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Thu June 14 2018 08:30:51

Etsy Raises Commission Fees and Adds Shipping

By: Ina Steiner

Sponsored Link

Etsy is raising transaction fees from 3.5% to 5%. That's still a low commission fee compared to Amazon Handmade and eBay, but what sellers are likely to zero in on is the fact the fee will now include shipping. To this day sellers bemoan eBay's move to charge commission fees (FVFs) on shipping - a much-hated move.

In dollars and cents, today's announcement means an Etsy seller who lists an item for $30 and charges $3 for shipping and currently pays $1.05 in transaction fees will pay $1.65 under the new fee structure - 60 cents more, or an increase of 57% in this case. 

That's significant, and some sellers may revisit their own pricing to see if they should raise prices - and determine if they should raise prices to build free shipping into any of their products. They have until July 16th before the new fees take effect.

To put it in perspective, the average commission fee on eBay is 10% of the selling price plus shipping - so that $30 item with $3 shipping would incur commission fees of $3.30, while Amazon Handmade charges a 15% ($1 minimum) "referral" fee - and beginning in 2019, Amazon will require sellers to pay $39.99/month for a Professional selling plan. (Note that only sellers who participate in Amazon Handmade have access to the fees page.)

Etsy explained the reasoning behind the move in today's announcement:

Why is Etsy raising fees?
We're updating our transaction fee to help us invest more in bringing buyers to Etsy, building tools that make it easier for sellers like you to run your shop, and providing the support you need to grow. As always, our goal is to make Etsy the best place for running a creative business online, and we think these changes will make Etsy even better.

Etsy said it plans to increase its marketing budget this year by at least 40%. In 2017, Etsy spent $78 million in marketing to bring buyers to the site; it plans to spend over $110 million in 2018.

The bulk of Etsy's marketing investment currently goes to performance marketing and tactics like Google shopping ads. Etsy will invest more in performance marketing, which it says is directly tied to securing more sales for sellers.

It won't cost sellers more to list on the site. The question is whether Etsy's increased marketing budget will benefit every seller equally - or if some sellers will simply pay more in commission fees for the same amount of sales they're already getting.

One thing eBay learned when it began charging commission on shipping is that every year, it gets a fee increase without having to announce a rate hike. That's because every year, all major shipping carriers raise their shipping rates. Etsy will likewise benefit by receiving more in fees every time shipping rates increase - which is a double-whammy for sellers.

Etsy is also offering subscription plans - see today's Newsflash article for details. Etsy is answering questions on this thread.




Comments (49) | Permalink

Readers Comments

Etsy Raises Commission Fees and Adds Shipping   Etsy Raises Commission Fees and Adds Shipping

by: pace306 This user has validated their user name.

Thu Jun 14 09:03:14 2018

Etsy learned that you can rip off sellers and charge for things you have nothing to do with - just like eBay did - with little to no repercussions.

I dont sell on Etsy, my wife does - so sadly - she gets the "eBay treatment" from Etsy.  =(

Etsy Raises Commission Fees and Adds Shipping   Etsy Raises Commission Fees and Adds Shipping

This user has validated their user name. by: Rexford

Thu Jun 14 09:19:35 2018

Placing a commission on shipping is just wrong, but all of these companies never miss an opportunity to feed their greed.

And their statement "We're updating our transaction fee to help us invest more in bringing buyers to Etsy BLAH, BLAH, BLAH" is just like politicians who push a tax increase but never deliver the goods.

eCrater is still the best deal in ecommerce as it relates to fees and staying out of your business.

I'd really have no issue with etsy's  rise in commission except for the fact that they are placing it on shipping as well.  That just screams greed.

Etsy Raises Commission Fees and Adds Shipping   Etsy Raises Commission Fees and Adds Shipping

by: pace306 This user has validated their user name.

Thu Jun 14 09:28:25 2018

"Its fee avoidance" if a seller has a low sale price and a high shipping price ... "ohhhhhh its a crime against the platform since you are taking money from them" ...... but its ok when the platforms steal from you - right?????

Its the usual thing - its ok when WE do it but not when you do it.

