Going International on Shopify| #041 | 36:08
Often times a merchant starts selling regionally or nationally, which helps with supply chain operations and overall early business success. However, when you have reached national success - what’s next? Internationalization.
This week, we are unearthing a recording we did at the beginning of the pandemic, and are joined by a good friend of ours to talk shop.
Alex is co-founder at We Make Websites, the Shopify Plus agency for international brands. Founded in 2009, We Make Websites is a digital commerce agency with offices in London and New York. Alex is an international speaker on ecommerce, brand and business growth.
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- [04:32] Tell us about yourself.
- [05:22] Can I sell internationally on Shopify?
- [07:03] Can I do multi-currency on Shopify?
- [10:29] What about translating content?
- [15:37] What should I do about domains?
- [19:39] What about taxes?
- [24:47] What about shipping goods?
- [27:41] What about expanding into China?
- [31:33] Store shoutouts
- [34:41] Where can we find you on the internet?
- Returns Manager (Discontinued)
- Translations API
- Form Swim
- Lady Rose Teas
Oftentimes, a merchant starts selling regionally or nationally, which helps with supply chain operations and overall early business success. However, when you have reached national success, what's next? Internationalization. And yes, that is a big word. This week, we are unearthing a recording. We did at the beginning of the pandemic and are joined by a good friend of ours to talk shop. Let's dig in.
Welcome to Commerce Tea, a podcast to help you succeed on Shopify. I'm Rhian.
And I'm Kelly. Grab a mug and join us as we talk about all things commerce.
Hey Kelly, how can merchants leverage customer data to drive more revenue and increase retention? How could they create personalized experiences customers love?
I recommend Octane AI, the leading buyer profile platform for Shopify and Shopify Plus merchants.
How does it work?
Octane AI features a shop quiz, Facebook messenger, and SMS and opt-in tools. Using the shop quiz, merchants can get to know customers with interactive questions, from product recommenders to gift finders, you can learn about a customers needs preferences, pain points, and more. This information gets saved into buyer profiles and you can sync your buyer profile data with your Facebook messenger, SMS, email and ad campaigns for personalized customer journeys.
What kinds of returns can brands expect?
Brands using the shop quiz have increased email signups by 16 times and driven a 28% increase in average order value. Facebook messenger and SMS see 80 to 95% average open rates and drive up to a 20% increase in revenue. Better yet, octane AI has plans for any size business and offers a 14 day free trial. Every plan gives you access to the shop quiz, Facebook messenger, SMS and opt-in tools. There are also plans available where Octane AI's experts will help you set up and optimize your tools for success.
It sounds great. Where can merchants go to learn more?
You can learn more book a demo or try it free join.octaneai.com/commercetea. Again, that's join.octaneai.com/commercetea.
Good morning, Kelly.
How are you?
I'm doing well. Hey, look, we recorded this at the beginning of the pandemic. What is happening for you today?
Today, I am getting my second Pfizer shot.
I'm so excited and also never like ... Okay, we literally recorded this, I think, in June of 2020. So here we are. I had no idea what we would be ... Well, life was very different in June of 2020 as well. Just generally speaking with the pandemic, there was a lot, we were still learning, but I'm really excited that we're kind of nearing the light at the end of the tunnel here, and hopefully, we can see each in person again soon.
I cannot wait to give you a big hug.
I know, and you also get your second shot soon too.
I do next week. I'm so excited. So I'm really glad we're bringing this episode back.
I am too, because I feel like it's even more important now to be discussing internationalization. This is a really, really good interview. Alex is one of our good friends. I think, you're really going to enjoy this. I did want to just preface it with one thing that because we recorded this in June of 2020, there have been some updates that have been made to both the Shopify as a whole, and Shopify Plus, in terms of internationalization, especially around the area of multicurrency.
So one of the more recent developments is that you're able to set pricing in multiple currencies on one single store. You could not do this before. You would have to set up multiple stores to go international to sell in those different currencies. So just a heads up there that there might be some old news in there, I guess? But generally speaking, just the overall concept of going international, this episode will be really, really, really helpful if you're looking to expand beyond borders.
Let's do it.
Today, we have Alex co-founder of We Make Websites, the international Shopify Plus agency. Hi there, Alex, how are you doing?
Hello, I'm good. How are you both?
