A Beginner’s Guide to Making Money on Etsy

Check out how you can turn a profit on Etsy.

If you’re a creative person (and if you’re on Creative Fabrica, downloading our font and graphic bundles for passion projects, then you are), you’ve probably thought about the possibility of turning your hobby into a money-making venture.

Well, now’s the best time to do so. Etsy is one of the most viable places where you can launch a creative side hustle, with millions of buyers from all over the world.

If you love creating printable planners, designing wedding invites and stationery, or assembling paper craft with assets from our Creative Fabrica library, Etsy has a spot for your niche.

Wary about taking the leap to creative entrepreneurship? If you’re a newbie seller, things may start off slow for you. But hold on tight. In this article, we’ll show you ways on how to make money and eventually become rich with Etsy.

 

Why sell on Etsy? Pros and cons to consider

 

Etsy is a very popular marketplace for creatives for several reasons. One is that it’s very easy to use and maintain.

Its established name is a great assurance of its quality of service, too. Having been around for quite a long time, it has a built-in audience that starting entrepreneurs can readily tap.

It is not a perfect platform, by any means. Because of its popularity, you have to expect to compete with millions of active sellers.

One way you can compete is by lowering your prices, which can greatly lower your profit margin. It’s not a very customizable site as well, so if you want to have a certain branding, Etsy may not be the place for you. 

However, if you’re new to online business, Etsy is as good a place to start as any.

The platform is known to support small businesses, encouraging their growth and consistently finding ways to improve sellers’ experience on their site.

It also has a community of experienced sellers who are always more than willing to share knowledge and tips to thrive on the site. Plus, if you follow our tips in this article, you’ll find plenty of ways to make money on Etsy even as a beginner.

 

How to make money on Etsy in 5 steps

 

Starting an Etsy store is not, by any means, a get-rich-quick scheme.

However, there are concrete things you can do to increase your chances of running a profitable store.

Here how to make money on Etsy in 5 easy steps.

 

1. Create a solid pricing strategy

 

Making money is directly correlated to your pricing strategy. So, you need to price your products competitively.

Take into consideration the cost of materials and tools you used, transportation or shipping, time spent on manual labor, and the prices of your competitors selling similar products on Etsy.

It would also help if you could cut down on certain things without compromising quality. 

 

2. Boost your online marketing

 

Smart Etsy sellers utilize social media and every form of networking to promote their shop and products.

Adopt this tactic for your Etsy shop and promote your products on different social platforms. Instagram, TikTok, and Pinterest are great places to start.

To widen your reach, consider collaborating with content creators who may already have an established audience. Build your community and establish your expertise through blogging and other similar ways of online promotion. 

Another digital marketing must for any online seller is SEO or search engine optimization. Rank your Etsy shop on search engines by optimizing your store name, product titles and descriptions, and bio with top keywords.

If you have the budget, you can invest in Etsy’s paid ads campaign. This ensures that you will show up in ads all throughout Etsy, increasing your exposure in the website.

Aside from guaranteeing your exposure to buyers with a higher intent of purchasing, partaking in this paid campaign helps you track the results of your advertising efforts. 

 

3. Diversify product offerings

 

It’s always nice to add some new offerings to your loyal customers every once in a while. In this case, you could take advantage of seasonality. For example, add Christmas-themed products when the holidays are near, offer personalization services for Mother’s Day, etc.

Need more inspiration on what to add to your offerings?

Read our guide on what to sell on Etsy to get insight on the website’s top sellers.

And make sure to optimize your listings. Read our tips on how to write an Etsy description that sells.

 

4. Offer promotions and sales

 

Aside from making seasonal offerings, take advantage of traditional discount holidays when buyers are most likely looking for a great steal.

Black Friday, Cyber Monday, and other similar holidays are fantastic opportunities to offer your customers discounts and clearance sales.

As a bonus tip, give exclusive access to discounts to returning customers to earn their loyalty.

Tip: Utilize your Etsy Shop Announcement section to announce new products, sales, and promo offerings.

 

5. Utilizing customer reviews

 

Customer reviews are more important than you think! In fact, this is where most Etsy sellers fail. Make it a habit to reply to reviews, whether good or bad.

Keep your tone friendly yet professional, especially when you’re addressing a less-than-satisfied customer.

The important thing to keep in mind is that you are building a community for your Etsy shop, so don’t be afraid to make connections with your buyers.

