How much does Etsy charge to sell items on the platform?
How can I reduce Etsy’s fees?
These are just some of the questions you should ask yourself if you’re interested in becoming an Etsy seller.
The subject of Etsy fees can confuse a budding Etsy seller like you. The platform has quite a few fees that can cut into your profits if you’re not careful in reviewing them.
Don’t worry, you’ve come to the right place.
In this guide, I will break down all the Etsy fees to help you maximize your profits.
Table of Contents
How Much Etsy Charges Shop Owners
Etsy is a one-stop shop for vintage, handcrafted, and customized goods.
The multi-billion dollar ecommerce site has had a slew of new and reactivated users, so you might have been interested in joining the bandwagon.
While selling on Etsy can be profitable, new and experienced sellers should know the recent adjustments to Etsy seller fees.
In addition to the general regulatory operating fee, sellers pay Etsy for promotions, exclusive features, and other Etsy services.
Learning to avoid specific fees is the key to guaranteeing your store’s profitability and supporting its long-term development.
What Are the Etsy Fees and Taxes?
How much does Etsy cost monthly?
This is something you need to know before you start selling on Etsy.
You need to recognize transaction fees on Etsy to calculate your profit from each sale accurately.
To help you determine how much it’ll cost to sell your goods on Etsy, check out the various seller fees you need to pay Etsy.
Etsy Listing Fees
Etsy charges a listing fee every time you add a new item to your Etsy store.
The Etsy listing fee is a flat rate of 20 cents, regardless of the category. Editing a listing is free, though.
Etsy considers a listing with multiple inventories (different colors, sizes, etc.) a single listing. Etsy will still charge the flat rate of 20 cents.
Etsy deducts the listing fee from your payment account when you publish or renew a listing. Note that the Etsy listing fee is non-refundable.
Etsy Transaction Fees
Etsy charges a transaction fee to cover operating expenses. Right now, the Etsy transaction fee is 6.5% of the item’s selling price, including any amount you charge for gift-wrapping and shipping the item.
If you sell in the US or Canada, the transaction fee won’t apply to the sales tax, goods and services tax (GST), and harmonized sales tax (HST) unless you include them in your listing price.
If you sell outside the US or Canada, the transaction fee will apply to the listing price (including all applicable taxes), shipping fee, and gift wrapping fee.
If you offer optional item customization (like custom shipping boxes) for an additional fee, Etsy adds this fee to the listing price. Etsy then applies the transaction fee to the total display price (listing price plus customization fee).
Payment Processing Fees
Etsy charges sellers a payment processing fee for each transaction that uses Etsy payments.
Etsy payment processing fees consist of a set rate plus a percentage of the item’s total sale price.
This rate and percentage differ for each country. The best way to determine how much your payment processing fee will be is to check Etsy’s guide on payment processing fees.
Etsy Pattern Fees
Pattern is a tool that allows you to create a separate website for your Etsy store. Pattern also lets you connect your store to the website and sync your inventory.
You can avail of Pattern’s 30-day free trial if it’s your first time using the tool. If you still want to use the tool after 30 days, you’ll have to pay a $15 monthly subscription fee (plus applicable taxes).
When considering optional Etsy fees, Pattern may be the only one worth paying. You are exempt from paying the 20-cent listing fee and the Etsy transaction fee if you only list items on your Pattern site.
You don’t need to pay an additional listing fee to list your items on Pattern. Since Pattern listings never expire, you don’t have to pay renewal costs.
Etsy Promotional and Advertising Fees
Etsy offers sellers several marketing options, such as shopping engine advertisements, paid advertising, and shop-specific promotions. Etsy charges different fees for each of these options.
As an Etsy seller, you must understand how these fees can affect your profits before paying.
Charges for Etsy Ads
Sellers can advertise directly on the platform through Etsy Ads, which have pay-per-click pricing. The price per click varies based on demand.
You can set a daily spending cap for this service. As long as your spending stays within that cap, Etsy will list your ads.
Etsy takes the fee out of your payment account.
Charges for Offsite Ads
Offsite Ads is the most recent improvement in Etsy’s advertising. It’s a brand new program that promotes your goods on popular websites like Instagram.
Etsy automatically signs up all sellers to Offsite Ads. However, sellers with less than $10,000 in annual sales can opt out.
You pay a fee whenever you get a sale from an offsite ad. You must pay an advertising fee based on the order total whenever a customer clicks on one of your offsite ads. The customer also has to complete the purchase within 30 days.
Charges for offsite ads generally range from 12 to 15% of your annual sales.
Processing Fees for Credit Cards
You’ll need to pay a processing fee to be able to accept online payments when you sell on Etsy.
Etsy Payments is Etsy’s proprietary payment processor. You need to use Etsy Payments to accept payments if you reside in one of 36 eligible countries. This service lets you accept payments via credit card, debit card, Apple Pay, Google Pay, Etsy Gift Card, and more.
Etsy Payments charges a fee of 3% plus 25 cents per transaction.
You can use PayPal if you reside in a country that isn’t eligible for Etsy Payments. PayPal typically charges a fee of 2.9% plus 30 cents per transaction.
Etsy Plus Subscription Fee
You can subscribe to Etsy Plus for $10 monthly if you’re in good standing with Etsy.
Etsy Plus offers additional tools, and you receive $5 in Etsy Ads credits and $15 in listing fee credits.
Etsy will deduct the monthly fee from your payment account until you cancel your subscription. Etsy may also charge US sellers a sales tax on the monthly fee when applicable.
