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Overview of Managed Markets

Managed Markets makes it easy to start selling to new international markets and reduces the complexity of cross-border selling. Managed Markets takes care of local regulations, taxes, duties, international shipping, and localization for each international market. Learn more about Managed Markets features and how they compare to international sales tools.

To use Managed Markets, your store needs to be on the Basic plan or higher, and have an online store.

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Pricing

Managed Markets has the following fees for international orders:

  • A transaction fee:
    • 3.25% for stores on the Shopify Plus plan.
    • 3.5% for stores that are on the Basic, Grow, or Advanced plan.
  • A 1.5% currency conversion fee, also known as the foreign exchange (FX) fee. You can adjust your product prices for international markets to be higher or lower based on your preferences.
  • A Shopify Payments processing fee that can vary based on your Shopify plan and the card type used by your customer.

Refer to Managed Markets with Shopify Payments for more information on pricing.

Determining tax on the Managed Markets fee

In some countries, the Managed Markets fee is taxable. Whether the fee is taxed depends on the address associated with the legal business name on your store. This address determines both whether tax is added to the fee, and which tax applies:

  • If your legal business address is in the United States, then no tax is added to the Managed Markets fee.
  • If your legal business address is in the United Kingdom, then VAT is added to the Managed Markets fee.
  • If your legal business address is in Canada, then GST, HST, QST, PST, or RST is added to the Managed Markets fee, depending on your province.

When duties and taxes are included in your prices, any applicable tax on the Managed Markets fee is built into your product prices, so your customers cover it. The tax isn't listed separately to your customers. When they aren't included in your prices, any applicable tax is charged to you directly and recorded on your merchant fee invoice.

Merchant of record

A merchant of record is the legal entity responsible for selling products to a customer, and for adhering to local laws and regulations in another region or country. Unless another party such as Global-e is hired to take on these responsibilities, most merchants act as their own merchant of record. When you act as your own merchant of record, you're responsible for registering for and remitting taxes, arranging to accept local methods of payment, and organizing shipping and fulfillment.

With Managed Markets, Global-e manages the complexities of selling to other countries or regions on your behalf, including remitting tax to local authorities, accepting local methods of payment, and managing duties and import tax, allowing you to start selling to new international markets quickly. When using Managed Markets, you don't need tax registration in the countries you sell to. Global-e provides the tax registration, allowing you to comply when selling internationally.

Harmonized System (HS) codes

In Managed Markets, Harmonized System (HS) codes are automatically assigned to your products and might differ from the ones that you initially entered. These codes are adjusted based on country-specific restrictions to comply with import regulations. You can review both your manually entered HS codes and the HS codes that Managed Markets assigns to your products in your Shopify admin. For more information about HS codes, refer to adding HS codes to your products.

To review the HS codes that have been assigned to your products, go to an individual product's page and refer to the information in the Shipping section. If HS codes aren't displayed, then they haven’t been assigned yet. However, duty guarantee at checkout is still in place to ensure smooth delivery.

Managed Markets benefits

When you sell internationally, you need to take care of multiple complexities, such as shipping, taxes, duties, and product restrictions depending on the destination country. Managed Markets can help you reduce these complexities and handle them for you. Review the following benefits of using Managed Markets when selling internationally:

  • Product restrictions and local laws: Managed Markets complies with local laws for cross-border products and restricts certain products to specific destinations. Managed Markets also creates commercial invoices and remits them where needed. To learn more, refer to the Managed Markets Merchant Service Terms.
  • Guaranteed currency conversion rate on refunds made within 30 days of the transaction: Managed Markets ensures that you can refund orders at the currency conversion rate that was given at the time of purchase within 30 days to avoid currency rate fluctuations.
  • Guaranteed duty and taxes amounts at checkout: The duty and tax amounts that are displayed at checkout to your customers are guaranteed. This means that even when the amount charged by customs is different, Managed Markets covers the difference and you don't have to pay any additional fees.
  • Tax filing registration in local destinations: Managed Markets handles local destinations tax filing responsibilities for your Managed Markets orders.
  • Fraud management: Orders on Managed Markets in the United States are automatically reviewed and given protection for fraud chargebacks. There are some rare chargeback cases that aren't covered by Managed Markets that you're responsible to handle yourself. To learn more refer to Fraud and chargebacks.
  • Increased customer conversion: Managed Markets supports features such as Shop Pay, local payment methods in customers' local countries, and shipping with pre-paid duties, which can help increase your customer conversion rates.
  • Enhanced customer experience for higher customer retention rates: You can offer delivered duty paid (DDP) shipping at checkout. Your customers don't have to pay any extra fees at the time of the delivery. This lets you communicate exact shipping fees without any surprise fees, which can help to lower the rate of returned or refused international packages.
  • Customer address validation at checkout: Managed Markets checks whether the address that your customer adds during checkout is valid.

To learn more about Managed Markets features, refer to the Comparing international sales tools and Managed Markets features.

Flow of funds

Managed Markets features are powered by Global-e. After an international Managed Markets order is placed in your store, Shopify Payments processes the transaction and holds the money in a Global-e account.

When Global-e goes across the border, they act as your merchant of record. Global-e holds the funds to remit the costs to proper authorities that are involved in the cross-border commerce transaction.

Getting paid

When you use Managed Markets, your payouts are processed daily by Shopify Payments. Refer to Managed Markets with Shopify Payments to learn more.

Shop Pay

If you have an upgraded checkout activated on your store, then you can use Shop Pay for your international markets with Managed Markets. Your international customers can use their Shop accounts for express checkout.

Local payment methods

With Managed Markets you can use more local payment methods for markets worldwide. For example, if you're selling products to customers in Denmark, then those customers can pay for products with Klarna using DKK currency.

New local payment methods are continuously being added to Managed Markets. To learn more, refer to local payment methods with Managed Markets.

Fraud and chargebacks

When you use Managed Markets in the United States, your orders are protected from fraud chargebacks with Shopify Protect. Refer to Shopify Protect to learn more.