What was the best platform to start selling handmade products online?
I did a lot of research about what platform to use to start my store. I looked at eBay Amazon, Shopify, Etsy and a few others. They all had their pros and cons, but Etsy was the best I found for handmade products. It is a great place to start for beginners. It comes with an established customer base and the platform to set up your shop is extremely user friendly.
The ready made customer base is huge for someone just starting out. Some Etsy shoppers are die hard handmade product shoppers specifically looking for products from new shops. They are actually specifically looking for newbies, they like being one of your first customers and often times are very kind and generous with their reviews. I've gotten some great advice and ideas from these experienced shoppers. The downside to Etsy is their fees and their free shipping guarantee threshold.
Etsy advertises giving you a free shop and you only pay 3% of the sales price when you make a sale. But, they have a lot of other fees in the small print that are easy to miss such as; relisting fees, transaction fees, gift wrap fees, shipping fees etc. I did not realize all the extra fees that would be tacked on until after my first few sales. With all those other fees the cost to a seller to sell a product on Etsy is actually closer to 10-12% of the sales price. So, if you sell on Esty, when you are calculating the price of your products make sure you are increasing the price by at least 10% to recoup these fees. This 10% does not include the costs of participating in their different add campaigns. If you participate these advertising options you will need to use an even larger percentage.
Etsy also wants shops to have free shipping when customers make purchases of $35 or more. To get shop owners to participate they use a "cookie" vs "stick" approach. Meaning if your participate in their free shipping guarantee they give your listings better ranking in the search engine, "the cookie", and if you don't participate for purchases over $35, you get charged a additional 5% "shipping fee" by Etsy, "the stick". A $35 shipping guarantee was a bad threshold for my specific product line. Etsy's calculator said I only had to increase all my products by $0.17 and over time I would recoup what I had to pay out in shipping because of how much your sales would increase by offering free shipping. I don't know where Etsy came up with that ridiculously low amount but it is extremely inaccurate. I found that with a free shipping threshold set at $35.00, I had to increase my product costs by $14 per gift basket to recoup these costs or include less in my gift baskets to bring the costs down so the price fell below $35. After months of playing around with this, I found it was better to put less in my gift baskets to keep the costs down and put the shipping on the customer. I have had no customer complaints and I don't feel like I'm over pricing my products just to keep Etsy happy. I think Etsy would be better off if they hadn't set a dollar amount for the free shipping guarantee, they should have let the individual sellers set their own free shipping guarantee amount that fit their specific product line especially since Etsy is not taking recent increases in shipping costs into consideration and increasing this threshold to compensate. Even big box stores have increased how much you have to buy to get free shipping, but Etsy has not budged on their threshold, putting more strain on sellers selling smaller products.
Etsy's huge customer base for beginners still outweighs these two negatives. As long as you price your products correctly and take all of your costs into consideration Etsy is still a great place to start. Things to keep in mind, are how unique is your product, is the Etsy market already saturated with similar sellers? This is where I ran into issues. There are a lot of handmade soap makers on Etsy, you will not make money just selling soap bars, you have to find a way to make your products stand out and make them unique.
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