Welcome to the Part 5 of the Earning on Etsy Series! I am excited to share with you lots of tips for marketing your creations on Etsy and beyond.
An Awesome Listing and Product
Before you worry about any sort of advertising (paid or unpaid) there are several steps you can take to help your product really sell itself. Once your product and your listing are awesome, we will talk about ways to get people to find your listing.
Product
It goes without saying (though I’m going to say it), that your product should be well-made with high-quality craftsmanship and attention to detail. I assume you make it with great skill and care and that you take pride in your creations. Customers can tell when an item is well-made and they will give you glowing reviews. The opposite is also true.
Photos
Take fabulous pictures. Etsy has a much higher standard for photos than ebay or craigslist. Etsy buyers are naturally artsy people who will appreciate great images (and shun the bad ones). A quick shot in the evening with your phone won’t cut it.
- Take multiple photos for each listing. Show all angles of your items.
- Show your items “in use” if possible.
- Have a plain background without distraction.
- Consider using the same or similar background for all your images to create a cohesive shop look.
- Use natural light if at all possible.
Just in case you think that I think I’m an expert, I know that I am far from it. I have a camera that I love, but I have not sat down to read the manual and figure out how to use it to its full potential. I am in the process of re-taking some of my photos from old listings that make me cringe when I see them.
Tags
In addition to your item’s title, you have 13 tags to help you describe your item to your buyers and their search engines (think SEO). Use all of them and make them count! Think like a customer. If someone were looking for exactly what you are selling, how would they search for it? Include color, style, function, occasion, synonyms and alternate names.
Don’t mis-tag your items. Showing up in search results where you aren’t wanted isn’t cool.
Categorizing
Near the top of your listing, you’ll be able to categorize your item on up to three levels. Put your item in the most intuitive category you can. If it is a supply or a vintage item, start with that. If it’s a vintage supply, then choose vintage in the first drop-down and supply in the second.
Further down in the listing form, there are options for recipient, occasion and style. Only use these if your item falls exclusively into one of the options, otherwise you are boxing yourself into one market (and out of others).
For example, when I list an airplane banner that says “Happy Birthday” I do not choose birthday as the occasion. I offer customization on the wording of all my banners, so I want that listing to show up when people search for baby shower banners or bon voyage banners. If you make wedding dresses, then go ahead and put “wedding” for the occasion.
Customer Service
The communication between buyers and sellers on Etsy is unique. Etsy is more open and friendly than other sites with similar purposes. It’s not unusual to receive a “convo” (Etsy slang for Conversation, Etsy’s messaging system) from your customer before placing an order, to ask about shipping, or to thank you once they receive their order. If you offer customization, it’s normal to go back and forth several times with a customer.
- Always be polite and helpful.
- Respond as quickly as possible.
- Go out of your way to make your customer’s experience great!
Once your shop is up and running, take some time to create a Policies page (click on Info & Appearances). Having written policies for payment, shipping, and refunds will be beneficial for both you and your customers.
Your communication and customer service can affect the customers’ feeling about their Etsy experience as much as your actual product.
Branding
Help your shop stand out by making a memorable experience for your customer. One way to do this is in the way you package and ship your goods. Here are a few ideas:
- Hand-write a short thank you note.
- Include a little something extra.
- Stick in a business card
- Add some cute inside packaging (maybe tissue paper, ribbon, or label) something simple that will convey still the special-ness of your product and your care and thoughfulness.
- Make sure your items are adequately packaged for their journey through the mail!
Have a cohesive look to your shop both with your pictures (mentioned above) and with the organization in your shop. If you sell vastly different items that have distinct audiences, you should consider opening a different shop. For example, I wouldn’t sell vintage thimbles along with my birthday banners and cupcake toppers. This will help to give your shop a neat and clean look.
Notes on Listings
Spread out your listings
Instead of listing your 10 new items all at once, list an item or two each day. This can help to spread them out over search results. Newly listed items also get a wee bit of time on the front page.
Auto-renew sold items
If you plan to sell and resell the same items, set your quantity high (maybe 20 or even 100) so that your item will keep renewing itself each time it sells. You won’t have to worry about going out of stock.
