Is Selling On Etsy Worth It?

One of the biggest complaints sellers have about Etsy is the number of fees you have to pay to sell on the platform. Each item is subject to a listing fee, a transaction fee, and a payment processing fee. Here’s a very quick representation of Etsy fees:

• Listing Fee: $0.20 on each product listing
• Transaction Fee: 6.5% of each transaction
• Payment Processing Fee: 3% + $0.25 per transaction

If you’re tired of paying a listing fee for each product you add, and you’re sick of paying a 6.5% transaction fee on all your sales, it might be time to open your own eCommerce site. eCommerce software typically costs around $30/month, and many do not charge any transaction fees. (You will, however, still have to pay a payment processing fee to your payment provider.)

With Offsite Ads, Etsy places advertisements for your products on major sites, such as Google, Facebook, Instagram, Pinterest, and Bing. If a customer clicks an ad that features your products and then buys from you within 30 days, you are charged for the advertisement. This charge is between 12%-15% of the purchase, depending on your annual revenue.

The big issue with this new program is that Etsy currently requires all sellers with over $10,000 in annual sales to participate. Many sellers are frustrated that they cannot opt out of the program, and some say that the advertising fee is far too expensive.

Competition is the number one problem with marketplaces. While it’s easy for customers to find your products, it’s just as easy for them to hop from your Etsy shop to someone else’s. On a marketplace such as Etsy, your products are constantly being compared to your competitors, and, sadly, lower prices often win out regardless of product quality.

By building your own site, you differentiate yourself from the competition and make it less likely that customers will look elsewhere.

Any shop that exists within the Etsy marketplace is under its authority. If Etsy decides your products don’t meet its standards and it shuts your site down, there isn’t much you can do about it.

To comply with Etsy’s requirements, you have to make sure that the products you sell are not included in Etsy’s list of prohibited items or prohibited services. Your account can also be suspended or terminated if you violate copyright laws, sell manufactured items, or avoid Etsy’s seller fees. Read Etsy’s seller policy thoroughly to see all of the regulations that you must follow to remain on the platform.

However, if you’re sick of renting space on Etsy (and living in constant fear of eviction), it may be time to get your own place. Create your online store and try it out on your own.

Because there’s so much competition on the Etsy platform, many sellers are forced to continually reduce their prices to attract buyers.

These reduced prices make it much harder for you to earn a profit, and eventually, the earnings may not be worth the time you put into your products. When the platform affects your bottom line to a detrimental degree, it’s time to leave.

It is very difficult for an individual Etsy seller to rank in Google search results. When Google displays Etsy on the first page of search results, it tends to lead to an Etsy search page, not an individual store or product. What’s more, users with Etsy’s Pattern sites also have difficulty ranking on search engine results pages, especially if they still use an Etsy subdomain.

While it’s never easy to figure out SEO, you may have a better chance with your own independent store than you do on Etsy.

One of the best ways to encourage repeat business is to establish a brand. You want customers to connect to your company and your story. Unfortunately, it’s very difficult to develop a sense of identity on Etsy.

The sad truth is that most Etsy buyers don’t pay attention to the shop from which they purchase an item. As a marketplace, Etsy has a much stronger identity than any of the actual shops it hosts. Etsy is the brand.

When you have your own site, you can truly make the shop yours. You can fill it with content that’s entirely relevant to your products and design it to fit your vision.

Etsy allows sellers to list only handmade items (including digital items), vintage items, and craft supplies. You cannot list manufactured items that do not fit into these categories.

If you’re looking to add a few manufactured items to your inventory, you may be ready to create your own site. With your online store, you can finally sell those bracelets you found on a wholesale website that go perfectly with your hand-dyed scarves. And you can do so without any fear of repercussion from a marketplace.

Shopify is a popular fully-hosted eCommerce platform that is fast, easy to use, and affordable. The basic feature set is enough for most users to quickly get an aesthetically-pleasing, functional online store up and running.

This platform is perfect for Etsy sellers looking to fully replace or supplement their existing store. Shopify offers affordable monthly pricing, the ability to build a website from scratch with no coding knowledge needed, web hosting and security, and access to 24/7 customer service.

You can start a 3-day free trial with Shopify and see if it is right for your business.

Square is a powerhouse in the world of payment service providers, POS systems, and online stores.

Like Shopify, Square offers affordable plans with access to a large number of features and would work great as a replacement or companion to your existing Etsy store.

An added benefit to Square is their ability to seamlessly allow you to take payment digitally and in-person at pop-up shops and other vendor events like farmers markets.

If payment processors, marketing, and shipping are all things you’d prefer to have handled for you, Etsy is going to be a great option for your business!

Even if you want to explore an independent eCommerce site in the future, it can be useful to start with Etsy to decipher all of the shipping options out there, payment processing fees, and marketing styles/costs.

Etsy can be a soft place to fail/land for new business owners. The startup costs are low, there are no difficult and binding contracts, and you get to decide how much inventory/product you make and sell.

If you’re worried about your product being too niche or not finding an audience large enough to start your own independent website, Etsy can also be a great place for you to gauge interest.

Even though Etsy and other marketplaces tend to push the idea that you can make enough money to quit your day job, that doesn’t have to be your goal. If the idea of starting your own website and all of the work that goes into doesn’t appeal to you then you can look to a pre-built marketplace like Etsy to share your products with the world.

Check out our article for side hustles you can start from home!