Updated on 12.18.14

How to Make Money Selling Crafts on Etsy

Jon Gorey
visible mending

Whether you can sew a handbag, make a picture frame, or just have an eye for vintage style, there’s a niche for you on Etsy, the eBay of handmade and vintage goods. Photo: Katrina Rodabaugh

Have you ever knitted a scarf, made jewelry, or sewn clothes for your kids? Can you build a bench, take intriguing photos, or make a picture frame from scrap wood? Or do you have a good eye for vintage styles and know where to find them at a bargain?

If you’re at all crafty, chances are you’ve used Etsy.com, the online craft marketplace — sometimes called the eBay of handmade goods. And if you’re any good at your craft, you might be able to earn some extra money from your hobby — by opening your own Etsy shop.

“I would definitely recommend Etsy to those wanting to bring in a little extra money,” says Tori James, a mother of three who makes handbags and clutches to sell in her shop Toriska.

Tori started her Etsy shop when her second child was a baby, and says the flexibility it affords is a key requirement at this point in her life. “For me, this job really is perfect. It brings in a supplementary income and fulfills my creative urges.”

Mixing Art and Business

While opening an Etsy shop is a proven way for crafters to make extra money — in fact, cities like New York have begun offering free workshops for artisans looking to start Etsy microbusinesses — it’s still best if you truly enjoy what you’re doing, because you may not make a bunch of money at first. Or ever.

“As an artist, I think it’s always first for the love of the work and second for the financial compensation. Meaning, most artists I know didn’t get into this work because it’s financially sustainable,” says Katrina Rodabaugh, whose craft-inspired first book, “The Paper Playhouse: Awesome Art Projects for Kids Using Paper, Boxes, and Books,” will be published in January.

According to a 2013 survey (.pdf file) of 94,000 Etsy sellers, 81% said they opened their shops as a creative outlet, while 68% cited supplemental income as a motivating factor.

“They started because they love it, and then they figured out how to make money from doing what they love,” Katrina adds.

But make no mistake — selling handmade items on Etsy is a business, and a big one at that. The site hosts hundreds of thousands of shops, and Etsy claims those sellers collectively made $850 million in sales in 2013.

Successful sellers learn to balance the creative side of the process with bookkeeping, buying supplies, customer service, and marketing.

“It’s definitely a different endeavor than I originally thought,” says Tori James. “I didn’t anticipate that I would become an amateur product photographer, graphic design artist, advertiser, bookkeeper, and many other things.”

Tess, owner of Boston-based Gilded Notes, agrees the Etsy experience is a crash course in business. “I learned so much from selling on Etsy, from how to maintain inventory, to customer service skills, to sourcing materials, and how to promote myself and my business,” she says.

What to Sell?

Etsy has grown — a lot — in the past few years, and its sprawl can be daunting to beginners. And to be truthful, you may have a hard time standing out if you’re selling the same thing as everyone else. Don’t let the artistic sensibility fool you — it’s still a competitive marketplace.

So what should you sell? For starters, consider what you’re best at, or what you enjoy making. What about that fun embroidered hat you made that everyone raves about, or the stylish-but-practical coin purse you gave your friend?

Sometimes, the right product just makes itself known. Tess from Gilded Notes found success selling jewelry that incorporates sheet music — but that wasn’t her first intention.

“The sheet-music jewelry was actually born from my decoupage work, where I was left with all these little scraps of sheet music that I didn’t want to waste,” Tess says. “I began incorporating them into jewelry, and soon that overtook the decoupage.”

Another option is to resell vintage items. If you have a tasteful eye for trends and enjoy spending weekends at flea markets, yard sales, and thrift shops, you could consider buying underpriced retro items and reselling them on Etsy or elsewhere. If you’re handy enough to restore a vintage piece to its former glory, all the better.

The most successful sellers offer something unique: They either put a new spin on a classic product, come up with an entirely new look or idea, or simply sell in a more customer-friendly way than others — with lower prices, a wider selection, or more striking photography, for instance.

