Navigating the Etsy digital marketplace can be an exhilarating yet challenging endeavor, especially when it comes to comprehending costs like Etsy fees.
An essential part of successful entrepreneurship on Etsy involves understanding these expenses in depth.
In this article, we’ll unravel the intricacies of Etsy fees, the proverbial cost of doing business on this popular platform, empowering you to make informed decisions that can enhance your shop’s profitability.
What is Etsy?
Etsy, a renowned online marketplace, is a platform that allows people to sell handcrafted goods, vintage items, print-on-demand, and craft supplies.
With its vast audience, Etsy is a dream ecommerce business platform for sellers worldwide. However, understanding Etsy fees is crucial for sellers to plan their pricing strategy and ensure profitable operations.
What are Etsy Fees?
Simply put, they are the costs that Etsy charges sellers for using their platform. These fees include listing fees, transaction fees, shipping fees, advertising and promotional fees, payment processing fees, currency conversion fees, and potentially, some other additional fees.
Now, let’s dive deep into each of these to understand how they work.
Table of Basic Etsy Fees
| Fee Name | Description |
|---|---|
| Listing Fee | $0.20 per item. This fee is charged regardless of whether the item sells. If the item is renewed after 4 months, the fee is reapplied. |
| Transaction Fee | 6.5% of the total item costs (including shipping costs). This fee is only applied when an item sells. |
| Payment Processing Fee | Depends on the country of the seller’s bank. In the US, it is 3% + $0.25 per transaction. This fee is applied to the total amount (including shipping). |
| Offsite Ads Fee | If Etsy advertises your items and it leads to a sale, you may be charged an additional fee. For most sellers, this fee is 15% of the total order value. |
| Shipping Fee | While not a fee from Etsy directly, sellers are responsible for the cost of shipping their items, unless they include shipping costs in their prices. |
| Subscription Fee | If you decide to use Etsy Plus, a suite of premium services, the cost is $10 per month. It is not necessary for all sellers. |
| Currency Conversion | When you sell in a currency other than your payment account currency, Etsy converts money to your payment account currency on your behalf for a fee. |
| In-Person Selling Fee | If you use Etsy’s card (Square) reader to process payments for in-person sales, there is a fee of 6.5% per transaction in the US. |
1. Listing Fees
On Etsy, each product you list on your shop comes with a nominal fee, known as the listing fee. This fee is charged irrespective of whether the product sells or not.
A charge of $0.20 USD is applied for each item you put up for sale on Etsy.com or on Etsy’s mobile applications. No extra listing fees apply to items already displayed on your Etsy store if they are also displayed on your Pattern site.
Pattern by Etsy is a service that allows Etsy sellers to create their own custom, standalone e-commerce website. It was designed to enable sellers to expand their businesses beyond the Etsy marketplace, with a personalized web domain and website that reflects their individual brand.
Listing on the Pattern site exclusively does not attract any charges. A listing fee is charged when you create or renew a listing on Etsy; no fee is charged for modifying a listing.
The listing fee is applicable whether or not the item is sold unless it’s a private listing. For private listings, the fee is charged only when the item is sold.
Etsy.com listings expire after a span of four months, while Pattern-only listings have no expiry date.
If you list multiple quantities of the same item, the original listing fee is $0.20, and the listing is automatically renewed at $0.20 after each of the items is sold.
You can find more about fees for multiple listings in this Help article. Listing fees are shown in your payment account and deducted when the listing is published or renewed.
One strategy to manage these fees effectively is to ensure that your listings are of high-quality and desirable to your target audience.
This improves the chances of your items selling, making the listing fee a worthwhile investment.
2. Transaction Fees
When you make a sale via Etsy.com, a transaction fee of 6.5% is charged on the price you display for each listing plus the amount you charge for shipping and gift wrapping.
If you are an Etsy Payments user and you list your items in a currency other than your payment account currency.
When selling from the US, the transaction fee will not apply to sales tax. If you sell from anywhere other than the US, the transaction fee will apply to the listing price (which should include any applicable taxes that you as a seller are responsible for), shipping price, and gift wrapping fee.
If you offer optional personalization for an additional fee, the additional fee for personalization is added to the listing price you display and the total display price is subject to the same transaction fees.
Transaction fees are deducted from your current balance as each sale occurs, and are reflected in your payment account.
The key to managing this fee is in pricing your products correctly. Keep in mind the transaction fee while setting the price, so it doesn’t eat into your profit margin.
3. Shipping Fees
Shipping fees aren’t charged by Etsy directly, but they play a crucial part in the overall transaction. As a seller, you can choose who bears the shipping cost: you or the buyer.
Whichever option you pick, remember that shipping costs can influence a buyer’s decision. Offering competitive, or if possible, free shipping can be an effective way to attract more customers.
4. Advertising and Promotional Fees
Etsy offers promotional services such as Etsy Ads and Offsite Ads. While these services can increase your shop’s visibility, they come at a cost.
