You’re creative. And you love to craft!
Not to mention, you’ve gotten pretty darn good at it.
Or, you have an amazing eye for vintage finds, but your closets are overflowing.
“You should start an Etsy shop!” your friends say. And, you’ve secretly shared that very same thought.
Etsy is a booming online marketplace full of amazing hand-made items and vintage goods. The platform brought in revenues of over $600 million in 2018! Who wouldn’t want to be a part of such a successful venture?
Here are the important stats you should know about Etsy shops:
- More than 2.1 million sellers offer over 60 million items for sale on Etsy.
- 86% of Etsy sellers are women, and nearly 95% of Etsy sellers run their shop from their home.
But you haven’t started that Etsy shop yet. And, I’m guessing it’s because getting started can seem so daunting.
People often ask:
- How much does it cost to set up an Etsy shop?
- Do you have to have a business license to sell on Etsy?
- How do I sell successfully on Etsy?
- Is it worth selling on Etsy?
Don’t worry – you’ve got this! And, we’re here to help.
We’ve created a comprehensive guide to help de-mystify and de-stress the process of starting an Etsy shop.
In the sections below, we’ll discuss branding basics, how to create listings, product pricing, financial and legal details – even marketing and long-term strategy – everything you need to know to succeed as an Etsy entrepreneur.
Here's the ultimate guide on how to start an Etsy shop:
1. Set up your account
Okay, let’s take a deep breath and dive right in.
We’re marching straight to Etsy and opening up that shop. But there’s no need for panic.
Setting up the shop is super simple. And, once you get past this mental barrier, you’ll be free to build your Etsy business.
So, shall we?
The very first step is to register your account.
Once you’re registered, you can start setting up your shop. You’ll be asked to specify a few basic preferences – like language and currency.
See? I told you this was easy.
Then they’ll ask you to do the scariest step of setting up your shop – choosing a name.
But, I’m here to tell you – don’t sweat your shop name just yet.
You’re right that you should take some time to think of a really great name (more on that in the next section – Section 2: Brand Your Etsy Shop). But the name you enter here can be changed until you actually open your shop. So, don’t let having the perfect shop name stop you from completing the rest of the process.
You can even change your shop name once after opening. So… breathe. You’re okay.
We just emailed the resources to you.
Once you’ve entered a name, you’ll be allowed to stock your shop, set up payment and billing. Etsy does a great job of guiding you through the process – just follow along, and you’ll be fine.
While Etsy does walk you through the mechanics of posting a listing, we’ll cover how to create awesome listings that really sell in Section 4: Create Your Product Listings.
Before opening your shop, fill in your bio and add a personal photo. Writing your bio is a great way to start thinking about who you are, why you’re opening a shop, and what you’re passionate about. All of these things will be incredibly helpful to keep in mind when you start thinking about the next step – branding.
We suggest that you read Section 2: Brand Your Etsy Shop and really think about your branding before deciding on your final shop name. So, without any further ado – let’s talk about branding…
Also, remember that most states require you to register your business if the trade name under which you operate your business differs from your business’s legal name.
For example, if your registered company is an LLC and is named Three Brothers, LLC, you cannot operate that business lawfully in most states if you’re selling products under the trade name Three Tigers. That’s because the registered name, and your trade name, are different.
Fortunately, this is not a difficult problem to overcome. You can simply register your actual trade name with your state (and or local government) by filing a “doing business as” (DBA) certificate. DBAs are also commonly called “assumed name,” “fictitious business name,” or “trade name.” Here’s a terrific resource that explains what a DBA is, the DBA state requirements, and how to file a DBA for your business in all 50 states and U.S. territories.
2. Brand your Etsy shop
Your Etsy shop will be unique.
That’s because no other shop has you at the helm and sells your specific line of goods.
Your brand and brand identity should also be unique.
Now, you may find yourself thinking, “I’m just opening an Etsy shop. It’s a side hustle. I don’t need to worry about branding!”
