Table of Contents
- 1 What is Etsy?
- 2 Etsy Dropshipping:
- 3 Dropshipping on Etsy: The pros and cons
- 4 There are many pros to these:
- 5 Here are some cons.
- 5.1 1. You pay more fees than you think
- 5.2 2. Dropshipping business models: Intense guidelines
- 5.3 3. Etsy sellers benefit from extensive community policing
- 5.4 4. Operates in accordance with economic sanctions and trade restrictions
- 5.5 5. It is a tedious process to list.
- 5.6 6. Potential profit sharing
- 6 FAQs about Etsy Dropshipping
- 7 How to dropship products from Etsy
- 8 Conclusion
You might not be familiar with Etsy if you are like me. It might be described as an eccentric online marketplace that sells all sorts of bizarre goods, such as an octopus made of resin or soap bars made from body parts. It is not a household name but it does sell essential products that are used every day. Etsy is not the same platform that Amazon and eBay. It is not a place that offers amazing bargains, universal 2-day shipping or doorstep delivery.
It’s amazing that Etsy still exists, if you really think about it. It is crazy to imagine Etsy could be integrated into today’s 21st century technology-driven eCommerce experience.
What is Etsy?
Etsy is a formidable opponent in the rapidly growing eCommerce market. It’s an online marketplace that allows handcrafted goods to be shared and sold worldwide. Etsy used to seem a bit archaic at one time. Customers waited long periods to get their products, and sellers didn’t always have enough stock. Etsy is experiencing a moment right this second.
You may have noticed the rise in support for small businesses, local shopping, and hand-made items. For example, the Makers Movement and small business Saturday have quickly spread across social media and on-line platforms. I am arguing that Etsy is the most popular eCommerce site for small-scale shopping. It was founded decades ago and continues to expand its market share.
It has been in existence since 2005, and in 2019, generated $200,000,000 in revenue. It has more than 40,000,000 buyers. It’s still underestimated by many business owners, consumers, as well as makers. It’s clear that Etsy is a great platform for eCommerce, especially as it becomes the main retail experience.
It takes creativity to navigate Etsy’s online marketplace. Although you don’t have to make everything yourself, dropshipping via Etsy requires a creative and skilled entrepreneur. You can unlock the Etsy code and you will be able to make high-profit margins, have loyal customers, an established market, and financial stability.
Dropshipping has seen a steady rise in eCommerce sales over the past few years. It’s basically the digital equivalent to brick-and-mortar storekeepers. Dropshipping businesses fill their shelves with small-business stockists, then hand over the production, packaging and shipping of each order to the manufacturer. Your platform allows customers to order products from you at a set price. They then take care of shipping it to their customer.
Your task is to set up an online storefront using WooCommerce, Shopify or Squarespace. You will need to create an online storefront (WooCommerce, Shopify, Squarespace etc.) and then curate a selection of products from the internet in order to resell them at higher prices. It’s all about creating a brand identity and knowing your target market.
Etsy is a little different from dropshipping, which can scare people away. However, it shouldn’t. This is where I will explain everything you need to know in order to tap into Etsy’s marketplace and grow your dropshipping company.
Dropshipping is possible with Etsy in two ways. Dropshipping Etsy products to an online shopfront from an Etsy seller is the first. This must not be done outside of Etsy.
Reselling other Etsy sellers’ goods comes with one catch. Handmade goods cannot be resold. This model cannot be used for your shop. You can only sell vintage products (products that are at least 20 years old, not made by yourself) and craft supplies on the platform. Although this is an unusual Etsy-specific position, I will explain it below.
Handmade goods are the most appealing part of Etsy products for many dropshippers. The second option may be the best for you if that is the case. If you are willing to take part in the design and production of the goods you sell, you can open an Etsy shopfront.
Dropshipping on Etsy: The pros and cons
Dropshipping has its pros and cons. I’ll explain them all.
There are many pros to these:
1. Conscious (and patient!) consumers
Etsy allows you to sell directly to customers if you open an Etsy storefront. The platform has created a unique community that values craftsmanship, human-centric shopping and individuality since its inception. Your customers will likely be drawn to a platform that shares these core values. Etsy customers are used to long production times and more willing to pay more for their purchases.
Etsy stands out from the rest of its competitors because its core values, which are unifying and largely altruistic, is what sets it apart. Amazon, for instance, was built on simplicity and efficiency. Amazon is unlikely to allow Etsy’s high prices and slow production times to be a problem. This gives entrepreneurs more freedom and flexibility to choose how they operate.
