Etsy is a great opportunity for anyone wanting to start a selling business. It is also suitable for dropshipping and - if you combine a free drop shipping company with Etsy as a marketplace - you can start your business with no initial investment!
This is because Etsy doesn’t require a fixed fee or a subscription: you’re going to pay a commission on each sale. But how much does Etsy take per sale?
It’s important to know anything about the sales tax Etsy requires if you want to price your items properly. This article, therefore, will be extremely helpful for you because we are about to discover anything about Etsy sales tax!
The Pros and Cons of selling on Etsy
Etsy is a well-known marketplace where anyone can sell their items, whether they are new or vintage, whether you are a private seller or an entrepreneur.
Etsy allows sellers to create their own marketplace within the platform, sell their items, make their prices, and handle their selling business just as you like. It is also suitable for dropshipping since there is no need to physically store or possess the items you are selling.
Etsy Pros
Start and grow easily
With Etsy, anyone can start their selling business, and not only because there isn’t any need for a big budget. The ease with which you can learn how to use the platform, create and market your brand and items makes also helps beginners start selling items from day one, find their first customers in no time, and grow their business as they grow as entrepreneurs.
Huge exposition
Etsy has a big advantage when compared to, for example, independent eCommerce platforms: it exposes your items to a huge audience from day one. Etsy can already count on a large base of customers that browse the marketplaces every day.
Great support community
Etsy is so popular that, even before the Etsy official customer support, you can count on a large and knowledgeable community online. For any issue you can experience, you can find tons of solutions already posted online.
The Etsy algorithm
The Etsy algorithm works in a way that favors new marketplaces. Of course, you still need to focus on marketing and fight with the competition, but compared with other eCommerce platforms, with Etsy it is easier to reach your audience when you are at the very beginning.
Suitable for dropshipping
Etsy is very suitable for dropshipping and, therefore, for entrepreneurs that can’t count on a big initial budget. With the right dropshipping company (see below for recommendations) and Etsy, you can even start a selling business investing zero money, only your time and efforts.
Etsy Cons
Limited branding opportunities
Of course, an independent eCommerce platform can build a stronger brand identity.
Great competition
Being Etsy so popular, the competition on the platform is very high. Marketing will still be key.
Does Etsy charge sales tax?
All the Etsy features we’ve just described are completely free; so, how does Etsy make a profit? Sellers are charged a fee for every sale they make.
And, how much does Etsy take from sales?
Etsy charges a $0.20 listing fee for each item you sell on the platform. However, the fee applies only when the item is actually sold. This means that you don’t have any Etsy sales tax to pay unless you have a profit.
Etsy Selling Tips
Never underestimate marketing
Etsy can expose your items to a huge audience from day one, and it also has the advantages of working through an algorithm that helps new marketplaces, but you still need to put a lot of effort into marketing both your brand and single items: offer discounts, make promotions, use social media, and more.
Set items’ prices carefully
When you set up the prices for your items you have to take many things into account:
- How much does the item cost you? Of course, you want to sell the item at a higher price than what you paid for it.
- What percent of sale does Etsy take? You need to calculate that the sales tax Etsy charges on each sold item are $0.20. This becomes even more important when you sell extremely cheap items.
- Do I have to claim Etsy sales on my taxes? If you need to claim Etsy sales on your taxes, you want to make your prices slightly higher; your profit will disappear once you’ve paid the taxes otherwise.
Etsy Dropshipping
Dropshipping is a great opportunity, especially when combined with Etsy. With dropshipping, you can lower your initial budget to nearly zero: you don’t need a warehouse, you don’t need to buy hundreds of products before selling them, you don’t need employers… All you need is, however, the highest quality free dropshipping platform possible.
The highest quality free dropshipping platform
Last but not least, we’d like to recommend SaleYee as the best free dropshipping platform. Just like Etsy, SaleYee doesn’t require a fixed fee so you can start selling SaleYee items on your Etsy store without investing a dollar!
SaleYee is also recommended because it offers top dropshipping services:
- the widest range of items and product categories;
- Free deliveries;
- Fast deliveries thanks to warehouses spread over every continent;
- After-sale support that allows you - as a seller - to offer the greatest customer support, refund/replacement/return support to your clients.
Conclusion
How much does Etsy take per sale? We’ve started with this query but we found out that there is so much more you need to focus on: your State’s taxes policy, how much your dropshipping platform charges you, and also how much your marketing strategies affect your budget. These are all the aspects you need to consider when you set your prices on Etsy.