Finding Buyers
Now that you have a beautiful shop, selling awesome products, we’ll move onto the part of marketing that you were expecting. If you do the first part right (the seven areas I discuss above), you will have much more success with the “advertising” portion of marketing.
In all honesty, I have done very little marketing outside Etsy and I’ve never paid for search ads within Etsy. I had a successful little business going before most of my friends even knew I had an Etsy shop. Maybe that’s just my style because I did the same thing with this blog. I had nearly fifty posts before I told any family or friends about Six Figures Under.
Social Media
By no means do you need to be all over every social networking platform to promote your Etsy shop. You won’t have time if you are busy creating awesome products and listings.
Etsy allows your to link your Facebook and Twitter accounts to your shop. Etsy shoppers can easily like or follow you. If Facebook is your thing, create a page for your shop. You can also include links to your social media platforms of choice in your listings or your shop announcement. Something like “Follow me to be the first to hear about new items, coupons, and giveaways” along with a link should be sufficient.
Honestly, the only social media I use for my Etsy shop is Pinterest. I only started that a couple months ago. I know, I’m slow. I created a Pinterest account just for my Etsy shop, but if you already have a personal account then go ahead and advertise your wares on it. You can have a board that’s just for your shop and pin each new listing there. You could also create boards of things that go well with your product(s), but aren’t direct competition.
Newsletter Mailing List
Creating a monthly or periodic newsletter is a great way to keep your customers coming back or hold the attention of fans of your shop. A newsletter is a great way to share your latest creations, give the inside scoop on your process, and offer special discounts. Getting into potential customers’ inboxes really give you an edge.
Creating a newsletter is actually easier than you think. I recommend using Mad Mimi. You can have 100 contacts and send unlimited emails to those contacts for free. If you want their awesome support and all the bells and whistles, you can customize a “pro” plan. Pro plans start at just $10/month for up to 500 contacts and unlimited emails. Go check Mad Mimi out! You won’t be disappointed!
Sales and Coupon Codes
If you sell seasonal items or like to rotate your inventory, having a sale or clearance category in your shop is a great way to make those items stand out. Sale or clearance items would be great info to share with social media followers or newsletter subscribers. Every loves to feel like they are getting a deal.
You can create your own coupon codes on Etsy. Go to “coupon codes” under Promote on the left side-bar in your shop-editing section. You can choose between free shipping, percent discount, or fixed discount. You can have Etsy send out a coupon code as a thank you to customers when they place an order. You can set a minimum purchase price and an expiration date. There is really so much you could do with coupon codes.
Blog
We’ve talked about snatching up a domain name to match your Etsy shop name, just in case you decide to start a blog or website to promote or sell your goods in the future. Now what are you going to do with it?
I have seen many people use their blogs to promote not only their products, but feature other favorite Etsy finds. If other sellers keep up with their own shop stats, they will notice the traffic from your site and check it out. You could also contact other sellers and interview them about their shop or process. You could offer giveaways and special coupon codes on your blog. If you’re ready to get a blog or website set up, I recommend Bluehost for hosting. Here’s a step-by-step tutorial for setting up a self-hosted blog.
If you already have a blog (no matter what the niche), including a widget with items from your store is a no-brainer. Take a peek at some of my recommended blogging resources and learn how to start a blog on a budget.
Word-of-mouth
Great products and fabulous customer service will get your customers talking, but word-of-mouth advertising can also start with you! Order some classy business cards and keep them with you. When you have an opportunity (or you make an opportunity), let people know what you create and why you love it. Talking about something that you are passionate about isn’t being pushy.
If you really want to be successful on Etsy, don’t just wait for the buyers to come to you. Be proactive and go out and find your buyers. When it comes down to it, there is a lot you can do to market your Etsy shop by spending little to no money.
Note: This post has a couple affiliate links for products or services that I use and love. If you make a purchase through these links I will get a small commission. For more information, you can see my disclosure policy.
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Bhagat Jewels says
Hi Stephanie,
Thank you so much for all advises and tips! Your article really helped my business pick up. please visit our etsy store at http://www.etsy.com/shop/Bhagatjewels
Thanks
Mona West says
Excellent article. Lots of really helpful information and very encouraging. I have read so many things that make it sound like you need to spend 20 hours a day marketing, I like your approach!
