If you want to open a shop, but before this, you want to ensure you grasp the entire picture of what goes into selling items on Etsy, in actual fact, the first thing you might think is, “What do I actually spend to sell stuff in an Etsy shop then?” This tutorial will give you the real, not even the slightest bit tricky, price of actually what you’ll pay as a newer shop to sell your goods on Etsy.
The Basic Listing Fee
A Listing Fee: Whenever you make a new listing or renew one of your listings, the first time the listing comes available or renews is a tiny listing fee of $0.20 US dollars per listing. That listing fee is active whether your item sells or not. The listing is auto-renewed every four months (again incurring the cost again). Or, of course, every time the item sells again, then another listing fee.
For most people that sell a big catalogue, all of those small fees get really steep—that's why, when considering how many sales to include in this calculation, consider the total quantity of active listings in your catalogue and not just the price paid of each item.
Transaction Fees on Every Sale
Transaction fees are imposed on every sale on Etsy. This amount is calculated as a percentage of the total price for the order—both the item price and the amount that you charge to ship it. It currently comes in at a worldwide rate of 6.5%. Therefore, your item pricing must include this 6.5% to avoid losing money from every sale.
Payment Processing Fees
Additionally to the transaction fee, Etsy will take a payment processing fee in order to deal with your payment via Etsy Payments. This fee changes a little bit with your country, because Etsy will likely apply a certain percentage of the sum plus a bit of money on top of it for each transaction.
Etsy Ads and Optional Marketing Costs
These are if you have also opted to utilize Etsy Ads for increased visibility, which comes out on top of fees, and are completely optional, but many people do utilize them to improve reach. Especially younger shops who still have not generated much organic traffic, as Etsy is a search engine just like Google!
Etsy has its own offsite ads program that’ll charge sellers a portion of the sale, 15 or 12 percent depending on yearly sales, whenever one of their sales is due to one of these offsite ads. Smaller sellers can choose to opt out, while large sellers will need to agree to the service.
Currency Conversion Fees
However, and this is very important, if you're selling from a country and listing with a different currency than the currency you bank with, Etsy has a currency conversion fee. You'll want to verify this carefully, though, because it can nibble your earnings away without you even noticing if your pricing doesn't take it into account.
A Simple Example
To provide some context on the Etsy listing fees, consider that you list an item for $30 with a shipping cost of $5 for a total of $35:
- Listing fee: $0.20 (when the listing is made or renewed)
- Transaction fee: around $2.28 (6.5 percent of $35)
- Payment processing fee: percentage + fixed charge depending on the country
When these are added together, you can quickly see the importance of figuring these fees into the prices of your products so that your profit margin is protected.
How to Price Around These Charges
A lot of sellers make a basic calculation of materials costs, time, and Etsy’s charges to work out a figure. By doing it from the very start, you can easily make sure you don’t price far too low and then realize in surprise later down the road all the fees have almost swallowed your profits.
Handling all of that yourself, manually, across tens or even hundreds of listings can become complicated really fast. At Caasto, we assist with the right arrangement of listings, pricing structure, and the whole Etsy USA account strategy—all-inclusive in our account management plan, and this way, any relevant fee is already included right away.
In terms of what actually will amount to the fee to make an account, Etsy updates them periodically in its “Seller’s Handbook.”
Final Thoughts
Etsy listing fees can be pretty straightforward if you split them up by listing fees, transaction fees, and payment processing fees. The idea is to ensure it all gets figured into your pricing from the start, rather than a few sales later when it becomes evident that your profits are slimmer than anticipated.
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