I am struggling to understand the rationale behind Etsy's new policy regarding their increase of fees beginning shortly. They are changing their policy to collecting transaction fees to include items sold and shipping charged.
Shipping? Really? Turns out, it's not the increase from 3.5% to 5% that will be the real money maker for Etsy, it's the change to "entire transaction."
While I can rationalize the payment processing fee charged on the entire purchase, a charge of 3% + $.25 per transaction, I cannot understand profits being made by the merchant of record on shipping as that portion is not part of the merchandise sold.
And I am struggling to find references as to this practice per U.S. law. It's possible that this is common in all online marketplaces, but as I have not engaged in selling with any other I have not come into contact with this.
While doing analysis on my many Etsy reports available, I discovered that Etsy currently, and presumably will continue, charging a transaction fee on EACH item and not on the total transaction. What happens in this is that the fractions of a penny for the transaction charge is rounded UP for each item. While this is only a few cents per total transaction cost - it is a buried windfall for Etsy.
Onto another item:
Since my shop is now approaching the 1099 threshold and I have brought an accountant on board to do my books, I saw that Etsy has a Quickbooks for Etsy product. So last week I gave it a try, after all, my new accountant uses Quickbooks & I thought it would be an easy solution to give her the Etsy data in one tight package.
It's pretty easy to set up, at first glance. Then, I discovered that upon initial set-up the program will only import up to 90 days of data.
No problem, I soon figured out how to import my reports for the months leading back to January 2018.
But then, I discovered that all of the totals and charts being presented were based solely upon the reports listing the Card Processing Fees. Etsy keeps their Transaction Fees, which include all of the listing fees (of which there are many,) on a separate report. OK - I had already figured out how to import the Etsy reports. So I attempted to import the rest of the Etsy reports to get the full picture of the fees I'm paying through Etsy.
Only, the way that Quickbooks for Etsy has been built out they have an drop-down box selections for only four columns of data, of which none of the four choices relate to the Transaction Fee reports, and there is no way to easily modify this without having some programming knowledge.
So, I did an online chat and backed out of my purchase of the Etsy for Quickbooks product. Within less than an hour of use.
See, in that product, Etsy is telling you just how profitable you've been, how much in taxes you'll owe, and providing all kinds of fancy charts & analytics. BUT...it's not taking all of the financial data to do these comparisons. So of what value is it?
Now, Etsy is about to make many changes, so it's possible that this will be corrected. According to my online chat person, the issue I brought up was going to be referred to their technical staff. I'm sure this will be corrected, aren't you?
OK - I'm climbing down off my soap box now.