What is Shopify and How It Works (Explained Simply)

Introduction to Shopify

Have you ever wondered, “What is Shopify?” while trying to figure out how to start selling online? You’re not alone. Many entrepreneurs feel overwhelmed when first exploring eCommerce options.

Shopify is an all-in-one e-commerce platform that lets anyone create and run an online store without technical expertise. Think of it as your digital storefront, cash register, inventory manager, and marketing team all rolled into one user-friendly package.

With over 2 million merchants across 175 countries using this platform, it’s become the go-to solution for businesses of all sizes looking to sell online.

What is Shopify Used For?

Wondering what exactly you can do with Shopify? The platform is surprisingly versatile:

Selling Physical Products

From handmade crafts to wholesale inventory, it handles shipping rates, inventory tracking, and order management for tangible goods.

Selling Digital Products

Ebooks, courses, and music, and it automatically delivers digital products to customers after purchase.

Dropshipping Businesses

Connect with suppliers who ship directly to customers, letting you run a store without holding inventory.

In-Person Sales with POS

Shopify’s Point of Sale system bridges online and offline sales, perfect for pop-up shops, markets, or brick-and-mortar locations.

One of our clients, a handmade jewelry creator, started with just 5 products. Within a year, they expanded to 50+ products with both online and in-person sales at local markets using Shopify POS, all managed from the same dashboard.

How Does Shopify Work?

Ever wondered, “What is Shopify and how does it work?” Let’s break down the process into simple steps:

1. Sign Up & Choose a Plan

Start with a 3-day free trial (no credit card required), then select from tiered pricing plans based on your needs.

2. Select Your Theme

Choose from free or premium themes that control how your store looks and feels.

3. Add Your Products

Upload photos, write descriptions, set prices, and organize your inventory.

4. Set Up Payment Processing

Connect payment providers (Shopify Payments, PayPal, etc.) to receive money from sales.

5. Configure Shipping

Set your shipping rates, zones, and delivery options.

6. Launch Your Store

Activate your chosen domain and open your store to customers.

Behind the scenes, Shopify handles all the technical complexities:

• Secure hosting (no need to worry about servers)
• SSL certification (keeps customer data safe)
• Mobile optimization (looks great on all devices)
• Regular security updates (protection against threats)

What is a Shopify Store?

A Shopify store consists of two main components:

The Frontend (What Customers See)

• Your product catalog
• Shopping cart functionality
• Checkout process
• Content pages (About, Contact, Blog)

The Backend (What You Manage)

• Dashboard with sales analytics
• Inventory management
• Customer information
• Marketing tools
• App integrations

The beauty of Shopify stores is their flexibility. You can start with a template that looks professional out of the box, then customize it to match your brand as you grow.

Check out these examples of what’s possible:

• Allbirds (sustainable footwear)
• Gymshark (fitness apparel)
• MVMT (watches and accessories)

Why Use Shopify Over Other Platforms?

When entrepreneurs ask, “Why use this instead of alternatives?” we point to these key advantages:

Ease of Use

Launch without technical skills; if you can use email, you can manage a Shopify store.

Built-in Mobile Optimization

All themes automatically work on phones and tablets (crucial since over 70% of online shopping happens on mobile).

Comprehensive App Ecosystem

5,000+ apps to extend functionality for marketing, inventory, accounting, and more.

Reliable Support

24/7 help via chat, email, and phone, something many platforms don’t offer.

Scalability

From your first sale to millions in revenue, it grows with you without requiring platform changes.

When we migrated a client from WooCommerce to Shopify, their page load times decreased by 40% and conversion rates increased by 28% within the first month, largely due to Shopify’s optimized infrastructure.

Who is Shopify Best Suited For?

This works exceptionally well for:

New Entrepreneurs

The intuitive interface and guided setup make it perfect if you’re launching your first business.

Small to Medium Businesses

Scalable features and reasonable pricing accommodate growing companies.

Creators and Influencers

Easily monetize your audience by selling merchandise or digital products.

Established Retail Businesses

Integrate online and offline sales with Shopify’s omnichannel capabilities.

Shopify Pricing Plans in 2025

Understanding Shopify’s current pricing structure is essential before you commit:

Basic ($29/month)

Perfect for new businesses with:

• Unlimited products
• 2 staff accounts
• 24/7 support
• Basic reports

Shopify ($79/month)

Good for growing businesses, adding:

• Professional reports
• 5 staff accounts
• Lower transaction fees

Advanced ($299/month)

For scaling businesses, including:

• Advanced report builder
• 15 staff accounts
• Lowest transaction fees
• Calculated shipping rates

Shopify Plus (Starting at $2,000/month)

Enterprise-level solution with:

• Dedicated support
• Custom checkout
• API access
• Multiple storefronts

Be aware of these additional costs:

• Premium themes ($180-$350 one-time)
• Apps ($5-$50/month each)
• Transaction fees (0.5-2% if not using Shopify Payments)

Common Myths About Shopify

Let’s debunk some misconceptions about what Shopify is and isn’t:

“You need coding skills to use Shopify”

Reality: The core platform requires zero coding knowledge. You can build and manage a complete store using just the visual editor.

“Shopify is only for physical products”

Reality: The platform excellently handles digital products, services, subscriptions, and memberships.

“It’s too expensive for beginners”

Reality: When you factor in what you’d pay separately for hosting, security, payment processing, and design on other platforms, Shopify often comes out more economical.

“Shopify stores all look the same”

Reality: With thousands of themes and customization options, two Shopify stores rarely look identical unless they’re using the same theme with minimal changes.

At 2HatsLogic, we’ve helped clients from one-person startups to multi-million-dollar brands leverage platforms effectively, regardless of their technical skills or prior eCommerce experience.

Conclusion: Should You Start a Shopify Store?

After helping dozens of businesses launch successful eCommerce operations, here’s what I’ve learned: Shopify offers the best balance of simplicity and sophistication for most online sellers.

If you’re asking, “what is Shopify, and should I use it?” – the answer largely depends on your goals. It’s particularly well-suited for:

• Businesses wanting to launch quickly without technical headaches
• Brands focusing on growth rather than infrastructure management
• Companies need unified online and offline sales systems

The platform’s limitations mainly affect businesses with highly specific custom needs or those requiring complex B2B wholesale configurations. Though even these can often be addressed with advanced customization.

At 2HatsLogic, we specialize in helping businesses not just set up Shopify stores but optimize them for conversion and growth through headless commerce implementations.

Whether you’re just starting out or looking to take your existing Shopify store to the next level, our team of experts can help you navigate the process.