But, your brand identity is the way your customers and potential customers will perceive your shop. That means you have a brand whether you choose to or not. And, you’ll be better served by making conscious branding choices instead of leaving it to chance.
Your brand identity’s importance cannot be understated – especially in the authenticity-driven world of Etsy.
Think you can get a perfect score?
Shoppers seek out Etsy for the personal connection they can forge with the shopkeepers there. Consumers can buy most necessities at Target, Amazon, or their local grocery store. But, Etsy is known for its special, one-of-a-kind goods with authentic backstories.
So, if you want to make sales, you’ve got to create a brand identity that communicates the essence of what your shop is about and builds confidence in your shop visitors.
So, before you post your first listing, ask yourself these important questions:
- What makes my merchandise unique?
- Who will want to buy my products?
- What can customers get from my Etsy shop that they can’t get anywhere else?
- What are my brand values?
- What is the most important part of my customer’s experience?
- What identity/personality do I want my Etsy shop to project?
Your answers to these questions (and others like them) will build the core of your shop’s brand. Your business name, your company logo, your shop banner or cover photo, and the items you list should all be informed by these core brand ideas.
Etsy Branding Basics
Your shop has three major branded elements that you should be aware of:
- your shop name
- your avatar (usually a logo)
- the shop banner or cover photo
These are the primary tools that you can use to communicate your brand in your Etsy shop. So, you’ll want to give them some real thought.
All business names should be brand-specific, memorable, and unique – this helps to set you apart from your competitors. But, Etsy adds a few additional requirements for shop names. Shop names can’t include spaces, punctuation, or more than 20 characters. And, each shop must have a unique name.
Luckily, these requirements will work for you! They’ll force you to think of a short, interesting name. Those are generally the easiest to remember.
Since punctuation and spaces are forbidden, use capitalization to ensure your name is understood. For example, “MyEtsyShop” is easier to read than “Myetsyshop.”
The shop avatar is where your logo should go (your personal photo should already be featured under your shop owner profile).
Your logo, like your shop name, should be directly informed by your business brand.
Whether your brand is high-end or casual will determine what sorts of imagery and fonts you choose. If your hand-made items are complex, consider a complex logo. Likewise, if your style is simple and minimalist, a simple and minimalist logo would be the better choice. You get the idea.
In addition to making sure your logo represents your brand, remember that Etsy provides a square field for your avatar. So, avoid long horizontal designs and choose a logo that will fit well inside a square.
For a great example, check out ClaraLoo’s logo above. It has a simple, child-like, rustic charm that perfectly reflects her playful and homey nursery decor. It’s also proportioned ideally to fit in the square avatar field.
Need help creating your best logo? Let crowdspring help! Our creatives are standing by to design a unique and memorable, custom-branded logo for your Etsy shop.
Shop Banner or Cover Photo:
The top of your Etsy shop is valuable real estate. This is where your banner or cover photo will go. This area sets the visual tone for your shop. And, when used effectively, it will memorably differentiate your shop from your competitors.
Etsy allows you to select a small banner (760px X 100px) or a larger cover photo (3360px X 840px) to fill that space.
Functionally, a cover photo has a distinct advantage over a small banner. Cover photos (as shown above) are visible when your shop is viewed both by computer and smartphone. Small banners only appear when your shop is viewed on a computer. For that reason, we recommend that you choose a cover photo over a banner.
Having a well-designed banner or cover photo is important. It makes your shop more attractive, yes. But, more importantly, it creates a professional impression and makes your shop seem trustworthy and credible.
Top Etsy shop ModParty uses their cover photo for advertising their shop name and showing off some truly excellent product photos.
A final word on branding…
Your shop name, avatar, and banner or cover photo are specific branding tools. But that’s not where branding ends in your Etsy shop.
Kevin Jones of Debt Free Happens (an Etsy entrepreneur, personal finance expert, and blogger) explains:
If you sell cute stickers it may not make sense to also sell customized beer mugs in the same shop. Both are great products but you are trying to create an environment that the buyer feels comfortable in.
