Monday, July 9, 2012

Things I've Learned as a Etsy Small Business Owner

Over the past couple of years, I've spent quite a few hours learning the ropes of selling homemade goods online.  While I still learn quite a bit every single month, I've decided to write a post about what I've learned so far, which was inspired by a conversation last month at Joann's with a mortgage broker who told me that she really wanted to quit her job and start selling her crafts online, after she eyed my overflowing cart full of fabric, inquired as to what I was using it for, and then asked for tips on how I got started and what had worked for me.

Right now I have three shops.  Two of them are online and one... well... I had plans for rapidly growing Full of Grace Creations this summer, but a bad blunder involving leaving both a key box of supplies (beads aren't a whole lot of good without wire, and I just can't bring myself to buy more when I have so much at home) and my entire stock of chaplets and rosaries (packed and ready to go, waiting in my sewing room to make it into the van...) meant that I decided to focus even more energy on my other two shops until I get back to Florida.  

That however, is just as well, because right now I'm trying to focus half my time on Sadie's Saints and growing my selection there... which brings me to my Etsy advice.  I know there are quite a few Etsy shop owners out there, so feel free to add your own advice (or even links) in the comment section.

Now, on to what I've learned these past few years:

Learn the Rules and Regulations Where You're Selling

One of the most helpful things I did when I first looked into opening Full of Grace Creations, was sit down and read through the Etsy instructions for opening a shop.  It was boring.  It involved sitting, reading something that wasn't really "fun" for quite a while.  But it was important that I knew the rules for selling before I started.  After looking over the rules I checked out quite a few shops to see what their shop policies and shipping policies looked like, and then came up with my own rules for my own shop.  It isn't the funniest part of starting up a small craft business, but it's important, and it was nice to have it out of the way.

Keep Prices Competitive through Smart Shopping

Setting prices can be difficult and when you're looking at handmade goods there can be a wide range of prices available.  When I began making rosaries and chaplets, and later headcoverings and dolls, I had a choice.  I wanted the products I made to be accessible at reasonable prices.  I wanted to make beautiful creations, but I didn't like the idea of selling a rosary for $150 when it had only cost me $10 and a couple hours work to make it.  

On the other hand, I still wanted to offer quality goods, which required quality supplies.  

This is where shopping sales became critical.  I buy my beads in bulk and I usually only buy fabric when it's more than 50% off.  I love 10% (or more) "off your entire purchase" coupons.  And if I find a warehouse with fantastic prices, I stock up.  

Craft and fabric store prices are often ridiculous without sales.  Here's an example.  When we were traveling I found one of those awesome fabric warehouses.  This one had a table of cuts of fabric that were labeled $2.99.  I found two giant pieces of unblemished minky on the table.  One was four yards and one was two.  They would have been $14.99 a yard at the fabric store I usually shop at.  When I combined it with fabric I'd bought at another sale the blanket I made Mae cost about $6.  If I'd paid full price it would have been over $30 and it would likely have been less to buy it then to make it.  

Sale shopping is key when you're a small business owner creating your own product.

Setting your Own Wages

The second difficulty, when I began pricing items, was figuring out how much I needed to sell each item for to make it profitable for me to be in business.  This became even more important when Paul started law school and I became the sole breadwinner for 10 months of the year.  

This part of pricing can be a balancing act.  I finally came up with a strategy that works for me, and helps me decide if it's worth it to carry a creation in my store.  I decided to pay myself $10 an hour for each individual product.  Now that's not the best wage in the world (especially since I don't add in the computer and listing time), but it was important to me to keep my prices down, and it's also not a bad wage either, especially since I'm working from home and naming my own hours.  So when I make a product I multiply the number of hours by 10 and add the cost of materials and voila: I roughly have the price rang for my product.   

In my experience finding a pay range that works for you can make pricing much easier.

Dealing with Uncertainty

Uncertainty is the downside of running my own online business.  I don't know it I'm going to make $0 or $1000 in a week.  I might work 55 hours in a week, but that doesn't mean anything is going to sell.  Or I might be completely lazy and make nothing, and have sales flood in.  

I do know there are times of year when I'm going to be insanely busy and spend hours late into the night sewing... and there are going to be times when I post and post and post new orders and nothing comes in.  My latest goal is balancing the slow times, and sewing like crazy during those times, so I'm prepared when the busier seasons arrive.  


In the beginning I worried so much about how my prices compared to everyone else's and how my products compared.  

The past year I've gained confidence and realized that all I really need to do is focus on what I'm making, and do what I do well, and trust that things will fall into place.  It can also be important for shop owners/crafters/artists to remember that imitation is the sincerest form of flattery (and repeat that to yourself frequently).  There's a good chance that, if you make something beautiful, you'll suddenly see it popping up all over the place.  Take a deep breath, ignore it, and focus on making your own products awesome.  


This is another important aspect that I didn't realize right away when I opened my business, but frequency of posting can be important.  I try to post something every single day.  This gets easier once you have more products.  Frequent posting keeps people looking at your shop, and hopefully while they're looking they'll find something they like!

Shop Size

I definitely notice that the amount of business I get is directly related to how many listings I have posted.  Variety can definitely help boost sales.  For me, having over 100 items posted seems to be a turning point where sales becomes somewhat regular.  Getting over 100 items made and photographed and posted can be a struggle, but I have noticed the flow of sales definitely increases in direct proportion to the number of items I have posted!