Dana says
Thank you Stephanie. I found your article very helpful.
I feature flower art and butterflies for your home and office.
Please visit my store at https://www.etsy.com/shop/sunpetalart
I’m having a Fall Special with FREE SHIPPING!
Armin Langlé says
Thank you for all your tips on Etsy, I just open my shop (and haven´t sell anytingh) but I think one of the things that is blocking me is that I don’t live on the USA, I’m from Mexico and the shipping costs and times are a great deal because postal service on Mexico its so slow, my clients will receive their product in 1 month or more.
but nevertheless I will be pacient.
Edwige says
Thank you for the tips! I guess I have to amp up my participation in blogging, social media and definitely word of mouth. This was very helpful as I just started my shop at the end of June and I am seeing not so much traffic to my shop. Thanks for sharing this information!
Eleonora says
Good info for new etsy sellers as well as old ones. I know I need to work on my SEO to make sure I am found more easily by my potential customers. Also when we underprice our product we don’t steal profit only from ourselfs but also from other etsy sellers that have to price lower their items to match our prices.
Www. Etsy.com/shop/SmileTheOcean
elia says
OMG, these were all so helpful. I am in the process of opening my Etsy shop and I have had to take a few steps back to make sure I’ve got all my ducks in order. You’ve answered so many of my questions, especially about pricing/shipping. Now for taking those pictures and listing my very first item…YIKES!
Susan says
Hi Stephanie,
Thank you so much for all advices and tips! I was wondering, is it worth to promote your listings on Etsy? I don’t really understand that bidding system yet and don’t know if I should look into that deeper. Will it really help to get my shop visited more often?
Stephanie says
Hi Susan, I have never paid to promote any listings, so I don’t have any experience in that area.
mary says
Im new to etsy and have gained some insight, thank you for taking the time to write this. I havent had a first sale yet and have even dropped my prices, no luck yet.
I feel invisiable
Roma says
Hi Stephanie,
Thanks so much for posting the Etsy tips online. It was a helpful read. I do have a question though, and sorry if someone already asked this and you answered it above – you wrote, “For example, I wouldn’t sell vintage thimbles along with my birthday banners and cupcake toppers” which makes me worry a little bit about my shop. I opened in October and am planning on selling greeting cards, jewellery, and paintings. So far I have mostly greeting cards. Either way, do you think these three categories are too vastly different for one shop? I don’t want to open up two more shops, but I wonder how keeping them all in one shop will work now that you mention it.
Thanks for your help,
Roma (TheAutumnDaisy.etsy.com)
Bec says
Thank you Stephanie – this series on Etsy is great! I had not come across your blog before, but I found the first of your Etsy-related posts reblogged on a WordPress blog and immediately read all the way through your following posts too. They have inspired me to consider starting an Etsy shop of my own – I enjoy knitting and making jewellery, although up until now I have only worn my creations myself or given them to family or friends. The idea of potentially earning a little bit of money from what I do for fun is an intriguing thought. Thanks again!
Stephanie says
I’m glad the series was helpful Bec! You really can make money doing what you do for fun! 🙂
Mari says
Wow, I love these tips. These are so great and I will be applying many of them soon!
Sharol Clay says
Thank you Stephanie,
I first read your blog in the beginning of October and thought oh my god this is so daunting.
Then, I decided to reread it only this time I printed out on October 19 and now it is December 22. I opened my Etsy shop last night and I can hardly believe it. I have had so much support from friends, relatives, photography mentors, and especially Etsy support they have been so wonderful answering all my crazy questions.
I would love any feedback from you on my Etsy shop, it is called “Sea Kelp Creations” I make jewelry and baskets from sea kelp that I harvest myself.
Thanks again,
Sharol
marian says
love some of the tips posted especially the link for a DYI light box Stephanie! Wish I had known about it 8 plus years ago. I purchased a small one similar looking to the DYI, but it only works for my small items. Maybe I will try to make a DYI large one. Have been selling online for years, but just recently decided to try Etsy. Thanks for your well written information.
