SHOPIFY CASE[1]

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Seneca College *

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724

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Business

Date

Feb 20, 2024

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docx

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3

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Shopify has been successful in establishing itself as a world-renowned ecommerce company that provides a platform for people to start their own online store and connect with customers to advertise and sell their products. In today’s globalized world, technological innovation has played a vital role in the success of ecommerce platforms. Shopify's dedication to innovation and adaptation has enabled them to successfully meet the wide range of demands of international markets, giving merchants the confidence to grow their businesses abroad. Its platform and business approach have continuously changed to meet the various demands of international markets. Some of the way Shopify did adapt are: 1. Localization : Shopify provides businesses with the ability to customize their online stores for various markets with its localization options such as tax calculations, currency options, localized checkout processes, support for multiple currencies and multiple language functionality. 2. International Shipping and Delivery : To make foreign shipping procedures for businesses easier, Shopify has connected with several reliable and cost-effective shipping agents and fulfillment partners to provide seamless international shipping processes for merchants. 3. Multiple Payment Method : To accommodate a large variety of payment methods that are preferred in various geographic locations, Shopify has partnered with multiple payment gateways to ease and facilitate payments in different currencies. 4. Regulatory Compliance: Shopify offers advice and resources to help merchants comply with local laws pertaining to taxes, data protection, and other regulatory requirements, thereby assisting them in negotiating the complexities of foreign legislation. 5. Customer Service : Shopify provide multilingual customer service support to assist merchants from different regions. Shopify is an available global platform, that welcomes both well-established companies to newly emerging ones. Signing up is so simple and only requires an email address, with a three-day free trial granted. This allows users to familiarize themselves with a platform’s operations to decide whether to subscribe or not. Whereas Amazon provides separate platforms for various countries and is more complex to use, which offers separate platforms for different regions. Amazon deducts 30% from each sale of a merchant, and as a result, merchant profit margins are very low
(Molson, 2023) . Merchants cannot just raise the price on Amazon as it needs to maintain consistency across every platform; if not, Amazon may suspend and deactivate their listings. On the other hand, Shopify requires merchants to purchase price plans they are as the basic plan from which merchants receive a 2.9% + 30c USD deduction from each online transaction, Shopify plan in which 2.6% +30c USD is deducted on every transaction which isn’t much as the platform they offer are globally large with a lot of customers (Shafiee, 2023) . Every business wants to foster strong connections with its clients, and Shopify figures out the limitations of the global platform and takes care of the problems. And enables businesses to establish direct relationships with customers where they can learn about their preferences and tastes on a personal level. Furthermore, Shopify distinguishes itself with a wide variety of customizations, which allows each outlet to have a different look. Along with-it Shopify provides extensive customization design, from which every storefront looks different, and the customer can experience its uniqueness. As opposed to this, Amazon and eBay limit the uniqueness of a company by restricting the layout of outlets on their platform. With this crucial difference, Shopify can set itself apart and expand under massive platforms like Amazon and eBay thanks to the significant differences. Customers are being more aware about the environmental laws/regulations and ethical code of conduct in running a business. In this scenario, Shopify has extended their efforts in conducting their ecommerce chain with sustainable and ethical standards that works towards wellbeing of the society and the planet in long run. Shopify claims to have 100% carbon free operations, they have invested in renewable energy projects and even get carbon credits to account for the damage it causes to the planet. (Kantariya, 2023). Moreover, Shopify promotes green packaging with the use of recyclable materials and has partnered with other green shipping companies to reduce carbon emissions. There is also a tool called Shopify planet app that calculates the emissions from each shipping and counters it by donating to environment friendly projects. Shopify’s approach of Print on Demand (POD) allows suppliers to manufacture products after receiving orders by minimizing overproduction and wastage. Shopify has always encouraged transparency in its supply chain so that the customers can get a clear picture of procuring, storing, marketing, and distributing products in the e-commerce chain. They emphasize fair trade practices and complying with labor laws of countries where they conduct business. It is vital for
them to partner up with ethical suppliers who give priority to sustainability and use ecofriendly practices in their supply chain. (Adnan, 2023). Sustainability and ethical e-commerce have been engraved in the core values of the company which has helped them to establish cordial environment in different countries along with respect towards their regulatory and ethical practices by giving utmost priority to environmental protection. Shopify conducts PESTEL analysis of the market they’re willing to extend their markets in and specifically focuses on social, technological, legal, and environmental factors of the region to comply with the regulatory laws and conduct a sustainable business. Investing in sustainable practices is an opportunity for Shopify to create a more powerful customer base who support similar causes. And it is mandatory for them to study laws/practices of other nations as changes in taxation, trade or environmental laws could be a huge threat for them to conduct their global business. References Shafiee, F. (n.d.). Does Shopify Take a Percentage of Sales? Popupsmart. Retrieved from: https://popupsmart.com/blog/does-shopify-take-a-percentage-of-sales Molson, J. (n.d.). John Molson MBA International Case Competition. Retrieved from: https://mbacasecomp.com/wp-content/uploads/2023/01/FINAL-CASE-7-Shopify.pdf Kantariya, P. (2023, December 26). How to Create a Sustainable eCommerce Business with Shopify . Cirkle Studio. Retrieved from: https://www.cirklestudio.co/blog/sustainable- ecommerce-business/ Adnan. (2023, December 19). A Guide to Responsible Business Practices on Shopify. Simple Author Box Pro. Retrieved from: https://wpauthorbox.com/print-on-demand-and- ethical-sourcing-a-guide-to-responsible-business-practices-on-shopify
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