Online purchases are a huge business, but they can’t happen without the underlying software needed to host the virtual store. Today, many online retailers are relying on ecommerce platforms that come directly through a homegrown Canadian company.

Founded in 2004 and launched to users in 2006, Ottawa-based Shopify provides virtually everything needed to conduct sales online. In addition to website templates and apps, Shopify offers cloud-based invoices and pay stubs, QR and bar codes, shipping labels, and even point-of-sale hardware such as card readers and receipt printers for brick-and-mortar businesses.

The company was founded by Tobias Lütke, a computer programmer who moved to Canada from his native Germany in 2004. Back home, after working for a large company, he tried to start a business creating software for call centres. It was unsuccessful, but it pointed him forward: he knew he couldn’t be happy working for someone else.

In Canada, Lütke and his friends decided to open an online store to sell snowboarding gear. He thought configuring the site would be the easiest part, but it turned out to be the toughest, since no existing software met his standards. He developed his own, and the online store launched using Lütke’s system.

Once winter was over and snowboard demand petered out, the partners felt there was more opportunity to make money off the software platform.

And that’s how Shopify was born. Its structure is a concept called Software as a Service (SaaS) which describes a business that centrally hosts its software and licenses it by subscription.

Shopify lets individuals or companies easily and quickly set up for online commerce, with most running their stores through Shopify’s site. Taking advantage of a free trial and templates, someone starting from scratch can set up a basic hosted online store in only a few minutes.

Shopify makes its money through monthly subscription charges, along with fees on consumer payments made through Shopify’s payment gateway, or through third party payment systems should businesses prefer to use their own.

It wasn’t easy at first, and Lütke often found himself with only a few weeks’ worth of funding to keep Shopify going. It survived thanks to some angel investors and Lütke’s determination to see it through. One of his initial mistakes, he later admitted, was charging clients a percentage of their sales.

Switching to a system of monthly subscriptions provided a more reliable source of revenue, and Shopify started to turn a profit within three years of its founding.

Today, the company also makes money from add-on apps, including those for fraud prevention, inventory management and email marketing, and offers a premium service for high-volume merchants, Shopify Plus, that’s capable of handling 500,000 hits per minute.

It’s now a top performer, with over 243,000 active Shopify stores across 150 countries that generate a combined $14-billion in sales. It has more than 900 employees across four offices in Ontario and Quebec. Its clients include Red Bull and Budweiser, and it has partnered with several large Internet companies including Facebook, Twitter, Uber, and Amazon, which ditched its own third party merchants’ website in favour of Shopify’s.

Online sellers can use Shopify’s platform to sell products to consumers directly through Pinterest and other social media, or their own websites or mobile apps.

In the fourth quarter of 2015, Shopify reported revenue of $70.2-million, an increase of 99 per cent over the same period in 2014. For full-year 2016, it expects to have revenues of $320 to $330-million.

Shopify isn’t unique. The market is jammed with similar online-store software companies, including major players such as Volusion, Big Cartel, and Bigcommerce.

Still, most critics put Shopify at the top of the list, citing the company’s ease of use, especially for novices; its ability to accommodate large or quickly-growing companies; its 24/7 phone and chat support; and the large number of available templates, apps and add-ons. Lütke believes
in leveraging the talents of others, and many of the apps offered are created by outside developers, who then sell them directly to Shopify’s clients through Shopify’s app store.

Having been a struggling entrepreneur himself, Lütke designs his company’s features specifically to help others who are trying to get their businesses off the ground, and who seldom have the time or expertise to set up their own sites.

Shopify doesn’t require users to know any computer code, as some of its competitors do. Lütke has added more back-office capabilities to make it easier for merchants to ship their goods, keep track of inventory and pay their employees, which in turn means more revenue for Shopify.

The company went public on May 21, 2015, raising more than $131-million. Lütke ensured that its voting stock stayed in-house to prevent the possibility of any unwanted takeovers.

He initially worried that the IPO would negatively change the company, but it hasn’t. He credits much of that to his employees who are hired for their ability to solve issues and take risks: the company famously says that the key is in how people act when they don’t know the answer.

Lütke also believes that much of Shopify’s success is due to the fact that it grew slowly, operated frugally, and never forgot its lean early years, which helped it avoid the overvaluation that seriously hurt many Silicon Valley start-ups.

