I recently came across an article called “The True Cost Of A WooCommerce Store”, posted on wpin.me. In the article, the author discusses hidden costs behind a WooCommerce installation and shows how prices can add up, eventually claiming it costs nearly a thousand dollars for initial licenses and that the renewal costs are extremely expensive. While I appreciate the author’s research, it’s not particularly spot-on and certainly not typical of a WooCommerce installation.
With that in mind, I wanted to give my own response and calculations in favor of WooCommerce – “The TRUE True Cost of a WooCommerce Store”. The name is still a work-in-progress.
Table of Contents
- In the Original Article
- Clarifying the Base WooCommerce Capabilities
- The TRUE True Cost of a WooCommerce Store
- Compared to Alternative Options
- tl;dr (Not really, just read the article)
In the Original Article
In the original article, the following specifications are chosen for the sample site:
- Base WooCommerce ($0 total)
- 2 Premium Payment Methods ($158 total)
- 1 Premium Shipping Method (Table Rate Shipping – as a sidenote, this is by far the most expensive shipping option. $357 total)
- Premium CSV Importer ($556 total)
- Product Add-Ons ($605 total)
- Subscriptions ($804 total)
- Returns and Warranty Requests ($883 total)
- Composite Products ($962 total)
Criticism was also put on the yearly license renewal fee, which is 50% of the original purchase price. While I understand what the article author was trying to achieve in showing worst-case scenarios and costs, it’s not really a fair representation, so I’d like to discuss what went wrong in that write-up.
Clarifying the Base WooCommerce Capabilities
Most of the aforementioned article discussed things you needed to purchase, but didn’t cover what was included – a real shame, since the WooCommerce development team spends a lot of time making sure to fit as much in as is reasonably possible. Here is a list of features, no plugins or extensions included:
- Simple products that can be in multiple formats
- Physical products which require a shipping address
- Virtual products that do not require a shipping address
- Downloadable products that grant access to a file after purchase
- Variable Products which would allow you to have multiple different versions of the same general item – for example, you could create t-shirts and have two variations, color and size. This allows you to add prices, manage stock, and even change shipping costs per variation.
- Grouped Products, which, if you couldn’t guess, allow you to group products together 🙂
- External/Affiliate products to allow you to showcase an item, but let another service actually handle the ordering
- Direct Bank Transfer – You may be selling “high risk” goods which certain payment gateways might not allow, i.e. firearms. This is your go-to, but can also be used to avoid transaction fees.
- Cheque Payment – In case you want to, I guess. Mostly, this is left in for a test payment method, as it moves the order along without having to go through a sandbox.
- Cash on Delivery – Great for the Local Delivery / Local Pickup options.
- PayPal – My favorite, allowing you to accept either transactions from PayPal or users with their credit cards, handled securely. No SSL certificates required.
- Simplify Commerce by Mastercard – Another essentially hands-off option, taking the burden of security from your shoulders.
- Free Shipping (can be conditional, i.e. “Free Shipping with Coupon” or “Free Shipping with orders greater than $50”)
- Flat Rate Shipping to allow either flat rate by order or based off of item quantity (i.e. $2 per item). Can be set per shipping class.
- International Delivery (Allows calculated costs to foreign countries). Again, can be set per shipping class.
- Local Delivery (allows you to specify ZIP codes which can receive this rate). A few different pricing scales here, such as a flat rate or % of cart total.
- Local Pickup (allows you to specify ZIP codes which can receive this rate). Can be set to a fee, left free, or whatever else.
- Allows different tax rates per area and product type
- User accounts & order histories
- Multiple email templates
- Tons of currencies to use
- Customer geolocation
The TRUE True Cost of a WooCommerce Store
Okay, so I guess the name is sticking. Let’s get to it.
I want to first address the list of features chosen by the author – simply put, either the plugin combinations were atypical or simply defaulted to the most expensive option. Table Rate Shipping, for example, is a wonderful plugin – by far our most powerful shipping method, which is why it goes for $199. Most shops don’t need it. The same thing goes for Subscriptions, another $199. Unless you need automated subscriptions, then again you never have to pay that cost.
Behind that idea is the real beauty of WooCommerce – you only pay for what you’ll use, nothing more. We can’t possibly price a WooCommerce installation without knowing what you’re selling, so let’s go over probably the most typical site – a store selling physical goods (candy!), shipping worldwide. We’ll even make it feature-rich to show I’m not trying to skimp.
Necessary Plugins for Our Candy Shop
Before we go any further, I just have to post it. Sorry, guys.
Good to get that out of my system… So, here’s what 50 Cent’s Candy Shop would need:
Since we already have basic features and variables in place (so we can have “Hershey Bar” and a choose-your-flavor “Lollipop”), candy always comes better in a bundle, don’t you think?
For this, we could use Product Bundles or Composite Products. Bundles would allow pre-defined groups, but thinking on the subject, we’d probably want to allow users to make their own gift bundles. “Build-your-own” bundles would be Composite Products – of course, you can make static bundles with that tool, so we only need that.
Running Tab: $79.
I’m a huge fanboy of Product Add-Ons. In my opinion, any store can benefit from it – we could add a field so when you send a gift bundle you leave a note, or tack on additional costs for rush preparation.
Running Tab: $128.
