How much is it to start an Etsy shop?

Starting an Etsy shop can be quite exciting! You want to make sure that it’s going to be a good fit and affordable. No one wants to get ripped off. I’ve had my Etsy shop for over 5 years, and it’s really affordable! In this post I’ll go over every single charge and fee that Etsy takes when you sell an item. I’ll also share things to be aware of when it comes to your costs, and how Etsy collects their fees – so there’s no surprises when you get going on your shop. By the end of this post, you’ll know exactly how much it is to start an Etsy shop.

$0.20 Listing Fee

Etsy collects a $0.20 listing fee per item. That means that when you initially post your item for sale, they’ll charge you $0.20 to list that item. If you want to open your shop and start with 10 products, at $0.20 per listing, you’ll be charged $2 total. Not too bad at all to open an online shop! You need at least one product listed for your shop to be live and open to buyers. I’d recommend at least 20 items so your shop has better appeal to potential buyers who want to see what you offer.

Now, this isn’t a one time $0.20 listing fee (unless you sell it only one time ever). EVERY SINGLE TIME your shop renews that item, you’ll get a $0.20 fee. For example, if you have 20 scarfs in stock, each time a scarf is sold, you’ll be charged the $0.20 listing fee for it to be relisted. You can have Etsy automatically renew listings based on your stock quantity, or you can manually renew it. Either way, each time it is renewed/sold, you’ll be charged the $0.20 listing fee.

5% Transaction Fee for the Product and Shipping

Etsy charges a 5% transaction fee for the product price AND a 5% transaction fee for the shipping charge price. 

For example, if I sell something for $16, I’ll get a charged 5% of $16; which is $0.80. I also charge $4 to ship the item. So I’ll also get charged 5% for the $4 shipping cost which is $0.20. 

So now in total, I’ve been charged $1.20 in fees.

You won’t have the transaction fee for shipping if you offer free shipping, or if you offer digital products.

3% + $0.25 Payment Processing Fee

In order to process the payment from the customer, Etsy charges 3% of the total price the customer paid, plus $0.25.

Going back to our $16 item example. The customer was charged $16 for the item, $4 for shipping, and then $0.96 in tax (don’t worry, Etsy takes care of the tax part so you don’t need to). All of that makes their total $20.96. Etsy will take out 3% + $0.25 of that total transaction of $20.96; which calculated to be a $0.88 fee.

How much is it to start an Etsy shop? Customer expense breakdown - Etsy fee breakdown
Customer’s expense breakdown

Here’s the total breakdown in fees in total:

  • Listing fee: $0.20
  • Transaction fee for the product: $0.80
  • Transaction fee for shipping: $0.20
  • Payment processing fee: $0.88

Total fees paid: $2.08

Of the $20 the customer paid my shop, I received $17.02 in my shop payment account. But that is not my bottom line. Next, we’ll talk about the other expenses that pertain to your particular business.

Your business expenses

How much is it to start an Etsy shop? Customer expense breakdown - Etsy fee breakdown - Etsy's transaction and processing fee
Etsy’s fee breakdown based off of the the above transaction

Depending on the nature and expenses of your specific business, keep in mind your costs. Costs such as your shipping supplies, the shipping label charge from your mail carrier, employee costs, supplies, etc are something to be aware of in pricing your product.

Build all of this into your product price and shipping price. You’re in business to make a profit and so is Etsy. Price your items that is fair and reasonable to a customer to purchase it, but also so that you’ll be making money! Add the cost of all of the above fees into your product. For shipping, I charge $4 because it generally costs me around $3 for a shipping label and around $1 for shipping supply costs.

Shipping expenses

On Etsy, it is easy to print shipping labels directly through your Orders page. Etsy will take the price of the shipping label out of your shop payment account.

On our above example, I’ll have around $3 taken out of my payment account for the shipping label cost.

If you sell digital products, you don’t need to worry about shipping labels or having USPS pick up packages!

How Etsy Collects their Fees

Last, Etsy collects their fees automatically. Etsy takes out the fees when a product is sold. That way, there is nothing to worry about and you can focus on selling product! I personally, love that it’s automatic so I don’t have to worry about paying a bill.

Now that you know what Etsy will charge, you have a clear idea of how much it is to start an Etsy shop and what you can price your products at on Etsy!

Be sure to checkout my other posts that are all about having an Etsy shop!

Similar Posts