The majority of its customers are based in the U.S., but Shopify steadfastly remains Canadian. And while it’s a flourishing company worth $2.5-billion, it’s virtually unknown to the vast majority of consumers, who aren’t aware that they’re buying their products through Shopify’s software.

That’s fine with Tobias Lütke, though. For him, it’s all about making it easy for others to look good and be successful.

The post Setting up shop appeared first on Canadian Auto Dealer.

Following Lincoln, completing the top five nameplate rankings, were Lexus, Jaguar, Porsche and Toyota. The five lowest-ranking nameplates, in descending order, were Chrysler, Dodge, Land Rover, Jeep and, in last place, Mini.

Among individual models, the Porsche 911 had the fewest problems in the industry, just 68 per 100 vehicles.

The study measured problems experienced during the past 12 months by original owners of three-year-old (2008 model year) vehicles. It included 202 different problem symptoms across all areas of the vehicle. Overall dependability was ranked according to the number of problems experienced per 100 vehicles (PP100), with a lower score reflecting higher quality.

Toyota Motor Corporation claimed seven segment awards – more than any other automaker – for the Lexus RX, Scion xB, Toyota 4Runner, Toyota Prius, Toyota Sienna, Toyota Tacoma and Toyota Tundra.

Ford Motor Company received four model awards for the Ford Fusion, Ford Mustang, Lincoln MKZ and Lincoln Navigator.

General Motors (Buick Lucerne, Cadillac DTS, and Chevrolet Tahoe) and Honda Motor Company (Acura RL, Honda CR-V and Honda Fit) each received three awards.

In addition, individual model awards went to: BMW X3, Mazda MX-5 Miata, and Mercedes-Benz CLK.

(The complete nameplate rankings and a listing of the top three models in each segment can be found in the accompanying tables.)

Import-domestic difference remains

The study found that, while domestic brands have closed the gap in initial quality with import-label brands, there is still a considerable difference between the two in terms of vehicle dependability. On average, the import-label brands outperformed Detroit-three brands by 18 PP100 in 2011.

That differential is consistent with the findings of Power’s 2008 Initial Quality Study, which examined the models included in the 2011 VDS after 90 days of ownership.

Domestic-brand cars had fewer problems (135 PP100), on average, than import-brand cars (147 PP100), but trucks and crossover vehicles from import brands had considerably fewer problems than those from domestic brands.

In addition to affecting brand image and brand loyalty, long-term dependability also has a noticeable effect on dealership service and customer-service spending, according to J.D. Power and Associates. As the number of problems experienced increases, owners are increasingly likely to use non-dealer service facilities for paid service work.

In addition, as the number of problems increases, the percentage of owners who say they “definitely will” return to their dealer for service diminishes.

Among owners who indicate they have experienced no problems, 76 percent indicate they “definitely will” return to the dealer for paid service. This proportion decreases to 42 percent among owners who say they experienced six or more problems.

Overall dependability improved from 2010
In the 2011 study, overall vehicle dependability averaged 151 PP100 – the lowest problem rate since its inception in 1990. Average dependability scores were 155 in 2010 and 167 in 2009 (adjusted to reflect changes in scoring).

During the past decade, industry improvement has averaged 8 percent each year.

Power says the recent slowdown in improvement is largely attributable to increased rates of problems with electronic features in vehicles, including audio, entertainment and navigation systems and new safety features, such as tire pressure monitoring systems.

“Automakers, as a whole, have made significant improvements in reducing traditional problems, particularly with vehicle interiors, engines and transmissions, and steering and braking during the past several years,” said David Sargent, vice president of global vehicle research at J.D. Power and Associates.

“However, as manufacturers add new features and technologies to satisfy customer demand and new legislation, they face the potential for introducing new problems.”

According to Sargent, as newer technologies become more widespread, enhancing the dependability of these features has become an important point of differentiation among automakers.

The 2011 Vehicle Dependability Study is based on responses from more than 43,700 original owners of 2008 model-year vehicles in the U.S. after three years of ownership. The study was fielded between October and December 2010.