Etsy Ads Fees
If you purchase paid advertising on Etsy through the Advertising Dashboard in Shop Manager, you can set a budget to limit the amount you’re willing to pay for Etsy Ads to promote your listings or shops on Etsy.
Your daily maximum budget can be set at or above a predetermined minimum set by Etsy, and you will not be charged more than your maximum budget on a daily basis. All bids are made in United States dollars (USD).
Etsy Ads fees may be charged on a recurring basis and are deducted from your current balance and reflected in your payment account. For more information, please see the Advertising & Marketing Policy.
Offsite Ads Charges
Etsy purchases offsite advertising from a network of participating partners, such as social networks and search engines.
If a buyer clicks on your ad and makes a purchase within 30 days, you need to pay an ad fee. This purchase is called an “Attributed Order.”
How much you pay for this ad fee depends on your past year’s sales:
- If you made less than $10,000 in the past year:
- Your ad fee is 15% of the sale from an Attributed Order.
- You can choose to not take part in these ads (opt-out), meaning no ad fee but also no ad exposure.
If you made $10,000 or more in the past year:
- Your ad fee drops to 12% of the sale from an Attributed Order.
- This 12% rate sticks with you forever, even if your sales drop below $10,000 later.
- You can’t opt out of the ads anymore once you’ve crossed this $10,000 mark.
- Etsy will check your sales each month to see if you’ve hit the $10,000 mark.
To calculate your sales:
- It’s just the item’s price times the quantity sold, without considering any discounts or cancelled orders.
- Sales made in person, Etsy fees, and costs for shipping, taxes, or gift wrap don’t count.
- If you’re selling in a currency other than USD, Etsy will use their exchange rate at the time of the sale to calculate your sales in USD.
It’s essential to balance your spending on these services and not exceed your budget. Regularly monitor the performance of your ads to ensure they are bringing in sufficient returns.
5. Payment Processing Fees
Payment processing fees are charges for the service of processing the buyer’s payment. These fees can vary depending on the location of your bank.
Etsy Payments users are required to pay a payment processing fee for each transaction. The payment processing fee is a percentage of the total amount of the sale, including shipping and tax.
One way to mitigate the impact of these fees is by selling higher-priced items, as the cost gets distributed over a larger sale.
6. Subscription Fees
Eligible Etsy sellers can choose to subscribe to Etsy Plus, a special package that offers an advanced toolkit designed to help burgeoning businesses.
A monthly charge of $10 USD applies to this subscription, which will be automatically subtracted from your existing balance and recorded in your payment account.
In certain scenarios, local taxes such as sales tax or VAT/GST may apply to this monthly subscription fee.
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Automated Renewal
The monthly subscription fee will be debited from your payment account on the same date every month, in your local currency.
For instance, if you subscribe on the 5th of March, your next subscription fees will be debited on the 5th of April, May, and so forth.
In cases where you subscribe at the end of the month, your fees will be debited on the final day of the subsequent month. For example, if you subscribe on the 31st of May, your next fee will be charged on the 30th of June. You can terminate your Etsy Plus subscription at any time by going to the Subscription section of your Shop Manager’s Settings.
You can use your Etsy Plus subscription until the end of the current cycle, with your final day of access displayed in your Subscription dashboard. Once your Etsy Plus subscription ends, your shop will revert to Etsy Standard, and you will no longer be charged a subscription fee. To learn more about Etsy subscriptions, click here.
As an Etsy Plus subscriber, the following credits will be available to you each billing cycle:
- 15 listing credits, which appear as a $3 listings credit in your payment account
- $5 USD in Etsy Ads credits, visible in your payment account and your advertising management page
These credits must be used within the billing cycle, or else they will expire. They do not carry over from month to month. Instead, they reset and are replenished at the start of each new cycle.
Etsy Plus subscribers have the opportunity to sign up for free “.store” domains and receive a 50% discount on certain domain extensions like “.com”, “.net”, and “.ca”, via our third-party partner, Hover.
This discount applies to the first year of domain registration. If you decide to purchase a new custom web address via Hover, you will be redirected to their site to finalise the purchase. The first year of your domain hosting subscription will be discounted as part of your Etsy Plus subscription.
After one year, the domain renewal will be subject to Hover’s standard pricing, without the Etsy Plus discount.
7. In-Person Transaction Costs
Sellers have the option to utilize the Square reader to facilitate payment for in-person sales. You also have the option to integrate your Etsy listings with Square.
If you do, listings with multiple quantities will incur the standard $0.20 renewal fee, similar to multiple quantity listings on Etsy.
Non-integrated listings will be subject to a $0.20 transaction fee, shown in your payment account as a “Square manual” fee. The fees for in-person sales are subtracted from your existing balance and recorded in your payment account.
