Tuesday, December 13, 2011

The Cost of Selling on Etsy

I, like many of you, love Etsy. This weekend I stumbled upon some lovely, neutral buttons. Many of them. Too many to keep.
So, I decided to list some of them in my Etsy store. Share the wealth, so to speak.

When I plan to list something, I always browse around to see what a reasonable price would be, based on similar items for sale.

I have noticed that some sellers may not take into account the cost of selling their items when they price them. I made the same mistake a couple of times and thought you may find it interesting to know, either as a buyer or a seller. Even if you're not looking to make money, it's nice to know that you're at least breaking even.

Example 1: 100 buttons for $2.50
Etsy Listing price: $0.20
Etsy commission: $0.09 (3.5%)
Paypal: $0.30 + $0.07 (2.9%)
Total cost to sell those buttons: $0.66 (26% of the listing price)
Money in your pocket: $1.84

Example 2: 3 yards of ribbon for $1.50
Etsy Listing price: $0.20
Etsy commission: $0.05 (3.5%)
Paypal: $0.30 + $0.04 (2.9%)
Total cost to sell the ribbon: $0.45 (30% of the listing price)
Money in your pocket: $1.05

Example 3: 1 yard of fabric for $9.25
Etsy Listing price: $0.20
Etsy commission: $0.32 (3.5%)
Paypal: $0.30 + $0.27 (2.9%)
Total cost to sell the fabric: $1.09 (12% of the listing price)
Money in your pocket: $8.16

Obviously the net effect is much larger for smaller items. Smaller items are what we most often list though...

(Edited to add:  I was just reminded that PayPal charges for the full amount, including the shipping. Accounting for the $1.75 shipping, the $2.50 buttons actually cost me $0.71 to sell! And the ribbon $0.50, which leaves me with $1 in my pocket, barely covering my cost - not to mention shipping supplies. Maybe I shouldn't have analyzed this...)

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13 comments:

  1. Interesting... I've always kind of wondered about that. Thanks for sharing!

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  2. The other thing to consider is that you're also paying that paypal commission on what you charge for postage - so it you charge at face value you're losing 2.9% of that too!

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  3. Thank you so much for sharing this information. I see Etsy in my future, so this is good to know.

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  4. Thanks for the breakdown. It's always helpful to see concrete examples rather than vague guesswork.

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  5. Thanks for sharing those costs, very interesting!
    But the buttons are so cute :)

    Hugs,
    Tatyana

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  6. Do you know if it works the same on ebay?

    There was at least 1 of not 2 gals on etsy whose stuff I adored, but I was NEVER quick enough to buy it when she listed on etsy - & yet if it were on ebay I would have bid more than they listed the item for... (I still might have lost, but at least I would have had a fighting chance.)

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  7. Ebay=totally similar, but you get fees billed for a month or more past the sell date...we or someone should come up with a different way...flat fee listing or something? :)

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  8. Thank you so much for sharing this. I've recently started wondering how it all would work. Good to know.

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  9. The other thing I don't like about etsy is you have to link your bank account to your paypal account in order to get paid through etsy. Or, you have to get the etsy visa card. I just ended up giving away a bracelet because I didnt' want to have to to link my bank account in order to make $1. It was more trouble than it was worth to jump through all of the hoops etsy had set up to manage my account. It sounded like a great idea, but in the end, wasn't worth the trouble. It was easier to just give the item away.

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  10. I am glad you analyzed that. I am getting ready to sell on Etsy but haven't made the final step. Now, I will put into "lots" some of my things instead of listing them individually.

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  11. Some people make up for it with higher shipping charges (especially fabric sellers) - it doesn't cost $1 per yard to ship fabric usually.

    I think bigcartel does flat rate posting, or a monthly fee for your shop.

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  12. And talking as a Etsy buyer, we still have to sum the border commitions. Last March I bought some fabric that cost $30 (USD) plus transport. I live in Portugal, and when the packages (the order came in two packs) arrived in my home, I had to pay additional €60 (EUR) (€30 for each pack) for border taxes only...

    From that day on, purchases in Esty are forbiden to me!

    Sew material (or other craft material) in Portugal is super-expensive, and order it from other coutries is even more expensive!

    AnaT

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