Hi, this is Anne with Graphic Design How-To, and today I'm going to go over all the fees
that you'll be charged if you're selling digital items on Etsy. Now, I also have another video
about fees if you have a physical shop and you're actually shipping things to people,
and if you want to see that video, it's right up here at the top of your screen above.
One thing that's changed since I made that video is that the 5% transaction fee is
now 6.5%. I also want to say that if you're already in an Etsy shop for the first time,
there's a link in the description below that you can get 40 free listings, and when you use that,
I also get 40 free listings. So it's definitely a win-win situation.
Alright, let's get started.
Okay, so generally speaking, for most of us, and it really depends on where you live,
Etsy charges number one, a listing fee of 20 cents. Now this one is the most confusing of
all the fees, in my opinion. So I'm going to talk a lot more about this at the end of
the video. But long story short, you have to pay this fee at the time the item is listed,
whether it sells or not. And if you're wondering about multiple quantities and how that works with
listing fees, that will also be towards the end of the video, and I also have a video specific
to that, and that'll be in the description below if you want to take a look at it.
The second fee is a transaction fee, and this one only happens if you sell something. It's 6.5% of
the cost that the customer paid. So if you have a sale going on, or let's say it's half off, you'll
only get charged 6.5% of what the customer paid in total, not the price before the sale and coupon.
The third fee is the Etsy payments fee or processing fee. This fee comes from using
Etsy’s payment system, which is called Etsy Payments. If you're in the list of countries
that accepts Etsy Payments, you have to have Etsy Payments as an option in your shop. If
you're not on that list, there are other payment options that are available for you,
and you won't have to pay the Etsy Payments fee. In the US, the fee for using Etsy Payments
is 25 cents plus 3%, and that percentage is also based on what your buyer paid.
The fourth fee is sales tax or VAT. Now, this is something that's collected by Etsy,
the buyer pays it, and then Etsy will send it off to whatever government needs it. You don't even
have to worry about it. So it won't come out of your income, and for that reason, I'm not going
to show it in these examples. But we'll look at how it works towards the end of the video too.
Now, if you want to see all the fees for every transaction that your shop has had, you can do
that by downloading your monthly statement, and I'll show you how to do that later too.
Okay, so let's look at a couple of examples. Let's say that I live in the USA, so I've got
Etsy Payments, and I want to sell some clip art. I'm going to fill out my listing, so I'll add
photos, fill out all the information for my listing, and I'll do a quantity of 100. Now,
you can put this up to 999 or something like that, but I always just do 100. So then once
I hit this Publish button, I'll be charged 20 cents, that's the listing fee. Then let's say
after a few days someone buys this. So here's the fee breakdown. Now I'm including that listing fee,
even though we already paid it, because I want to show all the fees for that listing.
So here is everything: we have our listing fee of 20 cents, we have our transaction fee,
which is 6.5% of what the customer paid, which was $2.75. So that is 18 cents, then we have our
Etsy payments fee of 3% of the price the customer pays is $2.75, and then we add 25 cents to that,
and that will give us 33 cents. After all is said and done, I will get $2.04 out of the $2.75,
and Etsy gets the rest. That's 26% in fees, but that is because it's a lower-priced item. So the
listing fee and Etsy payments fee really eat up a lot of that price. But this is a digital item,
so once you've created it, there's no more work involved, no shipping or anything, and this can
sell hundreds or thousands of times. Now, a good workaround to get that percentage down,
if you don't like paying 26% in fees, is to list bundles of designs at a higher price. Now,
because I set the quantity at 100, this listing will renew automatically until it
sells out. Let's say someone buys this. At that point, our quantity would become 99, and we get
charged another 20 cent listing fee. So let's say someone else buys another one, the amounts
will still be the same, but our quantity will go down to 98, and we'll pay another listing fee.
So I'm just trying to show how that listing fee works on quantities a little bit.
Okay, so let's look at another item. This one is a bundle of 10 clipart designs for $15.75. So here
are all the fees for that: we have our listing fee of 20 cents, the transaction fee which is 6.5%
times what the customer paid in this case which was $15.75. So that equals $1.02. Then we have the
Etsy payments fee which is 3% of what the customer paid which is $15.75 plus 25 cents. So that equals
72 cents. So after all is said and done, we end up with $13.81 out of the $15.75 sale price,
and Etsy gets the rest. So this is a much better deal for us, the fees are only 12% instead of 26%.
So it's definitely in your best interest to make bundles of clipart or whatever you're selling.
In addition to your single clipart items, taxes and VAT are not included here. But long story
short, as I mentioned, Etsy collects those for you, they charge that to the customer,
Etsy takes it, and you don't ever see it. So it doesn't really involve the buyer at all. Another
thing to mention about the listing fee: the listing fee is charged at the moment you list the
item. So if you use my link for 40 free listings, you won't be charged the fee for those, of course.
But let's say you have 50 listings and you paid, say, 20 cents each time you listed them. So at
that point, you owe Etsy $10. Now if you make a sale while you have an outstanding balance like
that, the net sale amount will be applied to your outstanding balance. If you don't sell anything,
you will have to pay that outstanding balance manually by a credit card, debit card or PayPal.
If you're wondering about multiple quantities, I get tons of questions about these, so I'm going
to do my best to explain them. Now, I mentioned that when you list an item, you're automatically
charged 20 cents. This is before anybody buys it. The 20 cent fee is good for four months,
or until someone buys it. Now since you have digital items, you can put your quantities however
high you want. So let's say you list an item like a resume template or something like that,
and you decide to put the quantity at 100. So you're thinking, “Oh my gosh,
am I going to get charged 20 cents times 100 right now?” The answer is no. So if you sell
the first one you list, which you paid 20 cents for, the next one will be automatically relisted
and you'll get charged another 20 cents at that point. You only get charged that 20 cents on the
next item that is listed after the one before it sold. So if you sell all 100 of that item,
then yes, you will have spent 20 cents times 100, so $20...because when it's relisted,
Etsy does see it as a new item. But if you don't ever sell any of them, you will only pay that 20
cents once, or if you sell five, you'll pay it five times. So hopefully that makes sense. Now,
if that listing with 100 quantity sits there for four months and no one buys it, it will expire
and you'll only have paid that original 20 cents, you know, four months ago when you first listed
it. Now, if you want to relist it after the four months, Etsy is going to want another 20 cents.
So the 20-cent listing fee is good for four months or until it sells. You can also set your listings
to just automatically relist when they expire if you want to do that. Now, if you've sold something
and your fees are still confusing you, go to your Shop Manager > Finances > Monthly statements and
then choose 'Generate CSV' right here. It might take some time, but eventually, you can download
it. When you open it, you'll be able to see the fees listed out separately. So let's look at an
example, and yours should look really similar to this. You'll have your listing fee, and that's 20
cents, your transaction fee, this will be the 6.5 percent on what the customer paid, and then you'll
have the processing fee, or the Etsy Payments fee. You'll also see sales tax or VAT here, but that's
not something you really need to worry about. And if you're still confused about anything, please
leave a comment in the comment section below. Alright, if you like this video and you want to
see more videos like this, just hit the Subscribe button and the little bell next to it. You'll be
notified every time a new video comes out. All right, I'll see you in the next video. Thank you!!