Last updated on 31 August 2022
Do you need to pay your vendors automatically using some sort of split payments app for Shopify? Now that’s possible! I’ve been needing this feature in my stores for years, but it’s not been possible until now so I thought I would write a blog on how to set it up.
Basically, if you have created a product with someone or need to pay a vendor/supplier their cut of the product sale, you can use CollabPay to calculate the earnings and split the payments automatically. Let’s get started.
First, install CollabPay
Go to CollabPay on the Shopify app store. CollabPay is the app you need to process the auto-pay split payments to your vendors and collaborators of products. It features a range of easy-to-use tools that will calculate the amounts owed to vendors and split payments automatically.
They have a 7-day free trial for all plans so you can test if it will work for you. You can see the pricing plans here.
How does it work?
CollabPay is essentially an app that calculates the percentages of what your collaborators are owed and pays them automatically on a timeframe of your choice.
You can add collaborators to your products and set percentages or flat fees that they will earn from the sales of those products. If you have set up automatic payments using PayPal, then you can pay your vendors without needing to do it yourself.
The automatic payouts work by connecting to your PayPal to CollabPay and processing payments using the PayPal Payouts feature.
When a sale happens in your store, CollabPay reads the sale price and calculates the amount your vendor is owed from the percentage you have set for them. Over time, when more sales come in, CollabPay will calculate the total amount that your vendor is owed.
Then when the payout date arrives (you can set custom payout intervals), CollabPay initiates a payout from your PayPal account directly to the vendor automatically. You can set when the payouts take place whether they are daily, weekly or monthly.
Who is CollabPay useful for?
- A Shopify store that needs to pay vendors
- If you created a product with someone and want to calculate & pay their cut to them automatically
- If you need to pay your stock supplier
- Split payments from your sales for any reason using Shopify
Basically, it’s perfect for any store owners who need to automate their workflow for anyone who created products together or people who are owed a cut from the Shopify sales.
Setting up CollabPay with your store
1. Add a collaborator to your products
First, you need to add a Collaborator (vendor) to your product. This will send an email to your Collaborator with an invite link where they can sign up and create their account. Once they have created their account, it will be automatically linked to the store’s account.
- Go to the ‘Products‘ page
- Click on a product that you want to add the Collaborator (vendor) to
- Click the ‘Add new collaborator‘ button and invite them using their email
2. Set your settings
Go to the ‘Settings‘ page and set your settings to suit you best. Things you need to do are:
- Set your payout intervals whether they are daily, weekly or monthly
- Request the PayPal Setup for automatic payouts
- You can do this by going to the ‘Settings‘ page > clicking on ‘PayPal Setup‘ > then following the instructions.
Once it’s complete, it will look like this.
Set up your PayPal account for automatic payouts
The best method to send money across borders to your vendors is by using PayPal. CollabPay integrates with PayPal to allow your vendors to be paid automatically no matter where they are in the world.
Now what you need to do is request PayPal Payouts, get approved and automatically split payments to your vendors. It can be lengthy because PayPal’s support at slow and sometimes painful, but once you have been allowed to use PayPal Payouts, then your store will be fully automated.
If PayPal happens to not allow you to use PayPal Payouts, then you will need to pay the vendors yourself manually and keep using CollabPay for calculating how much the vendors are owed.
You will need to apply to use PayPal Payouts for CollabPay automated payouts. Please go to this page to enable the setting.
1. Scroll down to here and click ‘Enable’
2. Click ‘Contact us’ and apply for payouts
Scroll down and click ‘Contact us’. You can either choose to call or message them. PayPal will usually get back within a few hours and process your request.
Once you have been accepted for PayPal Payouts
When PayPal accept your PayPal account for Payouts, you will need to link CollabPay and your account. You can do this by following the CollabPay PayPal Setup here or the steps below.
- Go to CollabPay, then go to “Settings“
- Go to “PayPal Payouts“
- Click the “Login with PayPal” button
- Click “Agree and connect“
What platforms does CollabPay work with?
Currently, it’s only available on Shopify, but WooCommerce and Etsy are coming next. You can keep up to date with the releases by following their website.
CollabPay has 3 payment plans. Each one includes a 7-day free trial.
Does CollabPay automatically split payments on Shopify sales?
Yes, CollabPay automatically calculates and splits payments to your vendors. It’s the best method I’ve found to pay your product creators without needing to manually process payments yourself.
There you have it, an easy automated way to pay your vendors and collaborators on Shopify. I’ve been waiting for an app like this for years and now it’s here. If you’re interested in viewing any more of my Shopify tutorials, please take a look and let me know if you want to learn anything else. I’m pretty clued up on Shopify!