Stephanie says
Hi Marian! The DIY lightbox is great and you can make it whatever size you need! 🙂
Casey H. says
Ok I am confused, for the Etsy fees is it the listing fee + the selling fee + Etsy Direct fee+ shipping?
Stephanie says
You’ll have the $.20 listing fee when you list an item. When it sells you will be charged the 3.5% transaction fee. Depending on how the buyer pays, you will have Etsy’s Direct Checkout fee OR PayPal’s fees. The buyer pays shipping costs that you determine (unless you offer free shipping). Since Etsy offers the great convenience of printing shipping labels from home if you choose, the cost of the postage will be added onto your bill. In part 1 of this series I talk about the fees in more detail.
Susan Williams says
Love this series! Great info! My daughter and I have been dicussing the prospect of opening an Etsy shop and this Iinfo is a fabulous resource. Thanks so much!
Stephanie says
Thanks Susan! I’m glad this Etsy series was helpful for you!
Pam says
I feature handmade cards that I’ve made on my blog and end with tons of them. I’ve considered selling them on Etsy, but I haven’t taken the plunge yet. Thanks for the series. It gives me lots to think about before I get started.
Stephanie says
You should give Etsy a try Pam, especially if you have the cards already made!
Amy says
I have been working on putting my own etsy shop together for a few weeks now and have done a lot of research on the process. This series was by far the most informative and easy to read. Thanks so much for sharing! I found you through Pinterest by the way and look forward to browsing through your blog. 🙂
Stephanie says
Thanks Amy! I’m glad my Etsy tutorials were helpful! Best of luck with your shop!
Trendy says
Nice post, see our shop in etsy: http://trend2tees.etsy.com/
Jennifer Dexter says
Are you willing to share a generic excel file revealing your formula? I am having trouble figuring the Etsy and payment fees into what my retail cost should be to reflect those fees. Thanks!
Jennifer Dexter says
Nevermind. I figured it out and I see there are some great resources on Etsy as well. Thank you for all of your tips in this series!
Stephanie says
I’m glad you figured it out Jennifer! Best of luck!
Ron Turner says
Stumbled across your site today researching Etsy as I prepare to open my shop. Wow, what a plethora of great advice and insight! Thank you so much for sharing your experiences and recommendations. I will be sure to implement your ideas and suggestions going forward.
Blessings!
Ron
Stephanie says
You are welcome Ron! Best of luck with your new shop!!
Rachel says
Hi,
I am new to Etsy and opened my shop on Sept. 18th this year. I still have yet to sell anything and was wondering if you could take a look and give me some pointers? Am I doing something wrong or is it normal for it to take this long to get started? Thanks for the help!
Stephanie says
Hi Rachel! You make such cute things. Your attention to detail is awesome! I think you have some great things! Sometimes it just takes some time to get going, which is normal.
The advice I would give is to work on getting rid of the shadowiness (not a technical term) in your photos so they are brighter and not so dark. You can use a cardboard box and some tissue paper to make a light box for taking pictures. Here’s an example: http://www.flaxandtwine.com/2013/02/diy-photo-light-box-a-finish-fifty-project/
Once you have really great photos, I would get on Pinterest and share your creations. The most effective way to share with the masses is to join collaborative/group boards in a niche that fits your products.
Best of luck!
sandy says
Hi, Stephanie.
I just found your blog. I started a vintage etsy shop in November of last year. Every time I started to make sales, etsy started another web site test, and sales evaporated. There was a clear pattern. Things were starting to pick up in August, but since the site has changed from an obvious marketplace to looking like a social media site, and the other changes recently implemented–hiding part of shipping costs, and the change in etsy paid ads) sales have almost disappeared, and views are scarce. With the recent changes to the etsy site, do you still recommend etsy as a venue?
Stephanie says
Hi Sandy. I haven’t noticed any major changes in my sales besides the normal ebb and flow. I’m not an expert on vintage, so I don’t know the other options out there (besides ebay) for vintage sellers. For handmade items, I still say Etsy is the way to go.