Labels for Shipping
You can buy and print USPS shipping labels for your transactions using Etsy’s integrated shipping label service. The Payment Account screen will display shipping labels.
In-Person Selling Fees
Etsy has partnered with Square to provide sellers with a choice for in-person selling. You can link your Etsy account to Square to sell online and in-person.
Note that you need a Square card machine to accept Etsy payments in person. You’’ have to pay the standard listing fees and Square’s payment processing fees when you accept in-person Etsy payments for goods listed on your shop.
Square won’t charge a transaction fee of 6.5% for each card payment. Instead, Square charges a flat fee of $0.10 plus 2.6% of the purchase price.
You pay a fee of 3.5% of the purchase price plus $0.15 for manually entered Etsy payments. Etsy charges a Square manual transaction fee of 20 cents if you use Square to sell an item that isn’t on your Etsy seller account.
Regulatory Operating Fee
Etsy has charged a small fee to sellers in some countries since 2021.
Here are the regulatory operating fees per country.
- France: 0.4%
- UK: 0.25 %
- Italy: 0.25%
- Turkey: 1.1%
- Spain: 0.4%
Etsy adds the fee to the item’s total price, which includes customizations, shipping costs, and gift wrapping.
How Much Does It Cost to Have an Etsy Shop
Technically speaking, opening your Etsy store is free. Starting your business on Etsy has no initial costs. You don’t have to pay monthly fees to keep your store running when you’re starting out.
You only need to pay a small listing fee each time you add an item to your store. Then, you pay a processing fee for every item that you sell.
Etsy automatically takes the fees out of your payment account as long as it has sufficient funds. If there are no funds in the account, you have 15 days from receiving your monthly statement to settle any unpaid fees.
You can make manual Etsy payments via debit card, credit, or PayPal. You can also sign up for automatic billing if you’re a US seller.
Etsy can use your card on file or pursue payment in other ways if you have an unpaid balance. Etsy can reverse funds to your account or hire a credit agency.
If you sell an item while you have an unpaid balance, Etsy will use the proceeds from that sale to settle your outstanding balance. Etsy reserves the right to revoke your selling privileges if your account is past due.
What Percentage of a Sale Goes to Etsy?
Here’s the amount that goes to Etsy for each sale.
6.5% of the total sale price + 20 cents + 3% of the total sale price + 25 cents = 45 cents plus 9.5% of the total sale price.
These charges apply if you are a US seller. Etsy applies different fees to sellers outside the US. Etsy may also require you to pay additional fees depending on your location.
How to Lower Etsy Fees
You can’t avoid paying fees altogether, but I can offer the following strategies to reduce your Etsy fees:
Group Listings on Etsy
Some new sellers have a lengthy product list to highlight their diverse product categories, increasing their listing fees.
You can cut costs by combining similar categories.
Bundle Your Items
You pay a transaction fee each time you sell an item.
You can group similar products and provide bundle discounts.
Bundling items incentivizes customers to spend more while reducing transaction fees.
Provide Free Shipping
If you offer free shipping, Etsy won’t charge shipping fees. Of course, you’ll have to raise the price of your item to cover the cost since free shipping isn’t actually free.
Free shipping encourages customers to buy more, so don’t hesitate to offer it.
Offering free shipping draws attention to your products and helps boost sales.
Offer Exclusive Listings
Offer to create a private listing if a customer messages you and expresses an interest in a specific item. An exclusive listing is helpful, especially if the customer wants multiple items.
You’ll avoid paying the 20-cent listing fee per item. Furthermore, Etsy will only charge you 20 cents for creating a private listing if the item sells.
List Costs in the Currency You Use for Banking
If you list your goods on Etsy in a currency other than the one associated with your default payment account currency or bank account, you will have to pay Etsy fees, a 2.5 currency conversion fee.
List your goods in the same currency as your billing account to avoid paying an unnecessary conversion fee.
Disable Auto-renewal
Etsy automatically turns on auto-renew for new listings. The listing fee may just be 20 cents, but it can add up if all your listings are on auto-renew.
Disable automatic renewal and switch to manual renewal. That way, you have more control over your listings. Manual renewal makes it easier to remove listings with poor sales records.
Don’t Run Etsy Ads for All Your Listings
Focus your advertising efforts on high-converting items with a high clickthrough rate. Doing so allows you to maximize the return on your advertising investment.
Run your Etsy Ads campaigns for 30 days to see what happens. After 30 days, review your metrics to determine campaign performance. Check how many clicked on the advertisement but didn’t purchase versus how many clicked and purchased.
Price Increase
Increasing product prices is another way to prevent fees from cutting into your profits.
Sellers frequently worry that raising the cost of their products will reduce their ability to compete.
Even though this can happen occasionally, some Etsy sellers claim that their sales did not fall off after they increased their prices. That may be because consumers frequently believe that products with higher prices are of higher quality.
Consider the Benefits and Drawbacks of Advertising
Carefully consider whether using Offsite Ads is beneficial or not.
Running Offsite Ads can lead to an increase in sales. However, you’ll also have to pay 12 to 15% of your annual sales to cover the fees for Offsite Ads.
The Bottom Line
Like your store, Etsy is a business that needs to turn a profit. As such, Etsy fees are an unavoidable aspect of running an Etsy shop.
While you can’t avoid all fees, you can reduce them to maximize profits. Hopefully, my article has given you a clearer understanding of how much Etsy charges for selling items.
You can also increase your profits by learning how to promote your Etsy Shop.
