Are The Etsy Fees Worth It?

Are The Etsy Fees Worth It?

Etsy has been the most well known marketplace for handmade sellers for years. It specialises in sales of vintage, handmade and craft items and has become a global marketplace for independent sellers like yourself.

If you browse recommendations for a place to sell your crochet, then Etsy tends to come in at the top of the list. Etsy is a place that customers expect to pay a higher price than on shopping sites that sell factory made goods, so you don’t need to worry about your higher price point scaring customers away.

Let’s look at some stats from Etsy reported in 2021.

Etsy has over 7.5 million active sellers across the globe in 234 countries, generating over £2 billion in sales and has become known for THE place to find unique and rare finds with 96 million active Etsy buyers.

I think you will agree that those stats are pretty impressive and show the potential for making some serious income from your Etsy shop. 

But the question I increasingly see being asked by sellers is:

Are The Etsy Fees Worth It?

Etsy has increased its fees over the last few years, and many sellers have become a bit disgruntled by the fee rises.

But to answer the question, are the fees worth it, we first need to look at what you are getting for your money and what fees you have to pay up front and after a sale.

Etsy charges a range of fees, plus there are some optional extras.

The only fee that you pay up front is the listing fee. This is much like Ebay where you pay a small fee for listing each of your items. This fee is currently £0.16 ($0.20)

All the other fees are only payable once you sell that item. These fees are a transaction fee plus VAT at 5% of your revenue, and a processing fee plus VAT at 4% of your revenue plus £0.20.

Unfortunately the price you charge your customers for shipping is also counted as revenue, something you need to take into account when deciding your fees.

So if you make £10 including postage on a sale, you will pay Etsy £1.51 in fees (including your listing fee) and receive £8.49 in profit which works out at 15.1% of fees for each item sold.

There is an option to turn on Etsy offside ads. This means Etsy will advertise individual items of yours in ads outside of Etsy. These ads occur an additional 15% charge.

You can calculate your own fees using this Etsy Fee Calculator

The good news is that all these fees except for the initial listing fee, are taken from your sales profits. Instead of being presented with a big bill at the end of the month, the fees are automatically deducted from the profits you make on each sale. As the fees are transparent, you can build them into your prices so that your profits are not affected.

This might look like a lot of charges, but what do you get for your money?

What Does Etsy Give You  In Return?

If the Etsy fees are worth it depends on what you get in return, and what you’re comparing it to.

Most people who start selling on Etsy are coming from free Facebook or Instagram pages. Of course when you’re going from free to paid, it’s going to feel like a massive chunk of your profits are being taken. But let’s see what you get from Etsy for those fees.

  • Site wide search
  • Google appearance
  • Shop front
  • Social account links
  • Automated pdf sales
  • Messenger service
  • Sellers App
  • Shop Stats
  • Coupons
  • Community Forum
  • Verified purchase reviews
  • Purchase Protection (NEW)

Some of these features are available on social media too, but many are not.

The biggest benefits that I find that selling on Etsy brings are the search box and appearing in Google searches.

This means that you don’t have to go and find all of your customers like you do on social media. Instead customers can find you when your products match the customers search on Etsy. Your Etsy listings will also appear as results in Google. So you can be found by an even wider audience who are intent on shopping for something special and unique who are primed to make a purchase there and then.

This benefit alone is huge. You can make selling your products much less work through these 2 benefits alone. You just have to put some work into your keywords in your titles, descriptions and tags. This means describing your product as your customer would search for it. This part is the art of selling on Etsy, it can take time and practice to get your listings optimised to get found in search results, but the rewards for taking that time can be huge.

A very recent announcement from Etsy (the email announcement arrived as I was writing this article) is Purchase Protection. This means that if your package gets lost in the post, Etsy will refund your buyer but you will keep your profits. An additional protection for you the seller, and is being introduced at no extra cost. This programme goes live on 1st August 2022.

So there are very real benefits to using Etsy versus social media. But how does Etsy stack up against marketplaces?

The emerging rival to Etsy for handmade sellers is Amazon Handmade. In terms of fees, Etsy and Amazon are very similar. Of course Amazon is a humongous marketplace for mass produced items, and it is now turning its massive consumer power to the handmade market. Products listed on Amazon Handmade are included in any Amazon product search meaning that you can take advantage of the massive amounts of traffic on Amazon.

But are consumers really looking for something unique and generally more expensive on Amazon? And I think you also need to remember that customers expect really fast dispatch times on Amazon, the slower postage times that handmade sellers generally need, may not fit well on Amazon.

Your other option is your own website. You can read more about your options for where to sell your crochet here.

All in all, Etsy is a great place to sell your crochet. It’s like a stepping stone before moving on to having your own website. If you can master the art of selling on Etsy, then you have the foundations in place for your own site. Etsy is far from perfect, but I believe the benefits outway the negatives.

Yes 15% of fees may sound high, but when you consider what you are getting (Hello, Google!!!) I think those fees are very much worth it

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