Margaret says
Hi Stephanie
Thank you so much for sharing your knowledge!! I am just about to open my shop on Etsy. I’m lucky… My hubby is a web designer and has his own servers, so hosting is all sorted! He will be creating a simple website to accompany my Etsy shop. We’ll see how that goes. Perhaps he should open an Etsy shop offering web design and hosting? He offers a domain name, 3 page site and a years hosting for $125. Think i’ll give him a nudge! Hopefully my shop will do well, and if so your advice and help will play a big part in its success. Great work and best wishes
Stephanie says
Thanks Margaret! That’s great that your husband can set up a website for you! And yes, he should totally open a shop himself if he has the time for a side gig! Best wishes to you both!
cheryl hansen says
thank you so much for taking the time to write this series …. I have been considering an etsy store for a while now – your article has so many great insights and tips …. I already have my name picked out ( and have for a while) the perfectionist in me is what is holding me up – better just dive in I guess …. ty for providing a life jacket and a lighthouse of information 😀
Stephanie says
I totally know what you mean! I have those same perfectionistic tendencies. If you’ve got the name, just dive in! You’ll do great! 🙂
Veronica Skinner says
I just found this post series today while doing some research about Etsy and starting a shop. Thank you so much for putting this together, there were things I didn’t even think of in here and points I’m going to take away and think on (I saved it to my bookmarks too for later reference).
If anyone is looking for a tool to figure out their pricing predicament or wondering what kind of profit they will be left with, I found a great one and it includes all associated fees as well.
http://www.ecommercebytes.com/cab/tools/calcs/etsy_fee_calculator
Happy Selling!
Stephanie says
Hi Veronica! I’m glad that my Etsy series has been helpful. Thanks for sharing the calculator that you found! Best of luck!
Mary bowers says
Sure enjoyed reading your sixfiguresunder on Pinterest . I was thinking about doing this,by golly I’m going to give it a try. I probably will check this site often for help while I try to put this all together. I can tell I’ll be on my knees a lot asking for help ha ha.
Thanks Again
Mary
Stephanie says
Way to give it a try Mary! You can do it! 🙂
Grace Sundman says
Hi Stephanie. Thank you so much for taking your valuable time to write this easy-to-understand article on how to sell on Esty. It was just the thing I was looking for!
I’m looking to sell some antique, vintage & retro items I have collected on Etsy. These are not crafts (although I’m thinking of this market in the future.) I have found most of these items already on Etsy however after reading your article, I realize I need to do more research on the seller’s, their shops & how often these items are being bought, etc.
Would your steps be the same if you were selling collectible items?
Also, do you have any tips for setting up your own website?
Thanks again!
Grace Sundman
Pst…You’d probably make a killing if you were to write a book about all these topics & sell it on Amazon!
Stephanie says
Thanks for your kind words Grace! I think that vintage sellers can follow the same steps. In addition you can learn about values by looking at ebay sales. If you “watch” an item on ebay you will be able to see the selling price once it has sold, otherwise you won’t be able to see the final price for auctions.
I am planning on writing a tutorial on setting up your own site, but for right now, my advice would be to choose a good domain name (easy to spell, easy to remember, descriptive or branded). Stay tuned for a real tutorial eventually. 🙂
Mrinmayee says
Hello Stephanie,
I have been reading so many articles about Setting Up Shop on Etsy but nothing like your series. It has every little bit a new potential seller can think of asking and your tone and tips and ideas have made it so simple and easy to follow. I opened my shop MRINMAYEE about 12 days back and have very few views. but with your tips I’ll work towards improving them.
Thanks a lot for the great work and good luck with your shop…Cheers!
Stephanie says
I just peeked at your shop and it looks like you just had your first sale! Congrats! Everything is looking good!
Laurie says
This whole series was so helpful! I’ve been trying to decide whether to open a shop on Etsy and you’ve just convinced me I can do it! I focus on up-cycled creations and some of them are large (furniture pieces). Any advice on whether to include those in my shop? Shipping seems a bit overwhelming for them…
Stephanie says
If there are viable (albeit expensive) shipping options, I would go ahead and offer them. You might be surprised at what someone is willing to pay for shipping.
You could also give an option for local pick-up. You can do a local search on etsy, so perhaps people who are looking for furniture-type items would look locally.
Also, just having more examples of your work available will give your buyers a better feel for your work.