Every item you post should reinforce your brand. Customers should feel that all of your listings belong in your shop. And every listing description you write should continue and underscore that feeling. This makes your customers feel like they understand you and what your shop is about. And that makes it feel like a safe, pleasant place to be.
Your bio and personal photo are also part of your brand. This personal information (and the voice you use to communicate it) create a deeper connection with your customers.
So, be thoughtful when deciding what items to list and what info to include in your bio. Use a consistent voice when writing your listing descriptions and writing any other customer-facing copy like your bio and store policies.
You can learn more about the nuts and bolts of establishing and maintaining a consistent brand identity in Grow Your Small Business with Consistent Branding.
3. Crunch the numbers
When starting any new business, it’s important to understand “the numbers.” You would typically discuss this in your business plan.
But you don’t need to write a formal business plan if you’re not seeking outside funding. You just need to assess what numbers are important when starting an Etsy business.
Etsy entrepreneurs will obviously want to track sales and profits; but, you’ll also need to keep an eye on your start-up costs. You should build these initial costs into your pricing to pay yourself back for your investment over time.
Luckily, start-up costs for Etsy businesses are minimal compared to virtually any other type of business.
Start-up costs for an Etsy shop are likely to include:
- your brand design (logo and banner/cover photo design)
- any license or permit fees (check with the SBA)
- basic infrastructural costs like internet service and Etsy listing fees (only $0.20 per listing!)
- any crafting tools you need to acquire to make products
- materials for your first products
Running smart calculations to determine how much it will truly cost to get your shop up and running will allow you to plan and avoid expensive surprises along the way.
Setting your prices
Setting the right prices can make or break your shop.
To create an effective pricing strategy, you have to start by knowing how much it costs you to produce or acquire your products.
This includes material costs and the value of your time. And, you’ve got to bake the cost of running your business (and some profit!) into your prices as well. Otherwise, it will be difficult to sustain your business over time.
Taylor Combs, a writer, and editor for Etsy’s Seller Handbook, explains;
First and foremost, your price should account for the cost of the materials that went into making the item and your time. If you’re unsure, try searching for similar items on Etsy to see what the average price point is.
Once you’ve done the math, it’s time to start considering the less-tangible aspects – competitor pricing and perceived value.
Your potential customers are shopping for more than just your goods. They’re shopping with your competitors, too.
And, they know how much those items cost. Consciously or not, they are gathering data about what they think a product like yours should cost.
That means you need to be aware of what your competitors are charging, too.
You might feel that your products are worth more or that you want to charge less than your competitors. And that’s okay.
But, if you’re completely unaware of what your competitors charge, you may miss the mark entirely – either costing you profit if you charge too little or sales if you charge too much.
Perceived value is the amount that a customer thinks a product is worth. And, your competitor’s prices are a part of that perception. But, not the whole picture.
How your products look plays a role. A cheaply-made necklace that looks fancy may have a higher perceived value than a beautifully made simple necklace. Most customers have no idea how much time, money or effort actually goes into making a particular item.
Your branding can influence how your product is perceived, as well.
A classy logo and high-end brand positioning will lead to a higher perceived value than an amateur logo and shop banner.
So, remember to consider your brand and your competitor’s pricing when creating your own pricing strategy.
For more pricing information, check out this guide from the helpful folks at Etsy.
4. Create your product listings
Your listings are the lifeblood of your Etsy shop.
Creating compelling listings can help your sales skyrocket – while lackluster listings will stagnate.
So, what does a compelling Etsy listing look like?
Well, the best and the worst Etsy listings all include the same three components – product titles, descriptions, and photographs. It’s how you execute them that makes the difference.
Master each of these three components, and you’ll have rock-star listings that leap into shopper’s carts.
Your listing titles identify your products to your potential customers.
Etsy’s Taylor Combs advises:
Think like a shopper and use words and phrases that buyers might use when searching for your item.
