You could say Shopify is the go-to online store platform for retailers, while Square is the jack-of-all-trades platform for small businesses with an emphasis on payments. It’s not so simple, though.

Shopify has always focused on ecommerce, but has a point of sale (POS) system. Square started with the world’s first mobile card reader with an app, then added more payment channels like ecommerce.

Both giants, which platform should you choose? Depending on what you need the most, the answer could be easy – here are the key differences to consider.

Square Shopify
Primary product Payment tools, card readers, POS systems Online store platform
Card machines App-based, standalone App-based
POS systems General, Retail, Hospitality, Services Retail
Online store builder
Payment systems Square Payments (built in) Shopify Payments (built in), external payment gateways
Remote payments Online checkout, e-invoices, virtual terminal, payment links, QR codes, recurring payments Online checkout, e-invoices, virtual terminal
Payouts 0-2 working days Up to 6 working days with Shopify Payments
Square Shopify
Primary product Payment tools, card readers, POS systems Online store platform
Card machines App-based, standalone App-based
POS systems General, Retail, Hospitality, Services Retail
Online store builder
Payment systems Square Payments (built in) Shopify Payments (built in), external payment gateways
Remote payments Online checkout, e-invoices, virtual terminal, payment links, QR codes, recurring payments Online checkout, e-invoices, virtual terminal
Payouts 0-2 working days Up to 6 working days (Shopify Payments)

Subscription costs

Some similarities exist between Shopify and Square pricing, but Shopify’s USD-priced subscriptions are decidedly more expensive.

Shopify is primarily an online store platform, so you must subscribe to a paid ecommerce plan. Longer subscriptions are cheaper when calculated on a per-month basis, but they’re all paid for upfront which can be large sums of money paid annually, every other year or every three years.

The cheapest subscription is Shopify Lite (US$9/month paid monthly), but this only includes Buy Buttons, invoicing and the Shopify POS app. Online store plans start at US$29/month on a monthly plan (Basic Shopify) with a general set of online store features. The medium plan, called Shopify, is US$79 per month whereas Advanced Shopify is $299 per month (monthly plans). VAT is added on top of these prices.

The Shopify POS app can be used on all these plans for free – but only the Shopify POS Lite features. The full range of Shopify POS features costs US$89 per month per location in addition to the ecommerce subscription.

Square Shopify
Lock-in None None
Card machines Reader: £16*
Terminal: £149*
Register: £599*
WisePad 3: £49*
Ecommerce plans £0-£60*/mo US$9-$299*/mo
POS software £0-£69*/mo US$0-$89*/mo + ecommerce plan
Online & keyed transactions Online, links, QR code: 1.9% (European cards)
2.9% (non-European cards)
Invoice, keyed, virtual terminal: 2.5%
Shopify Payments: 1.6%-2.2% + 20p
External gateway: 0.5%-2% Shopify fee + card processor fees
Card reader payments 1.75% 1.5%-1.7%
Payouts Free, 1% for instant Free (Shopify Payments)
Refunds Free Shopify keeps original transaction fees
Chargebacks Free £10
Currency conversion n/a 2%
Trial

*Excluding VAT.

Square Shopify
Lock-in None None
Card machines Reader: £16*
Terminal: £149*
Register: £599*
WisePad 3: £49*
Ecommerce plans £0-£60*/mo US$9-$299*/mo
POS software £0-£69*/mo US$0-$89*/mo + ecommerce plan
Online & keyed transactions Online, links, QR code: 1.9% (European cards)
2.9% (non-European cards)
Invoice, keyed, virtual terminal: 2.5%
Shopify Payments: 1.6%-2.2% + 20p
External gateway: 0.5%-2% Shopify fee + card processor fees
Card reader payments 1.75% 1.5%-1.7%
Payouts Free, 1% for instant Free (Shopify Payments)
Refunds Free Shopify keeps original transaction fees
Chargebacks Free £10
Currency conversion n/a 2%
Trial

*Excluding VAT.

With Square, there is no requirement to subscribe to ecommerce to use a POS system, or vice versa. In fact, most Square software is available as a free service, with options to upgrade to paid plans for more features.

Square has a selection of products with different costs, though, but we’ll keep it simple by focusing on the ecommerce and point of sale systems.

Square Online is the online store builder. Apart from the free plan with basic online store features, there’s a Professional subscription for £12 monthly, Performance for £22 monthly and Premium for £60 per month (all excluding VAT). On an annual plan, you pay for a year upfront which works out cheaper per month.

Square has a selection of POS apps for the different industries: Square for Retail (free or £49 + VAT monthly plan), Square for Restaurants (free or £69 + VAT monthly plan) or Square Appointments (free for one user, paid plans for more).

