How Does Etsy Make Money?

Is Etsy free?

For the buyer

If you’re looking to buy on Etsy, the answer is “yes, until you actually buy something”.  It doesn’t cost you any money to create an account on Etsy, browse or search for merchandise, add items to lists or to your “Favourites”, or write a review of a an item once you’ve already bought and received it.  However, once you’ve completed an order for an item on Etsy, or for an Etsy Gift Card, you’re going to have to pay someone for it.

For the seller

If you’re thinking of using Etsy to sell your wares, the answer is “not really”.  Setting up a shop on Etsy doesn’t cost you any money, but these things do:

  • Listing an item publicly
  • Selling an item
  • Selling a privately-listed item
  • Selling more than one copy of an item at a time
  • Processing a payment from a customer
  • Buying shipping labels for U.S.P.S. or Canada Post
  • Advertising your shop and items on Etsy
  • Joining Etsy’s Wholesale Program

All of these charges will be added to a bill that Etsy will send you on the first day of each month.  You have until midnight on the 15th day of each month to pay this bill, or it will be considered past due.  The only exception is the charge for processing a payment from a customer, which will be taken directly out of the money that you get from making a sale on Etsy.  The actual amounts of these charges are listed in the section below.

Etsy Pricing

For the buyer

All prices on Etsy are set by the seller of the item.  You will also have to pay for the seller’s shipping charges, which are based on how far away you are from the seller, as well as the weight and dimensions of the item(s) that you’re buying.  See our Etsy Shipping article for more detailed information on how to calculate your shipping costs.

Some sellers may also charge a state-sanctioned sales tax; this can usually be found under the Shipping and Policies tab, as well (and if it doesn’t, it should appear on the page where you review and submit an order).  It may only apply if you’re buying from the same state that the seller lives in.

Also, certain countries may charge import and customs taxes if you’re ordering from across international borders, so be aware of that possibility, too.

For the seller

Here’s a breakdown of the fees that Etsy will charge you:

  • Each item that you list on Etsy costs you 20₵ U.S.   Each listing lasts for 4 months from the date that you post it.  After that, you will have to pay another 20₵ U.S. per item to keep the listing active, unless you’ve sold the item (or sold out of it) in the meantime.  You can also list some items privately, which won’t cost you any money.  However, if you sell them, Etsy will charge you the usual 20₵ U.S.  If you sell multiple quantities of the same item at one time, Etsy will also charge you 20₵ U.S. for each extra copy of that item sold beyond the first (as if the copy was listed as a separate item).
  • Etsy charges you 3.5% of the sale price (i.e. before taxes and shipping costs) of each item that you sell.
  • For each order that you complete, Etsy will deduct a payment processing fee, based on the total cost of each order (i.e. total sale price of items in the order + tax + shipping costs), from the money that you receive from that order.  This fee varies by country, but is usually 3% or 4%, plus a flat fee per order that is between 0.25 and 3 units of that country’s currency.
  • The price for advertisements on Etsy varies based on what you’re advertising.
  • Purchasing shipping labels for the U.S. Postal Service or Canada Post directly from Etsy costs the same as — or sometimes less than — purchasing them from those respective companies.
  • Signing up for Etsy’s Wholesale Program, which lets you get another business to help you create and sell your wares faster, costs $100.  This fee is non-refundable.


And that’s a brief overview of how Etsy makes money, including what you have to pay as both a buyer and a seller!