Shopify vs. Square

By Skye Schooley,
business.com writer
| Updated
Aug 20, 2020
Image Credit: alexialex/Getty Images
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Learn the differences between Shopify and Square to determine which one is best for your business.

  • Shopify and Square offer competitive point-of-sale systems, complete with software, hardware and credit card processors.
  • Shopify offers customers flexibility in choosing hardware, credit card processors and integrations. It is a great choice for businesses whose revenue comes from e-commerce sales.
  • Square offers reasonably priced POS software, hardware and transaction fees. It can perform all the functions an entrepreneur or small business needs from a POS solution. Square is a great, affordable choice for businesses whose revenue comes from in-store sales. 

point-of-sale (POS) system is a combination of hardware and software used to complete sales transactions. But that's not all that POS systems do. They also store customer contact information, organize your sales data, and provide insightful metrics about how your business is doing. 

There are hundreds of POS systems that are available. And though the best POS system for your business depends on your needs and budget, two competitive POS systems that are often compared with each other are Shopify and Square

If you're stumped over whether you should go with Shopify or Square, we can help. We've examined both POS systems, including what each company offers, their costs (including their processing rates), features and their limitations. Here's what we found, which, hopefully, makes your decision easier.

 

Editor's note: Looking for the right POS system for your business? Fill out the below questionnaire to have our vendor partners contact you about your needs.

 

 

Shopify vs. Square POS Software: Pricing and plans

Shopify charges a flat monthly fee, plus card processing fees for each transaction. Here are the rates for each plan. 

Basic Shopify

  • Cost: $29 per month, plus 2.9% and 30 cents for each online credit card transaction. In-person credit card transactions are charged 2.7%. If you choose to use a payment provider other than Shopify Payments, you pay a 2% fee for each transaction.

  • What it includes: Unlimited devices, online store integration, two staff accounts, manual order creation, discount codes, SSL certificate, abandoned cart recovery and fraud prevention.

  • Best for: A brand new business.

Shopify

  • Cost: $79 per month, plus 2.6% and 30 cents for each online credit card transaction. In-person credit card transactions are charged 2.5%. If you use a payment provider other than Shopify Payments, you pay a 1% fee.

  • What it includes: Everything in Basic Shopify, plus five staff accounts, gift cards and professional reports.

  • Best for: A small or growing business.

Advanced Shopify

  • Cost$299 per month, plus 2.4% and 30 cents for each online credit card transaction. Each in-person credit card transaction is charged 2.4%. If you choose to use a payment provider other than Shopify Payments, you pay a 0.5%.

  • What it includes: Everything in Shopify, plus 15 staff accounts, advanced report building and third-party calculated shipping rates.

  • Best for: A larger business needing advanced features .

Shopify's fees, contracts and discounts

  • Fees: Shopify does not charge setup or bandwidth fees.

  • Additional plans: Shopify offers a basic plan for online transactions (Shopify Lite for $9 per month) and an enterprise-level plan for large businesses (Shopify Plus with customized pricing).

  • Contracts: Shopify offers a 14-day free trial. Plans are offered on a month-to-month basis – you can cancel at any time, or upgrade or downgrade as needed.

  • Discounts: Discounts are available (10% on annual plans and 20% on biennial plans) if you pay upfront.

Square does not charge a monthly fee for its basic POS software; there is, however, a monthly fee for the Square for Retail and Square for Restaurants plans. 

Square

  • Cost: $0 per month, plus 2.6% and 10 cents for each credit card transaction.

  • What it includes: Unlimited devices, inventory tracking, reporting and analytics, invoicing and fraud prevention.

  • Best for: Small and growing businesses.

Square for Retail

  • Cost: $60 per month (one POS per location), plus 2.5% and 10 cents per credit card transaction. Additional points of sale cost $20 per month.

  • What it includes: Online and in-store sales, scan and search capabilities, customer management, inventory tracking, employee management, third-party integration, and real-time reporting and analytics.

  • Best for: Businesses that need advanced retail features.

Square for Restaurants

  • Cost: $60 per month (one POS per location), plus 2.6% and 10 cents per credit card transaction. Additional points of sale cost $40 per month.

  • What it includes: Custom floor plans, menus by daypart, order entry and inventory tracking, employee management, multiple location management, discounts, real-time sales and shift reports, and third-party integrations.

  • Best for: Businesses needing advanced restaurant features.

Square's fees and contracts

  • Fees: Square does not charge setup, annual, monthly, PCI compliance or chargeback fees for its standard POS software plan. Customized rates are available for some businesses that have an average ticket size of more than $15 and process more than $250,000 in card sales.

  • Contracts: Square offers a 30-day free trial. You're not required to sign a long-term contract, and you can cancel at any time without incurring early termination fees.

POS Hardware: Peripherals, custom kits and bundles

In addition to POS software, Shopify and Square sell hardware, which you can buy as individual components or as kits and bundles. 