BS

Etsy Raises Commission Fees and Adds Shipping   Etsy Raises Commission Fees and Adds Shipping

This user has validated their user name. by: Rexford

Thu Jun 14 09:58:32 2018

pace says ""Its fee avoidance" if a seller has a low sale price and a high shipping price ... "ohhhhhh its a crime against the platform since you are taking money from them" ...... but its ok when the platforms steal from you - right?????"

I remember that so well.  Not a peep since they started taking a cut.  Not a ONE peep.

Etsy Raises Commission Fees and Adds Shipping   Etsy Raises Commission Fees and Adds Shipping

by: Linda This user has validated their user name.

Thu Jun 14 11:18:40 2018

Good bye Etsy, I see the writing on the wall and we all got lessons from eBay on how they rob from their customers, the sellers. Its the proverbial insanity statement:

Insanity Is Doing the Same Thing Over and Over Again and Expecting Different Results

Do any of these platforms EVER LEARN from each other????

Etsy Raises Commission Fees and Adds Shipping   Etsy Raises Commission Fees and Adds Shipping

by: FeelingFroggy This user has validated their user name.
Web Site

Thu Jun 14 11:18:47 2018

Welcome to Fleecebay JR.

Etsy Raises Commission Fees and Adds Shipping   Etsy Raises Commission Fees and Adds Shipping

by: Linda This user has validated their user name.

Thu Jun 14 11:20:26 2018

And yes, Bonanza also keeps promising that if you pay more, they will increase advertising! What a bunch of "phooey"!  

Etsy Raises Commission Fees and Adds Shipping   Etsy Raises Commission Fees and Adds Shipping

This user has validated their user name. by: The End

Thu Jun 14 12:03:33 2018

BASTARDS !
We compare ourselves to the BEST not the Worst.
Thank heavens I have other talents to draw on for money.
Just taught myself to Silver Braze.
Got a line out the door and around the block  :o)
Don't need "No Stinkin' Etsy".

Etsy Raises Commission Fees and Adds Shipping   Etsy Raises Commission Fees and Adds Shipping

by: pace306 This user has validated their user name.

Thu Jun 14 12:05:47 2018

When you dont actually make or sell anything (eBay and Etsy) you eventually run out of "other peoples money to spend".

Amazon (they are NO angels but they make and sell things) has a constant cash turnover. Prime, Alexa, tablets, phones, goods they buy and more all provide means to run the business.

The other 2 loosers have no monies - just fees. Therefore when you need more jet fuel, bigger offices, longer vacations etc - you turn to your one and only cash cow - sellers.

Etsy (good or bad) has a focus - especially if you have been runoff of eBay - so they know "they have you ... where else will you go".

eBay has the same mentality. They know that not every one is suited for Amazon or that alot of items are not good for Amazon. So eBay takes advantage and steals when ever possible (like a crooked employee taking money from the till knowing the company cant figure out the loss). eBay also knows "what are you going to do - sue us?????" so they take advantage as much as possible.

Esty wont help itself with this move - choice readings from the forums say that its seller base is up in arms ..... all it does is encourage more OFF SITE sales - just like it does on eBay (on eBay it got so bad that eBay had to "crack down" on sellers to stop it.

Greed is never unlimited - give a finger (middle one to them hopefully) and they take a hand ...

Best off to diversify and not rely on these people to live off.

Etsy Raises Commission Fees and Adds Shipping   Etsy Raises Commission Fees and Adds Shipping

This user has validated their user name. by: Rexford

Thu Jun 14 12:08:41 2018

The minute these companies go public the never ending greed kicks in.  Just remember that.

Etsy Raises Commission Fees and Adds Shipping   Etsy Raises Commission Fees and Adds Shipping

by: RL15 This user has validated their user name.

Thu Jun 14 12:30:56 2018


sounds like they are using the grifter as a consultant

Etsy Raises Commission Fees and Adds Shipping   Etsy Raises Commission Fees and Adds Shipping

by: Silver Ice King This user has validated their user name.

Thu Jun 14 13:38:54 2018

Remember, when Etsy went public they canned their CEO and brought in an Ex- Ebay employee and instantly they started making changes just like Ebay had.  This is nothing more than another copying of Ebay by and ex Ebay man.  

