Looking for a fun and creative way to make money online? Why not open an Etsy shop?
Etsy, one of the biggest online marketplaces in the world, has the potential to turn your side hustle into a full-time gig—or at the very least, it could provide you with some serious supplemental income.
With a reach of over 80 million buyers, getting your products on Etsy could be the catalyst you need to start your own business while doing the things you love. Want to get in on the action by opening your own Etsy shop? Follow this beginner’s guide to get started.
What is Etsy?
According to Etsy.com, “Etsy is a global online marketplace, where people come together to make, sell, buy, and collect unique items.” Etsy’s business model is based on connecting creatives, entrepreneurs, and small businesses with buyers looking for artistic and handcrafted goods.
The e-commerce platform launched in 2005 and has since expanded to be one of the most popular online marketplaces, touting over 60 million listings. According to Statista, the number of active sellers on Etsy was 4.3 million, and the site had 81.9 million active buyers as of 2020.
How does Etsy work?
Etsy provides a platform for buyers to sell their products to shoppers via a web browser or on the Etsy app. Etsy gives sellers the opportunity to market their goods without needing their own website like when using Shopify. Etsy doesn’t make any of the products it sells. Instead, it acts as the middleman, connecting buyers with sellers.
Sellers use the platform to create unique product listings and shops, which buyers can then peruse and purchase items directly from the seller. These independent artisans and businesses not only produce their goods but also manage the orders, inventory, and shipping. Etsy charges a fee for facilitating any sales.
Anyone can purchase items on the site, whether you have an Etsy account or want to checkout as a guest. The purchasing process is much like other online retailers, allowing you to add items to a digital cart before checking out.
What separates Etsy from other marketplaces is its primary focus on unique, handcrafted items rather than mass-produced ones.
How to start an Etsy shop
If you’re an artist, craft maker, designer, or independent business owner, selling on Etsy could be a very profitable way to market your wares and make some extra money.
Follow these steps to open an Etsy shop and start turning your hobbies into cold hard cash.
1. Create an Etsy account
The first step is to open an Etsy account. Head to the Etsy.com sellers’ page and click “Open your Etsy shop.” Enter some basic personal information to get started with an account. You can also sign up with your Google or Facebook account. Etsy accounts are free to create.
Be sure to read all of the platform’s policies to ensure that you stay within their guidelines.
2. Set up your Etsy shop
After creating your account, you can now start setting up and customizing your Etsy shop. You can set your shop preferences for selling your products as well as select the language for describing your products, the currency for trade, etc. You’ll also want to come up with a name for your shop. Think of a name that’s unique, memorable, and represents your brand well.
Other customizations that will help optimize your shop and hopefully attract more sales are your user profile and shop bio. This is how potential customers can learn a little about you and your products, so keep it personable and interesting.
3. Add items to your shop
Next, you’ll set up your product listings. When adding a listing on Etsy, you’ll be asked to fill out the following areas:
- Title: Be very detailed when giving your item a title. Think of how a customer would search for the product.
- About the listing: Choose between different options detailing who made the item and when, etc.
- Category: Choose which category best fits your product. Consider including subcategories as well.
- Type: Choose whether you are selling physical or digital products.
- Quantity and price: Add the price for each item and make sure you factor all the costs into your sale price. Include the amount you have in stock and if there are product variants such as size, color, or material.
- Product description: Describe your product in detail and make sure it can be easily understood by users.
- Product photos: Etsy recommends that you include at least 5 high-quality photos per product.
- Thumbnails: Adjust the thumbnails, which are the first photos buyers will see when they come to your shop, so that they are consistent with your brand.
- Shipping fees: Include shipping fees, country of origin, processing time, weight, and size of product. You can always update this information later if needed.
It’s a good idea to click “Preview Listing,” after you’re done filling out the information for your Etsy shop. This gives you the opportunity to review what your listing looks like and allows you to make any necessary edits.
4. Choose your payment preferences
There are many options for electronic payments on Etsy. Choose the payment method that works best for you, such as PayPal or Etsy Payments.
Etsy Payments allows sellers to get their money through different options like credit cards, bank accounts, debit cards, store credit, Etsy gift cards, and more. Some sellers find this payment method to be the most convenient. Though, keep in mind that this method will charge you a small processing fee — more on that later.
5. Add billing information
To add your billing information be prepared to authorize your credit card. You may also be asked to provide billing information so that Etsy can charge you for fees and commissions.
Some sellers might be eligible to enroll in auto-billing. Auto billing allows Etsy to automatically charge your account when you incur selling fees. This is a good option if you are worried about remembering to pay your monthly statements.
After setting up your billing information, you can start promoting your products and making sales!
