This article will cover some of the issues and questions that Etsy sellers may face as they set up their shop to help you decide if you want to step down the crafting road.
Can You Earn a Livable Wage on Etsy?
The average American household income is roughly $60,000, but a wage you consider could be much lower (or much higher than that. To understand what it will take for you to primarily live on earnings from your Etsy shop, you need to first determine how much you need to live. Look at your monthly expenses and create a budget. Once you have a number in mind, turn your attention to your product.
What do you plan to sell on Etsy? What will your net profit per item be? Remember to subtract the cost of materials, equipment, transaction fees, and other related expenses. Will your item sell? Is it priced appropriately?
When you have finally priced your item, find out how many units you’ll need to sell in order to meet your budget. To illustrate this, let’s pretend that you’ve determined you need $2,500 per month. You have decided to price each of your items at $30 and after subtracting expenses, you will net $17.50 per unit. You will need to sell 143 items per day in order to meet your budget. If you work 20 days in a month, you’ll need to produce 7-8 items a day that will successfully sell.
If each item takes you an hour to create, you’re already working a 40-hour week, and that doesn’t include photographing the items, SEO research, marketing, and other tasks that go into your business.
What is Your Overall Goal?
If you don’t necessarily want to earn a living on Etsy, it is far easier to supplement your hobby and earn enough to “repurchase” your craft items. The downside to this is that it will be more difficult to charge more in the future should you change your mind.
Competition on Etsy
The other thing you must consider is the competition around you. While there are many people who search Etsy for handmade gifts on a daily basis, there are millions of shops that are also marketing to the same crowd. Etsy doesn’t do anything “special” to help certain people get noticed, and those who have had several successful sales and reviews may get more traffic.
While you shouldn’t be discouraged from following your dream, you should keep in mind the risks of the business. Though many people have been able to build their businesses on Etsy, many more have made less than $100 per year.
Funnel Social Followers to Etsy
One of the best ways to reach people for your Etsy shop is outside of Etsy. Use your Pinterest or Instagram account to attract new potential buyers and funnel them into your store. While you will still need to grow your social media following (and possibly pay to promote posts for better results), you can reach people who might not otherwise see your products.
An added benefit of building your external social media is that you can redirect your traffic to your own site when and if you choose to leave Etsy without having to start over from scratch.
Are Etsy Ads Worth It?
The nice thing about Etsy ads is that the people who see your ads are already looking for a similar product. If done correctly, your ads can potentially earn you more clicks, likes, and sales. When you are first beginning, keep your ad campaign small so that you can gauge how it works and make necessary adjustments to improve its success.
The following video is created by a man named Dave, who has run an Etsy shop and has also reviewed several Etsy stores on his own. This is the first of a three-part video series about strategies concerning Etsy ads.