We're awesome. So tell us, who are you? What do you do?
Who am I? A deep question. So I'm Alex. I am co-founder at We Make Websites and we work on Shopify Plus. We're one of the inaugural partners and we work with international brands on that platform. So we started that business in 2009. It start off in London, and now we have two offices, one in London, one in New York, which is where I live now. Well, that's the short version.
Awesome. Our focus for this conversation is on international selling because I am not a resident expert in it, and there are a lot of tricks to selling internationally. That's why we're talking to you today. So can I sell internationally on Shopify, can anyone sell internationally on Shopify?
Yeah. So Shopify make it easy. Also, I would say, in your defense, Kelly, that a lot of US companies don't need to worry about it. A lot of brands, D2C brands, the US is an enormous market and there's plenty of fresh pastures within the nation. So I do think that, compared to Europe where once you get beyond ... Well, almost after you start a business, you have to start thinking about selling internationally. So I think it is normal that it comes later on in the process.
It is complicated, as I'm sure we'll get into, but it's certainly a lot less complicated than it used to be, and part of that is the work that Shopify have done. So if you're already on that platform, you definitely have a solid basis for doing this. In the last two years, they have rolled out loads of improvements to make it easier to sell online.
I suppose the various elements of those we should get into. So when you're selling abroad, there's all sorts of considerations, like translating the site, selling in different currencies, taxes, shipping, and each of those are quite deep topics, but for each of them, Shopify has got some sort of feature now that will help you. So, yes, for sure.
So that sounds like a potentially daunting task. What features right now are there native to Shopify and then what features are there that, if a person works with an agency, can they kind of unlock?
Yeah. Okay. So I suppose multicurrency is a good place to start with that, that obviously to sell abroad, you're going to have a much higher conversion rate if you can sell in local currencies. That basically means that when a customer gets to the checkout, that when they check out, they're paying in their local currency and they're not going to get charged by their bank and they know exactly what the amount is.
So Shopify have a multicurrency feature. So you have to use Shopify payments to use it, which I don't know if you've covered that in any other episodes, but there's a few sort of things to consider there about if you can use Shopify payments and so on, but assuming that you can use Shopify payments, then what happens is there's a set of currencies that they support that you can basically switch on.
So when you're on a given page, you use the switching tab, and you can change from US dollars to Australian dollars, or Canadian dollars, or British pounds or euros or whatever. They will change the prices on the front end and when the customer goes through the checkout, they pay in that currency.
So that's something that Shopify released in the last two years before that all you could do was sort of show an indication of price and then the checkout was still in the base currency of the store. The amounts of money are still converted into your base currency and Shopify have got a load of good documentation on how that works. But basically, it's a lot better than it used to be and a lot easier than it used to be.
Why you might have to get an agency involved and that's, obviously, what we do love is when you are selling in different territories and either you can't use Shopify payments, or you can't use some of the functionality they have in multicurrency. So for example, rounding is a big one. The way multicurrency works on Shopify is it's very elegantly designed and one of the features is that you can tell it to round prices. So they're going to alter them day by day as the foreign exchange markets change.
But you can say, "My euros, I always want them to round up to 95, or I want Japanese yen to always round to the nearest hundred," or whatever it is, which is great if you don't have wholesalers in those regions that are selling in your goods into Germany or Japan or wherever, because you normally, as a brand, are going to have agreements with those retailers about what your recommended retail price is. Obviously, if your price is changing all the time on your own a website, then that can cause some problems.
So it's things like that, that to be honest tend to affect bigger brands. So once they're doing a few million through the store. In the case that they need that, then what we do is we have separate stores on Shopify. So we call a multi-store architecture. So you might end up with yourbrandname.com, eu.yourbrandname.com and just like a list of country codes for the different domains and those are different websites.
So then, you get into a whole load of other questions, "Well, okay, how much sinking of content do you have to do between those stores and how do you maintain a code base for the theme across multiple stores and so on?" And that's the sort of stuff that we do. But like I say, you don't have to do that until you're really going sort of deep down the international route.
So speaking on the ... So multicurrency we've covered, but I think another pain point that I've experienced is translating content. There are apps in the app store, but I assume you have opinions on the apps that currently exist?
Yeah. I have some opinions. So ... I didn't mean that to sound aggressive.
