How much does it actually cost to sell on Etsy? We dove head first into the fees and broke them down for you.
What is the cost to sell on Esty? There are various sellers fees tied into selling on Esty. To see the breakdown of each fee read on……
Breakdown of “The Basic 5”
For my Etsy shop, I found there were 5 basic fees to learn and understand as an etsy seller. Once I understood these 5 basic fees it made it simple to understand the cost of selling on the etsy platform.
You may ask yourself, are there other additional etsy fees after I learn these 5? YES! There are other optional fees but I found once I got the 5 basic fees understood I was able to understand the complete cost of selling on the Etsy platform. As a side note:
Although there are 5 listing fees described below don’t get discouraged. I still find Esty to be the least expensive way to sell online. Let’s get started!
Here are the basic 5 fees
|1. Listing fees||.20 cents (per listing)||Charge for using platform|
|2.Transaction fee||5% fee of each sale |
( calculated on item price + shipping)
|Etsy’s cut for the sale|
|3.Auto Renew fee||.20 cents||The fee to add an item back to your store if it is not sold after 4 months|
|4. Payment fee||3% + 25 cents |
( each sale)
|Varies by country. Kind of like a fee for handling the money like Paypal.|
|5. Multi quantity fee||.20 cents |
( per listing)
|Fee for each additional item sold on the same one listing.|
1. Listing Fee
Your first charge. Hooray! A listing fee of $.20 USD is added for each listing once the item is published. This fee is good for 4 months or until the item is sold.
Equates to: Basically it’s Etsy’s charge for using their platform. Cost of $.020 for each added item to “their shelves”.
2. Transaction Fee
This is a charge of 5% of the sale of your item. It’s very important to understand that this 5% is off not only the sale price of your item but of the shipping cost as well.
Equates to: I see this as Etsy’s commision or cut from the sale.
3. Auto Renew Fee
This is a fee of $0.20 USD for each listing that does not sell. If you choose Auto Renew when you list your item it will charge you $0.20 USD every 4 months from the renewal date until sold.
4. Payment Fee
Etsy charges 3% plus $ 0.25 US for each sale. Be aware this fee varies by country. For my example I am using US fees.
Equivalent to: I think of this is a fee Etsy charges for handling the payments between buyer and seller. Esty does all the paperwork for the sale such as collects the money from the buyer and then turns around and pays you the seller. I think of this item as the “Paypal” of Etsy.
5. Multi Quantity Fee
This is $0.20 USD per listing. This is a fee for each additional item sold in the same listing. Don’t let this concept mess you up. When a sale occures on a multi item listing and the listing is not sold out, the listing is automatically renewed for the remaining items.
This is a fee if you only have more than one of the same item in one listing.
Now that you understand what Etsy will be charging you and why let’s see it in action. Here is a recent sale from my shop. Just to understand the basics of this sale here are the stats:
Item: Brass Kitchen Pot Holder was sold at $65.00. The shipping cost was $23.15 and sales tax was $6.17. The grand total of this sale was $94.32. Take a look below of the breakdown of fees found in my Etsy financial section to the sale of this item.
Fee 1: Listing Fee / Posting item to your shop
Fee 2: Transaction Fee / On Product
Fee 3: Transaction Fee / On Shipping
Fee 4: Payment Fee
We can all agree that understanding the total profit on your items sold is an essential part of understanding your business success. Without understanding your bottom line how would you figure out how to price your item for sale or even what to spend on material when making your items?
Etsy tells us to use the “Top Down” approach. You need to calculate the following to start:
~ Cost of material
~ Your time spent / Labor
~ Shipping cost and material
Don’t short change yourself here. I know early on when I first opened my shop I was underpricing my items in fear they would not sell. Make sure you check your competition, assess the listing fees costs above and document all your time and costs to get an accurate calculation of your profit.
It’s completely to your benefit to understand the way Etsy structures its fees. You need to calculate exactly how much profit is being made on each order.
To fully understand the fees will only make you a better, more educated seller. You owe it to yourself to get completed educated on your Etsy financial obligations. I think you will find once you understand these fees you will see Etsy is still one of the best market places for selling online.