The Cost of Selling on Etsy in 2023

by operator

While it’s free to establish a vendor profile on Etsy, there are charges associated with listing and selling products. The primary fees for Etsy vendors are linked to listing items for sale, handling payments, converting currency, advertising and promotions, shipping, and optional additional services and tools.

Fees for listing begin at 20 cents per item, and transaction fees are usually 6.5% of the total transaction value. You have the option to upgrade to a monthly subscription of $10 for Etsy Plus or $15 to create a personalized website through Etsy Pattern. Shipping, taxes, marketing, and advertising expenses differ based on various factors.

We will guide you through the different Etsy fees below and demonstrate how to estimate the amount you’ll pay for each product you sell on the makers’ marketplace.

Explanation of Etsy Fees

When you commence selling on Etsy, you need to acquaint yourself with the various fees that Etsy incurs. Here is a breakdown of the fees for Etsy sellers:

Charges for Listing

Merchants pay a listing fee of 20 cents for each item they sell from their Etsy store. This fee is also applicable whenever you renew a listing. When it comes to private listings, this fee is only applicable once the item has been sold.

After four months from the date of listing, the item will expire. If you utilize the auto-renew feature, your listing will automatically “republish” after the four-month period, and you’ll also pay an additional 20-cent listing fee.

Listing fees will appear in your payment account in different ways, but all refer to the “same” listing fee and are all priced at 20 cents:

  • Listing fee: The initial fee for listing a new item for sale, valid for four months
  • Auto-renew expired: The automatic renewal fee for items that remain unsold after four months (you can deactivate auto-renewal in the listings settings menu to manually renew)
  • Auto-renew sold: The automatic fee for selling additional quantities of items (more than one listed item)
  • Multi-quantity: The fee for selling multiple variations of the same item in one payment transaction – for instance, if you sell five types of the same item, once one item is sold, another charge will be applied for the next available item, and so on (Etsy doesn’t levy a fee for the extra listings until they are sold)
  • Private listing: The fee for a private sale to a designated buyer, unlisted to the public – let’s say you organized a direct sale with a buyer and provided them with a direct link to purchase, this will still be subject to a 20-cent listing fee

Note: There is no listing fee if you only publish the item for sale on your Etsy Pattern website – we’ll discuss that shortly. Pattern listings do not expire.

Fees for Transactions

Etsy imposes a standard transaction fee of 6.5% of the total item price, inclusive of shipping, gift wrapping, and additional customization expenses, for every sale made on your Etsy store. This excludes taxes.

For instance, let’s assume you sell an item with a retail price of $15 and a shipping cost of $3. Etsy will charge $0.975 (6.5%) for the listed product price plus $0.195 for shipping – making a total of $1.17 in transaction fees.

NOTE: On your Etsy bill, the transaction fee for each product will appear as two distinct line items: transaction fees deducted from the price of the item and transaction fees deducted from the shipping cost of the item.

Etsy Payment Processing Charges

All Etsy vendors are obliged to use Etsy Payments as their payment provider when engaging in sales on the platform. Charges for handling payments apply and differ depending on the country. If you are located in the US, you will be subject to a fee of 3% in addition to 25 cents for each transaction.

Fees for Selling in Person

Etsy is compatible with the Square card reader for processing payments made in person. You have the option to integrate your Square online store with Etsy, which will necessitate the payment of the standard 20-cent fee for each listed item. If you do not synchronize your products, Etsy will still impose a fee of 20 cents in the form of a transaction fee for every sale. When using Square for in-person sales, there is no transaction fee of 6.5% imposed by Etsy. However, you will need to pay the fees applicable to Square as stated in Square’s pricing guide.

Fees for Currency Conversion

In case you list an item for sale in a currency other than your home currency, Etsy Payments will levy a fee of 2.5% for currency conversion. Since Etsy primarily conducts business in US dollars (USD), if you handle any other currency, you may also be subject to a currency conversion fee. Most sellers prefer to operate in USD, while merchants and users of Etsy Payments in Bulgaria, Croatia, the Czech Republic, Hungary, Poland, and Romania use the euro.