Learn from customer reviews as they can help you improve your products and services. You can also highlight great customer reviews on products to help with your future sales.

 

How much it costs to sell on Etsy

 

Running a shop on Etsy is similar to having a physical storefront in that there’s a cost you need to pay – though of course, it’s considerably lower than renting an actual space. So if you want to make money on Etsy, you should take into consideration all the fees you need to pay Etsy as well.

Here’s a breakdown of the cost of running an Etsy shop:

 

Etsy Transaction Fees

 

Etsy charges a transaction fee for every listing that sells. It is equivalent to 6.5% of the total selling price per sale, together with other services like shipping, gift wrapping, customization, etc. For example, if you charge $10 for the item you sold, Etsy will take $0.65 from your sale.

 

Etsy Listing Fee

 

Etsy charges a $0.20 listing fee for every listing you have on your Etsy shop whether or not your listing sells. So, if you have 10 items up on your store, you will be charged $2 by Etsy

 

Etsy Payment Processing Fees

 

Etsy charges payment processing fees if you use Etsy Payments to process orders. Etsy sellers may notice that the processing fees have slight differences, especially if you’re selling to international customers. This is because the set rates vary per country (from 3% to 6%).

If you are in the US, your processing fee is 3% + $0.25 for every sold listing. For example, if you charge $10, Etsy will take $0.55 per US sale you make.

 

Etsy ads fee

 

Onsite

 

Etsy’s onsite ads appear on top of listings when users search for specific products, guaranteeing more visibility. The fees for Etsy’s onsite ads are computed based on a cost-per-click basis, which means that you will only be charged when people click on your ad, not when it is displayed.

The set amount for onsite fees varies per seller as you need to enter a budget to bid on an ad space on Etsy. Whatever your set amount ends up being will automatically be added to your payment account.

 

 

Offsite

 

Etsy works with third-parties like social networks and search engines for its offsite ads. There’s no upfront cost for this service. Etsy will only charge you an advertising fee when you make a sale from the ad. This means that you will only pay an offsite ad fee if a person clicks on your ad and makes a purchase from that click. If the person clicks on your ad but ends up not purchasing anything, you don’t have to pay anything.

However, if a buyer clicks on your ad and makes multiple purchases (separate orders) from that click, each purchase is eligible for the offsite ad fee. 

Offsite ad fees never exceed $100. They are computed in two ways:

• If you made less than $10,000 in the past year, you’ll be charged a 15% fee per sale attributed to an offsite ad. For example, if you sold your product for $10, Etsy will charge you $1.5.
• If you made at least $10,000 or more in the past year, you’ll be charged a 12% fee. For example, if you sold your product for $10, Etsy will charge you only $1.2. 

 

Etsy Shipping Fees

 

Shipping on Etsy is paid by the buyer and is added on top of the selling price. As shipping rates vary per region or country, sellers can manually set their shipping rates or use the USPS shipping rates provided by Etsy.

 

Etsy Plans

 

 

 

Standard Subscription

 

An Etsy Standard subscription includes all the basic Etsy seller tools. This is the default subscription for all Etsy sellers, so this is completely free. Paid ads and extra services can still be accessed with a Standard subscription, but with additional fees, of course. 

Plus Subscription

 

For $10 a month, you can get an Etsy Plus subscription. This amount will be deducted from your Etsy account, along with other fees you have incurred per month such as transaction fees, listing fees, processing fees, and more.

Getting the Etsy Plus plan gets you several perks such as listing credits and onsite ad fee credits, advanced shop customizations, discount to a partner third-party custom web address, discounts to custom packaging (depending on your location) and restock requests. 

To decide on what type of subscription plan you want to get, get more information from this guide.

 

Taxes on Etsy

 

Etsy does not let you pay taxes on the platform. However, you may need to pay taxes to your local government where your business was founded.

It is always a good idea to consult with a tax professional and check with your municipality when computing your taxes quarterly or annually.

For a comprehensive guide on all the fees sellers are required to pay to run a shop on Etsy, check out our article: Etsy Fees Explained.

 

 

Do you need to be a creator to sell on Etsy?

 

Etsy is known as the go-to website for buyers looking for one-of-a-kind pieces from artists and creators. So you’re probably wondering if you need to create products from scratch to sell well and make money on Etsy. 