So do I. We all have opinions.
I would say, nobody's nailed it, is the first thing I would say. So what we do is, first of all, a sort of caveat, which is we don't recommend any sort of automation for this, that ultimately you need to be getting your translations right and having a native speaker write the content in those languages, especially for the sort of brands that are on Shopify, which tend to be the brands that care more about tone of voice and where the brand itself is the proposition.
Obviously, if you're selling into different countries, you want to make sure that you're not making any faux pas and saying the wrong things. So with that said, you need a way then of managing content across multiple languages. Again, there's been a lot of improvements here. So Shopify have a translation API, which is relatively a new thing, in the last couple of years, which means that they support natively, but you still need an app to plug into my API to allow you to manage content.
It gets a bit complicated. So what we tend to do is manage for various translations in Langify. So that gives you a sort of easy place to do it. But what you end up having to do, and this is where it might get a bit complicated, but you have to use a type of file called portable object or machine object, which is a way of storing a load of text. So what is it in English? What is it in French? It's basically a table with two columns. For some reason it's called portable object and machine object and you need an app called a PO edit app to open the open and maintain it.
So you're probably thinking, "That sounds like a lot of work," and my answer is, "Yes, it's a lot of work." So if you're selling internationally, it is a lot of work and sometimes ... Well, I suppose my point is, if you're going down, the international route, it is a significant investment in time, if not money.
Translations, I think, is one of those areas where it's probably good to test that you can actually sell into those markets in English, because as sort of commonly spoken language, most people will be able to shop on that and at least you'll get some verification that people will actually buy internationally and then maybe you do a translation as later stage, because especially if you're selling in multiple languages, you're going to need a lot of native speakers to do that. There are translation agencies that do that as well. So that's great. But yeah, not easy.
I have a follow-on question about translating content because SEO, there's like a unique perspective in terms of translation and I think you nail it when you talk about having the individual domains, as opposed to just translating everything through one. Am I misunderstanding your thoughts on that?
Your thoughts are like, in a perfect world, brand X has a co.uk, a .ca, a dot everything, and on each one ... Okay, I just gave three Anglophone countries. That was a bad example, but .fr, or is that right? Dot something else. Then there's that content exists uniquely on that page and it's not a one-to-one translation, it's a translation that fits the local syntax and-
Yeah. It may also be different based on ... if you're in a sale because there's a national holiday, then obviously those might be different in different countries. So there is an opportunity when I say that you're suddenly managing five websites of content to optimize it for each. I think part of the art of this is figuring out which parts of your catalog really are the same throughout all your stores and which parts are different?
There's generally an element of ... I suppose, how much attention you pay to translation will vary between those. So the kind of banners and sort of marketing material, you would hope that that is absolutely spot on in terms of tone of voice and the message because you don't want to be making any mistakes there. Then you might get into product descriptions and things where you can probably be a bit less careful as long as you're correct, but it's not so nuanced as marketing copywriting.
Then just another thing whilst I'm thinking about that. You also need to think about support, which is, if you've got email addresses and chat box and all that sort of thing, they also need to be able to cater to that language, which is another consideration.
But anyways, to got back to your point about SEO, which is, that field is enormous, in SEO, and still lots of debate about what's the best. Also, it really truly varies on resources and how big you are as a business. So like generally what we do is exactly, like you said, them, so eu dot, or fr dot, and then UK dot and US dot or whatever the country codes are, are sub domains, or you can do them as folders.
So the way that Shopify's translation API works is you get a sub folder per language. So this is where it starts getting a bit complicated because you might have a different store per currency. So let's say euros and pound sterling and US dollars, so that's three stores. Then on your euro store, you might have five languages. So Spanish, French, German, Italian, whatever you've got. So then, you might end up with eu.yourbrand.com/fr so a French version of the store for euros and all that decision making, I think, is something that needs a lot of planning. What is the end result?
Another way you can do this, I mean, this tends to be what the big brands do. So it's a bit of a large undertaking, but you could also have a country level domain for each. So you might have yourbrandname.co.uk, yourbrandname.fr, yourbrandname.com, which then you've got several different domains that you'll try and boost the SEO. So if you're not Nike or Patagonia then that's going to be a lot of work.
