How To Start an Etsy Shop

person making pottery and packaging it to sell

Sladic / Getty Images

In 2020, online retailer Etsy gained more than 61 million new and reactivated shoppers to its platform.

In part due to its wide reach, Etsy offers a lucrative market for people eager to turn their crafts into cash. If you have a craft-based hobby, Etsy can provide a platform for you to monetize it. Its simple setup and relatively low platform fees make it a great option for new entrepreneurs testing the waters with a side hustle. 

To help you get started, we will detail what it’s like to create an Etsy business. You’ll learn the basics of setting up an Etsy shop and tips for efficiently scaling your business as an Etsy seller.

How To Start an Etsy Shop

If you have found a marketable craft to sell on Etsy, such as jewelry or pottery, you can start an Etsy shop within minutes. Here’s how. 

Create an Etsy Seller Account

The first step in building your business is to navigate to Etsy’s homepage. Once there, scroll all the way to the bottom menu and select “Sell on Etsy.” 

This will take you to a guide page where you can select “Open your Etsy shop,” and begin the process. You can create an account or register using a Google, Facebook, or Apple account. 

Creating an Etsy seller account is free, but once you start uploading products to the marketplace, you will have to pay a 20-cent listing fee. There are also transaction and payment processing fees once you start selling items.

Set Shop Preferences 

Once your seller’s account is ready, you can set your store’s basic preferences. This includes options like language, currency, and shipping details. For instance, if you are a U.S.-based seller planning to ship solely in the U.S., you can specify that in the preferences. 

If your bank’s primary currency is different from your Etsy shop’s currency, Etsy and payment providers like Paypal may charge you an additional conversion fee. Sellers can list items in a currency different than the one they selected originally and Etsy will convert the balance to the seller’s preferred account currency. However, this conversion will result in a 2.5% fee subtracted from the amount of the sale.

Name Your Shop

Naming your shop sounds like a relatively simple step but don’t underestimate its importance. Today, branding plays a crucial role in marketing. Unique and memorable names can build positive customer relationships and help you stand out from the competition. 

For instance, if you have an international store, you might want to choose something that’s easier to pronounce for non-English speakers. “The easier to spell, the easier it will be found,” Diana Kazamer, owner of U.K.-based LulouStore on Etsy, told The Balance via email. 

Add Listings

Once your shop is up and ready, you can start listing items. These can include both physical and digital products at a price of your choice. A digital product could be a piece of graphic art, such as a computerized drawing of a photo you save as a PDF. 

Adding a listing is fairly simple. You upload up to five pictures of your product, add a catchy name and description, and list a price that may or may not include tax and transaction fees. 

Consider including the postage fee in the displayed price so you don’t have to charge a separate fee for shipping, as that can sometimes steer customers away.

Find a Niche and Know Your Market

Setting up an Etsy store is just the beginning. Once your store is up and running, you need to find customers through active marketing and perform routine maintenance on your store. We spoke to successful Etsy sellers to discover tried-and-true strategies that will help you succeed on the platform. 

Your niche is your specialty. It is what differentiates you from other sellers in the same industry. Finding a viable product or idea in a profitable niche can set you up for success. 

To find a profitable niche, Natalie Dawson, an award-winning seller who offers skin-care products and bath bombs on Etsy, suggests evaluating your products against what’s already out there. This way, you can set yourself apart from the competition.

Betsy Benn, the owner of a home decor store on Etsy, recommends defining your specialty by asking yourself questions like: 

  • Will you only use recycled materials? 
  • Is everything designed to request? 
  • Will you offer free gift wrapping? 
  • Are you supporting charitable groups or communities with products they make and you sell? 
  • Is your focus on speed and convenience? 

“Then look at the products that exist in your sphere, define your brand values, and decide how only you could create that product,” Benn said in an email. 

Take Good Pictures of Your Product

Etsy has written a comprehensive guide to product photography because items with pictures and videos sell more. In a recent survey, Etsy discovered that 90% of shoppers said the quality of photos was “extremely important” or “very important” to a purchase decision.

“People cannot see your product in real life, so make sure they know what they are buying by showing it off as well as possible,” Anna Hamill, an artist on Etsy, told The Balance via email. 

When taking product photos, keep the following in mind: 

  • Take pictures from different angles.
  • Include images with various light settings (dim, bright, daylight, etc.).
  • Show all available colors.
  • Highlight the product’s features through close-ups.

Take Advantage of Etsy Features

Within its seller handbook, Etsy offers tips and how-tos on various features like discount pricing, external advertising, and video uploads, and there are blog posts on topics like thriving during the peak holiday shopping season. There are also personal messaging channels to help you find new buyers, connect with existing customers, and grow your business. Use these as much as you can to maximize opportunities for success. 

For example, Benn recommends answering customers’ messages every day (or whenever you are online), offering personalization, and using all possible hashtags to help people find your product. Dawson, on the other hand, suggests setting up a campaign to offer discounts to potential buyers who abandoned their carts. 

When you join Etsy as a seller, you are automatically enrolled in the platform’s advertising services, but you can choose to opt out. Etsy’s advertising services, launched in September 2020, enable Etsy to promote your items across the web. If you choose to take part in the service, most sellers will pay a fee on fewer than 10% of their sales.

If you make more than $10,000 U.S. dollars in sales on Etsy in a one-year period, you are then required to participate in the advertising services for the rest of your time on Etsy, as you benefit most from offsite ads. If you sell $10,000 annually and 10% of sales come from offsite ads, for example, you could expect to pay about $120 with a 12% advertising fee.

Treat Your Etsy Shop as a Business

It can be tempting to treat your Etsy shop like a hobby, especially when you are new and haven’t received many orders yet. But if you are serious about earning a decent income from your Etsy store, you have to treat it like a business and treat yourself as an entrepreneur.

That may mean setting up separate social media accounts for your brand and actively marketing your products online. For some sellers, this may also mean figuring out your taxes, hiring assistants to manage the shop, and regularly performing a cost-benefit analysis for all the products. 

Always Look for New Opportunities

When conducting a cost-benefit analysis or evaluating your statistics, you may realize some products aren’t selling well. Maybe you notice buyers are more interested in a side product you introduced casually. These are good signs to pivot your shop. For instance, Susan Widlake, an Etsy seller who initially sold designer hats, recently pivoted to create sequined face masks in the wake of the pandemic. This kept her shop relevant during rapidly changing times. 

Frequently Asked Questions (FAQs)

How much does it cost to start an Etsy shop?

To physically start the shop online, there is no cost. But how much money you need to start an Etsy shop depends on various factors, like the type of product you are selling, how much inventory you plan to produce at once, how you price and ship your products, and how much you want to spend on advertising. 

How old do I have to be to start an Etsy shop?

Etsy’s policies require users to be at least 18 years old to start an Etsy business. If you are a younger craftsperson interested in selling your creations, we recommend asking your parents/guardians to start a shop on your behalf.

How much inventory do I need to start an Etsy shop?

Etsy does not require you have a minimum inventory to start selling. When you sell your first item, though, you will pay a 20-cent fee. You also will need some samples for product photography.