It helps to be descriptive. You could name a listing “Wool Blanket.” Or you could name that same listing “Hand-Braided 100% Merino Wool Blanket.”
Providing more information increases the likelihood that your listing will be found. For instance, shoppers searching for “merino wool blankets” and shoppers searching for “hand-braided blankets” are both likely to find the second listing.
And, the more descriptive your listing title is, the more the customer can learn about your product at a glance. You can showcase what makes your product special and why customers can’t live without it before they’ve even clicked through.
Use evocative, descriptive words to highlight your products’ best qualities, and your listing titles will shine.
Strong product photography is your best sales tool.
Shopping on the internet involves more uncertainty than shopping in person. In a store, you can handle and examine an item with your own two hands. Customers can’t touch the products they want to purchase on Etsy.
But great product photos help to allay some of that uncertainty. And, well-styled photos that showcase the product in a way that resonates with your target audience help shoppers to envision that item in their lives.
Taylor Combs recommends including five photos on every listing. She suggests that you take the following:
A well lit, clear photo of the item you plan to sell
A photo that shows alternate angles of the product so shoppers can make an informed purchase
A photo showing any unique details of the product. Try to answer any questions a shopper might have about texture, color or the techniques used.
A photo that shows the scale of the item. Styling a photo with other recognizable props or by having volunteer models hold it in their hands can help.
Take as many photos as needed to give your customers a complete understanding of the product. And, of course, show it off to its best advantage.
Take photos with natural light (instead of camera flash) – this makes a world of difference. Play around to find out what time of day yields the best lighting for you.
And remember that these pictures must appeal to your target customer. So, keep those customers in mind and style the photos accordingly.
But most importantly, make sure your products are the stars of the photos – simplicity is key.
For the full skinny on how to create the best product photos, check out Etsy’s “Ultimate Guide to Product Photography.”
Writing an awesome project description is the final step to creating a stellar listing.
This is your opportunity to tell the story of your product. Include all of the unique details that make your item special. If you made the product, be sure to talk briefly about your process.
Help your potential customers envision how the product might fit into and improve their lives. People make buying decisions with their hearts more often than their heads. So, paint an appealing picture, and you’ll attract better results than if you simply listed features.
Finally, take a look at the descriptions your top competitors write. Never plagiarize their carefully written copy. But you may get inspiration on what information to cover or formatting.
For even more great tips about writing awesome product descriptions, click here.
5. Fill in the business blanks
Starting an Etsy business is a really user-friendly way to start a business.
But, it is a business.
This means that you will need to follow the same legal requirements your state has defined for any other business.
First, you’ll need to choose a legal structure for your new Etsy business. We discussed these options previously in our article 15 Tips for Turning Your Craft Hobby Into a Successful Business:
A sole proprietorship is the “most basic type of business to establish” according to the SBA (Small Business Administration). You are the sole owner of the business; and, as such, are solely responsible for the assets and liabilities accrued by the business. This may be just the ticket for your brand new, baby crafting business as it is also the easiest to set up.
If you’re interested in a little more protection, an LLC (or Limited Liability Company) may be a better fit. The LLC business structure provides the limited liability features you would find in a corporation. The Small Business Administration has all of the details about these common small business structures and others.
To learn more about corporations, partnerships and other legal mistakes people commonly make when setting up a small business, take a look at our post and video: 10 Legal Mistakes That Can Destroy Your Small Business And How To Avoid Them.
After you choose your business structure, you’ll need to file any necessary paperwork. The U.S. Small Business Administration tells us that some form of license or permit is necessary for virtually every business type.
Their website has all of the info you need to find out what sort of license or permit you’ll need for your Etsy shop in your state.
For more details about legal considerations for your Etsy shop, read this article from legal compliance experts Wolters Kluwer.
And, be sure to get familiar with Etsy’s own legal policy for sellers.
Taking care of these admittedly unexciting but essential chores will ensure that you don’t get bitten in the backside later.
