Entrepreneurs were traditionally required to purchase products in bulk at wholesale prices. Great if a product sells! But if a product does not sell, they are left with a box of unsold inventory.
Over some time, entrepreneurs disliked the prospect of having a box of unsold products, which made dropshipping an appealing alternative.
Why is this so? You purchase products from suppliers on an individual basis. So, if a customer orders a product from your store, you request that product – and only that product – from the supplier, who will handle the rest: manufacturing, picking, packaging, and shipping your product.
So you not only save money, but you also save a lot of time.
Is Etsy.Com Good For Dropshipping?
If you want to make money online, Etsy dropshipping could be a good option.
On Etsy, nearly 45.7 million buyers had purchased items. Not only is Etsy a simple marketplace for getting started with online selling, but dropshipping on Etsy makes things even more straightforward.
Etsy used to be a marketplace for only handmade items. However, you can still sell handmade items on the platform since it has evolved to support dropshipping. This, combined with digital product capabilities, allowed for a much larger number of sellers to use the forum.
Though dropshipping is not explicitly mentioned in Etsy’s seller policy, it does fall into the category of items that can sell on the platform.
Handmade items on Etsy must be made and designed by the seller. This means that to dropship, you must create your product.
For example, if you want to sell a cup, you must create a quote or graphic that will go on it. You can’t just sell a pre-made cup. That is considered reselling, which is not permitted. As you can see, dropshipping on Etsy is a breeze.
But don’t just take our word for it. Here’s a look at the advantages and disadvantages of dropshipping on Etsy.
Advantages of Etsy for dropshipping
1. Conscious consumers
If you decide to open a storefront on Etsy, you will be able to sell directly to Etsy users. Since its inception, the platform has fostered a distinct community of makers and consumers who value craftsmanship, human-centric shopping, and individuality.
If you join a platform with such broad core values, your customers will likely share those values and not amplify a loyal customer base.
2. Make your product base stand out
As dropshipping becomes more common in eCommerce, it becomes increasingly difficult for business owners to stock items that stand out in a crowd. Etsy allows you to store your virtual shelves with unique objects that you would neither produce nor sell in any other circumstance.
3. Etsy is the land of the niches
If you want to operate your dropshipping business in a specific area of the eCommerce world, Etsy is the place to be. In Etsy’s world, the wedding gifts, home goods, clothing, and baby product industries are thriving.
Even better, people are aware that Etsy is a premier destination for buying niche goods, so both makers and customers flock to the platform whenever they have or require custom items. Etsy has put in the time and effort to build a reputation for unusual and specialty items, so you don’t have to.
4. High-profit margins
Many of the items on the market are priced above market value. On the other hand, sellers benefit from an established community with a proven track record of paying those prices. Here, you can charge a high fee and still sell many products while maintaining a profit margin of 40% or higher.
Etsy’s policies require you to disclose your location as well as the place of your production. There’s no way to hide the fact that you don’t make your products.
Etsy’s quiet, consistent success can be attributed to its level of honesty and transparency. Customers can rest easy, knowing that their purchases have been approved by a larger platform with specific ethical standards when they use Etsy.
Before you get too excited, Etsy has some drawbacks to consider.
Disadvantages Of Etsy For Dropshipping
1. More fees than you realize
Like any other large online retail platform, you’ll have to pay some hefty fees for listing and selling on Etsy. Firstly, the $0.20 listing fee and listings are valid for four months. It may not appear to be much, but it can significantly reduce profit margins.
Second, they charge a 5% processing fee for each product sold. Keep in mind that neither of these prices includes shipping. Etsy has also created and released a slew of seller-specific tools and resources, such as ad fees, pattern fees, and in-person fees.
2. Intense guidelines
Etsy is a highly regulated marketplace. It has a long and dense code of conduct, but here’s the gist of it.
Reselling handmade products are not permitted, where you’re welcome to dropship vintage items or craft supplies. As previously stated, you must disclose to Etsy the location of your manufacturer and some details about the manufacturing process. However, not all of your business and logistical information will be made public. Etsy is very clear about what it is looking for.
3. Community policy
Etsy enjoys policing users, which is beneficial because it keeps operations fair, uniform, and running smoothly. However, it also implies that you must be aware of their policies. Otherwise, you risk incurring a slew of fees and penalties.
Dropshipping on Etsy is ultimately much more scrutinized than dropshipping through your e-store or other platforms. While Etsy’s readymade customer base, high-profit margins, and creative freedom are all appealing, consider what you’re willing to give up to get access to it.
4. Economic sanctions and trade restrictions
Etsy is a global marketplace, and it is headquartered in the United States. This means that Etsy abides by government and economic sanctions; they limit account usage in some geographic regions and prohibit goods originating in sanctioned areas.
Be aware that selling on Etsy entails some red tape beyond your control and may impact your sales and profit margins.
5. Tedious listing process
The process of listing products on Etsy is quite exhausting. Because the marketplace focuses on handmade goods and small businesses, there is an infinite number of product variations. Etsy has also created requirements for product listings that provide consumers with as much information and consistency as possible. However, it can be taxing on shop owners who are trying to earn a difference.
If you’re looking for an easy way to make money online, you can consider dropshipping on Etsy. It’s a simple way to start a product business without dealing with inventory, production, or shipping.
Though, Etsy expects more creativity on your part. It is tailor-made for this cultural and economic moment, with growing concerns about sustainability, shopping locally, and making goods by hand. Consider your brand’s and business’s goals carefully, and make sure you’re ready to take a more active role in its operation.
Dropshipping businesses are simple to set up on various eCommerce platforms, and you can source products from anywhere in the online marketplace. So, if Etsy isn’t for you, that’s fine; there are plenty of other eCommerce solutions available.