They made this hire so they could start doing what Ebay was rather than continue to grow as a company that was known for being reasonable with their sellers and not pulling all the stunts that Ebay did.  The minute this guy was hired, things immediately started changing in the same way that Ebay did, so no surprise that they have now added the FVF to include the shipping cost.  

As the article states, they now have a built in fee increase every year without increasing fees due to the shipping cost increase which has been unreasonable in recent years.

I don't sell on Etsy as my category does not apply there, but i do feel for those that now have to deal with them.

Etsy Raises Commission Fees and Adds Shipping   Etsy Raises Commission Fees and Adds Shipping

This user has validated their user name. by: Marie

Thu Jun 14 14:19:16 2018

Etsy also has a policy on variation listings that can be expensive to sellers.  On a variation listing, if you have someone purchase 2 or more different items from that listing, they charge you that pesky 20 cent fee on each of the sales even though it is from the same listing.

So they get that, this 43% increase in product FVFs and the 100% increase on the S&H charged by sellers.

So on the surface it may appear that they are less expensive than other sites, but you really need to run your numbers and see if it really is and if changes need to be made to what you charge for your products on this site.

Etsy Raises Commission Fees and Adds Shipping   Etsy Raises Commission Fees and Adds Shipping

by: gramophone-georg This user has validated their user name.

Thu Jun 14 15:01:24 2018

Linda wrote:
"Do any of these platforms EVER LEARN from each other????"

Yes, they do... and that's the problem.

Etsy Raises Commission Fees and Adds Shipping   Etsy Raises Commission Fees and Adds Shipping

by: maxmad This user has validated their user name.

Thu Jun 14 16:43:45 2018

We have been including shipping (aka free) so it does not change much for us, but I am definitely not happy about it.

last month we ended All ebay listings, maybe etsy will be next, this is a pure greed move that will only get worst, not going to help another evil company get rich,

These fee's are insulting, when you compare them to the amount of advertising you can buy to drive traffic to your own site.

Expect many sellers at etsy to leave, then watch another fee from etsy to take their place, the greed  never ends,  

Etsy Raises Commission Fees and Adds Shipping   Etsy Raises Commission Fees and Adds Shipping

by: thriftyone This user has validated their user name.

Thu Jun 14 16:54:59 2018

@maxmad; totally agree with you...they probably have not announced all of the features in the new upper tier "stores/upgrades" because they are waiting to see what the fallout will be from these changes...

Etsy Raises Commission Fees and Adds Shipping   Etsy Raises Commission Fees and Adds Shipping

by: maxmad This user has validated their user name.

Thu Jun 14 17:06:02 2018

thriftyone

yes, you're correct there will be fallout, but think about how much Free money etsy will take in %5 of All shipping this is a huge theft of pure greed, even if a million sellers leave, etsy will steal a fortune, with very little effort,

I wish I knew the actual numbers, it's got to be large  

Etsy Raises Commission Fees and Adds Shipping   Etsy Raises Commission Fees and Adds Shipping

This user has validated their user name. by: Ming the Merciless

Thu Jun 14 17:32:58 2018

One would think that given sorry state that ebafia is in that an intelligent CEO wouldn't want to take that road.

They don't learn, however. They take the shortcut to quarterly profitability and give nothing back to their customers.

With these piranhas, it's all take and no give.

Etsy Raises Commission Fees and Adds Shipping   Etsy Raises Commission Fees and Adds Shipping

by: Ichabod This user has validated their user name.

Thu Jun 14 17:41:15 2018

@Pace. I disagree with your comment about ebay not making or selling anything. Next to Washington DC, and with honorable mention going to Hollywood, ebay is the world's largest manufacturer and purveyor of hot air, which is selling at premium prices these days.  

Etsy Raises Commission Fees and Adds Shipping   Etsy Raises Commission Fees and Adds Shipping

This user has validated their user name. by: Marie

Thu Jun 14 19:12:53 2018

I'm not sure I understand why so many think that a 43% FVF increase on the product is no big deal!  So on a $100 item you jump from paying $3.70 [3.50 + .20] to $5.20 cents [5.00+.20].  

And if you stated your S&H separately, lets say $10, then you will be paying 5.70 in FVFs [5.20+.50].

While by itself it isn't much, but overall sales it is.  It is  well over a 40% hike.  

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