When is it time to move to Shopify Plus or BigCommerce Enterprise?
Shopify and BigCommerce both offer a range of plans starting around $30 per month and moving up to $300 per month. From there, Shopify's enterprise offering, Shopify Plus, starts at a whopping $2000 per month, based on revenue. BigCommerce's pricing is based on order volume and also runs north of $1000 per month as a minimum starting price. With such a large gap in pricing, how do you know when your small company is becoming big enough that it's time to upgrade?
Shopify and BigCommerce together control a vast amount of small and mid-market online e-commerce. They are useful direct-to-consumer platforms because they make it as easy and as relatively inexpensive as possible to set up a unique, secure, and powerful online store. In fact, their platforms scale so well that they also both have enterprise-grade plans for hosting websites that are doing lots of sales.
I've been working on a pitch this week for a client that makes around $1 million in annual sales. To date, this company has been managing to run their store on a small WordPress installation, equipped with WooCommerce. They recognize that to continue scaling they need a platform that's built for e-commerce, but they're also looking at monthly expenses tripling, or worse, if they upgrade to Shopify Plus or BigCommerce Enterprise. I realized this is likely a predicament many growing businesses face as they look to bridge the divide between startup products and enterprise-grade platforms. When is the right time to make the upgrade?
Well, there's not a simple universal answer, and to begin with, it depends whether you're using BigCommerce or Shopify. Let's break down the reasons why.
BigCommerce is quite straightforward because, unlike Shopify, most features are available to most plans. There are some exceptions, of course, but all-in-all BigCommerce's feature gates are far less likely to result in pushing you to upgrade than Shopify's.
Instead, BigCommerce forces upgrades by adding a surcharge for excess sales volume. In effect, BigCommerce merchants are penalized for having too many sales or too much revenue. BigCommerce is a solid platform, but this is a significant drawback that I need to bring up and caveat each time I recommend this platform, especially for fast-growing brands that might find unpredictable bills as their revenue increases. (On the other hand, BigCommerce does not charge a per-transaction fee, which may be appealing to some companies. Credit card processing fees, of course, will still apply, but those are billed by your processor, not by BigCommerce.)
BigCommerce's largest non-enterprise plan, Pro, goes for $299.99 per month, and includes revenue of up to $400k per year. The previous plan, Plus, goes for $70 per year and works for up to $180k in annual revenue. That means that once you hit $181k you'll need to upgrade to Pro. But where can you go from Pro? Well, you have two options once you hit $401k per year: You can either pay an additional $150 per month per $200k of annual sales or you can upgrade to BigCommerce Enterprise. (In contrast to Shopify, BigCommerce will rarely require you to upgrade to enterprise on the basis of features alone, so this is purely a math equation.)
While Shopify Plus starts at $2000 per month, BigCommerce Enterprise starts significantly cheaper than that. The exact starting figure is confidential and based on a complex formula that takes number of orders (not necessarily revenue) into account. That means that, depending on your order volume when you max out Pro, Enterprise may be significantly cheaper as an upgrade path for your store.
What I recommend is once you've surpassed the $400k cap, it's worth getting a custom quote for Enterprise. At that point, you can compare that to what you would be forced to pay by staying on Pro and paying for revenue overages, and make an informed decision. By the time you hit $1 million in revenue, it will most likely make mathematical sense to make the upgrade.
Shopify's pricing structure is significantly different than BigCommerce. Shopify allows unlimited sales volume on any of its plans, so you could in theory use the Basic plan for $30 per month and manage $1 million per year in revenue. Of course, that scenario is highly unlikely; just because you can do that doesn't mean you should.
Shopify's plans have significant feature differentiation. You'll need to upgrade your Shopify plan when you outgrow the featureset of your current plan. For example, you may find that you need additional staff accounts, additional inventory locations, or abandoned cart recovery emails. Whereas BigCommerce requires a plan upgrade at specific revenue milestones, Shopify allows you to determine when you'd like to upgrade access the additional features and functionality. Depending on your cost of goods sold and your feature requirements, it's possible one platform or the other makes significantly more sense for your business on this basis.
It's important to note that, unlike BigCommerce, Shopify charges a transaction fee on every sale you run through its platform. The fee varies depending on which plan you use. If you talk to anyone at BigCommerce, they'll surely remind you that this fee can add up quickly and be significantly higher even if they force a plan upgrade. There's one very big asterisk here though: Transaction fees are waived if you process payments with Shopify Payments. If that payment processor works for your business, it's often a very significant point in favor of Shopify.
But this article isn't about comparing Shopify to BigCommerce, but rather about comparing each of their startup plans to their own respective enterprise offerings.
Shopify Plus has significant feature differentiation to other plans, including major features like Shopify Audiences, Shopify Scripts, expansion stores, and more. Some significant apps, such as Avalara and Flow.io, only work on Shopify Plus. And if you want to modify your checkout and thank you pages, you'll need Plus.
That means that when you find you need one of these features, you'll need to analyze your business to determine if Shopify is still the best platform for your business when factoring in the required upgrade to Plus.
Generally speaking, $1 million in revenue is a good time to take stock in these features and determine if an upgrade to Shopify Plus would be worthwhile for your business. By the time you start to push past $1 million in sales, you're probably at the point where you would significantly benefit from the added features in Plus. In fact, Plus' additional features (including several automation features) may even provide a positive return on investment, not merely a quality-of-life improvement.
It is significantly more expensive, but that investment in your business will enable you to scale with new features and help your business to keep growing.
Empower Ideas is an independent agency that is a partner of BigCommerce, Shopify, and other platform. Our recommendations are made in your best interest, not because one is the only thing we offer. If you need help sorting through your platform or plan, reach out today!