What is Etsy?
One of the largest global internet markets is Etsy. It has the ability to develop a side gig into a full-time business. This business is made up of about five million merchants serving roughly 90 million active buyers.
It serves as a venue for small company owners to connect with their ideal clients. Millions of visitors browse the market with credit cards in hand, prepared to purchase homemade goods, artwork, and jewelry.
How to Sell on Etsy.
This is a 10-minute video that explains how to set yourself up on Etsy and how to sell your products successfully.
What Products Are Sold on Etsy?
“A Global Art Fair” is how Etsy describes itself. People can connect to make, sell, and purchase original, creative goods on this internet market. Therefore, it is not surprising that 88% of customers claimed that Etsy has unique things.
As a result, customers look for handmade and vintage goods, and craft supplies without the hassle of looking at multiple websites or walking around all day shopping. If you are selling any ‘vintage items” you must make sure that they are at least 20 years old.
Here is the list of top-selling items on Etsy right now: June 2023.
- Stickers.
- Notebooks and journals.
- Jewelry.
- Home Decor.
- Digital designs/Graphic designs.
- Posters.
- Toys & baby items.
- Vintage items.
- Organic cosmetics.
- Sewing and Crochet Patterns.
- Clothing.
- Bags and purses.
- Phone cases.
- Papercraft.
- Candles.
- Caps and hats.
- Source; Marketplace Pulse; June 2020.
Where can I find My Customers?
When you use Etsy as your “storefront” most of your advertising has already been done for you because you have access to 234 countries. There are 81.9 million active buyers on Etsy. It is ranked as the 4th fastest-growing eCommerce company in 2021, behind Apple, Chewy, and Amazon. In 2020, Etsy processed $10.28 billion in gross sales, a 106.84% increase from 2019.
You are already in front of the 8 ball and working with an established brand that can only benefit the goals of your own business.
Obviously, you can not rely exclusively on Etsy’s business reputation and you will have to do your own “social media” advertising. This can be done by posting “freely” on the likes of Facebook, Twitter, Pinterest, and many more or you can use a PPC (Pay per click) campaign. You can also look at email campaigns or even build your own website.
Here are three posts that can give you some more insight into this.
1. Best Way To Promote Your Business On-Line.
2. How to Advertise on Facebook.
3. How to Automate Email Marketing
Why Use Etsy?
People use Etsy when looking for that one-of-a-kind present or a distinctive hand-crafted item that nobody else has. They are the go-to internet store for handmade or vintage goods and crafts materials.
Because of its user-friendly platform, Etsy is well-liked among artists and craftspeople. Setting up an Etsy shop is incredibly easy compared to building and maintaining your own web business. You may literally contact millions of clients worldwide in a matter of minutes.
Can You Make Good Money on Etsy?
In a nutshell, YES.
If you sell products that are in demand, attractive, and competitive you can make money on Etsy. Make sure your products or product falls within the description of the goods above. Because customers know what products they can expect to buy when logging into Etsy.
So you do not want to be offering something that is not normally sold on Etsy. You can look at it the same as if you walk into a “car dealership” or “car yard” and you have rabbits on sale. A little far-fetched I know, but you would not try to sell something that is outside the normal product range of that store. And you want to have that same mindset when selling on Etsy.
To make money on Etsy, you need to follow some basic steps:
- Create a solid pricing strategy that covers your costs, fees, and taxes and leaves you with a profit.
- Boost your online marketing by using social media and networking to promote your shop and products.
- Diversify your product offerings by adding new items or variations that appeal to different customers.
- Offer promotions and sales to attract more buyers and increase your revenue.
- Utilize customer reviews to build trust and credibility with your potential buyers.
A Pricing Strategy For Selling on Etsy.
Here is an example of a pricing strategy that covers costs, fees, and taxes and leaves a profit.
Let’s say you want to sell a handmade teacup on Etsy for $10. below are some costs and fees you want to take into consideration.
- Raw materials: The cost of the clay, glaze, paint, and other supplies that you use to make the teacup. Let’s say this is $2 per teacup.
- Labor: The amount of time and effort that you spend on making the teacup. You should pay yourself a fair hourly rate for your work. Let’s say this is $5 per hour and it takes you 30 minutes to make one teacup. That means your labor cost is $2.5 per teacup.
- Packaging: The cost of the box, bubble wrap, tape, and other materials that you use to pack and ship the teacup. Let’s say this is $1 per teacup.
- Shipping: The cost of postage and delivery service that you use to send the teacup to the customer. This may vary depending on the destination and weight of the package. Let’s say this is $3 per teacup on average.
- Etsy fees: The fees that Etsy charges you for listing and selling your products on their platform. These include a listing fee of $0.2 per item, a transaction fee of 5% of the sale price plus shipping, and a payment processing fee of 3% plus $0.25 of the total amount paid by the customer. Let’s say these add up to $0.8 per teacup.