You can’t underestimate the importance of loyal customers and patients.
2. There are many opportunities to be creative.
Entrepreneurs are never short of ideas. They thrive when they have more control over their products and don’t have to worry about logistics, production, packaging, or shipping. Etsy is a great place to do this. Dropshipping through Etsy requires that entrepreneurs play a more active role in design and manufacturing. You can create your brand new way by selling under the Etsy umbrella.
3. Your product base should be different
Dropshipping is becoming more common in eCommerce. It becomes increasingly difficult for business owners stock unique goods that are not easily found. Etsy allows you to stock unique, one-of a kind items that you can’t produce or sell anywhere else.
4. Etsy is all about niches.
This is what I mean. Etsy is the best place to start a dropshipping business if you are looking for a niche in the eCommerce market. Etsy is home to many dropshipping shops, weddings and clothing as well as other products. There are many Etsy stores that thrive. Etsy is known for being a great place to find niche goods. Customers and sellers alike flock to it whenever they need or want to make a purchase. Etsy has spent the effort to build a reputation for uncommon and special goods, so you don’t have.
5. High profit margins
Many skeptics point to Etsy’s high prices for retail as an excuse to not apply a dropshipping model to the platform. It’s true that many goods sold on Etsy are priced higher than market value. However, sellers have the advantage of a well-established community that has a track record of paying these prices.
What does this mean for dropshipping companies? You can make significant profits. There is more flexibility in positioning your products on the market than in other industries. It is possible to price high and still sell a lot of products while maintaining a profit margin of at least 40%.
While some may consider this a disadvantage, I view this as an opportunity to see the glass half-full. Etsy’s guidelines demand that you disclose your location and where your production takes place. It is impossible to hide that you are not the one making your products.
Etsy has been quietly and consistently successful because of this level of transparency and honesty. Customers aren’t manipulated or trapped in the endless online game of selling and buying products from around the globe. Many people don’t know where their products are made in today’s global and complex online marketplace. It’s easy to order something online and it arrives in a box at your door within days.
Although Etsy does not show customers how your business is setup, they do collect this information from you to verify that your shop supports artisans and produces handmade goods. You can be sure that your purchases are approved by an established platform, which adheres to certain ethical production standards.
Be careful not to get too excited about Etsy.
Here are some cons.
1. You pay more fees than you think
You will be charged a lot of fees for listing your Etsy shop and selling it. When opening an Etsy dropshipping shop, there are a few fees that you should be aware of.
There is a $0.20 listing charge and the listings expire after four months. Although it doesn’t seem like much, it can significantly reduce profit margins. You can set up automatic renewals but you will be charged each four months for each expired listing. Manual listing renewals are more time-consuming and require extra effort to maintain your listings.
A second processing fee of 5% is charged for every product sold. Remember that shipping costs are not included in these fees.
Etsy also offers many tools and resources to help sellers such as pattern fees, ad fees and in-person fees. The analysis of these resources will be left for another article.
2. Dropshipping business models: Intense guidelines
Etsy is highly regulated as an internet marketplace. The House Rules outline Etsy’s stances on everything, from buyer/seller communications to seller handcrafted policies to supplier codes. Although it is quite dense and long, here are the main points.
Etsy offers a very specific language for the selling and reselling goods. Dropshipping vintage or craft supplies is possible, but it’s not permitted to resell handmade products.
It is possible to provide production assistance for original designs. It is described as a spectrum. Some businesses make each product in-house using their own tools and hands, while others design the product but lack the skills or means to do so. Etsy welcomes both ends of this spectrum, which is great news for dropshippers.
You are allowed to use your creativity and thoughts to make your product. There are certain restrictions on who and how you can outsource production. You must disclose to Etsy the name and location of your manufacturer, as well as details about the production process. However, not all details about your business or logistical operations will be made public. Etsy is clear about what information is public and what is not.
3. Etsy sellers benefit from extensive community policing
Etsy enjoys policing its users. This is useful because it ensures that operations are fair, uniform and run smoothly. It also means you need to be familiar with their policies. You could be subject to penalties and fees.
It is also worth noting that Etsy allows third-party payment gateways to track your activity. If you are unfamiliar with payment gateways, we have a crash course for you. Users are subject to companies such as PayPal reviewing your transactions and accounts in order to determine if they have violated their policies.
Dropshipping through Etsy is subject to greater scrutiny than dropshipping via an e-store, or any other platform. Although Etsy has a large customer base and high profit margins that are appealing, you should consider what you will sacrifice in order to have it.