So I think what I see most common, I think that's probably the most useful way to answer this question, is to have the Shopify multi-language API use different folders. So yourbrandname.com/fr is the French one, yourbrandname.com is probably the English default, youbrandname.com/ge is the German. Then, if you do need to take multiple currencies and control the price, you have a different Shopify store currency.
If you don't need to do that, and you can use Shopify as multicurrency product, which if you can, you probably should, in that case, you'd only have one actual store because for one Shopify store is powering both, all the currencies and all the languages.
That sounds like a lot of work.
It does sound like a lot of work. It does sound like a lot, but this is something that we're seeing mostly in Plus, right? For Plus merchants?
Yeah. I would say just solely based on the size of brand you need to invest the time in this, and I think a good stepping stone ... I suppose we haven't really talked about the trigger for actually going international, but a good stepping stone is looking at where your traffic is currently and if you got a lot of customers in a foreign country and therefore, is it worth investing in setting up there? Because we haven't even got into the physical real world side of, do you then get a warehouse in that country and ship and get a 3PL? Or are you just sending it internationally? Which, I wouldn't say I'm an expert in, because at the end of the day, I'm not running an e-commerce business, but there's a variety of options there.
But I think that the secret is to take it slowly. So maybe you start off selling in English, but you accept different languages or you use Shopify multicurrency because it's relatively straightforward to set up. Then further down the track you look at optimizing more, just as you do everything, then we're going to look at optimizing languages, and landing pages and AdWords campaigns and all this sort of thing. But yeah, definitely a big complicated topic, which is why I'm so glad I chose it today.
Just some light, light, easy things to speak about on a podcast like internationalization and how to do it.
Also speaking of really fun topics, taxes.
Oh right. Yeah, thanks.
How in the world does somebody handle taxes when they're selling internationally?
So I must caveat this answer by saying, ultimately I'm not an accountant or a lawyer, so take this all with a pinch of salt, but generally ... Okay, the big things to know. Probably one of the biggest things to realize is that the US way of adding sales tax, when you go to checkout, it's almost surprising as a foreigner when I go to a shop and I get to the checkout and it costs more than what it said and that's tax, which is unique, as far as I know, it's unique to the US.
So the idea that tax is added afterwards, and the reason that's important for e-commerce is it determines how you store your prices, because here you store them exclusive of sales tax and as far as I know, most other places, especially in Europe, you store them inclusive of prices. So if my product costs a hundred pounds, the UK equivalent of sales tax is called VAT, value added tax. So 20% of that goes to the government, basically. But the price I show is a hundred pounds.
Whereas here, let's say it's a hundred dollars. Well, you store the price at a hundred dollars, you show a hundred dollars, but then at the checkout, as you know, you get to this thing where it says, By the way, here are all the taxes that you're paying," which are added on. So the brand is basically saying, "That's not me, that's the government. That's what's going on."
So that makes things complicated for us, right? Because with all these things, I've just talked about, one of the options was to have one store and the problem then is the pricing is going to work differently because the setting for tax is global to the Shopify store. So that's a good example of where you might end up with different stores. So your US store might be separate to your European store simply so you can store prices differently.
The next thing on tax is ... So a couple of years ago, I think it was 2017, or maybe 2018, there was a case between Wayfair and the State of South Dakota. Basically, what the case was, was the State of South Dakota saying, "If you sell goods into our state, you should be paying us sales tax," and the state won that case. That now applies to ... Most states have adopted like a similar ruling.
There's a threshold just to make this more complicated. So if you sell less than a hundred thousand dollars into the state of South Dakota, you don't have to worry. But if you do, then when you file taxes, you need to file in the states that you sell into and that is basically why Avalara exists, which is a sort of tax calculation software, which will work out, based on where the customer is and where you are, because also, what is called your tux nexus. So your physical presence in states can determine where you pay a tax.
So if your employees are in New York, but your warehouse is in New Jersey, but you also have a team that's based in Indiana, then you might be paying taxes in all those places as well. So obviously, that gets horrendously complicated. So what Avalara do is basically work out where you owe taxes. Again, that is quite specific to the US. So generally, the US sore will have that, by Avalara will also help power and calculate your taxes internationally as well, and just generally help with the admin around that.
