How To Start an Etsy Business in 7 Steps

Starting a business allows you to enjoy the independence and autonomy of being your own boss. You get to set a direction for the business, implement creative solutions, and improve your financial position.

While there’s no problem with starting a business from scratch, it may take you time to lay the groundwork and establish appropriate channels and workflows. A faster way is to leverage online platforms to set yourself up quickly and start selling products—and Etsy can help you achieve just that.

Etsy is an online e-commerce platform that connects buyers and sellers. But unlike other e-commerce firms, Etsy limits the type of products you can sell. Specifically, entrepreneurs can only sell items they’ve created or designed, vintage goods that are at least 20 years old, and crafting supplies. These limits ensure that millions of commonly manufactured items don’t overshadow your creative and handmade goods.

Whether you’re a designer, artisan, vintage collector, or small business owner, you have the potential to turn a hobby into a profitable business on Etsy.

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In this step-by-step guide, we dive into the nitty-gritty of starting an Etsy business, including how to set up an account, plan the shop layout, manage finances, and expand the product range.

Start an Etsy business:

1. Set up your Etsy account
2. Plan your Etsy shop
3. Craft your product listings
4. Optimize for Etsy search and SEO
5. Manage finances and understand Etsy fees
6. Market your Etsy shop
7. Expand your product range and scale your business

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1. Set up your Etsy account

Starting an Etsy business allows your products to be instantly available to millions of potential customers. And with robust promotional tools and analytics, you can easily market products and manage your online shop. Etsy’s integrated payment system also enables you to close deals with buyers in different geographical locations quickly.

To start selling on Etsy, you’ll need an account—which can be easily set up on the official “etsy.com” site.

On the website, scroll down to locate the Open your Etsy shop button and press it.

You should see the following popup window asking you to sign in or register with an email address. You also have the option of using a Google, Apple, or Facebook account.

In our case, we will use a Google account to register. Once you’ve added the account, you’ll be asked to input your first name and a password, and then should see the following onboarding screen.

Press the Let’s do this -> button on the above page to proceed. Note that this means you’ve agreed to Etsy seller and payment policies.

In the next screens, Etsy will ask you several questions regarding your new business. Though these questions are optional, answering them will allow Etsy to deliver a more personalized experience.

Here are some onboarding questions you’ll encounter:

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Once you’ve answered or skipped the above questions, you’ll be directed to the following page. Click the Start your shop button to begin planning your shop.

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2. Plan your Etsy shop

Establishing a unique brand identity is a valuable step toward building a successful business on Etsy. Since there are many other sellers on Etsy, a good brand identity can highlight your unique selling proposition and set you apart from other small business owners.

While building a brand, focus on aspects like the techniques or materials you’re using to create products to identify your unique selling point.

With a specific product in mind, you also need to identify a target audience—and then research and understand their behaviors and interests. This helps you to tailor your products and marketing efforts more effectively. If you aren’t sure which groups to target, you can look at how other similar businesses are doing and use the information to shape your operations.

Etsy requires you to set shop preferences. Setting up your preferences includes selecting your shop language, country, and currency. Note that you cannot change the default language after it’s set, but you can add additional languages as you expand the shop to other geographical regions. Use the Save and continue button to save all your preferences before moving to the next step.

Another Etsy requirement is to add a shop name. The Etsy shop name must be between four and twenty characters. It should not contain any special characters and spaces. Go for a simple and memorable name. You can change the shop name later if you wish to rebrand.

While building your brand, you need access to high-quality product photos to showcase your items in the best way to attract potential customers. Apart from highlighting your product features, professional photography can help you maintain consistency in your Etsy listings. Consider working with qualified product photography freelancers on Upwork to help build your brand.

3. Craft your product listings

In the above step, we explored the planning phase—where we discussed how to identify a target audience, set shop preferences, and select a suitable shop name.

The next step entails adding product listings. In this phase, you need to add photos and descriptions of the different items you’re selling. Etsy allows you to add up to ten images of a specific item to bring out its important qualities. The photos should showcase the product from different angles to help buyers gain a deeper understanding and make better purchasing decisions.

To add photos to your Etsy shop, click the Add a photo button (highlighted in the image below). The add photo button allows you to navigate to a folder containing your product photos on your computer—which you can then select and upload.

Etsy also lets you add a 10- to 15-second clip of your product listing. However, the video does not feature sound. As a result, it’s paramount to include high-resolution visuals of your product (1080p or higher) to convey your message to the target audience. The product video should also be in the appropriate dimensions to ensure all aspects are visible to users.

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The next step involves adding compelling product descriptions and other listing details. When creating a product title, use keywords that potential buyers will likely use to search for items. You should specify the category in which the product fits to make it easier for shoppers to locate it.

Etsy requires you to include specific information about the product, including who made it, what it entails, and when it was made. Product listings on Etsy expire after four months. You can choose to renew the product listing automatically (this feature is available for $0.20)—or resolve to renew the product listing manually.

Apart from a detailed description, other specific information to include about your product listing might include:

• Product type. The item can be a physical or digital product.
• Production partners. If you worked with other people or agencies to design or create a specific product, you must specify them.
• Tags. Etsy lets you use thirteen tags—phrases that people may use to search for the item. Using all thirteen tags can help increase product visibility.
• Materials. Though optional, Etsy also allows you to list the different materials you used to create a specific product.

Once you’ve added basic information regarding your product listing, the next step is to complete the inventory and pricing section. Specifically, you need to specify the price of each item and the available quantity. Always account for the cost of materials and labor when setting prices to avoid selling your product at a loss.