The good news is that you can sell almost anything that fits into Etsy’s specified categories, following their policies. For example, if you’re selling hand-made, you have to disclose everyone involved in the production of the product – whether it’s you or a partner producer. You cannot resell handmade items.

If you’re selling vintage, the items have to be 20 years or older. Vintage-style items (inspired by vintage, but are not necessarily 20 years or older) cannot be sold under the vintage category.  You should read Etsy’s full seller policies to find if your product can be sold on the site.

To appeal to Etsy’s general audience which values creativity and authenticity, you should add your creative flair to your offerings, whether it’s through your actual offerings, packaging, freebies, or personalized features.

 

 

Creative Fabrica has fonts and graphics that you can incorporate into products like wedding sets, invitations, birthday cards, or creative digital files. You can also use these assets to create a signature branding. 

You can also use our Print-on-Demand assets to create items that you can then sell on POD sites such as RedBubble, TeeSpring, and others. Full POD licenses are especially for Print-on-Demand site users, allowing them to use the specific POD assets with zero or minimal modifications. 

 

Sell these products to make money on Etsy

 

The list of top-selling items on Etsy changes every year but these products are proven to be perennial bestsellers.

 

• Crafts and supplies

Craft-lovers are big fans of Etsy so it’s easy to see why crafting supplies are always top sellers on the site. To make your offerings stand out, use crafts graphics to customize your packaging or branding.

 

•  Wedding party favors

Offer customized wedding materials like invites, cake toppers, handmade centerpieces, and even paper bouquets. Get 3D SVG craft files from Creative Fabrica to produce intricate personalized items for your customers.

 

• Clothing and accessories

Fashionistas go to Etsy to look for handmade and vintage items. Create your own unique clothing items and accessories to sell using Creative Fabrica’s crocheting, knitting, sewing, and embroidery patterns. Use assets from our print-on-demand section to customize shirts, jackets, bags, and other fashion items.

Find the complete list of Etsy top-sellers when you read our article on What to sell on Etsy.

 

Consider alternatives to Etsy

 

If you’re a craft designer, pattern maker, or a digital artist, you can open your store at Creative Fabrica! Our high-quality graphics and fonts will surely help you create unique art pieces which you can then sell wherever and however you’d like.

Consider getting the All Access Subscription Plan to access our entire library of digital files – all with commercial license included. Having the plan lets you download bundles of fonts, graphics, and other creative files that you can mix and match to create your own products.  

 

 

We’ve also just launched Creative Fabrica Spark – our own AI generator tools to help you generate creative materials within seconds. We have CF Spark Art which you can use to create experimental images or inspire your creation, CF Spark Patterns to produce repeatable patterns for digital files and printables, and other AI generator tools that can help you work faster and more efficiently. 

When researching alternatives, you should take into account platform fees, requirements, ideal market, and other legal aspects, if applicable. As a business growth strategy, aim to have multiple selling platforms so you can expand your reach.

 

Is it still worth it to sell on Etsy in 2023?

 

Yes, it is still worth it to sell on Etsy in 2023. It’s an established marketplace for starting and budding entrepreneurs who make beautiful art not just for them but also for people with similar interests.

Creative people can showcase their skills and talent while generating passive income for themselves.

For a deep dive into this, check out our article on why we think it’s still worth it to sell on Etsy in 2023.

 

Our Ultimate Guide on Etsy 

 

Want to continue learning about how to run a shop on the world’s most popular online marketplace? Read similar articles like this one in Our Ultimate Guide on Etsy. 

A must for every beginner wanting to get a jumpstart as an Etsy seller, read How to start a shop on Etsy.

Make sure you stand out from the pack with a shop name that’s catchy, memorable, and SEO-friendly! Check out our guide on how to choose your Etsy shop name for inspiration.

 

 

Find tools to turn your passion into profit

 

Using different tools to make your processes more efficient can help you work smarter and faster toward your business goals.

If you need help with your marketing materials, our CF Spark Writer text generators will come in handy. 

Our Etsy product title generator and Etsy product description generator are there to draft eye-catching text so you can sell your products better. We also have an Etsy store bio generator that will craft a bio for you within seconds. 

To create more offerings, put your new ideas in words and see them come to life with our CF Spark Art AI image generator.

There’s no such thing as overnight success on Etsy.

Just as with any venture, you need to work hard and test out different strategies, like the ones we’ve provided.

Learn from your experience and from your competitors. Eventually you can turn your passion project into a profitable online business.