Lalia says
What a wonderful article! It was very informative and was exactly what I was looking for when I Google how to make money on etsy! I want to open a shop selling my dream catchers. I have a couple questions though. How do you tell if items like yours are selling? I looked at the views and when the item was posted but how do I know the people that viewed that I team are buying all so? Also as far as the tags, Would you use the tag dream catcher or dream catchers? Maybe both?
Thank you so much for taking your time to write this article!
Stephanie says
Hi Lalia! The easiest way to see if items are selling is to look at the items that the seller sold. When you are in a person’s Etsy shop, look at the left side bar where it says the number of sales. Scroll through the sold items looking for items that are similar to what you are selling. Pay attention to how often and how many sell to get an idea.
As for tags, you should be fine using just the singular (if you are just selling one in a listing). Etsy’s search is smart enough to figure out the plural. If you have an extra tag, you can add the plural in too. It can’t hurt!
Kelsey says
This article was exactly what I was looking for when I google searched “Tips for starting an etsy shop.” Love that you gave all kinds of insight, including how to become successful!! I just wanted to start up a new shop and was a little hesitant, but now I know ways to set myself apart from others. Thank you so much!!
Stephanie says
I’m glad it was helpful Kelsey! Best of luck with your shop!
Michael Harrigan says
Thank you Stephanie,
I just opened my Etsy shop (handknit scarves and shawls) a couple of days ago. I’ve been listing my patterns on another site and have created a Facebook page to try to get some traffic to my products and patterns.
Your laid-back approach to doing business is really appealing. I’ve read some other accounts of how to market an online business and found them to be overwhelming.
I’m going to take it nice and easy, and spend the bulk of my time doing what I love – which is creating lace knit designs and knitting the merchandise!
I like the idea of featuring items on my new business Facebook page, highlighting special offers, and probably offering knitting tips.
Thanks again,
Michael
Stephanie says
Hi Michael! Congrats on opening your shop! I’m glad my marketing method is less overwhelming. It is definitely nicer to spend your time doing what you love. Best of luck with everything!
Amy says
Thank you so much for this information Stephanie. Your advice has been worded nicely and makes great business sense! I will be opening my Etsy store shortly and will use all your useful tips. Wish me luck. 🙂
Stephanie says
Thanks Amy! I’m glad it was helpful! Best of luck with opening your new shop!!
Amy says
Hi Stephanie,
Do you have any suggestions on how to get better exposure on Pinterest?
Thanks.
Stephanie says
Hi Amy! Here are a few tips:
Make sure you pin things other than your own pins (or your etsy things). Potential followers want to see that you have a good collection of boards about many different topics. Make sure your boards are filled out (at least 4 pins will at least make your boards look full on first glance).
When you re-pin other pinners pins, they will be more likely to notice you since their feed will tell them that you re-pinned their pin.
You can make boards where you can showcase your items. For example, I sell airplane cupcake toppers and airplane baby shower banners. I would make an “Airplane Theme Baby Shower” board where I would pin other airplane decor, invitations, food, and ideas. I would be sure to include my airplane items as well. That way when someone searches for airplane baby showers, my pics will come up and people will be interested in following my board.
Once you have your own boards looking good (at least a dozen filled out boards organized nicely on many topics), you can look for group boards to contribute to. Group boards really are the key to getting your pins in front of lots of people.
Hope that helps a little! Maybe I should write a whole post on using pinterest to promote your etsy shop because there is a lot to say and some of it would be better explained with pictures.
Maggie Perez says
Stephanie thank you for all the great series and advice you giving us about Etsy and the time you have taken to write about it.. It has help me start my new Etsy business thank you. You Rock Maggie
Stephanie says
That’s great Maggie! Thanks for sharing and congrats on your new shop!!
Tara says
This has been a very informative, eye-opening series about Etsy, and I thank you so much for writing it. I have been considering opening up an Etsy store for some time now, and never really knew how to go about doing that. The market research will be a very important factor, as I do not want to go into a completely saturated market, even if what I prefer to make (Mostly aprons- other crafts I do I would not sell, like cross stitching- it would cost far too much to make a profit, and I do not believe people would pay what I would be required to ask, and I am far too new with quilting to be comfortable selling my work.) would fall within the saturated category.