J.D. Power and Associates 2011 U.S. Vehicle Dependability Study

Nameplate Rankings (Problems per 100 Vehicles)
1. Lincoln (101)
2. Lexus (109)
3. Jaguar (112)
4. Porsche (114)
5. Toyota (122)
6. Acura (123)
7. Buick (125)
8. Mercedes-Benz (128)
9. Cadillac (130)
10. Hyundai (132)
11. Honda (139)
12. Ford (140)
13. Saab (146)
14. Infiniti (151)

Industry Average (151)
15. Smart (152)
16. Chevrolet (156)
17. Volvo (156)
18. Subaru (157)
19. Kia (160)
20. Audi (161)
21. BMW (164)
22. Scion (166)
23. Ram (173)
24. Mazda (181)
25. Nissan (183)
26. GMC (184)
27. Mitsubishi (186)
28. Suzuki (190)
29. Volkswagen (191)
30. Chrysler (202)
31. Dodge (206)
32. Land Rover (212)
33. Jeep (214)
34. Mini (221)

J.D. Power and Associates 2011 U.S. Vehicle Dependability Study

Top Models Per Segment

Sub-Compact Car:
1. Honda Fit; 2. Toyota Yaris; 3. Hyundai Accent
Compact Car:
1. Toyota Prius; 2. Hyundai Elantra Sedan; 3. Toyota Matrix
Compact Sporty Car:
1. Mazda MX-5 Miata; 2. Scion TC*
Mid-size Sporty Car:
1. Ford Mustang*
Mid-size Car:
1. Ford Fusion; 2. Buick LaCrosse; 3. Mitsubishi Galant
Large Car:
1. Buick Lucerne; 2. Ford Taurus; 3. Chevrolet Impala
Compact Premium Sporty Car:
1. Mercedes-Benz CLK Class*
Entry Premium Car:
1. Lincoln MKZ; 2. Lexus ES 350; 3. Acura TL (tie) / Acura TZX (tie)
Mid-size Premium Car:
1. Acura RL; 2. Mercedes-Benz E-Class; 3. Lexus GS
Compact Multi-Purpose Vehicle:
1. Scion xB; 2. Chrysler PT Cruiser*
Compact Crossover/SUV:
1. Honda CR-V; 2. Subaru Forester; 3. Toyota RAV4
Entry Premium Crossover/SUV:
1. BMW X3*
Mid-size Crossover/SUV:
1. Toyota 4-Runner; 2. Hyundai Santa Fe; 3. Ford Edge
Large Crossover/SUV:
1. Chevrolet Tahoe; 2. GMC Yukon; 3. Toyota Sequoia
Large Pickup:
1. Toyota Tundra; 2. Ford F-150 LD; 3. Ram 1500 LD
Mid-size Pickup:
1. Toyota Tacoma; 2. Honda Ridgeline*
Minivan:
1. Toyota Sienna; 2. Honda Odyssey; 3. Chevrolet Uplander
Mid-size Premium Crossover/SUV:
1. Lexus RX; 2. Lexus GX 470; 3. Volvo XC70
Large Premium Crossover/SUV:
1. Lincoln Navigator; 2. Mercedes-Benz GL Class*

*No other model in this segment performs above the segment average.

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It outlines the ideal form the company should take in response to self-asked questions about what kind of organization Toyota should be and what kind of values it should honour.

Among other things, it says, Toyota-related operations around the world will define their own missions in the context of fulfilling the overall corporate mission statement and will translate those missions into concrete actions.

Compiling the Toyota Global Vision was a team headed by president Toyoda that included members drawn from the company’s operations around the world.

Highlighting the global mission statement is a commitment to being a company that customers will choose and will feel good about having chosen. Toyota has expressed that commitment with the slogan: “Rewarded with a smile by exceeding your expectations”.

Toyoda observed that Toyota has strived through its 74-year history to create socially beneficial automobiles and to earn smiles from customers worldwide. “All 300,000 of us at Toyota worldwide,” declared Toyoda, “will take part in laying a foundation for sustainable growth. Working side by side, we will strive to earn smiles by exceeding customers’ highest expectations. Together, we will write a new chapter of Toyota history.”

He continued: “Toyota will lead the way to the future of mobility, enriching lives around the world with the safest and most responsible ways of moving people. Through our commitment to quality, constant innovation and respect for the planet, we aim to exceed expectations and be rewarded with a smile. We will meet challenging goals by engaging the talent and passion of people who believe there is always a better way.”

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Toyota was also selected as Most Trusted Hybrid Brand.

“We’re honoured that Canadian readers have once again placed their trust in Toyota and have recognized us with these awards,” said Stephen Beatty, Managing Director at Toyota Canada Inc. “We remain committed to providing Canadians with a vehicle that delivers the quality, safety, sustainability and retained value they demand – and we value the endorsement that important awards like this represent.”