So use Avalara, speak to professionals, and then just be aware of when it comes to things like product information management, be aware of that fact about price. So you might have a database where you store all your prices, and that might be Shopify, or it might be a PIM or an ERP system, and you might then have to convert that price. So like what we see a lot with our UK businesses is all the prices are stored inclusive of VAT, which then when that price, even if it's converted to dollars, is put on a US site, it ends up being very expensive because the sales tax is being added again on top, if you see what I mean? So lots to think about basically when it comes to tax.
So I think it's a fine balancing of doing the compliance and actually making sure that you're generating the right tax returns and all the rest of it. But also, making sure that you're priced competitively in those markets and sort of following convention. So you're not surprising people with a tax at checkout because US stores have the opposite problem, which is, "Oh, we just add tax at checkout." So if I'm shopping in the EU and I get to your store and I started checking out on it, and suddenly you're charging me 10%, I think, "Oh no, that's not right, I thought I was only paying a hundred pounds," which is sort of a cultural difference, I guess, but it's where culture meats commerce.
Okay. So speaking of incredibly complex things, let's talk a little bit about how to ship goods internationally and the best way to do that, that is the least time consuming and the most efficient.
Right, so this is an over a huge topic, and ... you can tell I'm really ... It's not the way to start with all these things. So I think with shipping, obviously the simplest is to do whatever you do now, but ship it abroad, which costs obviously more. The moment you start FedExing stuff abroad it costs more and you also have to think about, there's also some rules when you ship internationally and obviously, it just takes a lot longer, which I remember, when I was young, you could only buy a lot of stuff from US stores, like band t-shirts and things and you got used to waiting two weeks for it to arrive. That used to be fine, but obviously all our norms have changed around e-commerce and we expected to basically arrive next day and all the rest of it.
So I think again, thinking about this from a sort of perspective of, what's easier to what's most optimized, you start off by doing that and okay, it might be slightly more expensive and sometimes you have to eat a bit of the cost in your margin. So you might not be charging on your shipping table the full amount, and maybe you just accepted a lower profit margin on those products.
Then once that people are actually interested in whatever target markets you can begin to optimize and say, "Well, actually we're going to get 3PL in that country. We're going to ship goods there," and that certainly is, ultimately, lower cost and a better experience for the customer. Obviously, that isn't a big undertaking and something that needs a lot of planning and to do a lot of research into which, in terms of apps ... So to just bring it back to Shopify, ShipStation seems to integrate with everything.
Their coverage is only the US and UK and Australia, I think, from memory. AfterShip and Shippo also are good options. The sort of Venn diagram of functionality between those three is not totally overlapping. It's worth looking at them and getting into what you actually need.
A really, really important thing to not forget is returns because obviously some people are going to want to send the goods back, and that gets even more complicated when they're not in the same country as you. So for that we've used Clicksit Returns Manager and Returnly as well and these are all sort of apps in the app store.
So have a look at the apps, do a bit of research on it, and I suppose, for any merchant that's listening, if you go and if you know brands that have done this, I think that's the thing to do and go and ask, well, what did they learn from doing it? Because shipping is one of those things that is a really tactical, like learn by doing, learn by mistakes, learn by getting stuff smashed because it was shipped for two weeks in a plane. It's all very down to earth, practical stuff. So get the experience and the knowledge that's already out there, I think, before you dive into this.
Let's talk about China.
[crosstalk 00:27:46] political statement, is it?
Thank you. I am a professional podcaster. So let's talk about shipping to China because I think we often talk about receiving products from China, but not shipping into China.
Yeah, exactly. So I would assume, just based on Shopify's overall merchant base, that most of them are outside China and looking at selling in and it's not straightforward. So the Chinese market is absolutely enormous. It's about half of all e-commerce. So that is the size of the market. I think in recent years, you've had more like sort of luxury and lifestyle brands that are already quite big selling successfully in that market.
From our experience of this, with our clients ... Well, let me get to the outcome. Normally what you end up doing is having a brochure site that shows off your goods, but generally not a transactional site and there's a few reasons for that. Most people buy through Tmall and JD, which are the big sort of e-commerce platforms, sort of an equivalent to Amazon and eBay, I suppose.
The difference is that the concept of having your own website, your own property, and like, for example, your own email list, isn't the norm there. So normally, if you're selling through one of these enormous marketplaces, which do have programs, especially Tmall, which as you've guessed from the name is a bit more like a mall where you do have a brand page and analytics and marketing tools and stuff and they will set up an account for you and yourself through that.