Stephanie says
Even if the market appears saturated, you can still be successful by the way you market your items, make your items unique or better in some way, and by adding your personal touch. When I gave Etsy a try years ago, it was as an experiment. I thought I was entering a saturated market and that no one would ever find me.
Christine Herrick says
If you set up a shop on Etsy, it it safe to assume that you do not need to be an official small business established with a Federal ID or paying sales tax? I am confused about that part and cannot find any answers easily. Thank you!
Stephanie says
Christine –
You have some great questions. Stephanie asked me to look at this since part of what I do as an attorney is help set up small businesses. One of the reasons you can’t find answers easily is because the answers vary widely between states, counties, and even cities. Because of that, I can’t give any specific legal advice, but I can give you some general information.
You’re really asking about three different things: business formations, Tax IDs, often need for income tax purposes, and sales tax.
1. As a general rule, you do not have to have a legal business entity (a corporation or LLC or something like that) for your Etsy shop. In every state I know of, if you have a business and no formal business entity, by default, your business is a sole proprietorship. Depending on your state laws and county or city ordinances, you will probably be required to do something “official” like obtain a business license or register a DBA. Your best source of information will be local, like a state or local Small Business Administration office or a local small business attorney. If you can, I’d start with the Small Business Administration – you can often get a free consultation and a helpful “Getting Started” packet.
2. If you form a legal business entity and elect to treat your business income as separate from your personal income, you will have to get a Federal Tax ID. Even if you don’t form a legal business entity, you should obtain a Federal Tax ID (called an Employer Identification Number) if you have employees. There are a number of other reasons you might need one, but that’s the big one. Your state might also require a State Tax ID in some circumstances.
If you know you need a federal Tax ID, it’s free and easy to obtain at: http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Apply-for-an-Employer-Identification-Number-(EIN)-Online
Deciding if you need to get a Federal or State Tax ID is a little harder, but your SBA, Chamber of Commerce, or local business attorney can likely help with that.
3. States are passing increasingly aggressive laws about collecting sales tax from online sales, but those laws vary from state to state and can depend on factors like your volume of sales, where your buyers live, and what kind of products you sell. You guessed it. Talk with your SBA office, a local business association or an attorney.
I strongly suggest you not rely on online advice for questions like these. The Internet is a good place to get general information, but a lot of legal information online is either just plain wrong or would apply to you only in a different situation. The best thing to do is go talk with some local people who’ve been through all the same questions and come out the other side with a viable business. Good luck!
— Mr. SixFiguresUnder
Katrina says
Thank you so much for this series. I’ve wanted to open an etsy shop for years now, I’m going to launch next month using your 40 free listings. I am working on a custom website as well. However, I am scared to build a customer base there and have etsy raise the fees. Do they have any contractual agreement or is pricing up to their discretion?
Stephanie says
Thanks Katrina! That’s exciting!
I opened my shop in 2007 and the listing fee of $.20 and the commission percentage of 3.5% have not changed. I don’t foresee it happening, but I suppose it’s possible. It might be nice to have a plan B for the future in case something crazy happens.
Something you could do to “hold onto” your customers no matter where you sell, is to invite customers to follow you on social media (facebook, pinterest, twitter, etc… I’d just choose one to focus on for your shop). Another option that I haven’t done (but I see others doing) is to invite those who like your shop or who are customers to sign up for your newsletter. You could have a monthly newsletter where you off coupon codes, your latest designs, and maybe some complementary ideas. Then you can direct your customers to whatever platform you want.
E says
I don’t yet sell on Etsy (though I’m looking into it), but I have bought several items on Etsy over the years. I have to say that I think a lot of sellers price their goods too low. I have run my own service business for a few years now, so I know what it costs to run a solo business. I’ve also spent some time researching pricing strategies, and there’s actually a fair bit of academic research on how people perceive prices. It mostly boils down to the fact that people are busy and don’t have eons to spend figuring out what something is really worth, so they use shortcuts. One of those shortcuts is the price. Most people often assume that expensive = good and inexpensive = bad. Of course, neither of those equations is always true, and not everyone believes them, but a lot of the time, a lot of people think that way (sometimes without even realizing it).