Now, let’s calculate your gross profit margin using this formula:
(Revenue – Cost of goods) / Revenue x 100 = Gross profit margin
In this case, your revenue is $10, which is the price you charge for the teacup. Your cost of goods is $9.5, which is the sum of all the costs and fees that we listed above. So, your gross profit margin is:
($10 – $9.5) / $10 x 100 = 5%
This means that for every teacup you sell, you make a profit of $0.5 or 5% of the sale price.
Is this a good pricing strategy? Well, it depends on your goals and expectations. A 5% profit margin is quite low for a handmade product, especially considering that you also need to pay taxes on your income and cover other fixed costs like rent, utilities, marketing, etc. You may want to increase your profit margin by raising your price, lowering your costs, or both.
For example, if you raise your price to $12 per teacup, your gross profit margin becomes:
($12 – $9.5) / $12 x 100 = 20.8%
This means that for every teacup you sell, you make a profit of $2.5 or 20.8% of the sale price.
Alternatively, if you lower your costs by buying materials in bulk, optimizing your production process, or finding cheaper shipping options, your gross profit margin also increases.
For example, if you lower your cost of goods to $8 per teacup by saving $1.5 on materials and shipping, your gross profit margin becomes:
($10 – $8) / $10 x 100 = 20%
This means that for every teacup you sell, you make a profit of $2 or 20% of the sale price. This is a small percentage, in my opinion, for the time and effort you have put into making this product. So you can adjust your profit percentage as you see fit.
Please remember that it is easier to readjust pricing down than up. If your potential clients see your cost go up they will not be as happy as seeing it go down.
I hope this example helps you understand how to develop a pricing strategy for your Etsy products that cover costs, fees, and taxes and leaves a profit.
Etsy’s Fees.
Etsy has fees associated with running its business, and the following cover these costs.
Each listing costs 20 cents. Whether or not the item you are listing sells, you will still be charged this fee. After four months, listings expire, and you must pay the charge again to relist an item that didn’t sell.
The listing will automatically renew at a cost of 20 cents for each sale if you list multiple units of the same item (including digital downloads) and pay the initial 20-cent listing fee.
There is a transaction charge, and that is 5% of the selling price, plus the price of shipping and gift wrapping.
Fee for processing payments: 3% plus 25 cents. This only applies if you conduct transactions through Etsy Payments. This is the cost for U.S. vendors; other countries’ fees may be different.
For a comprehensive list of fees please visit Etsy’s website here, Etsy’s Fees and Payment policies.
Some Statistics Worth Thinking About.
62% of Etsy sellers are based in the United States and California has the highest percentage of US sellers, at 14% with 30% of international Etsy sellers residing there.
The United Kingdom has the biggest proportion of vendors outside of the United States.
The top 10% of sellers make $10,000 or more a year. The top US Etsy seller has made more than 1.2 million dollars since the site’s launch.
Eighty-three percent of Etsy’s merchants are women. The age of the typical vendor is 39. Multiple platforms are used by multi-channel businesses to offer their products. Multichannel businesses make up 61% of Etsy sellers.
Income Fact or Fiction
What can be derived from the above facts? The first thing I look at is that 90% of the sellers on Etsy made less than $10,000 per year. For me, this means that at least in the initial stages I can not rely on this being a full-time income. And perhaps it never will be.
Since Etsy doesn’t currently gather sellers’ remuneration details, there are no accurate statistics available about how many Etsy merchants dedicate their full time to running their businesses.
Many Etsy merchants also sell their goods in other locations or work supplementary jobs to complement their earnings from Etsy. The bulk of Etsy merchants’ income does not originate from the marketplace; rather, Etsy serves as a supplement to their primary source of income for most of the sellers.
A recent survey of Etsy sellers showed 84% making under $50,000, and 25% of those people making $0-1000. As no official numbers are taken down all figures have to be taken at face value with no knowledge if they are true or not.
Etsy Alternatives for Additional Income.
There are many all-purpose options to contact customers for anyone selling anything online, including some reputable and established marketplaces and some social media platforms. However, if you want to create a long-lasting business, creating your own website is one of the best things you can do.
And doing this within an Affiliate marketing group will give you the potential to not only sell your products but also earn a commission while selling other products such as anything on Amazon. And Amazon is only one of thousands of potential businesses you can sell for.
To find out more about this you can either read my blog on “affiliate marketing” at
“Wealthy Affiliate Walks The Yellow Brick Road”
Or visit Wealthy Affiliate directly to answer your questions on the link below…
How can I make a decent income online and say goodbye to my HumDrum job?
Clicking on the above link will take you to the Wealthy Affiliate Website where you can join for no costs upfront. ( and you do not need to provide any credit card details). I have been a member of Wealthy Affiliate for 2 years and it has now become a great secondary income for me, and will soon become my prime income source.
Final Thoughts.
When starting any new business there are a lot of things to consider if you wish to be successful. Do your market research. You want to identify your target audience and find out who your competition is within Etsy. What will it take for people to buy from you and not your competition? What market trends and opportunities are available to you? Can you identify the top sellers for your product in Etsy and how can you do better than them?
If you can do all of that and are prepared to work as hard as anyone else running their own business, then you will have a great chance of making it on Etsy. But to improve your chances you need to add a second string to your bow, like most other successful people I know. GOOD LUCK.
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