Start Your Etsy Shop Part 1: What does it cost and how do I start?
When to start an Etsy shop?
I feel very strongly about my advice for this and it is as follows: start as soon as you can. Not in an urgent-the-house-is-on-fire way but more in a don’t let anyone stand in your way, way. You might come across articles that say you need x,y, and z to begin and while it’s true you do need to have some things figured out (name, what you’re going to sell), the rest can be learned through doing.
Consider this: if you take the step of simply opening your shop, that is a huge blocker out of the way. Also, nobody is really going to see your shop until you get your listings going so you can use it as an opportunity to learn your way around the dashboard and set up the basics of your shop. I believe that taking small steps like this towards your goals helps eliminate the mental burden that idea of starting takes.
Can anyone start an Etsy shop?
Yep! Setting up a seller account is extremely easy and doesn’t require anything like a business license or other certification. If you’re ready to start, you can learn more and sign up here.
How much money do I need to start an Etsy shop?
This question is largely dependent on what you plan on selling. If you are starting from scratch and need special equipment to make your items, you’ll incur quite a bit of cost up-front. If you plan on selling physical objects, you’ll need to consider the cost of shipping supplies and postage rates into your calculations.
For the purposes of this question, let’s just focus on what it costs from Etsy when you start your shop. The good news? There is no fee to open and register an Etsy shop. The costs of getting started mostly apply to creating new listings. Let’s walk through what it costs to list an item for sale on Etsy.
To list an item, Etsy charges you a non refundable $0.20 fee. This allows you to list your item on Etsy for 4 months and you will be charged this fee whether your item sells or not. Each time you sell an item, you will be charged $0.20 to relist it.
Something that really helped me reduce the friction of starting your shop is learning that you can get 40 free listings by going through a referral code. If you’d like to use mine (no pressure!) you can sign up here.
The listing fee is the only fee you need to pay in order to get started on Etsy. Pretty amazing, right?
Once an item sells on Etsy, there are 2 additional fees. Since the goal of selling an item is to make a profit, you shouldn’t incur a cost from this but I want to make you aware of it so you can structure your pricing correctly.
Each Etsy sale incurs the following fees:
Transaction Fee: 5% of item total
Processing Fee: 3% of item total + $0.25
If your item sells through Etsy offsite ads (which are ads they run for you on sites like Google) you’ll be charged a fee of $0.45. (FACT CHECK)
A relisting fee of $0.20. This is the fee I talked about above.
How to choose a good Etsy shop name
Describe What You Do
If you’re starting from square one, let the brainstorming begin! A good rule of thumb is to pick a name that suggests what you do, but don’t be too specific unless you truly plan on sticking to that one thing for life. For example, “Canary Paperie” would likely make a better name for a shop than “Canary Notepads.” Neither are wrong, but it’s good to consider how your business could evolve over time.
If you’re having a hard time coming up with ideas, take a sheet of paper and do a brain dump. Write down any words that describe you or the work you do. Include words that evoke how what you do makes someone feel, what it looks like, something unique about your process, or even things related to your origin story. For example “Stony Farms Soap Company”
Imagine it IRL
Imagine your name on a website or an ad for your business. Odds are, something like “Ann’s Art 34521” isn’t going to be a good name. Avoid misspellings (sounds obvious, but I’m talking more along the lines of how Tumblr is misspelled).
Why start an Etsy shop
Oh my goodness, the reasons are endless. How powerful is it that anyone can create an Etsy storefront and share their creative gifts with the world? Not only is Etsy easy to use, but it can help you get your product in front of a global audience that you may not have tapped into yet. For some creative entrepreneurs, Etsy can be an untapped source of revenue in their business.
In addition to the business potential of Etsy, think about consumer habits in today’s world. People are looking for unique items with an emphasis on handmade over machine made. This is especially true when it comes to selling giftable goods and items designed to celebrate special moments or even decorating your home. The variety of goods sold on Etsy allows people to express themselves in unique ways too: think custom jewelry, specialized water bottle stickers, or even wedding decor that’s uniquely you. This isn’t all hype and speculation either: last year there were 39.4 million (yes, million!) sales made on Etsy.
Another great thing to keep in mind is that Etsy makes money when you make money. This means that they’re working on your behalf. In the image below, Etsy shows the statistics for how visitors are finding my shop. Etsy brought in 71% of the visits, while I brought in 29%. Granted, I’m just getting started on Pinterest but it’s pretty amazing to think about how many more eyes are on my products just by being listed and found through Etsy search.
I also think it’s important to underscore reasons why you shouldn’t open an Etsy shop, with the main one being: don’t look to Etsy to create a quick buck. If you’re looking for a get-rich-quick scheme, Etsy is not that. It takes a lot of work and dedication to operate an Etsy shop. Not only do you have to create the product, but you have to learn SEO, marketing, and business tactics like pricing. I don’t say this to discourage you (in fact, all that stuff is fun to learn!) more so to caution you against the social media headlines you see that claim the person went from 0-10k in a month. Etsy is powerful in potential-filled, but it’s important to keep in mind that it’s all about the long game.
Can you have an Etsy shop and a website?
Yes. Even better: you can link your website directly from your Etsy page. This is great if you’re trying to build your brand because you can link to Etsy from your website and vice versa. This also means that you can extend your business into selling on other platforms like Amazon and Shopify if you wish.
It’s also worth noting that Etsy has their own website platform tool called Pattern. You can read more about it here. It’s a paid service that allows you to list your Etsy listings and have a custom-looking storefront on a standalone website. If you only plan on selling through Etsy it could be a good move, but to build a brand I’d recommend a more traditional platform such as Wordpress or Squarespace. It’s a bit more work if you want to create a storefront (especially if you have a lot of listings) but can be more valuable in the long term thanks to the level of control you have.
I hope this article answers some of your questions about starting an Etsy shop and I’m looking forward to sharing more in this series to walk you through the rest of the process in detail.