Also, it’s important for sellers to remember that trying to run their businesses as cheaply as possible is often unsustainable and leads to burnout. That’s not good for anyone: the seller, the seller’s family and friends, or the customers. I’d rather pay $45 for a handbag instead of $30 if that means the seller will be around in six months when I want another one.
Stephanie says
I definitely agree. It makes me sad when I see people on Etsy who seriously under-charge for their work. It makes me wonder if they even realize they aren’t charging enough. You need to find a way to standout besides being the lowest price. Price really does show how you value your work. If you don’t value it, others won’t either.
Nannette and the Sweetheart says
Thank you for this series. I have had an Etsy shop in the past that was uber successful! This time around I crochet baby headbands, beanies, hats, and other crocheted items. I am having a much more difficult time getting established. There is a market, that’s not the problem. The issue is there must be 5,000 other people selling the exact same items! It’s discouraging to say the least. I have the button on my blog, just did that and today I will link to my Pinterest account. That might help, but again, in my niche there are just so many sellers.
Love all of your suggestions!
Stephanie says
Thanks Nannette! Could you get back into what you sold in your really successful shop? It’s definitely harder to get going when you have a saturated market. Keep brainstorming ways to make your items standout. Have you thought about creating and selling patterns on Etsy or Craftsy?
Melissa says
Thank you for this series. I have learned a lot! I am 1 month in with my Esty shop and just received my 3rd sale. So excited! So looking forward to growing this business. And will put your advise into practice.
Stephanie says
Thanks Melissa! Best of luck with your shop!
Bonnie says
Good tips about Branding. I always love when I get a package from an Etsy seller that is beautifully wrapped or includes a hand-written note or a little extra something. It’s such a simple touch that makes the customer feel so special.
This has been a great series. I’ve learned so much. Thank you for writing it! 🙂
Stephanie says
I love the personal touch on Etsy too! I’m glad you enjoyed the series Bonnie! 🙂
Suburban Finance says
I’m not an Etsy seller but I think it’s important to have eye-catching picture for listing! As a buyer after I put in keywords to search for the item, I will most likely to click the picture that appeals to me the most.
Stephanie says
Definitely! Not only do great pictures show off your great item, but if you take time to have quality photos that tells the buyer that you also take time to make quality products.
Fran says
Thanks for this excellent series, and this is a VERY good point. Communicating “quality” throughout your Etsy items, shop, listings, and (I think most importantly!) photos lets buyers know that they have found a gem!
Fran says
I also loved your great points about following through with great packaging/shipping materials, or a handmade/hand-written touch. 🙂 It’s always such a delight to receive a thoughtfully packaged item in the mail! And it is something that certainly makes me want to from an Etsy Shop again.
Stephanie says
Thanks for your comments Fran. It is so fun to receive a thoughtfully wrapped order. I love it when my customers tell me that my items look even better in person.
Sarah Kristen says
Thanks so much for doing this series! The absolute best tip I have learned is about improving SEO – ALWAYS make sure your phrases in your title and tags MATCH. For example, I make signs out of license plate letters. For my “love” sign, I use phrases such as “license plate sign,” “love sign,” “reclaimed metal sign,” “rustic wedding decor” in BOTH my tags and titles. They have to be present and exactly the same in both. Then when someone searches for that phrase, I am much more likely to show up very early in the search results. This works very well and I noticed a definite increase in views and sales after I started doing it with all of my listings!
Stephanie says
Thanks for sharing a great tip Sarah Kristen! I’ll be sure to double check my listings for that and see if it increases my views and sales!
Emma Piper says
I’ve loved reading your etsy series! I’m a new to etsy and a new seller, so this was very insightful. I’ve just had my first sale and I’m so happy about it! One thing I would say to any new etsy sellers, never give up! You will always get that sale. Keep uploading, keep trying and have fun!
Stephanie says
YES Emma!! Thank you for emphasizing that point. I meant to discuss PATIENCE somewhere in the series (and I may have done so in the Part 1). Being patient is so important. It takes time for your things to get exposure. The first sale is definitely the hardest one.
Congrats on your first sale!! That is so exciting Emma! 🙂