Finding handmade goods online that are relatively cheap can be difficult.
You run into a lot of possibilities to purchase something that might be bad quality or made unethically or with bad products. Can you avoid this issue with Etsy?
Is Etsy cheap in general?
Etsy shops and their products are not as cheap as your local store or supermarket that sells off-the-rack, mass-manufactured items. However, if you’re looking for handmade products under $40, you’ve come to the right place.
Actually, you can start an Etsy shop with no budget (zero cost).
The problem with Etsy is that some seller products are very similar to other seller’s products Etsy-store-wide. For example, there are hundreds of shops to choose from when looking for a friendship necklace.
However, depending on the price points you choose from those stores, you could be getting a lower-quality item.
While this isn’t always the case, it is important to be a conscientious buyer when shopping online and make sure to know exactly what you’re getting for that lower price tag.
Are Items on Etsy Cheaper Than in Regular Stores?
Depending on what you’re looking for, Etsy is much more expensive than a regular store in the mall or supermarket that sells clothing, home items, jewelry, and art prints or paintings.
This is because Etsy – for the most part – does not mass-produce their items.
While sellers can have the opportunity to partner with third-party manufacturers to get their products made and out to customers more quickly, the designs and materials are usually handmade.
The Term “Handmade” and Price Points
Putting the term “Handmade” on an item when you buy it in the store comes with a lot of added price points to consider when making a purchase.
For example, if you went to the mall and bought a mass-produced, low-quality sweater for $20, the profit that the company gets from that sweater is much more than an Etsy seller would receive.
This is because mass-producing that sweater probably only costs them about $1-$3, and hundreds of those sweaters would be made nearly every minute.
An Etsy seller who handmakes their sweaters – even if the material is of lower quality – would spend upwards of an hour or two making that sweater, then take the time that it would need for posting it online, marketing it, adding product information and descriptions, and then would package and ship it to you themselves.
This added labor cost will factor into how much that sweater will cost you on Etsy.com. So, you may be looking at $40 or more for that sweater from an Etsy seller, but you would also be receiving something incredibly unique, handmade from someone who didn’t pay others very, very little to make it for their shop.
Is Handmade Worth it?
You may be thinking, “Well, I should just spend $20 in the mall if both sweaters are going to be of lower-quality, right?”.
Well, no. Even if the sweater’s materials are cheaper than, say, wool or 100% cotton, the sweater itself will have the value of seeing only one environment throughout its creation.
While a mass-produced sweater may come off a conveyor belt in a factory with low-paid workers (depending on which corporation you buy from), an Etsy seller makes it in the comfort of their own workshop, taking time and effort to put the right detail into it and then sell it at a fair price to the customer.
Even if you weren’t buying “handmade” on Etsy, but somewhere else, say at a farmer’s market or at a fair-trade shop, your price tag is still going to be higher.
It all comes down to supporting your local creators and shelling out a little extra to make sure what you buy is something you ethically believe in.
Why is Etsy so Cheap in Many Categories?
One major exception to Etsy’s more expensive price tags is cheaper items that are partnered with third-party manufacturers.
For example, if an Etsy creator makes a sticker based on pop-culture or their own unique creation, they are able to partner with third-party manufacturers to print and ship their products to customers.
This means that the Etsy creator is only creating the design or image of the sticker.
They do not print and ship it themselves with this partnership, which is great for both sellers and buyers because the product is cheaper to buy, professionally printed, and gets to the customer faster.
This keeps the price tag low, while still supporting art designers and creators who make their own stickers and designed items!
Controversy Over Third-Party Partnerships
Ever since Etsy allowed Etsy sellers to partner with third-party manufacturers, there has been some debate in the eCommerce community about what is considered “handmade” these days.
While many consider “handmade” to mean that the seller themselves must create, build, package, and ship the product all from one location, many other sellers – especially digital and watercolor artists – love having the opportunity to print their designs more than once and sell to multiple customers.
Partnering with printing companies allows artists to create a real watercolor painting, and then digitally reproduce it as a print and sell it to hundreds of fans or customers worldwide. This means that they don’t have to painstakingly recreate the same painting over and over again, or constantly come up with new designs every single day when their painting sells.
