Since its launch in 2005 Etsy has emerged as the premier website for crafters to sell their products online. In 2010, only five years after its launch, dealers on Etsy made upwards of $300 million in sales. As of the writing of this article, Etsy is ranked the 164th most popular website in the whole world. The Etsy website certainly boasts some impressive statistics, but not everyone involved makes a fortune.
While there certainly are craft entrepreneurs who make a living through their Etsy shops, there are also those that never even turn a profit. If you decide to open up your dream crafts store, or you have one already, I want you to have the information that it takes to turn a nice profit.
The first step in deciding whether to open up an Etsy shop, is deciding how much money you need to make from the shop in order for it to be worth your while. If you just want to sell a few things online for fun that your goals will obviously be much less formidable than if you want to do something like, oh, supporting a family.
Once you know how much money you need to make in profit in order for this venture to be worthwhile, you should consider what’s called your “profit margin.”
Understanding your Profit Margin
If you are able to sell hand knit teddy bears for $10 per bear, and it costs you $5 per bear on things like raw materials, that would give you a profit margin of $5 per bear. In order to make $1000 from teddy bear sales, for instance, you would need to knit and sell 200 bears. Now you can see why most of the people that make real money from Etsy run shops that sell jewelry.
By the way, if you didn’t understand that last paragraph, go back and read it again- it’s critical.
The following are a few pieces of advice for setting up a successful business on Etsy, but they are also useful for setting up shop anywhere else on the internet too.
Showcase Products Well
Make the products come alive with great pictures and great descriptions. Your potential customers are not able to pick up the items that you will have for sale. While that can be a big negative for being able to sell your goods, you can also turn it into a positive. By presenting your products in as fantastic a way as possible you can give your potential customers an overwhelming desire to see and touch the products, and if you can do that they will buy.
Develop a Cool Brand
If your store comes across as the place to be, and you come across as a totally cool person, you can have buyers flocking to your site. This is a process called “branding,” have fun with it, and if you get it right people will be willing to pay more for your products just because your name is on them. If you don’t believe me just check out how much more it costs to buy name brand soft-drinks than the generic brands that have the exact same ingredients.
Specify Your Listing
The way that you list products effects the way that Etsy will present them. Giving a specific description will provide you with a lot more targeted traffic.
Market Your Store
Get the word out about your store through paid advertising, starting a blog, or social media marketing.
Having an Etsy store can be a lot of fun socially and monetarily. If you decide to do it, be patient and keep passionate about it. Oh, and if you have a day job, don’t quit just yet, until you actually see your Etsy shop take off.
About the Author: Rachel Walker is a FastUpFront Blog contributor and business consultant. Fastupfront offers business loans and working capital solutions based on future sales.