Shopify POS hardware

From Shopify, you can purchase card readers ($29-$49), iPad stands ($119-$169), barcode scanners ($229-$329), label printers ($119-$149), receipt printers ($289-$359), receipt paper and mPOP receipt printer rolls ($29-$89), cash drawers ($119-$399), shipping labels and printers ($25-$279), and shipping scales ($39-$79). 

Retailers can purchase the Shopify Retail Kit for $180, which includes a tap and chip card reader, card reader dock, iPad stand, mounting kit and mini dock cable. The Shopify Retail Kit is only compatible with U.S.-based stores that operate with Shopify Payments card processing. The iPad stand is compatible with (but does not include) an iPad 6th generation, iPad 5th generation, iPad Pro (9.7 inches), iPad Air 2 and iPad Air. Shopify has a 30-day return policy on its hardware. 

There is also the Shopify Custom Kit. You can choose from a wide selection of Shopify hardware, and prices start at $589 per kit. Each kit comes with one iPad stand (iPad not included), a cash drawer, receipt printer and card reader. (Multiple selections are available for each item.) The Shopify Custom Kit is only compatible with U.S.-based stores that operate with Shopify Payments card processing. 

Shopify offers mPOP bundles that start at $439 and go up to $549 – these bundles are recommended for merchants who need a smaller or portable POS system. 

Square POS hardware

Square, too, sells peripherals and kits. You can purchase countertop hardware like the Square Register ($799 each or $39/month for 24 months), the Square Stand ($199 each or $18/month for 12 months) and the Square Terminal ($299 each or $27/month for 12 months). A Square Reader for contactless and chip transactions costs $49, and the Square Reader for magstripe transactions is $10, though Square gives you the first reader free. Square has a 30-day return policy, too, on its hardware.

Square offers custom kits for businesses in the food and beverage, beauty and wellness, and retail industries. For brick-and-mortar stores, kits start at $555 and range in price up to $1,329; for mobile businesses, prices range from $526 to $625. 

Shopify vs. Square payment processing

Square and Shopify are similar in their payment processing capabilities – each one acts as its own credit card processor. Square customers, though, can only use Square as their credit card processor. Shopify POS software users can use Shopify Payments or partner with an external merchant (additional fees apply). 

Both companies accept all major credit cards and contactless payments, and both work offline in the event of an internet outage (though Shopify can only process cash and custom payments offline, not card payments). 

Shopify vs. Square POS features

With Shopify and Square, you get a plethora of really useful features – mobile apps, detailed reporting and analytical tools, and third-party integration capabilities. A lot of these features are very similar, with some slight differences. 

Mobile applications

Shopify and Square both offer mobile POS applications that run on iOS and Android devices. Both have user-friendly mobile dashboards, inventory management features, customer contact access and sync your data. Square includes the mobile app in its free version, whereas you pay a subscription for Shopify. 

Reporting and analytics

Shopify's user-friendly dashboard lets you view orders and sales, traffic data, even which products are the most popular all in real time. Retail reports detail the location and time of each sale, the customer, and which employees made the sale. Shopify tends to offer more detailed reporting. With Advanced Shopify, you can customize reports to get even more specific data. Square has an intuitive dashboard, too; you can view sales, customer analytics and business trends in real time. Square's free plan includes basic sales and customer engagement data, while the Retail and Restaurant plans provide more advanced reporting. 

Advanced features and integrations

Shopify integrates with a number of applications to streamline your operations – more than 1,200 to be precise. You can connect with marketing, inventory management, customer support apps, and track customer engagement and employee management. Square doesn't have quite as many integrations, though you'll find many for accounting, e-commerce, team management, marketing and customer management. 

Shopify vs Square: Inventory management

Inventory management is an important tool used by retailers to manage their stock. With e-commerce software tools provided through Shopify and Square, retailers avoid selling out-of-stock products and receive low stock alerts.

Shopify inventory management

All of your inventory needs are managed under the Inventory dashboard in Shopify. You set up initial inventory and track sales and returns through your toolset. Inventory counts could also be adjusted manually at any point.

One aspect of inventory management to keep in mind when using Shopify is that low-inventory alerts aren't automatic; an add-on app must be installed first to receive notifications. Shopify supports importing and exporting through CSV files, as well as transferring stock to various locations.

Square inventory management

Basic inventory tools are included with Square, but retailers need to purchase the Square for Retail POS system to unlock all the capabilities. In the basic version, you add and edit inventory through the Item editor tool. Stock alerts can be added as well as the system providing support for CSV importing and exporting.

According to Merchant Maverick, those with high quantities of inventory or companies who wish to edit purchase orders in the app will need to choose Square for Retail over the basic version. Square for Retail also supports bar code printing, the transfer of stock across locations and support for retail product exchanges.    