This does bring up the question of whether or not Etsy can be considered solely “handmade” anymore, depending on customers’ own personal definitions.
Many customers will opt then to go to in-person farmer’s markets and spend a little extra money once or twice a year for products that they truly believe are supporting the artist and handmade communities out in the world.
However, this does take away the business of entrepreneurs who have dreams of making it big on Etsy.com.
Popular Products Aren’t Always “Handmade.”
Although some products are not necessarily “handmade” by the seller or their small team, some of the bestselling products on Etsy.com are those that are printed from third-party manufacturers.
T-shirts, mugs, pillows, tote bags, stickers, bookmarks, business cards, planners, and more are usually printed through another company and shipped from that company to the customer.
Some of the top-selling shops out there are shops that create slogans to go on blank-canvas items like T-shirts and Mugs that customers love to buy! These are usually internet personalities or social media gurus who have created their own “brand” and now sell “merch” to their adoring fans.
So while it isn’t necessarily “handmade” at all times on Etsy, those cheaper items are by no means less in the spirit of what makes Etsy the community that it is today.
How Much Does it Cost to Open an Etsy Store?
Opening an Etsy store is completely free.
However, once you start posting listings and selling on the Etsy platform, you will have some expenses that you have to pay to Etsy.
The general fees that Etsy charges to all shops are:
- $0.20 cent listing fee per listing (Every 4 Months)
- 5% Transaction fee at point of Sale
- 3% + $0.25 cent payment processing fee for moving funds to your personal bank account
An Example of This With Numbers:
So, you’ve begun your store selling, say, handmade hats. You knit them yourself and will ship them to customers yourself once they are sold online.
Say each hat takes you $5 to make for materials, and it takes you two hours to knit one. Because of this, you charge $20 per hat online, plus a $3 shipping fee.
Now, let’s say you have 100 hat listings to go up on your site.
Finally, let’s say you’ve made about $500 in hat sales over the course of those four months. At $23 per hat, that means you have sold about 22 hats in four months!
Now, let’s calculate those fees:
- $20 every four months for listing fees (100 listings)
- $1.15 Transaction Fee at Point of Sale per hat (for 22 hats = $25.30)
- 3% +$0.25 cents fee to transfer remaining funds ($454.70) to a personal bank account
After four months, your total profit is roughly ~$440.81.
Many Etsy sellers believe that this isn’t nearly enough to make them want to continue with their Etsy shop, or that it isn’t enough money. However, these sales are for those who are beginners to the shop without a huge online following or presence on Etsy yet.
Once you are selling 100 hats PER MONTH, your income and profits will be much larger, though that means the fees will be larger, too.
Do I Need to List my Products Really Cheap to Do Well on Etsy?
Like we’ve discussed in our article, “Do Etsy Ads Really Work?”, we’ve discussed how competing with other popular Etsy shops can sometimes mean lowering your prices to the absolute minimum that still allows you to make a profit.
This is not ideal and is a last-ditch effort for new Etsy shops that are trying to get noticed online.
Lowering your products to very cheap is a good way to get picked by someone trying to save money, but it does mean a lot of work for you at the beginning of your Etsy shop’s life in order to start to get some five-star ratings.
Once you’ve had enough five-star ratings and good reviews, customers are more likely to trust your shop and pay a little more for your product.
This is a great way for new shops to get their name out there but can be fatal for well-established shops who need their income full-time.
To avoid selling your products for too cheap, try spreading the word on your own through social media or to preexisting fans of your product!
Is it Cheaper to Ship Through Etsy?
Like we mentioned in our article, “Does Etsy Help With Shipping?”, Etsy’s Calculated Shipping system is great for shop owners who purchase USPS or through Canada Post.
Etsy will create shipping profiles that include you and your customer’s information, size, weight, and calculated shipping cost to your listings in order to help you price your stuff.
Once you create a profile for that item, you can categorize new listings under those profiles so that Etsy can calculate how much each new “small wallet” should be charged to customers to account for shipping.
This is an incredibly fast and efficient way to get your shipping done, but it isn’t necessarily cheaper. If anything, it saves you the cost of time and labor that you would otherwise spend without it.