4. Operates in accordance with economic sanctions and trade restrictions
Yes, that sounds a bit wordy. But, please, listen. Etsy is a global marketplace but its headquarters are in the United States. This means Etsy adheres to government and economic sanctions. They restrict account usage in certain geographic areas and prohibit the sale or import of goods from sanctioned regions.
You should be aware that Etsy sellers can encounter red tape which is beyond your control. This could have a negative impact on your sales and profit margins.
5. It is a tedious process to list.
This isn’t a problem unique to Etsy. However, listing your products on the site can be exhausting. There are many product options on Etsy, as the marketplace is for handmade goods and small businesses. Etsy has established requirements for listing products that provide consumers with the most accurate information and uniformity. This can prove to be a burden for shopkeepers trying to maintain multiple products.
To give you an example, listing on Etsy will be similar to listing on Amazon Handmade. You will need to put more effort into it than listing on a storefront independently owned by Squarespace, Wix, or Shopify.
6. Potential profit sharing
It is your responsibility to pay any seller who supplies your products. You must negotiate a fair deal to ensure that you get a good profit margin and compensate the seller for their hard work.
FAQs about Etsy Dropshipping
You’re not the only one still confused about dropshipping on Etsy. It’s a challenging place because of its strict dedication to handmade products, and the specific community guidelines.
1. Is Etsy legal to dropship?
The short answer is yes. It’s not helpful, I am sure.
Etsy allows you to drop-ship only one direction. You can sell vintage and craft supplies as long as you have an agreement. You can’t resell handmade products that you haven’t made.
You must be aware that Etsy allows you to sell finished products and not made by you. Only the former is permitted. Only those who have played a part in the development of a product can legally sell it. Buyers need to know where you are located and where production takes place so they can be fully informed about where their product comes from.
2. How can you find a manufacturer or maker to work with?
You can only use Etsy to produce your own designs if your partner is a seller. Third-party companies are not allowed to get involved.
This means that Etsy’s policies prohibit outsourcing.
Printful and Art of Where are warehouses and studios that make products and integrate with online platforms such as Shopify and Etsy. You can contact Etsy to sell directly to their customers. They will design and manufacture the goods and then ship them to you. With their expertise and specialized equipment they can help you bring your ideas to life and take care of the logistics. Expert manufacturers can save you time and headaches.
It is difficult to determine if a seller uses a dropshipping model. However, dropshippers like ThreadDomain that can move large volumes of the same clothes products in multiple patterns are likely to be taking advantage of dropshipping opportunities.
You can source products for your Etsy e-store by contacting sellers you like and asking if they are willing to ship and supply products. Dropshipping can be a great way for companies to get more exposure and sales. Dropshipping is often offered at a discounted rate by sellers. You must inform sellers about your plans before you upload their products to your shop.
3. What is the process of splitting profits in dropshipping situations?
These numbers can vary from one brand to another and from product to product. Art of Where and other large companies have established commission, wholesale, dropshipping, and rate rates they will not budge on. However, smaller sellers and manufacturers may have a lot of flexibility regarding their prices.
Many Etsy sellers who are smaller often get excited. Dropshipping deals can give you extra exposure and offer great savings.
How to dropship products from Etsy
Although there are some extra steps, it is easy to set up your dropshipping company. You only need to establish the right channels and relationships for both Etsy drop shipping options.
Upload a product from Etsy into your Shopify store
- Do your research. Make sure to find sellers on Etsy who align with your brand.
- Establish a communication line and reach an agreement on dropshipping terms.
- If you don’t have Shopify, add it to your Chrome browser
- Click the Shopify extension and go to the Etsy product page. Change the wording.
That’s all! You should see the product in your Shopify store.
There are good news for those who want to open Etsy shops. Etsy offers many resources to help you explain the process. Start your Etsy shopfront
- Find a partner to produce the products you create for your store.
- Calculate profit margins and prices.
- The Etsy website allows you to register as a seller. You will need to name your shopfront, set up billing and payment methods, add your production partner’s details, and list your products. Maximize marketing opportunities and create an engaging story for your shop.
You’re ready to go. This will allow you to be involved in product development and production without having to lift a finger.
Whatever route you take, ensure your business is set up for growth and long-term success.
Although Etsy may require some extra creativity, it’s a great time to dropship to the platform. Etsy was created to address these cultural and economic issues.
You should think carefully about your brand’s goals and be ready to play a greater role in the operation of your business. Dropshipping is easy to set up on any eCommerce platform and you can source products from anywhere in the world. If Etsy doesn’t suit your needs, don’t worry. There are many other options available.