However, even if you’re not the next Martha Stewart, you can still build a successful shop if you have a large social network. List your best items and, when you’re ready, send your shop’s link to friends, family, and co-workers. They’ll be happy to learn they know an actual artisan and may enjoy buying your work as gifts. That patronage may not be sustainable, but it can give your shop a valuable kickstart and some helpful positive feedback.

Setting Up Shop

Once you have an idea of what you can sell, here’s what you’ll need to get started:

Name your shop. Choose something that’s descriptive of your style or product, easy to remember and to spell — and not already taken.

Design a banner. Your banner is the virtual front door of your shop, so you want it to look inviting and provide a visual cue to what’s inside. You can start with something simple, but if you have a graphic designer friend, now may be the time to call in a small favor.

Choose a profile picture. Etsy shoppers are on the site because they want to buy something unique from an individual person — not a generic plastic gizmo from Amazon or Wal-Mart. So show them who that person is.

Now it’s time to fill in all the details. Set up your profile page. Tell customers who you are, what you make, and why and where and how you do it. Etsy shoppers care about the process, and any information you can offer about your story or passion will make buyers feel better about making a purchase — especially when you’re just starting out and have no positive feedback yet.

“People love hearing the stories behind pieces, and that includes your story as well,” says Tess. “Excitement is contagious, so it really pays to let people see your passion shine through.”

Fill out your shop policies, including returns and exchanges and shipping fees. Etsy’s blog offers plenty of guidance about how to set shop policies and craft a compelling profile page.

Listing an Item

Signing up as a seller is free, but it costs 20 cents to list an item for four months or until it sells, whichever comes first. Etsy also collects 3.5% of the final purchase price.

When you’re ready to list an item for sale, it’s a fairly straightforward process, and Etsy offers a step-by-step listing guide. You’ll choose the product’s category and type, add images, and create a title and description.

Pay particular attention to an item’s title and tags — this is your chance to help your item turn up in search results, a huge sales driver.

“Make correct use of your titles and tags,” says Tori James. “It’s how customers find your items through Etsy’s search.”

When creating a title for your item, consider what keywords a buyer would search for when looking for your product or something like it. This includes physical descriptions of the item itself — e.g., silver, 1-inch, oval, pendant, necklace, jewelry — but also the style or sentiment behind the piece — e.g., romantic, organic, reclaimed, literary.

“Learn everything you can about search engine optimization, or SEO,” recommends Jessi VanGundy, who sells her handmade pottery from Knoxville, Tenn.

Remember to tag items with keywords, as well as alternative search terms used in other parts of the country or world. For example, what one person calls a teapot someone else may call a kettle.

“[SEO] can be very complicated for a newbie, but it’s worth the time reading up on it in the Etsy forums,” Tori James says.

Photography

One of the biggest factors in driving sales is attractive photography. For years, Etsy has offered free photography workshops online and at its Brooklyn, N.Y., headquarters.

“Photography is extremely important,” stresses Jessi VanGundy. “When you’re selling online, your customers can’t pick up the item, turn it over, and feel the texture. So your photos have to show all of those things.”

But it doesn’t end with good lighting and focus. Many successful crafters establish their own visual style that permeates everything from their listing photography to their logo, banners, and the products themselves.

“We are really becoming a visual culture, so I do think it’s important to think about how you’re sharing your items through photography, styling, branding, and what makes your product or work distinct or recognizable,” says Katrina Rodabaugh, who says she has tried to develop her own visual style on Instagram and other social media.

‘The Work Around the Work’

It’s important to realize that there’s more work to selling a craft piece than simply creating it, as time-consuming as that essential process may be.

You need to photograph it, write up a description, and list it for sale. Once it sells, you’ll need to package and ship it, not to mention track your income for tax purposes.

“There’s so much work around the work,” says Katrina. “Yes, you have to take professional-looking photographs, consider your tags in your listing, consider your pricing, keep your shop looking updated and fresh, consider your social media outlets, and then find ways to promote the work. But you also have to consider customer service, packaging, shipping, and restocking.”