Etsy seller fees
While setting up your initial Etsy account is free, it does cost money to do business on the platform, as Etsy charges various fees to use their service.
Here are the 3 main types of fees you will come across when you sell on Etsy:
Every time you list an item in your shop Etsy will charge you a small fee. Etsy charges a flat fee of $0.20 for each item you list, regardless of whether the product sells or not. Listings expire after 4 months. Etsy’s automatic renewal feature will renew the listing when it expires, charging $0.20 each time unless you cancel the listing.
Every time you sell an item, Etsy charges a 5% transaction fee each time you sell an item, plus whatever you charge for shipping and gift wrapping.
Payment processing fee
As mentioned earlier, if you accept payments online through your Etsy shop using Etsy Payments, you’ll incur a payment processing fee for each transaction when an item is sold. The payment processing fees will vary based on where your bank is located. For U.S. sellers, Etsy charges 3% + $0.25 per transaction.
Tips on how to sell on Etsy successfully
Setting up your Etsy shop is just the beginning. If you really want to run a successful and lucrative shop, you’ll need to go the extra mile in order to boost your visibility and increase sales.
Consider the following tips help you maximize the returns on your new Etsy shop:
- Utilize Etsy’s social media tool: Social media platforms such as Facebook, Instagram, and Pinterest are great ways to extend your reach, connect with your customers, and drive traffic to your Etsy shop. Luckily, Etsy simplifies this process by easily connecting your Etsy shop to your social media accounts. This will allow you to quickly alert all your social followers of announcements, sales, new products, and items you’d like to promote.
- Leverage search engine optimization (SEO): You’ll want to make it as easy as possible for customers to find your Etsy shop through Google search. That’s where SEO comes in. Take some time to learn the basics of SEO and use what you’ve learned to optimize your product listings. You can do so by including keywords that customers would use to search when looking for products like yours. To get started, check out Marmalead, an Etsy-specific tool that can help you identify the right keywords.
- Take aesthetically pleasing product photos: When purchasing items solely online, the only way to shop is with the eyes. So the visuals you use to showcase your products will be vital to how well your shop attracts customers and makes sales. Place your efforts into taking excellent product photos. It may even be worth investing in professional photography services to guarantee your photos stand out against other sellers in the marketplace.
- Research your niche: It doesn’t hurt to do some market research both before and after setting up your Etsy shop. Study some successful shops to see what they’re doing and which types of products tend to do the best on the platform. Also, research how to price your merchandise so that your prices are competitive yet reasonable and affordable for potential buyers.
- Always provide great customer service: Good customer communication is key if you want your Etsy business to thrive. Shoppers are more likely to buy from shops where they receive great service, and your chances of receiving positive reviews will increase. Keep your customers happy by replying quickly to any questions and feedback, responding favorably if any problems arise, and making it easy for customers to contact you.
- Keep your financial records organized: Stay on top of your bookkeeping by organizing your records and using business accounting software to simplify the process. Automating your bookkeeping will help you better understand the direction your Etsy shop and your business are headed. It can also help you set targets and track your sales and expenses.
How much does Etsy charge?
Etsy charges an assortment of fees in order to open an Etsy shop. The most common fees include listing fees, transaction fees, payment processing fees, and shipping fees. You may also be charged a fee for certain promotions you take part in. To get a clearer understanding of the total fees required to list and sell your products, refer to Etsy’s fees and payments policies.
What can I sell on Etsy?
Etsy specializes in handmade, vintage, and unique items. There are many things you can sell on the platform, such as art, clothes, jewelry, home decor, and much more. But there are some specific categories of prohibited products and services that aren’t allowed on Etsy. Some of these categories include items that glorify or support hate, items that are violent, items made with hazardous materials, and items that promote illegal activity.
How old do you have to be to sell on Etsy?
Minors under 18 and at least 13 years of age are permitted to use Etsy’s services with permission and supervision of a parent or guardian. The guardian must be the owner of the Etsy account used.
Minors over 13 who wish to sell on Etsy must follow some additional policies. For more information, review Etsy’s minors policy.
Who pays for shipping on Etsy?
Typically the buyer will pay for shipping, depending on where the buyer is located; shipping fees will vary.
The step-by-step process for opening an Etsy shop is fairly simple; the hard part comes afterward. Remember running an Etsy business takes time and commitment, so don’t be discouraged if your shop isn’t as successful as you’d like in the beginning. Like any business, the more time you put in, the better chances you have of seeing a lucrative return on your investments. Ultimately, if you continue to focus on offering high-quality, unique products and building your customer base, you’ll find that opening an Etsy shop was worth the effort.