The company is building a new online, TV, radio and print marketing campaign, “#1 for a reason” that is says will remind Canadians about why Toyota is the #1 selling passenger car brand in Canada.
will Reader’s Digest awards are the latest in a series of accolades that help explain why Toyota is the #1 selling passenger car brand in Canada.

In a news release, Toyota says it offers fuel-efficient, well-built, value-priced vehicles, and cites other recent accolades, such as being recognized leaders in six segments in the 2011 Canadian Black Book Retained Value Awards, as further evidence of consumer support for its vehicles.

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There is some good news. APA Director, George Iny, says that, “Despite all the media attention over safety recalls, overall quality and the value propositions of new and used vehicles offered in 2010 are good.”

APA says 2010 is a transition year for the industry. “The carmakers are racing to introduce new, friendlier, sport utility vehicles built on lighter car platforms that will wreak less damage on the vehicles they hit in the event of a collision. There are some innovative smaller vehicles like the Kia Soul and Nissan Cube, with more to come shortly, like the Ford Fiesta and Mazda2, but it will be another year or two before the fuel saving technologies required to meet more stringent U.S. fuel consumption standards make their way to the market.”

Advertising standards
The APA expressed dismay, however, over the drop in standards for new vehicle advertising. Chrysler, it says, is now pushing very long 84 and 96 month loans which promise low payments, but will leave consumers owing thousands if they try to sell the car to pay off the loan early.

Also more prevalent in this year’s new car ads are bi-weekly and even weekly payments. “Consumers are used to budgeting with monthly payments,” says Iny. “Weekly payments make the deal look cheaper, when it may not be.”

The APA was also critical of lease deals on luxury cars currently advertised with monthly payments ranging from $350 to $600 in the bold print. To get those monthly payments, says the APA, you may have to add over $5,000 in initial payments, fees and charges buried in the fine print, and the total for up-front money should appear in the bold print next to the monthly payment.

Price advertising by used car dealers in Quebec, on the other hand, is much more transparent, and proves it is possible to advertise with integrity, says the APA.

The American carmakers
According to the APA, Ford is in the best shape among the domestic carmakers, with competitive mid-size cars and SUVs like the Fusion and Edge. Canadian sales are likely to increase with the arrival of the subcompact Fiesta this summer and a new Focus next year.

The reliability of the new Fords has improved incrementally each year since 2007.

GM has some appealing products like the Malibu sedan and Chevrolet Equinox SUV, but quality issues linger with steering, front brake and electronic components on several GM models that can drive up maintenance and repair costs.

Chrysler is in a holding pattern this year, with a lacklustre line of small vehicles and not much new to offer for another year or two.

The European carmakers

Canada is a big exeption to the weak market for luxury vehicles in most western economies, the APA says. BMW, Mercedes-Benz and Audi have been breaking records thanks to high sales of entry-level sedans like the BMW 3-series and Audi A4, and compact SUVs like the Mercedes GLK.

The German luxury automakers now offer four-wheel drive almost exclusively on their Canadian market sedans and are attracting customers from other luxury brands like Acura, Volvo and Jaguar.

The APA says the competition is so intense that it’s possible to lease an entry-level car from a German automaker for similar or less money than a loaded Japanese intermediate.

Cadillac will have to wait for a return to leasing in Canada to be truly competitive.

In the affordable segments, Volkswagen is now off APA’s list of vehicles to avoid. The APA says VW’s reliability has improved to average or better for several models, and that most VW products rate at the top of their class for performance, comfort and safety.

The Asian carmakers
Hyundai and Kia experienced explosive growth in the last year, as consumers looked more closely for value in their purchases. All the new Hyundai and Kia products offer superior value and several redesigned Hyundai models have generated fewer complaints recently than their Japanese rivals, the APA says.

Hyundai recently declared its intention to post best-in-class fuel economy in every segment it competes. That’s no small feat as it will mean making vehicles that use less fuel than Honda and Toyota, and will certainly require the automaker to introduce a hybrid.

Kia offers innovative designs with democratic pricing; APA particularly likes the Rondo which is rated best in its class, and the Soul, which is a unique vehicle

And then there’s Toyota
Toyota has warranted a lot of media attention recently because of the controversy surrounding reports of unintended acceleration with its vehicles.

The APA believes the two most likely causes for unintended acceleration are:
1) Interference between the pedal and floormat, because of an incompatibility between the Toyota accelerator pedal on certain vehicles and “pantsaver” style mats installed by owners in winter, and;
2) Pedal misapplication.

