Why is etsy so expensive

Why Is Etsy So Expensive? The Tell-All Guide For Sellers! [2024]

“Why is Etsy so expensive? I was about to get my Etsy side hustle game on!”

You just went through the Etsy Seller Guide and explored your financial dashboard. But you found thoughts of doubt creeping in. 

Is starting an Etsy shop worth it? 

What are all these charges? 

Though it can seem quite scary when you’re faced upfront with what seems like an endless list of charges, Etsy is a brilliant platform to make extra money and share your handmade products (physical OR digital!). 

The extra money you earn from Etsy could help you travel around the world!

I am also really into Etsy these days as I’m helping my sister grow her Etsy account. Here are some pictures of the store. While researching and testing what is effective for her account, I thought it would be helpful to share the details here with you so that you can also benefit and grow on Etsy!!

Why is etsy so expensive

Now, I’m here to talk you through the different fees Etsy charges to ease your experience as a first-time seller. 

I’ve included some case study examples, and hopefully, by the end of the article, you’ll feel a lot more confident in deciding how to make Etsy your next step in financial freedom!

Why is etsy so expensive

Affiliate Link Disclosure

Some of the links included below are affiliate links where we may earn a commission if you click on them but at NO EXTRA cost to you. I hope you find the information below helpful!

Note: If you are super busy and you want to start making money selling on Etsy fast, you can check out this and this Etsy course. It will help step up your Etsy game and start earning within 3 months! 

Alternatively, you can also check out this free Etsy Ebook that will share a list of best-selling products by month and teach you how to capitalize on seasonal trends to make sales.

So, Why Is Etsy So Expensive To Sell?

You’re eager to start your business on Etsy. But you’re wondering, “Is Etsy expensive to sell on?”

Before you dip your toes in, you should have an idea of how much Etsy costs!

Etsy charges these fees to cover their expenses for website hosting, transaction costs, customer service, marketing, and more. 

In a way, you don’t need to set up your own website to sell your products! Etsy takes care of these for you in exchange for some seller fees. 

If you were to set up your own website, you would have to settle website hosting, domain, marketing, and payment processing systems all by yourself!

Don’t forget the time you’ll take to create or source your products to sell! These are probably not even half of it if you wish to set up your own website O_O 

Now you need to know what kind of Etsy fees there are. Thus you can plan better about how to price your products efficiently. 

Besides, you won’t be taken by surprise by any “Etsy hidden fees” when you look at your Etsy payment account! 

Overall, these are some of the types of Etsy fees for sellers: 

1. Listing Fees

2. Transaction Fees

3. Payment Processing Fees

4. Advertising & Promotional Fees

5. Subscription Fees

6. In-Person Selling Fees

7. Currency Conversion Fees

8. Pattern Fees

9. Regulatory Operating Fees

Why is etsy so expensive

Types Of Etsy Fees

After going through why is Etsy so expensive, let’s go into detail about each Etsy fee.

  • Listing Fees

For every physical or digital product you list on Etsy, you incur USD 0.20 per listing.

You need to renew your listings at USD 0.20 each every 4 months, regardless you made a sale or not. 

Your listing fees will differ depending on the quantity of items you’ve listed. 

If you listed the same item in multiple quantities, your initial listing fee is USD 0.20 for the first item. You will only be charged for the remaining quantities once you’ve sold each of them. 

The only exception is if you created a private listing, which you will only incur USD 0.20 if you sold the private listing. 

Etsy has an automatic renewal feature for your listings toward the end of the 4-month listing period. But you can choose to opt out of the automatic renewal feature.

  • Transaction Fees

For every sale, Etsy will charge a transaction fee of 6.5% to the final price after any discount. The final price includes shipping, product personalization, and gift wrapping.

For every sale, your incurred transaction fees are subtracted from your current balance. It will be reflected in your payment account.

  • Payment Processing Fees

Many Etsy shops use Etsy’s payment processing system – Etsy Payments. The system accepts debit or credit cards, Etsy gift cards, Google Pay, and more. 

The fees will differ depending on the location of your bank account. You will be charged a payment processing fee for every transaction made through Etsy Payments.

The payment processing fee is calculated based on the total sale, which includes shipping and tax.  

For US sellers, your payment processing fee is USD 0.25 + 3% of the final price, which includes shipping, product personalization, and gift wrapping. 