We don’t need subscriptions. As much as a subscription candy delivery sounds like a million dollar idea (I’ll only take a cut of the profit for the suggestion), that’s really an entirely different business model. If our store is doing well then we can always revisit it, but for now let’s assume people order for special occasions or as-needed.
Order Management, Payment, & Shipping
The original article makes it seem that you need to purchase a plugin for returns. Not true! In the new versions of WooCommerce, we have a robust Returns system. Although some people might benefit from a premium return system, the plugin mentioned is not a top seller, so we can assume most shops don’t use it.
Regarding Payment, for some reason the original author wanted four payment methods – two free, two premium. Okay, but that doesn’t really cover – nobody goes out shopping saying they need to buy two options. Instead, let’s shop for what we need.
- Local Pickup will allow users to place orders online and come to the Candy Shop (god, gets me every time) to avoid shipping costs. We can still set a $5 handling fee, though.
- Free Shipping can entice users to buy more – pushing people to a $50 minimum to get free shipping… Like we need motivation to buy more.
- Okay, so we obviously need something to really ship the goods. Instead of opting for Table Rate Shipping, which is complex and complete overkill, why not go with USPS? They’re reliable, and they cover the globe, allowing users to pick different speeds. I’ll even say we want to include the Stamps.com API, which lets us easily print the calculated totals.
Running Tab: $286
For Payment, I don’t know why we’d want four payment methods. More likely, we’d want to keep it simple – payment methods we trust and that don’t require a lot of work. We could absolutely do this with the built-in PayPal and Simplify Commerce, but we want some extra features. PayPal Pro to the rescue.
Note that you could choose an Authorize.net or whatever else – aside from Table Rate, most shipping plugins cost the same.
Running Tab: $365
One thing I haven’t covered is converting an existing store to WooCommerce. This can be expensive, or it can be pretty cheap – it depends on what and how you’re doing it.
The original article author chose Product CSV Import Suite, which is actually not the best plugin for the job. That plugin is more for transferring from one WooCommerce install to another in MASSIVE batches, but there are plugins to convert existing competetor databases for free – after all, WooCommerce does want your business. The one-stop solution here is Cart2Cart, a tidy little service to handle this headache.
Running Tab: $365
With $365 worth of plugins (WITHOUT coupons, see below), at a 50% renewal that’s $182.50 per year, after the first year. This includes constant updates and WooCommerce Support, which is an excellent resource.
They forgot to mention…
I want to level the playing field before my next step – WooCommerce, like other self-hosted solutions, requires a web host and domain. You can run it on cheap $5/month hosting, but I won’t go there… Let’s say you went middle-of-the-road $15/month with a respectable host. That’s above their intro level and should give you more than enough resources to get started – if you have too many visitors for your hosting to handle, then that’s what we call a happy problem and you can upgrade.
You’ll also need a domain – about $10/year. This means hosting is going to cost $190/year.
Running Tab: $545 for the first year, $372.50 per year afterwards.
It’s really worth noting that there are very frequent sales with deep discounts on WooCommerce products – check around WooThemes’ birthday, or Black Friday, or any other major shopping holiday. During installation of WooCommerce, you’re actually given the chance to opt-in to a non-intrusive program for a 20% off discount, so you don’t have to wait for a sale.
Are you guys tired? I kind of am, and numbers are a lot to process… Time for another quick, candy-related musical interlude!
That was fun. Back to it, though!
Compared to Alternative Options
Simply put, WooCommerce blows any other self-hosted solution out of the water. Multiple times over. I’m not lying – check it out:
For that reason, I don’t want to get in to other self-hosted options, as that’s just preference, but the clear trend shows the winner. Instead, let’s compare costs with the biggest hosted solution: Shopify.
I’m not the first to compare the two, and I won’t be the last. What this comes down to is NOT price, but whether or not you want hosted or a self-managed solution. THE BELOW COMPARISON IS ONLY TO SHOW THE COMPETETIVE PRICING OF WOOCOMMERCE WHEN PUT INTO PERSPECTIVE.
I’m using the prices for the Basic plan as of October 5, 2015: https://www.shopify.com/pricing
At $29 per month, the total cost per year is $348. Let’s run the comparison, where each cell is the total cost up to that point from day one.
|Option||Year 1||Year 2||Year 3||Year 4||Year 5|
The price difference at this point is $295 more if you chose WooCommerce. The difference is that WooCommerce doesn’t take a cut of any transaction costs – the basic plan with Shopify takes 2.9% + $0.30 per transaction. That’s where you’ll save your money, and the complete control you have over your site (as opposed to other limitations like a maximum number of products) is where WooCommerce shines.
tl;dr (Not really, just read the article)
Without giving more examples and use-case scenarios, I feel like my point has at least been demonstrated. In the initial article, “The True Cost of a WooCommerce Store”, the numbers were heavily skewed to emphasize a point. While I understand the necessity, I don’t agree with the misleading nature.
WooCommerce CAN be expensive, but no more expensive than a paid or hosted solution at the basic level. If you want premium management, expect to shell out much more – all outside of the cozy, flexible WordPress environment.
When it comes to your online store (and very likely the success of your business), there’s no reason to skimp on costs or shy away from a software purchase. $2000 in a 5 year span is a drop in the bucket for a profitable business – cost at that point becomes irrelevant, and instead, you want to focus on flexibility… And when it comes to flexibility, with 300+ official and hundreds of free third-party extensions, WooCommerce is second to none.
Thanks for sticking with me, and hopefully this helps someone out there!
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