For other incidents, the cause is undetermined and will likely remain so, due to a lack of investigation when first reported by consumers, in many cases attributable to Toyota and its dealers.

The APA continues to recommend most Toyota models. The automaker’s quality has slipped a bit recently, it says, and launches of some redesigned models like the 2007 Camry and 2009 Corolla were not troublefree. But Iny says Toyotas continue to offer superior reliability and low operating costs. Resale values have slipped a bit but continue to be better than average.

However, the APA says Toyota’s conduct during the sudden acceleration investigation has exposed weaknesses in the way Canada investigates safety defects.

The APA is recommending the following changes:
• Dealers should be required to log complaints about potential safety defects reported by their customers and file them with Transport Canada. Toyota dealers made early reports of unintended acceleration “disappear” by not recording them, or telling owners their cars were OK without investigating further.
• Automakers must have field engineers on staff or on contract to investigate reports of safety defects. Until recently, Toyota had no engineers available in Canada to investigate field reports of sudden acceleration, even when incidents resulted in a collision. Iny calls this situation “irresponsible” and a possible violation of the Motor Vehicle Safety Act, which makes it the carmaker’s duty to ensure the safety of its products.
• Canadian law requires automakers to notify Transport Canada when they become aware of a safety defect. The APA says the language in the Motor Vehicle Safety Act may need to be reviewed to require cooperation with the government during an investigation. Toyota appears to have concealed from both American and Canadian regulators the fact that several models were equipped with onboard event data recorders that record data like accelerator and brake pedal position in the seconds before an impact. Had Toyota or the government been able to download data after the early reports of collisions, it would have helped identify the cause of complaints, and possibly rule out electronic interference issues
• Transport Canada needs more resources for its small defect investigations department. This includes adding a couple of engineers with a specialty in vehicle electronics, and ensuring it has the bench strength to handle the recall investigations that go critical every four or five years and result in a large influx of reports.

According to Iny, Toyota’s response in the sudden acceleration file has cast a shadow that is unwarranted over recalls from other carmakers. Recent statements by its Canadian executives have been light on details about the changes Toyota needs to make at the corporate and dealership level to be more responsive to safety complaints.

Toyota’s insistence that there are only five complaints for “sticky” accelerators – while true – is self-serving and lacking in candor, given the much higher number of reports of unintended acceleration for other causes including undetermined causes, Iny says.

He adds that a comprehensive technical solution to address the unintended acceleration issue needs to take into account the potential for pedal misapplication, because the gas and brake pedals are located close together and outside of the field of view of the driver; Canadian owners are also more than likely to install rubber floormats in winter, so designers of the floor and pedals need to take this into consideration for Candian-market vehicles.

The APA predicts that now that Toyota is sharing its event data retrieval equipment with government investigators in the U.S. and Canada, it will likely take another six months to a year to definitively identify the causes of unintended acceleration.

The APA’s new-vehicle ratings are available at its website, www.apa.ca.

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Following a hugely successful media preview day, with media attendance topping 1000 for the first time in the show’s 38-year history, Toronto’s pro-car mayor, Rob Ford, officially opened the show to the public on February 18.

“The war on the car is over,” Ford told an audience of people lined up for tickets and waiting for the show to open. After declaring the show open, he personally shook hands with everyone in the line as they entered.

The mayor’s appreciation for cars and their importance seemed to be shared by the public who thronged to this year’s show in record numbers through the first weekend, which included Ontario’s annual Family Day holiday.

“Discover, Connect and Experience” was the tag-line for the show and it delivered to show-goers on all counts. More than just a display of concept vehicles and new cars and trucks, of which there were many, it featured something for everyone – beginning at the show’s entry level with two displays that set enthusiasts’ hearts racing.

First was ‘Concorso Exotica’ – a display of noteworthy exotic cars that ranged from 60s Ferraris to the latest Porsches and Lamborghinis. Then came the ‘Cruise Nationals’ display of the best examples from Ontario’s many summertime ‘cruise’ events, including an immaculate 1931 Cadillac V-12 roadster. There was also a huge exhibit of iconic Camaros and Firebirds – all as prelude to the main event, the manufacturers’ displays of shiny new vehicles, many of which were making their Canadian debuts.

It was hard not to be excited, which was precisely the point of the show. Excitement drives sales!

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