  • Advertising & Promotional Fees

Etsy offers various services to promote your shop and market your listings, such as Etsy Ads and Offsite Ads

For Etsy Ads, you can limit the amount to pay. Your daily maximum budget can be the same or more than Etsy’s predetermined minimum budget.

For Offsite Ads, you only need to pay the fees if the advertisement for your listing directly brings you a sale within 30 days of the buyer’s click. 

The Offsite Ads fee depends on the sales of your shop over the prior 365 days. 

The sale comprises the listing price, shipping fee, gift wrapping, and optional personalization. 

If you made less than USD 10,000 over the prior 365 days, you will pay a fee of 15%

If you made more than USD 10,000 over the prior 365 days, you will pay a fee of 12% if you qualify the moment you apply for the program. 

Otherwise, you will be charged a fee of 12% on the first day of the month after qualifying.

But if your sales fall below USD 10,000 after, you will still be charged 12% for the lifetime of your shop. You are unable to opt out of the Offsite Ads program. 

  • Subscription Fees

Etsy sellers may opt-in to a subscription package called Etsy Plus at USD 10 per month, which can be canceled at any time.

Benefits of Etsy Plus include 15 listing credits worth USD 3 per month, Etsy Ads credits worth USD 5 per month, and 50% off for selected domains through Etsy’s third-party provider

  • In-Person Selling Fees

You can utilize Square for in-person sales. You can choose to sync your Etsy listings with Square. 

If the Square reader processed any in-person sales, you will not be subject to Etsy’s transaction or payment processing fees. Instead, you’ll be charged with Square’s payment processing fees.

  • Currency Conversion Fees

If the currency for the price of your listing differs from the payment account currency, you will need to pay a currency conversion fee of 2.5%

Etsy usually recommends sellers list their items in the same currency as the currency of the payment account to prevent incurring foreign exchange charges on sales. 

  • Pattern Fees

You can try Etsy’s Pattern tool for a free trial of 30 days before paying a monthly fee of USD 15

You can use Pattern to create a website that you can personalize – domain, fonts, theme, and more! You can have listings that are only available on Pattern. 

  • Regulatory Operating Fees

The regulatory operating fee will be charged to Etsy sellers in certain countries for each transaction.

It is a fixed percentage of the listing price added with shipping, gift wrapping, and optional personalization fees. 

United Kingdom – 0.32%

France – 0.47%

Italy – 0.32%

Spain – 0.40%

Türkiye – 1.1%

Of all these fees, listing fees, transaction fees, and payment processing fees are mandatory Etsy sellers’ fees you will definitely be charged upon your sales. 

Therefore, I’ll be providing examples that include the fees above in the next section.

Why is etsy so expensive

How Much Does Etsy Cost?

In this scenario, you are selling handmade soap bars at USD 10 at a cost of USD 4 each. 

  • Listed 1 Item, Sold None

If you choose to list only 1 handmade soap bar, you will be charged USD 0.20 upon listing. Once 4 months are up, you need to pay USD 0.20 to renew the listing

Total Seller’s Fee: USD 0.40

Initial listing fee: USD 0.20 

Renewed listing fee: USD 0.20

  • Listed 4 Items, Sold None

If you listed 4 items at the beginning, you will be charged USD 0.20 upon listing. If none are sold, you will need to pay USD 0.20 to renew the listing. 

Total Seller’s Fee: USD 0.40

Initial listing fee: USD 0.20 

Renewed listing fee: USD 0.20

  • Listed 4 Items, Sold 1 Item Before Listing Expired

If you listed 4 items at the beginning, you will be charged USD 0.20 upon listing. When you’ve sold 1 item before the listing expires, you’ve already been charged USD 0.20 earlier so you won’t need to pay again.

Let’s say you sold 1 handmade soap bar at USD 15 (buyer pays USD 5 for shipping), the transaction fee is USD 0.98 (USD 15 * 6.5%).

The payment processing fee for 1 handmade soap bar is USD 0.70 [USD 0.25 + (USD 15 * 3%)]

The sale of 1 item leaves you with 3 remaining handmade soap bars. As you’ve sold 1 item before, your listing will automatically renew with a fee of USD 0.20.

Total Seller’s Fees For 1 Handmade Soap Bar: USD 1.88

Initial listing fee: USD 0.20 

Transaction fee: USD 0.98

Payment processing fee: USD 0.70 

Profit For 1 Handmade Soap Bar

= USD 10 (price of item) – USD 4 (cost) – USD 1.88 (seller’s fees)

= USD 4.12

Profit margin for 1 handmade soap bar

= USD 4.12/ USD10

= 41.2%

  • Listed 4 Items, Sold 4 Items Before Listing Expired

If you listed 4 items at the beginning, you will be charged USD 0.20 upon listing. 