Fees for Regulatory Operations

Depending on your location, you may also have to pay a Regulatory Operating fee for each transaction. This fee is calculated as a percentage of the total cost of the item, including shipping, gift wrapping, and customization. The breakdown of these fees for Etsy sellers is as follows:

  • United Kingdom: 0.32%
  • France: 0.47%
  • Italy: 0.32%
  • Spain: 0.40%
  • Turkey: 1.1%

Fees for Shipping

Etsy does not directly provide shipping services and thus does not directly charge for shipping. Sellers may have to pay shipping fees to the carrier of their choice, and the charges depend on the rates set by the carrier. These rates often take into account factors such as package size, weight, origin, and destination.

Showing Etsy seller offers free shipping for orders above 35 dollars.

Additional charges may apply for insurance, signature confirmation, and return labels. Nevertheless, you can purchase shipping labels through Etsy, but this requires the use of Etsy Payments or PayPal as a payment method. However, fees for this service may vary.

Currently, Etsy offers shipping labels through these carriers:

  • Australia Post
  • Canada Post
  • FedEx
  • Global Postal Shipping
  • USPS
  • Royal Mail

As you can observe above, this Etsy merchant offers complimentary shipping for orders exceeding $35. Most sellers opt to provide free shipping on specific items, for orders surpassing a certain amount, or include a fixed charge.

Etsy Costs Calculation Example

To assist you in comprehending all the costs we previously mentioned, we’ll present an illustration of how these costs accumulate for an item sold in an Etsy Shop.

Etsy silver chunky vintage earrings for sale.

(Source: Etsy)

As an illustration, an Etsy merchant based in California sold the item displayed earlier. Delivery fee amounts to $3, and the purchaser utilized a credit card to make payment for the item through Etsy Payments.

Here’s how the listing costs will apply:

Product Price: $22.70

Shipping Expense: $3

Sales Tax: 7.25% x $22.70 = $1.65

Sale Amount: $27.35

Less Costs:

Listing Fee: 20 cents

Transaction Fee: 6.5% x ($22.70 + $3)

Sale Amount = Product Price + Shipping

= $1.67

Etsy Payments Fee: 25 cents + 3% x $27.35

Sale Amount

= $1.07

Shipping Etsy Fee: $3 x 5% = 15 cents

Total Etsy Seller Fees: $3.09

Product Price: $22.70

Less Etsy Seller Fees: $3.09

This Etsy merchant generated $19.61 in net revenue.

To examine how Etsy compares with other online selling platforms, take a look at our Shopify vs Etsy comparison guide. Shopify is our preferred choice for the best ecommerce platform, and you can compute platform costs and processing fees using our Shopify fee calculator.

Etsy Pricing Options

Etsy enables you to sell on its online marketplace at no cost, but it provides you with the opportunity to upgrade to Etsy Plus for $10/month or opt for Etsy Pattern at $15/month to create your own store. However, it is important to note that if you choose to sell on Etsy Pattern, your products will not be displayed in the search results on the main Etsy marketplace.

Etsy Plus ($10/month)

Etsy Plus is an optional monthly subscription that grants you access to a more comprehensive range of tools for personalizing and promoting your Etsy shop. It costs $10 per month and provides the following features:

  • Credits for listings (15/month) and Etsy Ads (worth $5/month)
  • 50% discount on a custom web address for your Etsy shop
  • Restock requests for potential buyers interested in your sold-out items
  • Customization options for your shop
  • Discounts on customized packaging and promotional materials such as boxes, business cards, and signage

Etsy Plus will automatically renew, so if you decide not to continue with the $10 monthly fee, you must proactively cancel the subscription.

Etsy Pattern ($15/month)

Etsy Pattern is an optional add-on that allows you to create a fully personalized Etsy website, designed and branded according to your preferences. This requires a $15 monthly subscription fee (plus any applicable sales tax), although Etsy provides a free 30-day trial period. You may also need to pay domain name registration fees. Etsy Pattern subscriptions will automatically renew, so if you do not wish to utilize or pay for this tool, you must proactively cancel it.

Etsy Pattern serves as a website builder for Etsy sellers, offering optional functionality.

Etsy pattern site builder.

Etsy additionally provides a range of optional services to enhance your storefront as part of your retail marketing strategy. However, these services come with additional fees for Etsy sellers.

Etsy Ads

Etsy Ads boost the visibility of your store and products within Etsy’s on-site search and related pages. The fees for Etsy Ads vary based on your budget and objectives, allowing you to allocate as much as your marketing and advertising budget permits. You can set your own maximum daily budget, and Etsy will display your advertisements until you reach that budget. By default, Etsy suggests a maximum daily budget of $25, but you can adjust this as needed.