Pricing

All of this factors into your pricing. When trying to set a price for an item, consider the cost of all the materials you need to make it. Include other expenses, too, like shipping supplies, equipment, even the electricity to run the space heater in your garage workshop.

Then, add in your labor costs — what you should be earning per hour. If it’s a therapeutic hobby that you’d be doing anyway, that’s fine; but if you really want to establish a successful side business, you can’t be paying yourself $4.50 an hour to design and sew hats or build handcrafted benches.

“Make sure you’re charging enough to pay yourself for your time,” Jessi VanGundy says. “A lot of new sellers charge way too little and don’t earn anything for their labor.”

Finally, add a degree of retail markup — your desired profit plus a bit of wiggle room for seasonal sales or promotions.

“When you’re just starting out, it helps to have some items at a low price point,” Jessi adds. “In the beginning, I sold a lot of lower-priced items — like single mugs and yarn bowls. But as I established a reputation, I began selling higher-priced items and custom orders for sets of things.”

Beyond Etsy

Of course, there are other places to sell crafts. Some sellers set up booths at craft shows, farmers markets, concerts, and holiday fairs to sell their goods and bring their brand to a new audience.

“Shows are so tricky because you never know if they will work out for you until you try them,” says Tess of Gilded Notes. “I’ve done shows where I haven’t made a single sale, but I still don’t consider them a bust. … You never know who’s out there, checking out your work. I’ve gotten emails from boutiques and other show organizers months later saying that they picked up my card at a show and want to feature my work.”

Tess adds, “In that way I think shows can be a very powerful way to not only make sales, but also attract a broader customer base and make valuable contacts.”

Made by Katrina shop owner Katrina Rodabaugh sells and displays her work in a number of venues besides Etsy. “I also sell work through galleries, shops, craft fairs, and sometimes directly to individuals,” she says. “I think the craft fairs are the most work but also the biggest payoff in terms of income, yes, but also in terms of networking with other makers and getting your work out there to a larger audience.”

When you display your work at a fair or show, concentrate just as hard on branding yourself. “Whenever I exhibit at a large craft fair, I make sure to have a stack of postcards and business cards available,” Katrina says. “Plenty of folks will take your card and contact you through your shop or your site after the fair — it’s a great opportunity to share your work.”

Tori James currently sells exclusively on Etsy, but she’d like to get her independent website back up and running in 2015. “Having more than one income stream is usually required if you want to sell handmade,” she says. “I’ve found that relying completely on Etsy is nerve-wracking because they often make changes, and the changes aren’t always favorable for my shop.”

How Much Can You Earn?

The average Etsy seller, if there is such a person, earns about $3,400 a year from the site. But approximately one in five Etsy shops is a full-time business, while 58% of sellers hold down other jobs and operate their Etsy shop as a side gig.

This means earnings can vary drastically — from nothing at all to a respectable full-time salary.

Toriska owner Tori James, whose handbags and clutches range from $30 to $80, says, “I usually make about a sale a day, or a little less.” But, she adds, she often gets some bridal purchases during wedding season, which result in a cluster of sales all at once.

“Most of the year I put in part-time hours, but during wedding season I put in full-time or more hours to keep up with orders,” she says.

“You also need a supportive spouse or family, because you will likely put in many hours of work and a lot of money before you see results,” Tori adds. “It was around eight months before I started earning money and 18 months before my sales became regular.”

A long-running Etsy discussion thread provides a look at the variety of income levels sellers achieve. Brittany Zerkle of BeeZeeArt, an art student whose best-selling items include sewing patterns and small, handmade stuffed animals, says, “My little shop makes just enough to pay for my classes, student loan payments, and put gas in my car.”

However, the most common response on that thread — repeated a number of times — was, “Not enough to quit my day job.”

Jessi VanGundy echoes that sentiment, though she hopes to earn enough to be a full-time potter before long.

“I’ve been able to make enough money to pay for all my pottery expenses, including buying a new potter’s wheel and paying rent at a local ceramics studio,” she says. “At this point, I’m happy that my rather costly hobby has been able to pay for itself, though I hope next year I can make a bit more of a profit.”

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