When you sell your first item before the listing expires, you’ve already been charged USD 0.20 earlier for the first item. Hence you won’t need to pay a listing fee for the first item. 

Let’s say you sold 4 handmade soap bars at USD 15 each (each buyer pays USD 5 for shipping), the transaction fee is USD 3.90(USD 15 * 6.5%*4).

The payment processing fee for 4 handmade soap bars is USD 2.80 [USD 0.25 + (USD 15 * 3%)]*4

When the remaining 3 items are sold, you’ll be charged another USD 0.60 (USD 0.20 x 3 items). 

Since you’ve sold 4 out of 4 listed items, the listing won’t be renewed until you do so.

Total Seller’s Fees For 1 Handmade Soap Bar: USD 7.50

Initial listing fee: USD 0.80 

Transaction fee: USD 3.90

Payment processing fee: USD 2.80 

Profit For 4 Handmade Soap Bars

= USD 40 (price of items) – USD 16 (cost of items) – USD 7.50 (seller’s fees)

= USD 16.50

Why is etsy so expensive

Why Is Etsy Taking My Money?

Now that I’ve gone through the types of Etsy fees, you’re wondering why Etsy has so many fees O_O

The main reason why Etsy charges fees to the sellers is to cover the fees for their business. 

This includes Etsy’s fees for marketing, website hosting, transaction costs, customer service, and more. 

Why is etsy so expensive

Is It Worth Selling On Etsy?

Well, is it worth selling on Etsy? 

Some people think Etsy overpriced its fees for sellers, making it less worthy to sell on the platform. 

Although it seems Etsy does take quite a chunk of your profit as Etsy sellers’ fees, there are a few benefits to why it’s still worth selling on Etsy. 

1. Lots Of Traffic

If you’re worried about traffic, Etsy has plenty of it!

After all, it is a well-established platform! In 2024, there were more than 90 million active buyers ready to buy on Etsy! 

2. Easy To Navigate

If you are a beginner on Etsy, let me assure you it is quite easy to navigate Etsy! 

Etsy has a Seller Handbook that provides plenty of information to help you get started on the platform!

There are many tips for you too, so it won’t hurt to spend some time going through the Seller Handbook. 

3. Focus On Your Products

Because Etsy has an established platform, you don’t have to worry too much about setting up your website, domain, hosting, payment processing system, etc. 

Instead, you can focus on creating or sourcing the best products for your Etsy shop! After all, time is valuable in your business! 

4. You Could Earn A Decent Income

You can still earn a decent income on Etsy, provided there is a good level of demand for your products and you continue creating high-quality products. 

One of the easiest products to start selling on Etsy is digital downloads. You need to invest some time to create excellent digital downloads, but you only need to do it once. 

You don’t have to keep recreating the same digital download again! You can create more digital downloads and spend time marketing your Etsy shop on your social media.

How Does Etsy Compare?

If you are still on the fence about which platform to choose, here is a comparison of the pros and cons of selling on Etsy, Amazon Handmade, and eBay. 

Pros Of Selling On Etsy

  • It’s easy to navigate the platform
  • Well-established platform with lots of traffic and buyers who are ready to buy
  • Lots of tips for sellers to help you increase your sales
  • Known for selling handmade products, craft supplies, vintage products, and digital downloads
  • It may be easier to enter certain niches in the market

Cons Of Selling On Etsy

  • Depending on the niche, there could be a high level of competition
  • You have to understand many types of sellers’ fees and price your items accordingly
  • It’s hard to establish customer loyalty as buyers are always looking for cheaper options

Pros Of Selling On Amazon Handmade

  • The platform has a strict policy to ensure it sells only handmade items (you know the platform takes handmade items seriously!)
  • Amazon is a huge platform trusted by many buyers
  • No monthly subscription fees for sellers here (unlike regular Amazon seller accounts)
  • Save your time by utilizing Fulfillment by Amazon (FBA)

Cons Of Selling On Amazon Handmade

  • A higher transaction fee of 15% per sale (Etsy: 6.5%)
  • It could be harder to get your application as an artisan seller on the platform approved
  • More competition 

Pros Of Selling On eBay

  • More than 100 million active users on the platform
  • Easier to set up your store compared to Etsy
  • eBay has made it easy to sell on the platform with its Global Shipping Program

Cons Of Selling On eBay

  • You have to pay a monthly fee to run your store on eBay
  • It isn’t a platform solely for handmade or vintage items so there may be fewer of your targeted customers here
  • As handmade and vintage items are more expensive, you’ll be competing against sellers who sell mass-produced items at a lower price

How To Make Etsy Worthwhile

To make Etsy worthwhile, I have curated a list of tips for you!