Shopify vs Square: Reporting

The reporting feature in your e-commerce tools allow you to track essential statistics about your business. Comprehensive reporting tools allow you to uncover key analytics about your business and your core client base.

Shopify reporting

The types of reports accessible through Shopify depend on the version you purchase for your business. To unlock all reporting features, you must download either Shopify Advanced or Shopify Plus. The Shopify Lite option provides the least number of reporting options with only payment reports, tax reports, and product analytics included. The more expensive POS packages offer reports for consumer behaviors, marketing, live sales, profit reports, and inventory reports.

Square reporting

More report features come standard with Square than Shopify. Unlike Shopify, you don't have multiple packages to choose from. Most businesses will simply choose between Square Free and Square for Retail Plus. All reporting features are unlocked with Square for Retail Plus, including sales summaries, sales trends, customer payment methods, store sales, team sales, activity log, and returns. Square Free has nominal reporting capabilities, but can report on basic sales figures.

Shopify vs Square: Customer Management

As part of your POS system, you should consider support for customer management. This is a substantial convenience since you won't want to rely on a separate CRM system.

Shopify customer management

Shopify makes customer management automated through their POS system. Any time that a customer places an order through your business, their information is saved into your Shopify account. In most cases, the customer name and email address will be automatically listed within your Shopify database. Admins on the Shopify account can also edit and delete any customer profiles saved in the system. Grouping customers is another useful feature since this permits you to target any marketing emails.

Square customer management

Square's customer directory is compiled through every credit card sale. Square links the customer name to their credit card with account information coming up automatically for each subsequent sale. Businesses can add customers manually if they use another form of currency such as check or cash. Square will also automatically group customers by those who are reachable via email and those with missing contact details.

Shopify vs Square: Employee Management

Employee management POS tools are mainly used to track each team member's sales figures. This can help you pinpoint any potential issues with team members early on.

Shopify employee management

Most Shopify employee management tools are added on through the Shopify app storefront. Any key features for employee management can also be accessed the Advanced Shopify package. For starters, all Shopify systems provide you with full control over the level of access on the POS platform. All internal transactions can be tracked back to each employee through assigned pin numbers. Employee management tools also include tracking for training sessions and time clocks.

Square employee management

Employee management is done through Square's Team Management and Team Plus package options. For Team Management, you'll be able to track employee time clocks, breaks and integrate their data with the standard Square POS system. For Team Plus, you pay a flat fee per location and are given access to employee management tools such as individual sales reports, activity logs, overtime violations and multiple wage rates.

Shopify vs Square: Mobile POS App

Mobile support has become a key part of shopping for a POS program for businesses. According to Oberlo, mobile sales are expected to increase by more than 25% in 2020 from 2019. A mobile POS application you can depend on should be included with your e-commerce software package.

Shopify mobile POS app

Shopify has two standard options for companies: POS Lite and POS Pro. POS Lite works for small businesses who need limited reporting and analytics support. POS Lite processes credit card transactions on-site through your mobile device while saving customer profiles and providing order tracking. POS Pro provides in-store analytics, improved inventory management support, and works across locations.

Square mobile POS app

Square was one of the earliest providers of mobile payment processing and specializes in making transactions easy to manage on the go. Square securely saves all payment information for customers within the mobile app. The app provides the capability to create and send invoices with a few simple clicks. Sales are also tracked through the app and can be viewed per item or per day.

Pros and cons of Shopify

Shopify offers more flexibility and customization when it comes to which hardware and credit card processor you can use with its POS software. This is especially beneficial for business owners who need a highly customized system or want to work with another payment provider or gateway. If you are an online business or most of your revenue comes from e-commerce sales, Shopify is a great choice. 

The downside to using Shopify is the price. Unlike Square, the entry-level plan, Basic Shopify, charges a monthly fee, and although it has slightly lower processing fees than Square, that's only if you use Shopify's in-house credit card processor. 

Pros and cons of Square

Square's hardware costs less than Shopify's hardware, plus you can purchase it with a payment plan. Also, Square does not charge monthly fees for its standard POS software. If you run a business and most of your revenue comes from in-store sales, Square is an affordable and all-around great choice. 

But Square does not offer as much flexibility with some features as Shopify does – case in point, with Square, you don't have the option of using another credit card processor, you must use Square. 

At business.com, we've evaluated more than 100 POS systems. Visit our best picks page to read our reviews of Shopify Payments and Square, and to see the POS systems we recommend

Skye Schooley is an Arizona native, based in New York City. She received a business communication degree from Arizona State University and spent a few years traveling internationally, before finally settling down in the greater New York City area. She currently writes for business.com and Business News Daily, primarily contributing articles about business technology and the workplace, and reviewing categories such as remote PC access software, collection agencies, background check services, web hosting, reputation management services, cloud storage, and website design software and services.
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