6. Make a stocking strategy
Opening a shop is a great first step.
But, if you hope to run a successful business, you need to plan for what comes after you open.
Maintaining your shop properly is key to your success. And, well-stocked shops perform best.
So, Etsy hobbyists may get away with stocking their shops as they find items or when they feel like it; but, Etsy entrepreneurs need to be more proactive. Plan now to ensure you’re not overwhelmed later.
Etsy allows three different types of shops: hand-made goods, vintage items, and crafting supplies. Each of these three categories will have different requirements for maintaining your stock.
Depending on how prolific a crafter you are, you may already have a substantial stock of crafting supplies if that’s the case – good on you! You’re set for a while.
If you’re not already sitting on a large stockpile of craft supplies you can sell, you may want to develop buying relationships with wholesalers to increase your profit margin on the items you sell.
But, you will need to jump through a few minor hoops before you can do so. You’ll need an EIN, a tax license, and a registered business name. Check out this article from Chron to learn all the details if wholesale purchasing seems like the right fit for you.
If you’ve chosen to sell vintage goods, you probably already have a collection of vintage items just waiting to be sold. And, that’s great – but what happens after this stock runs out?
That’s right! Shopping! And, while that may sound fun now, shopping for stock can be hard work. And, it means that you need cash upfront to invest.
You may benefit from setting a regular shopping schedule to keep you on track. You should acquire new items consistently – an empty shop is bad for business. And, finding quality vintage items can be hit and miss. Shopping regularly will ensure that you don’t find yourself in a merchandise drought.
Planning a regular shopping schedule also allows you to plan your purchase expenses over time, ensuring you can cover the investment.
If you plan to make the items you sell, you have a lot to think about.
- Will all of your items be made one-of-a-kind?
- Or will you offer products that you can create an assembly-line style?
- Will you sell downloadable digital goods (like prints or crafting patterns)?
- Or will you hand-craft physical items?
- Will you offer customized items on request?
Bear in mind that one-of-a-kind hand-crafted items may bring you joy to make, but they’ll also be the most challenging to keep stocked. Supplement these more time-intensive items with staple products that are quick and easy to make.
You can also build out your shop with custom listings that are made on request. Custom listings are great because you know you’ll be paid for the item, and you don’t have to invest the time and effort until the order actually comes in.
It’s a good idea to set production goals for yourself – like making X items per week to keep your shop well-stocked. What is a realistic production goal for you?
Whatever type of shop you plan to run, don’t leave your success to chance. Planning for how you’ll stay stocked will increase your odds for success.
7. Plan for shipping
Shipping is part and parcel (ha!) to running an Etsy business.
Don’t wait until you’ve made your first sale to figure out how you’re going to fulfill the customer’s order. People have come to expect speedy shipping and top-notch communication. So plan to figure out your shipping logistics so you don’t ever keep customers waiting.
Luckily, Etsy knows that shipping is important, and they’ve got a system in place to help their vendors ship more easily. You can print shipping labels, calculate shipping charges, and track packages right from your Etsy shop. You can sign up here.
But, you need to think beyond just the logistics. Etsy shoppers are looking for a personalized shopping experience. And, how their item is packaged is an important part of that experience.
Consider including a short personal note. Think about what materials you’ll use to both protect the item in transit and create a beautiful unboxing experience.
Will you include coupons or a small gift?
Whatever you choose, be true to you and your shop’s brand.
8. Spread the Word
Opening an Etsy shop does not necessarily equate to immediate sales and success. It takes time to build a presence and a customer base. But, there are certain steps you can take to help your shop grow faster!
As you’re first starting, look to your friends and family to make your first sales.
Online shoppers everywhere rely on positive reviews to feel safe about making a purchase. But, your brand spanking new Etsy shop has no reviews yet.
So, reach out to friends and family – they’ll want to support your endeavor. Encourage them to make a purchase or two and leave a positive, honest review. It also never hurts to ask them to talk up your shop to their friends!