While creating a shipping profile, specify delivery timelines and associated costs. Etsy can help you calculate an appropriate shipping price based on the customer’s location and weight of the package. Other important information to add to your shipping profile includes your zip code (which shows where your orders will be shipped from), the countries you support shipping to, your order processing times, supported shipping carriers, and handling fees.

4. Optimize for Etsy search and SEO

Search engine optimization allows businesses to improve their website ranking on search engine results. Using the same techniques, Etsy SEO can help your shop and product listings appear in more results whenever users search for similar items you offer.

Etsy SEO is influenced by a set of different factors, including:

• Relevance. Etsy ensures that customers receive matching results for their search queries. This means it will only display a product listing if the tags, keywords, product descriptions, and titles are similar to what people are looking for.
• Recency. Etsy search algorithms can favor new product listings to make them more visible to customers.
• Bounce rate. How long customers stay on your product listing page can influence your shop’s ranking.

Here are some tips to enhance your shop visibility through SEO:

• Incorporate popular keywords in your product descriptions, tags, titles, and attributes. But ensure the keywords are relevant to your product to boost the likelihood of converting customers.
• Choose a shop name that includes at least one primary keyword. For instance, if your shop deals with belts, you can go with names like FeshionBelts or BeltUp. Etsy will let you know if a specific name has already been taken.
• Incorporate long-tail keywords in your product tags to capture more search queries.
• Write in-depth shop descriptions to show that you’re experienced and trustworthy.
• Add high-quality videos and images showcasing various features of your products. Remember to include alternative text that explains what the visuals are all about.
• Add backlinks to help improve your shop’s ranking. Consider adding backlinks on personal websites, blogs, and social media sites to boost your Google rankings.

5. Manage finances and understand Etsy fees

While Etsy provides shop owners with a robust marketing platform, it’s not entirely free. Here are some examples of fees you’ll be charged on Etsy:

• Listing fee. Etsy charges a $0.20 fee for each new product listing.
• Transaction fee. Each sale on Etsy is subject to a 6.5% transaction fee of the product’s price.
• Advertising and promotion fee. You’ll be required to pay to use Etsy's specialized marketing tools, including Etsy and Offsite ads. However, the overall fee depends on your usage and the selected marketing service.
• Subscription fees. Etsy Plus is a subscription service that costs $10 per month.
• In-person selling fees. You’ll be charged a $0.20 transaction fee for payments made with Square Reader.
• Payment processing fees. Etsy shops using Etsy payments are charged a processing fee. The overall cost may vary depending on the location of your bank account.
• Shipping fees. Depending on your location, you can purchase Etsy shipping labels to fulfill your orders. However, shipping costs vary depending on the destination, package weight, and carrier.

Before launching your Etsy shop, ensure you have enough funds to cover basic fees. As you start out, it might be a good idea to avoid too many subscriptions, which could accrue debt on your credit card. For smooth transactions, consider signing up on Etsy payments, which supports multiple payment methods, including PayPal, Mastercard, Visa, Apple Pay, and Google Pay.

6. Market your Etsy shop

Marketing helps you promote your products among your target audience. As a result, you need a detailed marketing plan that outlines the strategies you’ll use to advertise your products.

To increase your Etsy shop visibility, consider using social media platforms and Etsy ads.

Social media platforms like Facebook, X (formerly Twitter), and Instagram have billions of active users and are free, making them good marketing channels. You can make posts about your products and then include links, directing users to your Etsy shop.

Etsy ads allow your shop to be featured in search results as well as on other Etsy pages. You can set up Etsy ads directly from your shop manager dashboard. Setting a budget to control your advertising expenses is a good idea. The minimum daily budget you can set is $1.

Your promotional materials, including images and videos, should be high-resolution to showcase your unique product features to potential buyers. Use design tools like Canva to enhance the overall look and feel of your ads.

7. Expand your product range and scale your business

You can grow your Etsy business by exploring other product lines besides your primary product. For instance, if you specialize in selling handmade items like jewelry, you can explore the cloth wear business to expand your market base.

Invest in customer engagement activities to build and maintain long-lasting relationships with clients to keep your business thriving. This requires you to respond quickly to any queries they may have. You should also maintain a positive and professional tone in all communications to facilitate an excellent customer experience.

Starting an Etsy business can be extremely rewarding. As the shop grows, you may be able to transition it from a side hustle to a full-time business. Write a business plan that covers your evolving goals for a successful transition. The business plan will provide direction, ensuring you focus on important aspects necessary for growth.

You should also have enough finances to cover basic expenses as you settle into your full-time role. In addition, networking with other entrepreneurs, mentors, and industry experts can help you identify growth opportunities.

In your new full-time role, embrace innovation and creativity to adapt to emerging market trends.

Work with Etsy professionals

Whether you craft unique physical goods, enjoy trading vintage items, or want to sell digital products, Etsy provides you with an online marketplace to launch your business quickly and find clients. The costs of starting and maintaining an Etsy shop are relatively low, making it suitable for businesses of all sizes.

Use Etsy’s built-in marketing tools like Etsy ads to promote your business. Additionally, you can grow your business by designing other products to sell on Etsy.

Now that you know how to establish an Etsy business, you need a team of professionals to help you handle growing demand, among other factors. Upwork can connect you with experienced Etsy administration freelancers to help you out.

If you’re a qualified Etsy administrator looking for work, start your search on Upwork. With Etsy administration jobs posted regularly, you can find projects to work on to grow your portfolio while earning extra income.

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Upwork is not affiliated with and does not sponsor or endorse any of the third-party tools or services discussed in this article. These tools and services are provided only as potential options, and each reader and company should take the time needed to adequately analyze and determine the tools or services that would best fit their specific needs and situation.

Prices are current at the time of writing and may change over time based on each service’s offerings.