How to Start an Etsy Shop in 6 Easy Steps

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Etsy is swimming with people who are eager to spend money. The question is whether or not your store will be the one they find.

“Selling on Etsy isn’t a difficult process, but many creators or shop owners can over-complicate it,” says Aviad Faruz, CEO of Etsy. FARUZO, an Etsy store that sells personalized jewelry. “The best way to solve this problem is to choose a niche and follow it when defining your store’s catalog. This helps make things easier in the long run.

Since its IPO in 2010, the designer market has exploded with interest from crafters and consumers wondering how to start an Etsy shop. Etsy had 96 million active users and more than seven million Etsy sellers in 2021, according to data compiled by Statista, an analytics company. The platform also generated a whopping $2.3 billion in revenue last year.

Whether you want to grow on Etsy for a side hustle or as a small business owner, you can open your own storefront in minutes. Plus, it won’t cost you a fortune, and you’ll have potential customers waiting to come and browse your offerings when you launch. We asked four current shop owners about how to succeed on Etsy; here’s what they had to say.

How many items do I need to start selling on Etsy?

Good news: you can start selling on Etsy with just one item. However, more listings generally equate to more exposure for your storefront, and a successful Etsy shop prioritizes search engine optimization and multiple easy-to-browse Etsy listings.

“The amount of product you need depends on your niche,” says Pat Servin, owner of PicasPrintables, an Etsy shop that sells printable wall art, board games, and planners. “In my niche, it’s important to have more than 25 articles. Many in my niche upload new articles every week.

But deciding on an ideal number of products sometimes takes a bit of trial and error.

Having multiple products in your Etsy shop on day one can seem daunting at first, but it will help you speed up the testing process and find out which products are selling better than others. If you’re wondering how to start an Etsy shop that will quickly grow, the multiple item listing details will give you more data.

“Having multiple products in your store is essential; it allows you to do your own customer research,” says Carrie Williams Howe, owner of The happy hive, a Vermont-based Etsy shop that sells hand-poured beeswax homewares. “When I started, I had both personal care products and home products in my shop. I found personal products like lip balm and lotion to be a harder sell, maybe because the market was saturated. But home products started to take off right away. This allowed me to sharpen my focus and eliminate products that didn’t suit me.

Pro tip

Focus on your niche. Create physical or digital products you love, price them competitively, and create compelling descriptions to attract the right buyers.

How to Start an Etsy Shop in 6 Steps

You can start an Etsy shop and launch your online store by following these six simple steps.

Step 1: Create an Etsy Account

Visit Etsy.com from your desktop and select the “Login” link. Unless you already have an Etsy account, you’ll click the “Sign Up” button and enter your email address, first name, and password to sign up.

Step 2: Activate your Etsy shop

Once your Etsy account is created, you’ll use it to set up and manage your new Etsy shop. Visit sellers page, click the “Get Started” button and enter the credentials you created in the first step. Click the button under the banner that says “Open Your Etsy Shop” and select your preferred language, country of residence, shop currency, and other shop preferences.

Next, click “Save and Continue”, enter your store name and select “Save and Continue” again. If the shop name you want is longer than 20 characters or is already in use, Etsy will ask you to choose another name. Keep in mind that you are only allowed one store title change once your store is established.

Step 3: Add ads to your online store

On the next screen, you’ll create your first Etsy listings by uploading or entering the following information:

  • Relevant images or videos, including a thumbnail image (up to ten photos)
  • A title, brief description, ad category and attributes (optional)
  • Tags to help make your ad more visible in searches (optional)
  • Materials (physical items only) or crafting supplies used in the process
  • The store’s price, quantity, SKU number (optional), and tax rate (if applicable)
  • Variations if you sell a physical item
  • Shipping price options and item weight and size (if located in the United States, sell physical items and use calculated shipping).

If you can do it, offering free shipping as an incentive is a strategy many Etsy business owners use to increase interest in their online store.

Step 4: Beautify your storefront

Before adding items to your store, customize its appearance to make it shine. Consider adding a banner and store announcement to welcome online visitors, and don’t forget to upload a logo that complements your brand.

There is also space to educate potential customers about your business and what it stands for. You can add photos or videos to the About section to illustrate the evolution of your brand, define your niche market, introduce the store manager or other team members, and share visuals of everything what you would like visitors to know.

Most importantly, don’t forget to include your store’s policies. Be sure to provide advice on payment options, order processing times, shipping, and your exchange and return policies.

Step 5: Select payment and billing settings

You will need to provide your tax status to get paid on Etsy. Here’s what you’ll enter based on your selection:

  • Sole Proprietorship or Sole Proprietorship: Your full name, address, phone number, date of birth, last four digits of your social security number, and country of residence
  • A registered legal entity or incorporated business: business entity name and address, EIN, business registration number, and store owner information (including name, date of birth, address and the last four digits of their social security number)

Related: LLC or S Corp? The Tax Decision New Business Owners Must Make

Remember, if you’re pursuing Etsy as a small business owner, it’s wise to set up a separate business bank account that can act as a payment account for your Etsy business.

The final step is to select the county where the bank you will use to receive proceeds from Etsy sales is located. Enter the routing and account number, and from there you’ll be ready to get paid through Etsy. You will also need a credit card on file for Etsy to collect fees, such as payment processing fees, Etsy listing fees, and any other Etsy transaction fees. Enter your full name (printed on the card), card number, expiration date, and CVV number, and Etsy will collect its monthly fee. Consider applying for a business credit card to help separate business and personal expenses.

Step 6: Open your Etsy shop

The final step is to open the virtual doors to your Etsy shop. You can do this by selecting the “open your store” button after entering your credit card information.

For more visibility on Etsy, favor descriptions and visuals

You want to make the best first impression possible when potential customers discover a product in your Etsy shop, especially if they found you from the Etsy search bar or other search engines. Two best practices for this are to prioritize quality product descriptions and incorporate good images or videos into your listing.

“With every product, it’s important to create descriptive overviews and use lots of synonyms to describe it,” says Meaghan Thomas, owner of pinchspicemarket, a Kentucky-based Etsy shop that sells fair trade spices. “Thinking beyond keywords is also important. You’re trying to sell your product to people, so it helps to give as many relevant details about it.

Visuals are just as important for drawing attention to the items you’re selling.

“Videos are also essential for attracting looks and sales,” adds Thomas. “Etsy’s algorithm loves when you have a video showing your product or how to use it. They are easy to make and don’t need to be heavily produced.

Does it cost money to start selling on Etsy?

Opening an Etsy shop is free. However, sellers pay Etsy listing fees and transaction fees. You will also pay payment processing fees if you use the Etsy Payments feature. The fee schedule is as follows:

  • Listing fee: $0.20 per listing (each listing is valid for four months)
  • Transaction fee: 6.5% of the order amount, including shipping (and gift wrapping if applicable)
  • Payment Processing Fee: $0.20 per transaction if using Square when selling onsite

How do taxes work on Etsy?

Some sellers are subject to VAT or value added tax. It should be added to the transaction and payment processing fees, if any. Check Etsy’s fine print and with your industry to determine if you’ll need to add other taxes or fees to your listings and ensure transparent pricing.

If you love creating physical or digital products and visibility is your biggest concern, becoming an Etsy seller might be the perfect fit for you. Create an account and start listing items today to speed up the trial and error process and get you that much closer to making money online.

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