Those reviews and sales will “seed” your shop for future sales.
You may also want to initiate a refer-a-friend campaign. All types of businesses strive for strong word-of-mouth marketing. You can encourage this by providing small printed discount coupons.
Indicate on the coupon that it’s for a friend and is only good for their first purchase. Then place these coupons in all of the packages you ship. And, to sweeten the deal – offer the original customer a discount on their next order if their friend makes a purchase.
SEO stands for search engine optimization. In a nutshell, this means setting up your shop and listings to make it easy to find on the web.
SEO is too big a topic to do justice here. But here are a few tips to get you started…
- Utilize tags in your Etsy listings. Tags allow you to “tag” a listing with certain keywords to make it easier for shoppers to find.
- Use popular keywords in your listing title and product descriptions.
- Use Etsy categories to make your items easier to find.
And, for oodles more information about Etsy Search and SEO, check out these articles.
As a new, up-and-coming business owner, you’ll also want to take full advantage of the inexpensive and easy exposure that social media marketing offers you. As we previously explained,
Social media gives you the ability to easily keep customers up-to-date on new products, store policies or sales. It also enables you to build a social rapport with current customers, while building low-pressure relationships with future buyers.
Maintaining (at a minimum) a Twitter and Facebook presence will help you build an audience of devotees.
Make it easy for visitors to see what your shop is all about by featuring those fabulous photos of your products in a Facebook album.
Social media is also the perfect platform to help future customers get to know you and your shop.
One major reason customers buy from Etsy instead of a major retailer is that they connect to that business’s story. So, use your Facebook and Twitter to share that story – for free!
9. Build a web presence outside of Etsy
You have an Etsy shop. So a website would be redundant, right?
While you obviously don’t need a website to open an Etsy shop, it’s an excellent tool for helping your business grow. Here’s why.
A website gives any business more credibility. In our digital culture, people expect businesses to have a website.
As we explained previously:
A recent study shows that 97% of consumers research their purchases online before they buy something.
Now, shoppers certainly aren’t consciously seeking out Etsy vendors who also have a website. But almost anyone can open an Etsy shop. And if a customer is trying to decide between two similar Etsy shops and one has a professionally designed website while the other does not…
Well, I know who I’d buy from. And it’s not the shop with no website.
Besides adding credibility, a stand-alone website also serves as another touch-point for customers to find your goods. It increases the chances of finding customers who don’t already shop on Etsy – widening your potential customer pool.
A simple, well-executed website is enough to accomplish all of these benefits. You don’t even need to have e-commerce capabilities on your website – simply link customers directly to your Etsy shop.
Follow these guidelines to get the most from your website:
Start by ensuring that your website design is a clear extension of the brand you’ve established in your Etsy shop. Visitors should be able to recognize that it’s the same business immediately.
Create consistency by…
- Prominently featuring your Etsy shop logo and name
- Using the same brand colors from your logo and Etsy banner on your website
- Sharing all of your product photos on your website with the same listing descriptions
- Match the same authentic writing voice on the website copy that you use in your Etsy shop
- Include an “About” section that shares the story you’ve shared on Etsy
- Link customers to your Etsy store to make purchases
Finally, a strong website design will lend credibility and legitimacy to your business. To learn more about great website design, check out Grow Your Small Business With These 7 Website Design Best Practices and 10 biggest web design trends for 2021.
You made it!
If you’ve followed all of the advice in this article, then you are well on your way to a successful Etsy business.
But, you may still have questions. In fact, you probably do. And that’s okay.
Etsy is one of the most supportive online communities in the world. You can seek out help from your peers on the Etsy Forums. Etsy even has a deeply informative Seller Handbook with articles covering every topic you could need to know about. So, you’re never alone.
You’ve got this. Keep listing and keep learning – and before long, your Etsy business will be thriving.
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We regularly update this guide to keep it current. It was most recently updated on April 7, 2021.
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