How to Save Money on Etsy Fees

by myklist

It’s no big secret that Etsy has raised their fees and even added some new ones. This is scary for a lot of small shops or crafters wanting to break into the Etsy market. I have a few ways to save money on Etsy Fees that should calm your fears some and get you back into the swing of selling Etsy or starting your shop.

First let’s take a look at those scary fees

  • Listing Fee $0.20
  • Transaction Fee 5% (raised fee)
  • Shipping Fee 5% (new fee)
  • Payment Processing Fee 3% +$0.25 (This is for the US only. Check this link for a list of fees in other areas)

Here’s a breakdown of how those fees affect one of my sales. This example does not show any of the hacks I use to save money on Etsy Fees.

Here you can see I sold my item for $8.50. This is $6 for
the decal and $2.50 for the shipping.

Listing fee $0.20, Transaction fee $0.30, Shipping
transaction fee $0.13, Payment processing fee $0.51. Total fees for this item
are $1.14.  I only charged $2.50 for
shipping but I actually paid $2.78 for the shipping label (I usually offer free
shipping or discounted shipping in my shop. It brings in more sales). So my
profit is $4.58 ($8.50 – $1.14 fees -$2.78 shipping label = $4.58)

Hack One to Save Money on Etsy Fees

Offer free shipping! Etsy doesn’t charge a shipping transaction fee if you offer free shipping. Now of course you’ll have to charge more for your item to offset the shipping because free shipping is totally NOT FREE. But don’t worry, this will not deter buyers, it will bring them in! Everyone loves free shipping and Etsy prioritizes shops that offer free and discounted shipping. You’ll get more eyes on your items and, in turn, sell more this way. Check out this post on how to offer free shipping in your Etsy Shop. Here’s an example of fees when an item is offered with free shipping.

In this example you see I sold 6 cups for a total of $66.78.
This is $10.50 per cup + tax.  My
transaction fee was $3.15, my payment processing fee was $2.25 and my listing
fee was $1.20 ($0.20 per cup). There was no shipping transaction fee since the
item shipped for free. Total fees for the item were $6.60.  So my profit is $48.38 ($66.78 – $6.60 fees –
$11.80 shipping label = $48.38). I was able to save $0.60 in fees. This order
got me thinking about the listing fees though. This brings me to my next hack…

Hack Two to Save Money on Etsy Fees

Bundle your items. If you have items that usually sell in multiple quantities, like my party cups, then offer them in bundles. My original listing was for 1 cup at $10.50 and the customer just put in the quantity they wanted at checkout. This charged me $0.20 for each item sold. I revised my listing to offer cups at $11.00 each and in quantities of 4, 6, 8 or 10. My next order came in with a customer wanting 6 cups, same as the previous order but this time I made more money. Take a look at the example.

Here’s how it breaks down. 
The item sold for $66.00 (there was no tax on this one because I don’t
have tax set up in that state yet…I really need to get that done). This is
$11.00 per cup. My transaction fee was $3.30, my payment processing fee was
$2.23 and my listing fee was $0.20. Again, no shipping transaction fee because
the item shipped free.  And this time, my
listing fee was only $0.20 because I bundled the item rather than having the customer
purchase each cup individually.  Total
fees for this item were $5.73. That’s $0.87 cheaper than the last example and I
sold the EXACT same thing! I just learned how to work the system.

Hack Three to Save Money on Etsy Fees

When at all possible, offer private listings. If a customer messages you asking a question about an item, answer all of their questions and then offer to set up a private listing for them. This will again save you on the $0.20 listing fee per item. When you set up a private listing Etsy will charge you $0.20 only if the item sells. If it doesn’t sell, you don’t get charged. This comes in handy when someone is wanting to buy multiple items.

Just today I had a customer ask me how many juice box holders I had in stock. I told her I had 3 left and she asked if she could buy them all. She could have just gone to my listing and put all 3 in her cart. Etsy would have charged me $0.20 listing fee for each item along with the other fees. Because she messaged me about the item I offered to make her a private listing. I include all 3 juice box holders and Etsy only charged me the $0.20 listing fee. I was able to save $0.40 on this order. See the example below.

I did not raise the price per item for this transaction so I
charged the customer shipping. Because I charged shipping, Etsy charged me a
shipping transaction fee.

To sum it all up and a word of caution

To save money on Etsy Listing Fees you can offer free shipping, bundle items, and create private listings. I know that saving $0.40 here are $0.20 there may not seem like a lot I promise it adds up. You’ll be able to save $100’s a year and do it pennies at a time. Now, I do want to caution you, Etsy has a strong “Fee Avoidance” policy. Here is Etsy’s Fee Avoidance Policy.

None of the hacks I have listed violate the Fee Avoidance Policy. If you’re coming up with additional hacks, please be mindful of Etsy Policy and don’t take risks. The goal here is to sell more and make more…not get your shop shut down for breaking the rules.

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