December 23, 2022
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Side Hustles

How to make money on Etsy

Want to know how to start an Etsy shop? Here's everything you need to know.

How to make money on Etsy

Thinking about starting a side-hustle with Etsy? Smart. Love that for you. The first thing you’re probably wondering about is…

How much can you make on Etsy?

The amount of money you can make on Etsy varies, as with any selling platform. Some sellers make a steady $75 a month. Others make their full-time income on Etsy, and are able to turn their side hustle into their main hustle.

This amount depends on a few factors: your marketing, the time you put into your Etsy store, how unique your product is, and the size of your profit margins.

One Etsy seller, TheMillennialBoss, shared their revenue graph on their blog here, if you want some cold hard numbers to go by. On their website, they recommend finding a product that is as cheap to produce as possible. For them, this is digital prints.

However, this isn’t the only way to make money on Etsy. The unique thing about Etsy as a platform is that people go to it as a place to find personalized gifts. This is another angle to take when deciding what product to sell. Personalized gifts may take more time and money on your part, but can sell well on Etsy.

What to sell on Etsy

There are three main categories to sell on Etsy, according to its website: handmade items, vintage items, and craft supplies.

On the Etsy site, they provide a list of questions to ask yourself when deciding which product to sell:

💙 Do you enjoy it?

💙 Is it on trend?

💙Will it make money?

💙Does it have growth potential?

If you want a little more specific guidance, these are the things that perform best on Etsy, according to data from Gathering Dreams:

  1. Handmade personalized jewelry
  2. Jewelry and craft supplies
  3. Printables
  4. Digital art work
  5. Stickers
  6. Notebooks and journals
  7. Party decorations
  8. Wedding products
  9. Personalized cards
  10. Personalized gifts
  11. Handmade clothes
  12. Accessories
  13. Home made bath and beauty products
  14. Zero-waste products
  15. Vintage items

So you know you can make money on Etsy. And you might have an idea of the product you want to sell. The next question is…

How much does Etsy take?

Etsy takes 6.5% of the total order amount in your designated listing currency. This fee includes the cost of the item, as well as shipping and gift wrap. Etsy itemizes these charges separately on your Payment account. This fee comes out automatically.

But that’s not the only fee Etsy takes. Etsy also charges a  listing fee, which is a flat rate charge of 0.20 USD per listing. This fee is charged regardless of whether or not the item listed sells. And it’s automatically added to your payment account when you publish an item.

There’s also Etsy Plus, which is an optional subscription of $10 per month. Etsy Plus includes credits for shop listings and Etsy Ads, access to custom web address discounts, restock requests, advanced shop customisation, and more.

Again, this is optional.

Do you need a business license to sell on Etsy?

No, Etsy does not require a business license to sell on their platform.

However, this is a little more complicated than it seems. You might need a license or permit from municipal, county, state, or federal agencies regulating businesses. It depends on whether your shop is classified as a hobby or a business.

The IRS provides 9 questions to ask yourself so you can classify which category your store falls into, which includes things like the amount of revenue your store brings.

Is Etsy safe?

Yes, Etsy is safe to buy and sell on. This is because it provides buyer protection,  a secure payment system, and a transparent review system.

How to start an Etsy shop

To start an Etsy shop visit Etsy.com/sell and select Get started. Then select your shop language, country, and currency, then click Save and continue. Choose your shop name, then click Save and continue again. You’ve got a shop.

That’s the short answer. To get your shop off the ground, there are a few other things you can do:

  1. Create a consistent brand
  2. Look into Etsy SEO
  3. Reply to customers frequently and in a super friendly way
  4. Take professional looking photos
  5. Add a personal touch to packaging

There you have it. You’re on the way to making bag with Etsy. If you’re interested in selling on other sites, check out our guides for selling on Depop, Poshmark, or eBay.

One last thing

If you’re looking to start your own side hustle, you’re gonna need a super tight budget. Our money app Cleo can help you with that, for free.

And if it’s an emergency, Cleo can spot you $100 if you really need it (eligibility requirements apply).

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