So what I would recommend, if you are doing that, and again, it helps if you've already proven that people are interested in buying from you before you dive into this stuff, because it's not easy or cheap. Normally, you'd have a Chinese version of your store that runs on Shopify and is like more of a brochure, like a brand experience, that sort of content and then the individual pages normally would link out to one of these store. That's just one way of doing it.
To be honest, it's still a quick developing area, I think, that nobody has thought of cracked it and I think ... the really thing to remember is foreign hosted websites are slower in China, and there's all sorts to think about there. You've got to cut down links to social media, you got to cut down asset sizes and all sorts of things that will mean that your site is then faster, but it's just a bit of a different ball game compared to expanding elsewhere.
So I would say to brands, look into it, but look into it with caution. It's quite a big undertaking, and those platforms that do have sort of managed services are not cheap. So definitely something to do once you're further down the road of internationalization.
Wow. So we have gone over a lot of things, and I think I'm beginning to understand internationalization, at least I've scratched the surface and thank you, Alex, for joining us and helping us and all of our listeners understand what is a complex topic that is also essential to high growth stores that are high volume on Shopify, specifically Shopify Plus stores. We've been ending all of our episodes with shout outs to a store that we really liked this week, and Kelly, why don't you start first?
Okay. So I feel like I should probably stay on brand for once to Commerce Tea. So I chose a store that sells tea. It's called Lady Rose Teas. They have a tea sampler that I am most definitely going to be buying so that we can drink tea while we record Commerce Tea, which is appropriate, but they also sell like other different kinds of teas that I'm not familiar with. Like there's such thing as hair teas, there are bath teas.
I don't know. I have a lot to learn about tea for somebody who decided to name a podcast and include the word tea in it. I don't know much about tea. My tea usually comes in the multi box packages from the grocery store. So I'm not familiar with loose leaf teas in general, but that was a long way of saying yes, Lady Rose Specialty Teas is my store this week. Alex, what's yours?
Do I get to choose a store?
Yeah. You get to chose a store.
Oh wow. Can I choose one of our own?
Okay. So one of the sites that we've launched recently, which I think has got lots of good examples of internationalization and selling in different regions and so on, is Pangaia. So that's spelled P-A-N-G-A-I-A. They're a sustainable clothing brand. It's a really a beautiful site that was built through our team, and like I say, fully international. So that would be my recommendation.
Thank you for that.
Rhian, what's yours?
Mine is a brand called FORM Swim, which are smart goggles for swimmers. It's pretty cool because it measures the distance that you're swimming and it can also sense what stroke you're doing while you're swimming. Then it gives the swimmers feedback in real time in ... Y'all, I'm sure, remember the Google Glass? So think that, and it has a display right in front of your eyes so you know exactly how long you've been swimming, how many laps you've done, how many meters you swim, et cetera.
The reason I'm calling them out is, it sounds like it would be bad, but it's actually a really good, one, it's beautifully designed. But two, my daughter has a pair and they actually broke, which, to be honest, I'm not sure how much of that is the product versus my daughter. But I emailed them and was like, "Hey, this happened, she got them as a gift." They were ... the warranty and the replacement process has been so smooth and just what you want to see in a commerce experience that I think they deserve a shout out for just having a great customer experience.
I love that.
Also, it's a cool product.
I want some, and I don't swim. So I expect it to be like, "We don't know what the hell you're doing."
They're like, "Ma'am, that is not a stroke."
It's just going to say, "Good try."
Nice effort. All right, Alex. So before we leave today, I just want to make sure everyone can find you on the internet. So tell me, where do we find you?
So our company website is wemakewebsites.com. You can find out more about what we do there. We also have a Twitter, wemakewebsites_. A bit unfortunate we've got an underscore. Same on Instagram, someone's hogging wemakewebsites. So if you're listening, please get in touch. So wemakewebsites_ on both Twitter and Instagram. Then my personal Twitter is aobtweetz with a Z. With a Z. A-O-B-T-W-E-E-T-Z.
Perfect. We'll include all of those in our show notes for our listeners. Thank you, Alex so much for joining us. It's a pleasure as always to speak with you.
Thank you. Yeah, it was a real pleasure. Thank you both.
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