  • Aim to become an Etsy star seller! It shows that you provide excellent customer service to your buyers.
  • Use keyword tools such as Keysearch and Sale Samurai (two of my favorites!) to help increase the chances of your Etsy shop being seen.
  • Check out some paid Etsy courses such as Gold City Venture Etsy Course.
  • Put in consistent effort to create high-quality products and market your Etsy shop.
  • Choose a niche you are passionate about, has low competition, a high level of demand, and great potential to be profitable.
  • Do not compare yourself to other Etsy sellers and focus on what you can do to grow your Etsy shop.
  • Use the same currency for your listings as your bank account.

FAQs On Why Is Etsy So Expensive?

How Much Does Etsy Actually Take?

So, how much does Etsy actually take from its sellers? 

The sellers’ fees depend on how much do the sellers make on Etsy. 

The mandatory sellers’ fees are:

  • Listing fee
  • Transaction fee
  • Payment processing fee
  • Advertising & promotional fee (Offsite ads for those who earned more than USD 10,000 over the prior 365 days)

The it-depends-on-the-situation fees are:

  • Currency conversion fee
  • Regulatory operating fee
  • In-person selling fee

The optional sellers’ fees are:

  • Advertising & promotional fee (Etsy ads)
  • Pattern fee
  • Subscription fee

Related posts

Is It Expensive To Have An Etsy Shop?

Wondering if it’s expensive to have an Etsy shop?

It depends on many factors whether it’ll be expensive for you to open an Etsy shop. Here are a few (of many) factors:

  • Niche of your products
  • Level of competition
  • Demand for your products
  • The cost to create or source the products (could affect your Etsy sellers’ fees)
  • Etsy sellers’ fees
  • The time to create or source the products
Why is etsy so expensive

Is There An Alternative To Etsy?

Wondering if there are other alternatives to Etsy? There are a few other options for you to consider: 

1. eBay

2. Shopify

3. Amazon Handmade

4. Big Cartel

5. Bonanza

Can I Live Off Just Selling On Etsy?

So, can you live off just selling on Etsy?

While several Etsy sellers make a good living from only selling on Etsy, many sellers receive extra income from their Etsy shop while maintaining a full-time job.

To earn a full-time income on Etsy, many factors that could influence your sales:

1. The niche of your product

2. The demand for your product

3. The level of competition

4. The amount of time you invested into your Etsy business and products

5. The amount of marketing for your Etsy shop

6. The price and profit margin of your products

Why is etsy so expensive

Why Is Etsy Shipping So Expensive

So why is Etsy shipping so expensive? 

Etsy automatically calculates the shipping costs when you’ve created a listing. Etsy calculates the cost by considering the following:

  • Weight of the items
  • Method of shipping
  • Destination of shipping

Etsy is known for selling unique handmade and vintage products which are hard to find in other places. A lot of these products are delicate or fragile. 

Some Etsy sellers also offer priority shipping for those who wish to receive their products faster, which will increase the shipping fees. 

Besides, Etsy offers insurance for any lost or damaged items during transit. Therefore, the high shipping costs can be quite worth it.

If you’re an Etsy seller living in the United States, you can save on retail postage rates up to 30% by purchasing shipping labels from Etsy.

But Aisha, I wonder why is Etsy international shipping so expensive too?

The distance and increasing costs of shipping the item to your buyer overseas contribute to the higher prices on Etsy. 

It also depends on the size of the item you’re shipping overseas. Larger items would require more resources to ship, thus increasing the cost of international shipping.

I’m so excited for you to start your business on Etsy! I hope this article answers your concerns about why is Etsy so expensive. 

As all these Etsy fees do add up, remember to consider all the Etsy fees when you are pricing your products.

While you will encounter other challenges while selling on Etsy, it is quite simple to navigate and set up your shop on Etsy.

But I’m confident you can tackle the challenges that come your way and build a successful business on Etsy!

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