In-person sales made using the Square reader are exempt from Etsy’s 6.5% transaction fee and any Etsy payment processing fees. However, they are subject to Square’s Payment Processing Fees.
8. Currency Conversion Fees
If you’re an international seller, you might face currency conversion fees. This fee applies when the currency of the payment from the buyer differs from your bank’s currency.
To manage these fees, consider them while pricing your products, especially if you’re targeting international customers.
Managing Etsy Fees
Occasionally, you might come across other fees like subscription fees for Etsy Plus add-on features, costs for using Pattern (Etsy’s website builder), or in-person selling fees. Stay informed about these potential costs and factor them into your business plan.
By now, you should have a fair idea of the different Etsy fees. But, how can you minimize them? Here are some practical tips:
- Price your items correctly: Ensure your prices cover not just the cost of goods but also the Etsy fees.
- Offer competitive shipping rates: Use Etsy shipping labels to benefit from discounted rates and offer competitive shipping prices to your customers.
- Make your listings count: Only list items that you’re confident will attract buyers. This way, you get the most from your listing fee.
- Monitor your advertising spend: Regularly review your ad performance to ensure you’re getting a good return on your investment.
- Sell higher-priced items: Selling more expensive items can help distribute the impact of payment processing fees.
- Factor in currency conversion costs: If you’re selling internationally, ensure your prices reflect potential currency conversion costs.
Remember, the key to minimizing Etsy fees and maximizing profits is staying informed and regularly revisiting your pricing strategy. With careful planning and strategic decision-making, you can turn Etsy fees into a worthwhile investment for your business growth.
Etsy Fees – Frequently Asked Questions
How often does Etsy charge fees?
Etsy charges listing fees as soon as an item is listed and transaction fees are charged at the point of sale. Other fees such as payment processing and advertising fees are typically reflected in your Etsy bill that’s generated monthly.
What happens if I don’t pay my Etsy fees?
If Etsy fees are not paid, Etsy may charge your on-file payment method or limit the functionality of your account until the outstanding fees are paid.
Are there any Etsy fees when offering refunds or cancellations?
If you cancel a transaction, Etsy generally refunds the associated fees to your payment account. If you issue a refund to a buyer, transaction fees are not refunded, as the sale has already taken place.
How do I pay my Etsy fees?
Etsy fees are usually automatically deducted from your sales. If your sales aren’t enough to cover the fees, you’ll receive a monthly bill, which you can pay directly from your Etsy account or via a registered payment method.
Can I get a refund on my Etsy fees if I decide to deactivate my account or listings?
As per Etsy’s policies, the listing fees are non-refundable. If you choose to deactivate a listing or close your account, the listing fees will not be refunded.
How do I dispute an Etsy fee that I believe has been wrongly charged?
If you believe you have been wrongly charged an Etsy fee, you should contact Etsy support directly. They can look into the issue and help resolve it.
Are there any fees for updating or renewing my listings on Etsy?
Yes, there is a small fee each time you renew an item listing on Etsy, whether it’s done manually or automatically when an item sells.
Is VAT included in Etsy fees?
Etsy’s fee structure does not include VAT. However, if you’re in a country where VAT is applicable, it may be added to your selling fees.
Are there any fees associated with gift wrapping or personalization on Etsy?
Etsy does not charge any specific fees for offering gift wrapping or personalization. However, transaction fees apply to the total amount the buyer pays, which would include any additional charges for these services.
How can I see a summary of my Etsy fees?
Etsy provides a detailed breakdown of your fees in the ‘Payment account‘ under ‘Finances‘ in your Shop Manager. This summary includes all the charges such as listing, transaction, payment processing, and advertising fees.
Does Etsy offer any discounts or waivers on their fees for charity shops?
Etsy does not provide any specific fee waivers or discounts for charity shops. However, it’s always a good idea to check the latest Etsy policies for any updates or changes.
Do I have to pay Etsy fees if my shop is on vacation mode?
If your shop is on vacation mode, you will not incur listing fees as you will not be listing new items. However, any outstanding fees prior to activating vacation mode will still need to be paid.
Does Etsy charge a fee for restocking items?
Yes, when you renew a sold-out listing or restock an item, Etsy charges a listing fee.
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Etsy Fees – Summary
Understanding Etsy fees is crucial for any seller on the platform. From listing to transaction fees, shipping and promotional fees, every charge plays a significant role in your business’s profitability.
By staying informed about these fees and following the strategies laid out in this guide, you can ensure that your Etsy business thrives.
Whether you’re new to Etsy or an experienced seller, always remember: understanding your costs is the first step to maximizing your profits.
Navigating Etsy fees might seem like a daunting task initially, but with time and experience, it becomes an integral part of managing your Etsy shop.
Remember, every successful Etsy seller started where you are now. With a firm grasp of the fee structure and some effective strategies in hand, you’re well on your way to joining their ranks. Happy selling!