Similar to Amazon or Google Ads, Etsy Ads enhance the presence of your products in search results for specific keywords.

External Ads

Etsy’s ads outside of its platform enhance your visibility on external websites and platforms within its network of advertising partners, which may include social media, search engines, and other online shopping destinations. These charges amount to 15% of Attributed Orders from the previous year. Attributed Orders come from individuals who click on the advertisement and make a purchase from your Etsy store within 30 days of that interaction. Once your annual sales exceed $10,000, this charge decreases to 12%.

Etsy ads help your products appear in search results for specific keywords.

Etsy Taxes on Sales

All online merchants are responsible for keeping up with the most recent e-commerce sales tax requirements and regulations, both in the regions they operate from and the locations they ship to. You can modify sales tax settings from your Shop Manager dashboard.

Etsy automatically prepares and provides US-based sellers with an annual 1099-K form for their federal and state taxes. Sellers conducting business in other countries might need to account for VAT or GST, depending on their location. Occasionally, Etsy will automatically compute and collect this on your behalf. In other cases, you will need to customize pricing and tax settings to ensure compliance.

Etsy may also apply sales tax to additional services such as Etsy Plus, Etsy Pattern, and seller fees.

Payment of Etsy Fees

If you are using Etsy Payments, Etsy deducts seller fees from your Etsy balance. Therefore, when Etsy sends you a deposit, all the fees have already been deducted and paid.

Fees for a given month on Etsy can be paid starting from the first day of the following month. You have the option to pay your outstanding amount between the first and 15th of the month. Payment can be made using a debit card, credit card, prepaid card, or PayPal from your Etsy dashboard.

Minimizing Etsy Fees

As you may deduce, Etsy fees can accumulate quickly, and if you fail to account for these fees, you could end up with a very narrow profit margin or even a loss. We provide some suggestions on how to reduce selling costs on Etsy.

Set Product Prices in Your Bank Account’s Currency

Avoid Etsy’s 2.5% fee for currency conversion by using the same currency in your bank account for your product listings.

Increase Your Prices

This is the simplest way to safeguard your profit margins. If you consistently sell a particular item, do not hesitate to raise your prices to reflect the demand for the product (remember that you are selling handmade products, so they hold more value in terms of cost and time). Of course, this also entails a risk as it might discourage potential and existing customers. Just ensure that your prices remain within the range of your competitors.

Create Product Bundles

A workaround to avoid multiple fees for product listings is to bundle your items together. If the items are related and can be sold as a set, consider bundling them to incur only one listing fee. Do not limit bundling to related items; you can also bundle similar items. For example, if you sell handmade candles, you can offer three candles as a bundle and pay a 20-cent listing fee instead of individually listing each candle for 60 cents.

Prioritize Marketing over Paid Advertising

Etsy ads do not guarantee sales; they simply increase the visibility of your product in search results. When you decide to invest in ads, ensure that your listing is optimized with high-quality product photos and trending keywords to help improve the chances of conversion.

Consider engaging in assertive and consistent advertising initially, utilizing the advice we enumerate in our articles below:

Acquire Your Own Online Store

If the charges imposed by Etsy seem excessive to you, it is now the moment to contemplate establishing your own online store. It will necessitate additional exertion and time to set up, and you will also need to invest more in initial fees. Nonetheless, the preliminary time and expenses expended during the commencement of your online store will assist you in saving more in the long term. Alternatively, take into account complimentary website builders if you are genuinely on a strict budget.

Delve into other platforms for online stores by examining the subsequent guides:

Essential Point

Roughly, about 6.3 million vendors actively generate income on Etsy’s marketplace to a customer base comprising more than 90 million customers. As numerous as 71% of Etsy vendors regard their shop as a legitimate enterprise, and 82% possess aspirations to augment sales. With such plentiful possibilities for expansion, it is crucial to be cognizant of connected charges, so you can incorporate them into your pricing strategy and ensure profitability.

Furthermore, Etsy holds the ability to modify these charges at any given moment. Hence, it is imperative to comprehend the fees and costs you amass, as well as methods to diminish those fees or take advantage of alternative vending avenues. Armed with this knowledge, you will be capable of effectively vending lucrative products in this ever-evolving artistic marketplace.

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