Shopify has been around since 2006 — almost two decades — yet despite its massive success, one part of the platform has seen very little change: Shopify’s out-of-the-box reporting.
For simple net sales, Shopify’s reports are serviceable. But the moment you need to break it down — gross sales, discounts, returns, cancellations — you’re in spreadsheet purgatory. Throw in marketing giveaways or customer make-goods, and you’re left wondering whether anyone at Shopify has ever actually run an e-commerce business.
Here’s the painful journey most e-commerce CEOs and CFOs know all too well…
Early Stage – Trust in the Platform:
In the beginning, you rely on Shopify’s basic dashboard reports. They’re simple, easy to access, and seem to do the job. You look at sales and you assume it’s accurate.
The Realization Phase:
You and your team start to notice inconsistencies around refunds, exchanges, and cancellations. You start to lose confidence in the accuracy of your sales numbers.
Manual Reconciliation Begins:
In an effort to get reliable numbers, you and your finance team start manually dissecting Shopify’s exported reports — adjusting for refunds, exchanges, cancellations, and discounts in spreadsheets. It’s time-consuming, detailed work that pulls focus from higher-value activities.
The Frustration Plateau:
You make do, but confidence in your sales reporting is low. Each month requires tedious reconciliation from your finance team, and it’s clear the current process isn’t going to scale with your business.
The Strategic Shift:
After much pain and suffering, it becomes clear that a scalable solution involving proper data infrastructure, data connectors, and BI reporting is the only way to gain confidence in the numbers. You kick off a significant project to finally give you peace of mind around sales.
For finance professionals, accurate reporting is non-negotiable. Shopify’s reporting gaps mean you’re stuck doing manual work just to piece together an accurate picture of the business. It’s an incredibly complicated and cumbersome process that pulls attention away from all your priorities. Thanks Shopify. Eventually, most companies bite the bullet and end up building out custom data analytics solutions from scratch just so they can get an accurate, real-time read on their most basic sales related KPIs.
How Karlon Group Can Help
At Karlon Group, we specialize in helping e-commerce companies navigate and eventually move beyond Shopify’s reporting limitations. In the early days, we can help you work within the limitations of Shopify reports. When the timing is right, we can guide in the inevitable data infrastructure + data analytics project, so you can take full control of your financial reporting.
About the Author:
Karsten Loose is co-founder and Managing Partner at Karlon Group, a fractional finance and accounting firm that helps companies build, scale, and optimize their finance and accounting functions. Karlon Group works with companies across SaaS, consumer, manufacturing and technology, offering a full suite of finance and accounting support tailored to each client’s changing needs.