of its customers to do every other aspect of their business in the way they choose. I take your point - and its probably true. BUT when I use what is essentially a glorified website builder to build a site they don't get to tell me who i can put my money through or dictate anything about how i run my business beyond hosting and the builder. The reality is that it is even more reasons for a business to not build a business that is dependant upon another in this way.
- boringg 6y ago
  I hear your generic complaint about platforms but in this case the Merchant and actually customers (not third party developer) are the people who should be protected. Partners (third party developers) should have access to provide Merchants much needed services and get paid for that but as I see it Shopify has to regulate what those Partners are doing so that neither their Merchants or Customers are getting taken advantage of. (I.E. avoid any kind of fallout similar to facebooks cambridge analytics level or fraudulent payments). In this case the third party developer was circumventing the user agreement clearly for their own personal gain and potentially putting customer/merchant data at risk, or at the very minimum not willing to pay the terms that they agreed too. At least thats my perspective. In terms of glorified website builder - the level of sophistication on these multi channel e-commerce and IRL platforms, inventory management, taxes etc is actually quite daunting to manage.

kerng 6y ago

This sounds like a phishing mail even, at least the way it's written.

neycoda 6y ago

Kind of hard your tiny text in gray on yellow on a 6" phone screen... HN needs a UI revamp.

colbertpetru 6y ago

They passed the point of no return as soon as they started giving out business loans via Shopify Capital. This backlash against lock-in strategies will continue to dog Shopify.

sergiotapia 6y ago

Are you surprised by this? It's like going on Upwork and offering to charge customers less by direct invoice instead of their Upwork charging service lol come on son

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