Search
  1. Home
  2. Business Finance
  3. How to Open an Etsy Shop in 8 Steps: Etsy Fees and More
Published 05 September 2023
Reading Time
13 minutes

How to Open an Etsy Shop in 8 Steps: Etsy Fees and More

Create an Etsy account, list your first products, connect your payment methods and open your shop for customers.

Etsy is an online marketplace for handmade goods and artwork. Opening an Etsy shop is free and relatively easy, and it can provide a home for your products — however niche — without having to build your own e-commerce website. 

Here’s how to start an Etsy shop in eight steps, plus information on Etsy seller fees and tips for success on the platform.

1. Create an Etsy account

You can set up an account with Etsy by visiting etsy.com/uk/sell, then selecting ‘Open your Etsy shop’. You can create an account with your email address or an existing Google, Facebook or Apple account.

If you’ve shopped on Etsy before and have an existing account, you can log in with your credentials and then select ‘Open Your Etsy Shop’ to start creating your own store.

2. Set your shop preferences

Next, you’ll be asked some simple questions, such as why you’re exploring Etsy and if there is anything specific, such as branding, that you need help with. You have the option to skip these questions if you would prefer not to answer.

Then, you’ll be directed to the ‘shop preferences’ screen, where you’ll designate the basic settings for your store — your default language, the country you’re based in and what currency you plan to use.

If you list products using a different currency than the one in your Etsy Payments account, you’ll have to pay a 2.5% currency conversion fee on each sale.

3. Name your Etsy shop

Here’s where you can start to get creative: coming up with your Etsy shop name. Your store name can be anything you’d like, as long as it falls within Etsy’s guidelines that say it should:

  • be four to 20 characters long
  • have no spaces, special characters or accented letters
  • not have a name that’s already in use by another Etsy seller
  • not have trademark infringements
  • contain no profanities

You can change your shop name as many times as you like before it’s open. And you can still rename it once your shop is open. While this will change your URL, web traffic will be automatically redirected to your new name. Etsy will display an icon next to your shop name on your pages to show that the name has changed. 

If you try to enter a name that’s already in use, Etsy will suggest some similar names that are available:

To get the ball rolling, consider the following name suggestions:

  • Try suggestive, descriptive names: You can use words or phrases that evoke the feeling of your brand or describe what you’re selling. 
  • Try abstract names: Abstract names can set your store apart and make it easier for customers to find your store when searching online. 
  • Use your name: Your own name can be a quick and simple option — and allows you to easily change or adapt the products you sell. Consider adding a modifier, such as ‘Studio’ or ‘Workshop’. 

If you think you might eventually expand your online business, do some additional research to ensure that you can acquire a business domain (the web address of your trading name) that matches your shop’s name.

4. Add items to your shop

Listing physical and digital items (think printable stationery, patterns, stickers or gift tags) in your Etsy shop involves separate processes. We’ll show you the basics of how to list a tangible item; you can consult Etsy’s guide if you’re listing a digital item.

Add photos and videos

You can include multiple product photos and a description per item. Etsy recommends shooting in natural light, showing items in use and including other objects to show scale.

You can also include one video lasting five to 15 seconds, but without any sound.

Complete your listing details

Give your item a title that describes the product in as much detail as possible, but keep in mind there’s a 140-character limit. You’ll also have the opportunity to provide an in-depth description, a bulleted overview of the product, and additional details, such as the product’s category and type.

As you start to fill in product details, Etsy will prompt you for additional information specific to that type of product — such as whether a piece of art comes framed, whether it’s designed for a certain holiday or occasion, or whether it belongs in a particular room in the home.

Pay attention to the section called ‘renewal options’. If you select ‘Automatic’, your listing will automatically renew after it expires every four months. Each time the listing renews, you’ll be charged a 20-cent fee (converted into your currency).

If someone else helps you produce your goods, you may need to add information about them too. Etsy defines these ‘production partners’ as any person who is not part of your shop’s staff or any outside company that helps produce your goods. This might mean they have some skills or equipment you don’t have or that you’re contracting out some work in order to keep up with orders.

Finally, take advantage of all 13 tags available per item. Shoppers find your item by searching for keywords in the search bar, so work backward and think about what a customer might type into search to discover your item and use those words as your tags.

