Shopify to NetSuite Integration: Your Way!

This article is relevant if you are looking to produce an eCommerce integration to the NetSuite platform. While it is suited for Shopify to NetSuite integration, the pattern can applied to other eCommerce shopping systems.

Background

A few years back, we implemented NetSuite for a consumer packaged goods company. At the time, the company had eCommerce presence and used an outside software development agency to maintain the consumer shopping system. As my firm is a NetSuite Systems Integrator, we naturally were comfortable using all the NetSuite tools to produce the connector. The client was satisfied as the integration met their exact business rules.  All was well and troublefree.

More recently, the client hired new Marketing management and decided to re-platform the eCommerce system to adopt the Shopify Plus subscription as it offered a better architecture to support their new ambitious marketing and promotion strategies. The client had an array of choices available to them as there are a number suppliers offering Shopify to NetSuite integration. The clients choices were similar to the discussion I offered in the Magento to NetSuite Integration: 15 Questions To Ask article.

Making Business Decisions Against Technology Offerings

When selecting a technology and related vendor to support a critical daily ongoing operation, understandably, all kinds of different concerns come forth. I had built trust with the client and they asked me to advise to assist their decision making for their new Shopify to NetSuite integration.

One of the significant concerns was not to disrupt the business operation because of the change in eCommerce systems. I had helped the new Marketing manager, responsible for driving the project, understand some of the specialized business rules that we had already put in place. Here were a few key rules that were not obvious to him:

  1. Price and Discount Management: the eCommerce system needed to be flexible to support any type of pricing and¬†promotion strategy while not being encumbered by any setup on the NetSuite system. Accordingly, our specialized integration ensured all orders went into NetSuite with an “online” price level. However, any differences in prices were¬†accounted for as an “eCommerce Price Difference” discount code with special general ledger routing. ¬†Further, if an actual promotion was offered to the eCommerce shopper, this would be captured as yet another discount called “eCommerce Promotion” with the promotion (coupon)¬†code in the description. The power of this approach was to produce better merchandising reporting to help¬†management gain insight into how much margin they were¬†given relative to their online¬†price standard.
  2. Sales Tax Routing: the key to easier integrations is to avoid having two different taxing engines: one on the eCommerce system and the other on NetSuite. Here, the client’s only business requiring sales tax was to be conducted on Shopify. We thus trust the tax reported by the front-end¬†and we appropriately bring into NetSuite back-end the tax rate as calculated by the eCommerce system.
  3. Customer Deposit Accounting: in the client’s model, they were working with an¬†Authorize AND Capture credit card processing model. In this use case, NetSuite needs a supporting customer deposit record against the sales order during integration. ¬†See my related article, [cref¬†using-netsuite-payment-methods-to-drive-customer-deposits].
  4. Variance Rules: in all of our eCommerce integrations (and numerous others), we maintain control information to confirm that order total, shipping total, tax (line or header), and line price are all within expectations. We then couple these controls to tools to manage the order process. For example, many of clients use our Transactions Approval Manager (Record State Manager) to help ensure that orders meet all criteria: in this case, there are no unexpected order variances.

Line based discounting approach is the best practice for ambitious organizations. Reviewing the other NetSuite to Shopify integration offerings, none of them offered the price logic we produced above. ¬†All of them forced in eCommerce pricing using the NetSuite line “Custom Price” technique effectively losing the merchandising discount information. However, I did see a way that I could “tunnel” underneath a third-party¬†integration using userevent scripts to get the same result — yet this technique¬†would have introduced new risk and investment into any third-party solution.

Direct NetSuite to Shopify Integration

After weighing the strengths and weaknesses of the various options, the client decided that it was lower risk to continue to work with us to modify their existing integration and support a Shopify to NetSuite connection. Here, they could retain their existing business rules and not disrupt their day-to-day operations. Because my firm is their partner to support all of their NetSuite needs, they also liked the idea of not having “yet another vendor” in the mix.

Accordingly, we refined the algorithms and built a NetSuite driven Shopify integration. What this means is that NetSuite is responsible for picking up and keeping Shopify up to date (as opposed to a middleware service or Shopify web hooks pushing data to NetSuite).  The architecture needed to be robust so that if NetSuite or Shopify is offline for maintenance, there would be no issues. We needed to make sure that nothing gets out of sync. When we collect information from Shopify, we write metadata to the front-end with related keys so that we can link information together in both systems. We have a queueing and job control design pattern that allows queries to find work; at the same time, we can use the queues to help design dashboards and alerts to ensure that all information is as expected.

Key Capacities of the Shopify NetSuite Integration

The related diagram offers an overview of the integration. The key elements include:

  1. Customers: shoppers are created as NetSuite customers. We have options to build and maintain an address list and inherit attributes as the business desires.
  2. Orders: orders are inserted as unapproved Sales Orders leveraging the key rules, and more, noted above.
  3. Shipments: NetSuite item fulfillments and related tracking information is pushed back to Shopify. Depending on the payment capture configurations, we also update the Shopify payment API to get funds.
  4. Automatic Invoicing: once we ship, we automatically invoice (or produce cash sale; depending on the configuration) to ensure that get proper revenue recognition matching costs with revenue.
  5. Inventory Updates: on a set schedule, we update Shopify for the product inventory so that the eCommerce team can specific out-of-stock conditions to shoppers.

Importantly, because my firm’s business orientation is not products but instead professional services, we can refine the algorithms to fit our client’s exact specifications. ¬†This means that our client’s do not feel they have to compromise due to the way information is getting pushed into NetSuite. ¬†Clients tell us that they¬†appreciate¬†that we can hold their larger business processing paradigm while we ensure that the integration does not produce cost on the margin by being insensitive to how they need to see information.

Get the Shopify to NetSuite Integration

Since our model is about NetSuite leadership for both innovation and care, we do all we can to help our clients succeed without a software product agenda. As such,¬†all of our previously-built algorithms are free of charge; ¬†This means we are there for our clients to lead an integration implementation and we take care of updates or requested refinements where needed. ¬†You can indeed have it your way! Perhaps you too are looking for a Shopify to NetSuite integration? ¬†Maybe you have a different eCommerce integration and you would like help. ¬†Feel free to reach out to me and let’s have a conversation.

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Marty Zigman

Holding all three official certifications, Marty is Southern California's NetSuite expert and leads a team of senior professionals at Prolecto Resources, Inc. He is a former Deloitte & Touche CPA and has held CTO roles. For over 25 years, Marty has produced leadership in ERP, CRM and eCommerce business systems. Contact Marty to setup a conversation.

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