Do you have a creative talent that you’re itching to turn into a business? If so, Etsy could be the tool you need to turn your homespun creations into a profitable side-line – or even your main source of income.

But what exactly is Etsy and how does it work? Read on to discover all you need to know!

First, let’s provide a little context. If you make a product and sell it through your social network, how many potential customers could you hope to attract? A couple of hundred? Maybe over a thousand, if you put time and energy into growing your network?

In 2018, 39.4 million people bought things from Etsy’s 2.1 million sellers. The company’s annual marketplace revenue hit USD 593.65 million in 2019. That’s a whole load of customers and revenue that you could tap into if you open an Etsy shop!

What is Etsy and how does it work?

Etsy is an online marketplace. The company connects artists and creators with those who might like to buy their products. Sellers tend to produce handmade, small batch goods or sell vintage items and collections.

If you’re looking for a unique gift for a special someone, Etsy is the place to find it.

To sell your wares on Etsy, you set up a ‘shop.’ Customers can search for your shop and browse everything you sell or search for an item in order to discover your goods.

Your Etsy shop is, essentially, a customisable page that you can use to share details about your brand and the products you create. Customers can leave feedback based on how they feel about your goods, your customer service, your delivery timescales… anything that has created a memorable shopping experience for them.

How much does it cost to sell on Etsy?

If you’re used to selling your creations yourself, then having to pay fees in order to do so through Etsy may not seem the most attractive idea. However, it’s no different to paying a pitch fee at a traditional marketplace or paying rent in a bricks and mortar shop.

What does it cost to sell on Etsy? There are actually several fees, covering everything from listing your items to helping pay for offsite advertising. Not all fees apply to every item, so let’s break it down to look at the true cost of selling on Etsy. Note that all figures are correct as at September 2020.

What is the Etsy listing fee?

It costs £0.15 to list an item on Etsy. That price will cover your item being listed for up to four months.

What is the Etsy transaction fee?

When you sell an item, you will pay a transaction fee. At the time of writing, the Etsy transaction fee is 5%.

What are the Etsy payment processing fees?

Sellers also have to pay for payment processing when they sell their wares on Etsy. The payment processing fee is 4% plus £0.20.

What is the Etsy Offsite Ads fee?

The Etsy Offsite Ads fee isn’t something you pay routinely. Just as you only pay a transaction fee when you sell, you only pay the Offsite Ads fee when you sell as a result of one of those adverts. The fee is set at 15%.

The Offsite Ads service is optional (though enrolment is automatic, so it’s a case of opting out rather than in). However, once your sales pass 10,000 USD in a 12-month period, participation becomes mandatory for the lifetime of your shop. Thankfully, Etsy does discount the fee to 12% at that point.

What does it cost to promote listings on Etsy?

In addition to the Offsite Ads service, there’s also Etsy Ads. This is the service you use if you want to promote your listings.

Etsy Ads is all very high tech. The company’s algorithm responsible for understanding how customers engage with your shop.

It’s up to you how much you want to spend on Etsy Ads, which products you want to promote and how long you want the campaign to last. Etsy recommends a minimum budget equivalent to $3-$5 per day.

What does Etsy Plus cost?

Etsy describes its Plus service as, “an expanded set of tools to help jump-start growth and express your brand.” If you plan to take the market by storm, this could well be the way to do so. Etsy Plus will set you back £7.80 per month.

What about Etsy shipping costs?

Etsy charges a shipping transaction fee of 5%. This means that you need to factor in losing 5% of the shipping cost when you list your item’s postage.

How to sell on Etsy in 7 easy steps

Are you fired up and ready to start making money on Etsy? Just seven simple steps stand between you and a whole new line of income!

1. Visit Etsy

Go to to get started. You’ll need to create an account before setting up your shop.

2. Customise your shop’s settings

When you set up your shop, you need to customise it, including specifying a language, location and currency.

3. Choose your shop’s name

Give this stage some careful consideration. The ideal shop name will reflect your brand, ethos and the kind of products you sell. It also needs to be something memorable, so that it sticks in customers’ minds.

4. List your products for sale

With your shop set up, it’s time to start listing your wares. Provide as much information as possible for each item, so that customers can see what your product is, why it’s so fabulous and how essential it is that they own it.

You can add photographs as well as a product description, so use this facility to ensure that your items truly shine.

There are some practical details to take care of at this stage too, including inventory information and shipping costs. Pay careful attention to the latter and remember to charge enough to cover the 5% shipping transaction fee, so that you don’t inadvertently lose money every time you post something.

5. Choose your payment method

If you’re selling through Etsy in the UK, then Etsy Payments provides you with a secure payment system that’s easy to use. Using Etsy Payments means you can accept payments from your customers in a range of formats, including:

  • Debit cards
  • Credit cards
  • PayPal
  • Apple Pay
  • Google Wallet
  • Etsy gift cards

6. Add your billing info

Etsy will ask you to add a debit or credit card to your account when you open your shop. The card acts as a means of verifying your identity, as well as providing a way for you to pay your Etsy fees.