Square has other features that may incur a monthly cost (if they’re not free). For example, advanced employee permissions for the point of sale have a monthly fee of £20 + VAT/month per location, though basic permissions are free of charge.

Shopify offers many additional apps at a cost, but most of them are developed by other companies with their own fees.

ecommerce platform UK

Commitment and cancelling a subscription

Neither of the platforms require a contract lock-in for their packages, but you cannot get a refund for subscriptions.

This is mostly an issue with an annual ecommerce plan (and the 2- or 3-year plans of Shopify) because it’s a large, non-refundable sum of money you’re paying in advance of using the online store. So even though you can cancel any time, you can’t decide to get your money back with a change of heart later.

To cancel a Shopify subscription, you have to contact support in advance of the subscription auto-renewal. The support team will then do it for you, after which your online store is inaccessible.

In contrast, Square allows you to cancel any subscription any time in your account without having to contact support. All the many free features and saved changes will still be accessible in the account thereafter.

Transaction fees: simple versus complex

Then we have transaction fees, where high-volume merchants will see some clear differences.

Online transactions through a Square website, QR code or payment link cost a fixed 1.9% per transaction with a UK/EEA card or 2.9% if the payer’s card is non-European. Only on Square Online Premium does the transaction fee for UK/EEA cards reduce to 1.75% through your online store – other cards remain at 2.9%.

Virtual terminal, keyed or invoiced transactions cost a fixed 2.5% no matter the card.

Shopify has tiered rates: 2.2% + 20p on Basic Shopify, 1.9% + 20p on Shopify or 1.6% + 20p on Advanced Shopify for any card transaction online. This applies to email invoices and virtual terminal payments as well.

Only Shopify allows you to use another online payment gateway, but for an additional fee: 2% on Basic Shopify, 1% on Shopify or 0.5% on Advanced Shopify. This is added to your external card processing fees per transaction. It’s like a penalty fee for using a different processor, but Shopify calls it a “transaction fee”.

Shopify also adds a 2% currency conversion rate on all transactions paid with a foreign-currency card, which could make a big difference to cross-border retailers. Square has no such fee.

Card reader payments are a fixed 1.75% through Square Reader, Square Terminal or Square Register. Shopify charges 1.5%-1.7% for card reader transactions depending on the subscription tier.

Given the fact that 20% or so online purchases end up being refunded, Shopify’s refund cost could eat into your margins, particularly when transaction values are high.

Overall, the discounted rates on the higher Shopify plans do not make a big difference for businesses transacting only a few thousand pounds a month.

But the rates between Square and Shopify make a clear difference when it comes to refunds: Square charges nothing, while Shopify charges the original transaction fees (both the percentage and fixed fee) for every refund processed.

Given the fact that 20% or so online purchases end up being refunded, this could eat into your margins, particularly when transaction values are high.

On top of this, Shopify charges £10 per chargeback, refunded if you successfully resolve the customer dispute. Square does not have a chargeback fee.

With Shopify Payments, you have to wait up to 6 working days to receive funds from online sales in your bank account. With Square, transactions typically settle in your bank account the next working day, but you can choose instant payouts for 1% added to transactions.

Online store builder: basic versus mature

If you only looked at the website builders, Shopify would win hands down.

It is simply the most advanced online store builder with lots of functions to grow any retailer with either Shopify’s built-in features or the 6800+ apps you can add. While user-friendly enough for a lay person, it also allows developers and web designers to implement their own code.

With Square Online, you also get an online store builder, but only a few templates (one for retailers, another for food and drink) with basic customisations for creating a site with no prior experience. Integrations for accounting, inventory and more are available, but they don’t expand on the functions of the website editor itself.

Image: Mobile Transaction

Shopify

Paid and free Shopify templates.

All of Shopify’s website plans require a subscription, but then you get enough features to start a professional web store even on Basic Shopify. A Shopify website is equipped to handle many products linked to different stock locations (if needed).

Although some themes are free, the best cost up to $350 + VAT. The premium themes you pay for generally have more customisation options in the website builder, whereas free designs are less flexible. In other words, Shopify doesn’t give you the same design settings across all themes.

Image: Square

Square Online store editor hasn’t got many customisation options.

You can build a free online store with Square if you can live with the footer and free URL containing Square’s branding. Suffice to say, a subscription is better for serious stores, particularly as many features are missing on the free and cheaper plans.

But Square Online is perfect for a single online ordering page (free of charge) for delivery, collection and shipped orders.

In-person payments at a point of sale

Those who only do business face to face should go for Square with its industry-tailored POS systems. There’s no value in using Shopify POS unless you’re actively using the mandatory ecommerce subscription that has to be paid for.

Shopify POS is designed to benefit online retailers who need a till that cleverly works together with the online store for a unified sales experience.

