Founded in 2012, Passenger is a responsible outdoor clothing brand with a mission to "inspire meaningful escapism", fostering wellbeing and connection with nature and the outdoors. The UK-based company has woven their commitment to sustainability into every thread of their business, with 74% of their products made out of responsible fabrics and a tree planted with every order. With quality apparel that's durable, attainable, and comfortable and a socially-conscious mission, Passenger has seen skyrocketing growth, from about $500,000 to over $100 million GMV in just four years.
Initially, international expansion was not a focus for Passenger, with cross-border sales making up less than 1% of the company's revenue. But implementing Markets proved to be transformative, helping the brand successfully expand into multiple international markets. As their global presence grew, new operational challenges emerged, particularly around managing multiple currencies. That's when Multi-Currency Payouts through Shopify Payments became the natural next step in their evolution, providing a sophisticated solution to help the team better manage their now-global business operations.
Since implementing Shopify's international expansion tools, Passenger has seen:
- Proportion of international sales grow from just 1% to 40% in just two years
- Unified shopping experience for customers from a single store
- Elimination of weekly FX overhead with ability to hold foreign currency to pay suppliers
The Challenge: Going global without fragmenting the shopping experience and adding costs
While Passenger's products and mission had the potential to appeal to customers worldwide, transitioning to international ecommerce initially involved too much complexity in time and resources.
For one thing, the company wanted to avoid the complexity of creating separate expansion stores for each international region—a common approach that can create more problems than it solves. "We've seen how other brands have created expansion stores for each region and then need to create complex backend logic for things like inventory management," says Jon Lane, CEO of Passenger. "With Markets, it's all one instance of Shopify, which made things a lot easier." This unified approach eliminated the need for separate payment accounts and the seamless backend syncing of inventories, marketing content, reporting, and applications that would otherwise be required.
The team also wanted to be efficient in paying their suppliers, who were located around the world. They wanted to avoid paying a foreign exchange fee on every vendor payment, which only increased their cost of goods sold (COGS).
As a business, having a load of dollars or Euros available is a natural hedge. We source our products globally, and it's really important that we have some funds in those local currencies. We don't want to get money converted from sales into GBP and then have to convert it again to pay bills and thus pay the foreign exchange rate twice.
The Solution: Saving costs and time with a seamless currency experience
When the Passenger team first heard that Markets was being released in the UK, they recognized it as the ideal solution for their international growth ambitions. Markets provided a unified platform that eliminated the complexity of managing multiple stores while enabling local experiences for customers worldwide.
"We've always tried to have a test-and-learn approach to most things we do. Markets enabled us to do that," says Jon. "We rolled out about 10 different markets over a couple of weeks and in some cases launched into new markets in less than a day." With Markets, Jon and his team could easily see data for all their operating regions and test performance and strategies across markets. These insights informed how they tailored and translated their websites for specific markets, ensuring that the content and experience resonated with local customers.
"We ended up getting significant traction in the US and Germany," Jon says. "We knew we could ensure that our brand comes across in the best way possible in these regions, spending more on marketing and localizing a bit more. For example, we made sure that the shipping methods and wording in checkout were right for the US versus German customer."
As their international presence grew to 40% of their business, Passenger's financial operations became more sophisticated. This led them to adopt Multi-Currency Payouts through Shopify Payments, enabling them to manage their global financial operations more efficiently. "It's not necessarily about saving margin. We always want to price things at a proper retail price, rounded to the price point that makes sense, and not just layer in the conversion fee on top of that. It's crucial to get this right for the customer proposition," explains Jon.
A key benefit of Multi-Currency Payouts is currency settlement, which allows the brand to hold funds in foreign currency to pay suppliers. "We're buying tens of millions of pounds worth of product a year, and the time savings gained in having the right currency setup adds up every week when we pay those bills. It's a big saving for us," Jon says.
The currency settlement feature also enables Passenger to connect a payment settlement to a local entity and route transactions as domestic rather than international ones. This results in higher bank authorization rates, which means products get to customers faster and the business generates more revenue.
Shopify has made a huge difference because we just haven't had to worry about how we suddenly integrate with a backend in a different language or anything. It's been much more straightforward and takes the operational load off us massively.
The Results: Escaping international expansion inertia
With Markets, Passenger saw their proportion of international sales jump from less than 1% of their total sales mix to 40% in just two years. As part of Shopify Payments, Multi-Currency Payouts has driven time and cost savings to ensure that the brand can continue to expand across borders. Throughout their evolution from domestic retailer to global brand, Shopify has provided the right tools at the right time, from Markets enabling their initial expansion to Multi-Currency Payouts supporting their maturing financial operations.
"I think we really just started—international sales are only going to get bigger," Jon says. "Shopify's international expansion tools like Markets and Multi-Currency Payouts have been game changers for us. The more the years go on, the more we will use them just to make sure that we keep up our pace of change and keep on building these markets."
Shopify solutions have worked well for Passenger's expansion journey because Shopify supports their test-and-learn approach. The brand applies this method to everything they do, from improving products to growing the business.
"Everything we do, we could do it better. If we do lots and lots of one percent incremental improvements, we can take this business a long way," Jon says.
I'm just super pleased with Shopify's Multi-Currency Payouts. It enables us to offer a transparent and streamlined payment experience for customers. It allows us to hold funds in foreign currencies so we can pay suppliers in the most cost-effective ways possible. And it was easy to use as part of our current operations without increasing overhead or administrative costs. These are key pain points that hold other brands back from going global.
