Confusion reigns as angry Neto retailers consider switching providers

Neto

E-commerce software provider Neto is facing an exodus of customers as confusion reigns about its plan to push through a price hike to stem losses.

In the days after SmartCompany detailed changes to Neto’s pricing structure, business owners have continued to take to social media to express outrage and research switching providers.

Neto is changing its pricing structure so customers are charged based on their annual revenue and will start billing in US Dollars rather than Australian Dollars.

It has claimed there will be a $360 cap on price increases for at least 12 months from the April 1 implementation date.

However, SmartCompany has been approached by several customers who say they’ve been told they will pay much more than that.

In an original email to clients notifying them of the changes on February 28, Neto chief executive Ryan Murtagh said discounts would be applied to clients to ensure they didn’t pay over the cap.

But it has since emerged Neto sent a number of different emails, some of which did not mention the discount.

In one email seen by SmartCompany, Neto told a client, who is turning over more than USD$1 million annually, their plan would increase from $499 a month to over USD$750 after a discount was applied.

Converted into Australian currency at current exchange rates, that equates to over $1,000, at least an AUD$500 increase.

In another email, a client was told, “we have reviewed your account and based on your last 12 months revenue you would be subject to a price increase of AU$2,304”.

Neto said it will apply a AU$1,944 discount to the customers account for the next 12 months to cap their increase.

The business maintained it will ensure a $360 cap is applied per store for all clients and is asking merchants who have been told they will have to pay more to contact them to have their plans corrected.

However multiple clients who say they went back to Neto for clarification say they have either yet to receive a response.

Meanwhile, dozens of confused customers have continued to take to social media to explore switching to new providers, despite being faced with the expensive task of switching their websites onto new systems.

Review pages for Neto services online, including Google reviews, have been bombed by angry business owners while competitors have begun openly pitching disgruntled clients.

As SmartCompany reported earlier this week, there are also business owners who plan to stay with Neto and have defended the business, saying their rates are still competitive.

However, others who have accepted the price increase have criticised Neto’s communication about the changes saying they’re still unsure what their bill will be in a months time.

“I didn’t know about the $360 cap when I was negotiating with them so I was at a big disadvantage to everyone else,” one client tells SmartCompany.

“We shouldn’t get distracted from the fact that even with a $360 cap this is still a massive price increase, $4320 of annual overhead increase is a massive amount for any small business to absorb.”

Wholesalers, who operate on higher volumes but with less margin, have expressed particular concern about the move to a revenue-based model as the new system would significantly affect their cost base.

The small business ombudsman is monitoring the situation after receiving two complaints in recent days, one of which was rescinded after the business owner decided to switch providers instead.

Murtagh has explained the increase as necessary to clients to “balance its costs”.

This article was updated at 3:30PM AEDT to clarify details about Neto’s client discounts. 

NOW READ: “Gouged”: Angry retailers threaten ACCC complaints over Neto price hikes

NOW READ: E-commerce tips from online retail experts

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Garry
Garry
1 year ago

For a fraction of the price and the same effort you could have an awesome ecommerce site built on NOPCommerce.

Pete
Pete
1 year ago
Reply to  Garry

Garry there are a lot of opensource ecommerce platforms out there, the solution that neto provides had direct connectors to various other applications to streamline the process of running a business online and in store however those connectors are increasingly being phased out and the cost increase of those has doubled and is now in US$. So neto is a platform that just works without too many headaches, it just became really expensive and has a lot of bugs that it shouldn’t have, has simple problems that should have been fixed years ago and it has also become a slower less responsive platform, not just in terms of online speed for end users, back end speed for business users and response times to support requests. In essence they may have grown rapidly but their platform hasn’t kept up, their support has waned and none of that equates to a reason to increase a clients costs by 500%.

Matthew Cummins
Matthew Cummins
1 year ago
Reply to  Garry

I used NOPCommerce directly before going to Neto, as that was what the business was using before I was involved. It was a piece of poo. Worst eCommerce system I’ve ever seen, almost unworkable, and with absolutely no redeeming features compared to other available platforms. Only pushed on clients by ASP programmers because it’s built in ASP, so represents an easier system to build for those who are familiar with Microsoft ASP programming rather than the more commonly used PHP. But in terms of features of the software itself or usefulness for business owners – it’s a bad joke, or at least it was when I last used it.

Maybe it’s improved in the last 5 years, it would have needed it, it was pathetic.

I’m not saying everyone should stay with Neto. For some it still represents the best option, at least for now, for others a move is in order. But in terms of what to consider if Neto is no longer for you, I’d suggest Shopify, Woocommerce, BigCommerce, Magento, Netsuite etc as viable options, depending on where you fit in the market. Possibly a few more. But not NopCommerce!

Garry
Garry
1 year ago

That you not started with a batshit crazy anti Microsoft diatribe says your 1 of those flakes that destroys business’s because your more interested in you anti Microsoft obsession than delivering a solution that address’s the clients business needs.
Shame on you!
Oh and as for the idiotic claim that PHP is more common than C#, a quick look on seek or any of the other job sites soon puts that myth to bed.