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Etsy to Launch Manufacturing Marketplace in the Fall

Etsy will launch a new Manufacturing marketplace in the fall, it announced on Monday. Etsy sellers will be able to search for manufacturing partners and contact them through its messaging system (Etsy Convos).

But isn’t Etsy a marketplace for handmade and vintage goods, some people might ask? As Etsy explained in its announcement, “Nearly two years ago, we changed our policies to allow approved Etsy sellers to use production assistance to make their goods, provided they partnered in ways that were aligned with our values and policies.”

Since then, Etsy has approved 5,000 sellers to use outside manufacturing, resulting in 7,853 partnerships as of June 30, 2015. 85% of those relationships are between sellers and manufacturers in the same country.

Etsy is inviting manufacturers in four categories to apply to join its marketplace: apparel and textiles, machining and fabrication, printing, and jewelry and metalwork.

And Etsy plans to charge fees – “Transacting via Etsy Manufacturing will have associated fees that will be announced at a later date,” the company said.

Etsy expects manufacturers to adhere to its policies, but it will not audit or verify them. “We encourage Etsy designers to read our ethical expectations for working with manufacturers and conduct their own due diligence around their partner’s practices and fit for their business,” it explained.

“While Etsy will not be doing direct audits or site visits, we will review and approve manufacturer applications on an individual basis according to a number of criteria, such as their commitment to transparency, the degree to which they allow subcontracting, and their size. Manufacturers on Etsy Manufacturing must also agree to a series of commitments on transparency, safe and just workplaces, and customer service.

“We would like the designer to know more about each manufacturer’s story and business, and we are building the platform to showcase this as an entry point to more conversations and visits between the designer and her partner.

“We’re focused on finding manufacturers who fit the needs of Etsy sellers and who are willing to work with small businesses.”

Etsy cited one of its sellers, Virginie Dyvorne, as an example of a seller who uses three local manufacturers in the production of her jewelry: a polisher, a caster, and a plater. “Relying on her team of manufacturers allows Virginie to focus on what she does best,” Etsy wrote.

The marketplace also cited a manufacturer, Deluxe Screen Printing, as an example of a small-scale manufacturer that shared the same values as Etsy and Etsy sellers. “Deluxe prides itself on producing high-quality hand-printed designs with eco-friendly materials,” Etsy said.

During the beta program, Etsy is only accepting applications from manufacturers in the U.S. and Canada. “International manufacturers are still encouraged to apply and will be contacted when the marketplace opens up to other regions,” it explained.

Sellers reacted on the Etsy discussion board with a range of concerns. Some said the news made the line between manufacturer and handmade more blurry.

“My take is that Etsy’s focus isn’t on handmade, vintage, & supplies. It’s about supporting the small businesses that sell handmade, vintage, & supplies. I think this is a good move.”

To which another seller replied, “This manufacturing venture may be construed as supporting small businesses who want to grow and expand into manufacturing. However it does nothing to help small businesses who are quite happy being small artisan producers…aka the people who have been a good part of Etsy’s bread and butter since opening.”

Referring to Amazon’s new store featuring handmade goods, one seller said “Amazon’s news is the handmade site and Etsy’s news is about manufacturing. Up is down, right is left, lol.”

You can read the full announcement on the Etsy blog, and it will host a Forums discussion with members of the Etsy Manufacturing product and policy teams Tuesday, September 15, from 3 p.m. to 5 p.m. eastern time.

Comment on the AuctionBytes Blog.

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Ina Steiner
Ina Steiner
Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). She is a member of the Online News Association (Sep 2005 - present) and Investigative Reporters and Editors (Mar 2006 - present). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com. See disclosure at EcommerceBytes.com/disclosure/.