Complete your inventory and pricing

In this section, you’ll enter your product’s price, VAT (if applicable), quantity and Stock Keeping Unit (SKU) number (if you have one). These are used to keep track of inventory, so you can add a product’s SKU number to the listing to help with organisation, but it won’t be visible to anyone else. 

You can also add variations — such as sizes, materials and colours — and link photos to those variations.

Don’t under-sell yourself; price your products so that you can cover your material, labour and production costs, plus Etsy’s fees. But keep in mind that one of Etsy’s major draws is the prospect of buying unique items at prices that won’t break the bank. Try to strike a balance between the two.

Set your delivery prices

Here, you’ll include all the details needed for delivery services, such as Royal Mail and Evri, including costs, country of origin and processing time.

Both Royal Mail and Evri offer a range of methods for delivering products within the UK and internationally. For international deliveries using Royal Mail, including from the UK to any country within the EU, you’ll be provided with the necessary customs forms. Items sent without these forms may be delayed or returned. If using Evri for EU deliveries, you won’t need to fill out any additional documentation, as it is only required if you’re posting something from the UK to a country outside the EU.

Create your return and exchange policy

Etsy offers sellers a returns and exchanges policy in line with the UK’s distance selling laws, in which buyers have the right to return certain products for any reason by contacting the seller within 14 days, starting from the moment a customer receives the product (not when they purchase it). There are some exceptions to this rule, including custom-made or perishable goods, digital products and items that can’t be reused for health or hygiene reasons.

Publish your listing

You can preview your listing to see how it’ll look to customers before it goes live.

5. Choose your payment preferences

Once you’ve added an item to your store, you’ll need to set up your Etsy payment preferences.

Etsy requires sellers to offer Etsy Payments in their shops, which allows you to accept credit cards, debit cards, Apple and Google Pay, Etsy gift cards and, in some cases, Klarna. There will be a payment processing fee for this.

You can also use PayPal – Etsy recommends that sellers use its integrated PayPal account for payments to go into your account, but you can choose to be paid into your own PayPal account.

Etsy Payments charges a payment processing fee of 4% plus 20p per transaction in the UK.

6. Set up billing

You’ll need a credit or debit card on file so that Etsy can charge you selling fees. This cannot be a non-reloadable prepaid debit card.

Even if you’re starting an Etsy shop as a side hustle, strive to keep your business and personal finances separate. The easiest way to adopt this best practice is to open a business bank account dedicated to your Etsy store’s revenue and expenses.

Etsy fees for sellers

Like most e-commerce websites, Etsy charges its merchants fees associated with listing and selling products. Although joining and starting an Etsy shop is free — unless you opt for a paid subscription plan — you’ll need to pay listing and transaction fees for each item you sell, converted into Sterling. Bear in mind that, depending on your situation, you may also be charged VAT on these fees. For further information on how VAT is applied, visit Etsy’s website. 

If you’re using Etsy Payments, these fees will be deducted automatically from your sales funds. If you still owe additional fees at the end of the month, Etsy will automatically charge the credit card you have on file, or you’ll have to make payments yourself. Here are the fees that Etsy charges:

Etsy listing fees

Etsy charges 16p (depending on currency fluctuations) per listing at the time each item is listed.

You have to pay this Etsy fee for each product, regardless of whether or not the product sells. Listings expire after four months; if you want to keep them active for an additional four months, you’ll have to pay the fee again.

Etsy transaction fees

Etsy charges 6.5% of the total order amount, including shipping and gift wrapping costs.

Etsy payment processing fees

Etsy charges 4% + 20p per transaction in payment processing fees.

Additional Etsy seller fees

Etsy may also charge other fees, including:

  • Delivery fees: If you deliver with Royal Mail or Evri you can buy and print your shipping labels directly through Etsy. Delivery label fees vary for each purchase.
  • Square fees: If you sell items from your Etsy store in person using Square POS and don’t sync them with your Etsy shop inventory, Etsy will charge a 16p fee. 
  • Etsy ads: If you purchase paid adverts from Etsy, fees will vary but you can set your daily maximum spend.
  • Offsite ads: You’ll be charged 5% or 12% of any order made if Etsy offers an offsite ad for your listing. The fee you pay will depend on how much revenue your shop generated the previous year, up to a maximum of $100 per single order (converted to your local currency).