7. Optimise your shopfront

Before you start selling, take a critical look at your shop and add some more detail to inspire customers to buy and fill them with confidence.

Adding a profile to let people know who they are buying from is a great way to boost engagement with your brand. People buy from people, so share your story and why creating your products is so important to you.

It’s a good idea to include policies too, so that customers know where they stand in terms of:

  • Order and shipping timescales
  • Returns, refunds and replacements
  • Bulk orders

The more you can share with customers, the more comfortable they should feel buying from your Etsy shop.

You can also decide at this stage what you want to do in terms of using Etsy Ads to market your products. There’s likely to be an element of trial and error as you play around with different marketing campaigns and ideas, so keep an eye on what works and what doesn’t in order to maximise the effectiveness of your marketing spend.

Tips for Selling on Etsy

There are plenty of actions you can take to maximise your sales success on Etsy. We’ve included some of the key considerations here, to get you thinking strategically about how to turn your products into pounds.

Opt for professional photography

One of the most important steps is photographing your products.

Given the choice, would you buy from a seller whose products had been photographed in poor lighting on a cluttered table or from one whose images showcased their products professionally?

The more beautiful your products look, the more likely they are to sell. Using a professional photographer is the ideal solution but if your budget won’t stretch that far then at least read up on how to take photographs like the professionals before you start snapping away.

Organise your shop

You’ll also need to organise your shop in the way that best showcases your products. How you lay things out can have a big impact on whether or not people buy from you. Ask for constructive feedback from friends and family on how your shop looks and whether a different product arrangement might work better than your current one.

You can also chat to the friendly Etsy community about how to lay out your shop. They’ve all been there and done it, so can offer helpful insights into what might work best for your shop.

Learn Etsy SEO

How can you make your products rank above those of your competitors when it comes to Etsy search results? By learning Etsy SEO!

Etsy SEO is a pretty big topic, so we won’t go into it in full right now. Suffice it to say that Etsy matches customers’ search queries to listings’ titles, categories, tags and attributes. You therefore need to ensure that your titles, categories, tags and attributes contain everything they need to help position you at the top of Etsy’s search results.

Test your pricing

How much are your products worth? Will dropping the price slightly lead to a sudden uptick in sales? Can a time-limited discount encourage people to buy?

There’s plenty of room for manoeuvre when it comes to how you price your goods, so why not test out a a few different strategies as you get used to selling on Etsy? Just be sure to keep careful notes about how effective each strategy is, so you can home in on the perfect price over time.

Run your store like a business

Speaking of doing things properly, it’s really important to have the right mindset when it comes to your Etsy shop. Treat it just as you would a shop with physical premises – keep good financial records, monitor your stock levels and plan for any periods when you’re likely to be busier (or quieter) than usual.

Running your store like a business can help with everything from boosting customer engagement to sorting out your tax bill. Taking the right approach from the outset can save you headaches further down the line.

Track your product performance data

If you want to make a long-term success of your Etsy shop, it’s essential to track how well your products perform. Which items are your bestsellers (and why)? Which products have significant seasonal trends? Can cross-selling bundles help to shift stock that’s not performing as well?

Tracking your product performance data can provide major insights into what you need to do to maximise your success on Etsy. Doing so from your first sale onwards will give you plenty of data to work with.

Selling on Etsy vs Ecommerce Platforms

Etsy is an online marketplace, rather than an ecommerce platform. You sell alongside other creatives, just as you would in a physical marketplace packed with stallholders.

Ecommerce platforms, on the other hand, allow you to set up your own website. You then upload your products, track orders and manage payments. Shopify is perhaps the best-known example of an ecommerce platform.

Just to confuse matters, Etsy does actually have its own ecommerce platform – Etsy Pattern. This is available to Etsy sellers who want a website of their own, in addition to their Etsy shop.

There are various advantages to selling through Etsy’s marketplace rather than an ecommerce platform:

  • Etsy delivers a readymade retailing experience. This is ideal if you’ve not sold goods online before.
  • You don’t have to be a tech genius to sell on Etsy. The site is super easy to use and even those with limited technical abilities should be able to get a shop up and running pretty quickly.
  • Etsy has built in marketing and payment processing tools that mean you can be selling goods in as little as an hour.

However, ecommerce platforms also have their plus points:

  • They allow you to access powerful ecommerce tools and apps.
  • You have greater flexibility over the look and feel of your online store.
  • You have a fully-fledged website that you can market how you please.
  • You’ll pay a fixed monthly fee, rather than a percentage based on your transactions.

Which solution you choose will likely depend on how much time you have available and how technical you are. Whether you see yourself selling products as a small side hustle or as your main career can also be an influential factor when it comes to the Etsy marketplace versus an ecommerce store decision.


Etsy is a well-established marketplace for the sale of craft, vintage and homemade items. It provides a quick and easy way to set up and sell your wares and to access millions of potential customers.

We’ve walked you through how to set up your shop on Etsy and start selling and detailed some of the key benefits you will get by doing so. Now, it’s over to you to set up your shop and start making money from Etsy!

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