This synergy is very valuable in today’s retail environment, for example when customers purchase something online and want to exchange it in person or need to collect it in store. To fully benefit from this, the monthly cost of Shopify POS Pro is necessary.

Shopify POS works on Android devices, iPad and iPhone.

Square, on the other hand, lets you use its general (Square Point of Sale), hospitality (Square for Restaurants), retail (Square for Retail) and service (Square Appointments) POS software independently from other sales channels if preferred.

They all have free versions and there are paid subscriptions for all but the general POS system. This allows you to choose a system designed for your sector, with options to mix and match with other Square tools in your account.

What about hardware? While Shopify POS, Square Point of Sale and Square Appointments work on Android, iPhone and iPad, the restaurant and retail apps are made for iPad or Square Register.

Square for Restaurants hardware

‘Restaurants’ till system on Square hardware.

Both Shopify and Square sell their own card readers that connect to its apps, but Square also offers Square Terminal and Square Register with POS software built in.

Cash drawers, receipt printers and barcode scanners can connect with either provider, but Shopify is not built for hospitality and therefore won’t work with a kitchen printer. In other words, there’s more choice with Square.

Payment system and remote payments

Square and Shopify come with their own card processing system built in, but only Shopify allows you to use an alternative payment system.

All of Square’s POS and online features use Square Payments. For this reason, you should not choose Square if you want another payment processor in your online store or brick-and-mortar shop. You can add PayPal as a payment method on the Performance plan, but not other options.

Image: Square

Square Online Checkout page

Square online checkout page via a payment link.

Shopify Payments is Shopify’s default payment system, but you can use another online payment gateway with an added fee per transaction accepted, for example Klarna, Braintree or Stripe. This provides more flexibility, but the cost prohibits merchants on a budget to choose something with lower rates.

Apart from its online checkout, Shopify has a basic virtual terminal labeled “Draft Order”. As suggested by the name, it’s best for creating orders on behalf of the customer. In contrast, Square Virtual Terminal is a very versatile solution designed for Mail Order/Telephone Order (MOTO) payments.

Email invoices can be sent through Shopify, but again, Square Invoices comes with more features including a dedicated app.

Payment links and QR codes for touch-free ordering can only be generated and sent via Square – just pay a transaction fee.

Does Shopify work with Square?

Does Shopify integrate with Square (or vice versa)? Yes and no.

Several inventory syncing platforms can connect your Shopify inventory with Square inventory, such as Square Sync (Shopify App Store) and Finale Inventory (Square App Marketplace). This means you can use Shopify for your online store and Square for your till and keep stock synced.

What about using Square as your online store and Shopify as your till system? Well, Shopify POS is only worth it when connected to a Shopify online store.

You could use Shopify for ecommerce and Square only for its free tools like payment links and invoicing, but then transactions won’t be processed by the same payment system.

Square integrates with several big ecommerce platforms such as Wix and WooCommerce, so you could also choose to bypass Shopify completely.

Image: Shopify

Shopify website chat statistics

With Shopify, you can integrate various customer chats in your online store.

Customer service and reviews

Shopify offers 24/7 phone, email and chat support for all its subscribers.

This is much more than Square’s regular support hours between 9am and 5pm on weekdays only. Paid subscribers to Square for Restaurants, however, do get round-the-clock phone support – essential for bars and restaurants operating nights and weekends.

What about reviews? They’re a mixed bag. Like most payment platforms, both get a fair amount of complaints from users about poor customer support and frozen payments (relatively common issue for payment services).

Reaching a real team member from Square is a challenge, as you’re encouraged to find answers through the online help section or submit a message. Shopify is not much better, even on the higher plans.

Some users complain they pay more in Shopify fees and chargebacks than what they earn through the online store. Square’s lower price point means this isn’t an issue, but the downside is that Square’s POS or ecommerce software is too simple for some users.

Verdict: Shopify for online retail, Square for all-round value

There’s lots to love about Square’s all-round features that work for most small businesses, whereas retailers would thrive with Shopify’s optimised features built to convert more customers online.

Shopify is built for retail – you see this with its features catering to large product inventories, not services. Only Square has specific solutions for food and drink, beauty or other professional services.

Square does provide an easy entry point into ecommerce, but you’ll struggle with its online store limitations beyond a few hundred items in your inventory. Developers and designers will also struggle to customise a Square site, but its templates are modern and crisp. The amount of customisations available with Shopify, on the other hand, far surpasses Square’s.

Brick-and-mortar shops usually prefer Square for its easy, efficient POS systems, card readers and simple pricing, but Shopify does allow integrations with major POS systems other than its own pricey version.

Square

Best for: Any small business that wants the widest range of tools on the same payments platform

Sign up free with Square

Shopify

Best for: Any size retailer that needs an expandable, but user-friendly, online store

Try Shopify’s 14-day free trial