7. Open your Etsy shop

Once you click ‘Open Your Shop’, your store will be live. Etsy shoppers will be able to see and purchase your listings.

The URL for your shop will be in one of two formats:

  • www.etsy.com/shop/shopname
  • shopname.etsy.com

8. Customise your shop

Now that you’ve actually opened your Etsy shop, it’s time to start selling online. Just like a bricks-and-mortar store, your digital store should be easy to find, well curated, intuitively organised and regularly updated.

Here are a few sections you can fill out to ensure that your Etsy shop opens (and runs) successfully:

Add a personal bio and photo

Your public profile is how visitors to the site can learn more about you, both as a business owner and as a person outside of your work.

Add images

You can add four different images to customise your Etsy shop:

  • A shop banner, which appears at the top of your shop on desktop and mobile.
  • An order receipt banner, which shows up at the top of customers’ receipts.
  • A shop icon, which is a small image that conveys your shop’s brand.
  • A shop owner photo, which is a photo of you that appears in your Etsy Conversations threads.

Rearrange your items

Feel free to move your items around on the page. You can also ‘feature’ up to four items, which will show up high on your shop’s homepage.

Add sections

Group your items into up to 20 categories so that buyers can more easily sift through your products. Sections will appear on the left side of your homepage and include the number of products within each category.

Add your shop’s ‘about’ section

Just like your personal ‘about’ section, your store deserves its own bio, too. You have 5,000 characters to tell customers your business’s origin story. Keep in mind that Etsy (and customers) value transparency and openness, so don’t worry too much about writing traditional marketing copy — just be genuine.

You can also provide photos or a video of your studio space or creative process and add links to your store’s social media profiles.

And you have to list anyone you employ to help you make and sell products.

Add a shop announcement

This text appears on your shop’s homepage, under your listings. It should broadly summarise what your shop is about and include any time-sensitive information, such as whether you’re on leave or vacation and when you’ll return.

A version of this article initially appeared on Fundera, a subsidiary of NerdWallet.

Frequently asked questions

How much does it cost to set up an Etsy shop?

While it’s free to create your Etsy shop, Etsy charges UK sellers 16p per listing and 6.5% per transaction. You’ll also pay 4% plus 20p per transaction in payment processing fees.You may also need to pay VAT on certain sellers’ fees, depending on your situation.

How do Etsy sellers get paid?

You’ll most likely have to process your customers’ online payments through Etsy Payments. Customers can use credit or debit cards, Apple or Google Pay, Klarna, Etsy gift cards, store credit and more. If you opened your shop before 26 April 2021, you can also accept payments through your PayPal account. Etsy recommends that shops opened after this date use Etsy payments, which has a PayPal integration.

Etsy Payments takes a payment processing fee of 4% plus 20p per transaction in addition to Etsy’s transaction fee of 6.5%.

Who pays for delivery on Etsy?

Sellers are responsible for the delivery of sold items to buyers. If you’re using a delivery service, the seller is still ultimately responsible for getting the items to the buyer. However, you can pass the cost of delivery on to your customers.

How long does it take to get paid by Etsy?

New sellers receive deposits weekly, as long as you don’t owe more in Etsy fees than you’ve made in sales.

Image source: Getty Images

Dive even deeper

8 Steps to Writing a Checklist for Your New Business

8 Steps to Writing a Checklist for Your New Business

Whether you’re setting up a small business or just planning a side hustle, writing a checklist can help turn your business dream into a reality. In this guide, you can download NerdWallet’s new business checklist to help kickstart your business planning. Good luck with your new venture!

Credit Card Processing Fees 2024

Credit Card Processing Fees 2024

When your business is taking card payments, you’ll need to pay card processing fees. Find out more about what they are, the different types of fees you’ll have to pay and whether you can pass on any of them to your customers.

How to Open a Merchant Account

How to Open a Merchant Account

Once you’ve launched your business, you’ll need to open a merchant account to be able to take card payments. We explain what’s involved, where you can get this type of account, and what documents you’ll need to provide.

Back To Top