Tutorial

This walks through the first useful result: one creator, one agreement that pays them a share of a real product, a test order that earns a royalty, and a payout batch approved and sent.

Budget about half an hour. You will need one product to attach a rule to, and (for the last two steps) a PayPal account you can connect. Everything before that works on any plan.

1. Install the app

Install Royalty Payouts Paladin from the Shopify App Store and approve the access it asks for. It reads your products and your orders, including order history, because a royalty has to be matched to the line items that earned it. It asks for no payment or customer permissions.

After the install the app syncs your product catalogue, so give it a moment before the product pickers look complete.

2. Connect PayPal (optional now, required to send money)

Open Settings, find the PayPal payouts card, and enter the Client ID and Client secret from a REST app in your PayPal developer dashboard. Set Mode to Sandbox while you are testing and Live when you are not, then press Test connection.

Two things to know before you get here:

• PayPal payouts are a Pro plan feature. On any other plan the card explains that and the rest of the app still works, settled by hand.
• PayPal has to enable the Payouts feature on your live account. Sandbox works immediately; live does not, until they approve it.

You can skip this step and come back. Batches still generate, and you can still review and approve them, you just cannot send them through PayPal yet.

While you are on this page, set Notification email if the approval alerts should go somewhere other than the store owner’s address.

3. Add a creator

Open Creators and press Add Creator. Fill in:

• Name. Required, and the only required field.
• Email. Optional. It is used for statements, payout reports, and creator portal sign-in. A creator with no email still earns; they just get nothing by mail.
• PayPal Email. The address PayPal sends their money to. This can differ from the email above.
• Payout method. Leave it on PayPal, or set it to manual if you settle this creator by wire or cheque. Manual creators are left out of the PayPal send and marked paid by hand instead.

4. Create the agreement

Open Agreements and press New agreement. That creates a draft agreement with one blank rule and drops you into the editor, on Details.

An agreement is the deal. The rules inside it are the formats: a digital rule and a print rule at different rates, say, or one rule per region. The left rail splits into an AGREEMENT section (the settings every rule in the deal shares) and a RULES section.

Work down the agreement section:

1. Details. Name the agreement and set its effective dates. Nothing accrues on an order dated outside this window.
2. Recipients (baseline). Press Add recipient, pick your creator under Creator, and set Split %. The splits must total 100%. Every rule inherits this list unless you override it on the rule itself.
3. Payouts. Choose the Payout schedule: Monthly, Quarterly or Annually. This is the period the ledger buckets earnings into and the period payout batches are cut for. When to start running payouts lets you hold batching back to a date without stopping earnings from accruing.
4. Deductions. Set Royalty basis to Net sales or Gross sales. Gross applies the rate to the full line amount and deducts nothing. Net subtracts whichever of Deduct discounts, Deduct prorated shipping and Deduct unit cost you switch on. Leave Handle refunds (negative ledger entries) on unless you genuinely do not want refunds to claw back royalties.

5. Set up the rule

Select the blank rule in the RULES section of the rail. Give it a name, set Royalty rate (%), then open Products and choose what it covers. You can pick products by hand or build a query (by vendor, product type or tag) and let the rule keep itself up to date as your catalogue changes.

Two optional sections sit below it. Order criteria restricts the rule to (or away from) B2B orders and specific countries, which is how a rule that pays a different rate inside the EU is expressed. Recipients override replaces the baseline split for this rule only.

If you need another format at another rate, press New rule in the rail and repeat.

6. Publish

The header carries one next step button. On a new agreement it offers Continue to data cleanup and then Continue to historical pull, two optional tools for pulling past orders into the ledger, and finally Publish agreement.

Publishing is what makes the rules live. Until then the agreement is a draft and earns nothing, so you can leave it half finished without any risk of it paying somebody.

7. Place a test order

Buy one of the products the rule covers and mark the order paid. Within a moment of Shopify reporting the order as paid, open Ledger: there should be one row per recipient, showing the gross, the basis, the rate applied and the amount earned.

If nothing appears, the usual causes are a draft agreement, an order dated outside the agreement’s effective window, a product that is not actually on the rule, or an order carrying a tag you have excluded.

8. Generate the batch

Open Payouts, which is titled Payout Approvals. Batches for a closed period are created automatically on the first day of the next period. Generate payouts now runs the same check on demand, under the same calendar rule, so on the tenth of the month it will report that there is nothing new to batch.

That is fine for a first run: press Pay out current period early instead and it batches what has been earned so far in the open period. Read the confirmation before you accept it: money sent early cannot be clawed back by a refund recorded afterwards, which is why waiting for the period to close is the default.

9. Approve and send

Each batch appears pending approval with its total and one line per creator. Press Review on a line to see what is behind it, then Approve Batch, or Approve All Pending to clear the queue in one go.

Approving does not move money. Sending does: press Send Approved Payouts and confirm the total. The send runs in the background, and the batch goes to processing.

10. Watch it settle

Lines do not turn paid because the app asked PayPal to pay them. They turn paid when PayPal reports that item succeeded. The app polls for this hourly, and Reconcile now asks immediately.

A creator with an email address gets a payout report once their line is confirmed paid. From here on, the same cycle repeats on your payout schedule, and the only step that needs you is approving the batch.

Next: the documentation covers each area in detail, and the FAQ answers the questions that usually come up in week one.