And now, in the interest of not making a handbook size advice column, I'll stop for today.  Maybe I should make this into a series, posting whenever I learn something new (or when I remember something that's helped).  

And hopefully this will help someone! 


  1. Thanks so much for posting this. I have been thinking about starting a Etsy business but really had no idea where to start. This has been very helpful. Hopefully by the time my daughter starts school this fall I will have something to started.

  2. Thank you so much for the information. I have been going back and forth about whether or not I should open up an Etsy store. We could really use the added income, but I am worried it wouldn't be worth it.

  3. One thing I don't see a lot of people posting on, but that I feel is important, is if you're going to take yourself seriously, you need to look into what is required for your state's and federal taxes. Many states require sales tax, and even if you net a loss for the year, the IRS wants you to claim what you've made for the year in sales. Most Etsy sellers don't pay taxes. It's just a fact I've come to realize.

    Since I do my etsy and personal sites as my business I pay the appropriate state sales tax, and I also pay income taxes to the US government. Since I'm self employed this includes what you need to pay for medicare etc.

    I think most people don't want to bother with this, but it kind of bugs me. I pay my taxes, you should too. Once you get going it's not that hard, and really, it helps you get an idea if your business is actually worth it, with how much you make out of it per year.

    (JoAnns also has a program where you can get 10% off your purchases that aren't already discounted if you show your tax id)

  4. Cam,
    Thank you so much for writing this out. I remember reading a lot about pricing and getting a lot of bad advice about it too. Looking forward to revising my shop some more in the down time while I am waiting for my machine to get fixed...Oh, I sent in the icon print in the mail today for you. Hope you enjoy it!

  5. Would it help you out if some of your customers wrote reviews? I bought a sewing pattern from you and am nearly finished my first head scarf and would be happy to write you a review/testimonial. (And yes, it would be positive!)

  6. That's awesome about the 10% off Allison! I need to find mine.

    I would definitely second the sales tax advice. My business is registered in California, which is where I pay sales tax, although not much since 99% of my business is outside the state and about 30% is outside the US.

    With our family size we have yet to pay from my business for income tax, although we do file every year. I imagine that will change when Paul has a job in a couple years and our combined income is more.

    Doing those two things really does give you peace of mind, because you know you're doing everything legally!

  7. And to those of you who are thinking of starting up businesses, if you do let me know and I'll link to it! I love looking at new etsy shops! And shopping at them!

    (And Maria, I'm hoping your sewing machine is fixed really soon! I love the apron you made. It is my absolute favorite. I think it's going to fit for the whole pregnancy. I'm going to write a post about it as soon as I wash it. Right now it's covered in pink minky. It was a lifesaver when I made Mae's blanket!).

  8. Hi Sophie-

    Good reviews are always wonderful to receive! And I'm so glad you like it!

  9. I more than slightly envy those of you who are "crafty". That has never been one of my talents, sadly.

    I think it would be just wonderful to have a skill whereby you could bring in money by working at home, making lovely things! My mother had me take sewing lessons when I was young... it didn't take. :(


  10. I think Allison is talking about the VIP card at JoAnns. It really does come in handy. Also, you can purchase your items tax free with your tax-exempt status, which really makes a big difference in the long run.

    I just posted a listing for the apron. I ran out of the polka dot fabric, so I'm making it made-to-order. Also, I made another listing for children's pinafores too, at a pretty good price.

  11. I am so glad you posted this. I actually have an etsy store (Mamacre8s), but it doesn't have anything in it. I've made a few things, but I've been nervous about getting started. I have made things that are totally different from each other and feel like they should be in different shops. When I signed up for etsy, I thought that you were only allowed one shop per email address. Is that still true? I was wondering how you had multiple shops and I really wanted to do that too.

    My life has been changed drastically recently (you can see my blog for details) and I am going to need to find a way to start earning some money. I think this is a way to do it. I plan to get the shop stocked as soon as things settle down a bit.

    I know a couple of people have suggested JoAnn's VIP card; but depending on your interest rate (for the interest-free shopping), you may want to apply for their teacher's card. As a homeschool teacher, you are eligible for 15% your entire purchase, every time you shop. They will be having renewals next month and usually offer a small gift or a 20% off day when you sign up.

  12. Hi Heather-

    Each shop has it's own email address through gmail. It can get a bit hectic that way, but it's still the only way to do it!

    I hope that helps!

  13. Thanks, for sharing your experience and thoughts. It helps those who are still struggling out there.
    I opened my shop earlier this year. I am yet to have any sale though. Still, it has been very interesting. You learn a lot about business, online business, social media, attracting customers etc. while doing so.

    My first issue was to draw traffic to the shop.
    Then after listing few items, I started having trouble making good stuff. They were just not good enough (at least to my eyes). So I decided not to list them.
    I do have a regular job (which takes most of my time actually) so listing new items is my #1 problem these days. Hopefully I will be out of that phase soon. Once I start producing new good items again my listing count will go up and maybe some sales will pop up.
    Feel free to take a look (click on my name) at my budding shop and give comments on how to improve it.


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