Impact of Price Change on Shopify.

On Marketcube, Operators are the owners of an order however, Vendors are the owners of products . Therefore, only vendors can update or change product prices. This article explains what happens if Operators update prices of a product on their store.

Any change made in product price by the vendor will pass through to the Operator and their store (depending upon operator product approval setting, if the operator has auto-accept changes enabled, changes made by the vendor will automatically get updated in the operators' store). As mentioned, operators cannot update the product price but they can add a markup or discount in product prices as part of our pricing management. 
Sometimes operators update the product price on Shopify however since operators are not the owner of the product this change will be reflected on Marketcube as a markup (if the price is increased) or discount (if the price is decreased).

Let's understand impact of markup using an example.

Vendor, 'Ralph Lauren' added a product Polo T-shirt at $100.
This price was reflected in the Operator's store (as shown below).shop

Operator, 'Men's Online Fashion' wanted to update the product price from $100 to $150 so they made this change on Shopify (as shown below).
price-4

  • And this change led to a change of price for this product on the operator's store. All customers will now buy the product at $150.sh
  • Let's see what happens when an order is placed for this Product.
    price-Jul-29-2021-12-37-26-35-PM

  • The customer paid $150
  • In Marketcube the order price reflects as $100.
  • Commission calculation will be taken from the original price of the product added by vendor so $100 will be the price of the product for commission calculation.
  • The Operator will keep $50 (as a markup which will be the operators to keep) and the vendor will get the remaining payment after deducting the commission
    (so for example. if commission is set to be 10%:
    The operator will take  $10 (Commission- 10% of $100) + $50 (Markup- $150 - $100)  hence a total of $60.
    The vendor will take $90 (Total Price of Product- $150 - Commission and Mark up  $60 hence a total of $90.
    com
  • However if the operator is not charging any commission on this product the vendor will receive $100. Whilst the operator keeps the $50 markup. Below is a screenshot of the invoice if the operator had no commission set up. 
    comm

                                                                                                                                                                             

Similarly, if an operator lowers a product price, this will be reflected as a discount and will not have any impact on the vendor's payout as the vendor payout will be based on the original price of the product.

Let's understand the impact of discounts using an example:

  • Vendor, 'Ralph Lauren' added a product Polo T-shirt at $100.
This price was reflected in the Operator's store (as shown below).
shop
  • Operator, 'Men's Online Fashion' wanted to update the product price from $100 to $50 so they made this change on Shopify (as shown below).
pay-1
  • And this change led to a change of price for this product on the operator's store. All customers will now buy the product at $50.

dis-2

  • Let's see what happens when an order is placed for this Product.

cust

  • The customer paid $50
  • In Marketcube the order price reflects as $100.
  • Commission calculation will be taken from the original price of the product added by the vendor so $100 will be the price of the product for commission calculation.
  • The Operator will have to bear the discount provided by him as he updated the price from $100 to $50  and the vendor will get the payment  after deducting the commission on the actual price of the product
    (so for example. if the commission is set to be 10%:
    The operator will take  $10 (Commission- 10% of $100) 
    and will pay the vendor $100-$10= $90 because this discount was provided by the operator to his end-users and it will not have any impact on vendor payouts.
    disc

                                                                                                                                                                 
Got more questions? Use the chat on your right or email support@marketcube.io to get in touch