In recent years, dropshipping has been proven as a worth-to-try eCommerce business model. Therefore, there is a rise in the number of merchants who want to launch a dropshipping business and earn money. Among many marketplaces, Etsy has both strengths and weaknesses to be a dropshipping platform.
If you are a dropshipper and want to sell creative products, why not check out the detailed guide for Etsy Dropshipping written by LitCommerce? In the upcoming sections, we will walk you through:
- What is Etsy Dropshipping?
- How Dropshipping on Etsy Works
- Pros and Cons When Dropshipping on Etsy
- What Are Etsy Dropshipping Policies?
- How to Dropship on Etsy? – Full Guide
- Top Winning Products to Sell on Etsy for Dropshipping Business
Let’s explore!
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What is Etsy Dropshipping?
Etsy dropshipping involves selling products on Etsy without keeping any inventory. Instead, when a customer places an order, you forward it to a supplier who ships the item directly to them. This can save you time and money since you don’t need to make or store the products yourself.
However, it can be challenging on Etsy, a platform that celebrates handmade and vintage goods. To succeed, you’ll need to be upfront about your process and choose products or designs that feel unique. Reliable suppliers are essential since you can’t check product quality personally.
Customers on Etsy often appreciate authenticity and a personal touch, so branding, communication, and honesty about where your items come from matter a lot. If you follow Etsy’s guidelines and focus on building trust, dropshipping can be a relatively low-risk way to begin selling online and connect with a vibrant, supportive community of shoppers.
How Dropshipping on Etsy Works
Let’s start with how dropshipping generally works. Dropshipping lets you sell products online without storing inventory. When a customer orders from your store, you buy the item from a supplier who ships it directly to them. You act as a middleman, handling sales and marketing, while the supplier takes care of shipping and stock.
In fact, Etsy doesn’t directly support dropshipping, as it has rules that restrict key aspects of the model, like reselling. However, the two approaches to do dropshipping with Etsy and still comply with Etsy’s policies. These methods aren’t traditional dropshipping but offer a similar way to operate on the platform while staying within the guidelines.
Keep reading to learn how they work.
1. Start an Etsy shop and outsource products
This Etsy dropshipping approach lets you outsource the production of your products, so you don’t need to handle making them yourself. If you choose this method, you can only outsource products that you’ve designed. This is because Etsy’s rules require that sellers are involved in the design process of any handmade items they sell.
Another method is to sell products like craft supplies which are mentioned in the Etsy policy. Those products allow buyers to design their own products with unforgettable experiences. By finding a good manufacturer from other places, such as AliExpress, you can compete with better prices and sell tools to many Etsy buyers. However, dropshipping on Etsy this way, you’ll still be responsible for shipping orders.
2. Purchase products from Etsy to sell in your own store
This approach means that you buy products from Etsy sellers and then resell them on your own eCommerce website not on another Etsy shop. For example, if you want to sell phone cases on eBay, you can find unique products on Etsy, contact the seller for permission then list them on eBay.
By having your own online store, you gain more control over your business and the way you operate. But this also means you’ll be responsible for promoting your site and driving traffic since you won’t have access to Etsy’s existing audience of shoppers.
Want to make money with Etsy, you might also want to read:
Pros and Cons When Dropshipping on Etsy
The pros of dropship on Etsy
#1. Low competition
Because it requires more attempts to dropship on Etsy, there will be fewer dropshippers on this marketplace, which means you will have fewer competitors. Dropshipping on Etsy is not a bad idea if you want to build an online store that sells creative products.
Based on the mentioned methods to dropship on Etsy – the top-notch online marketplace, there are some highlighted points to make it more competitive.
- On the one hand, you sell outsourcing products on the Etsy storefront. It is possible to sell products like craft tools which are mentioned in the Etsy policy that commercial quantity is also approved. By finding a good manufacturer from other places such as AliExpress, you can compete with better prices and sell tools to many Etsy buyers.
- On the other hand, if you want to sell in other places, Etsy is a great place to find suppliers for handmade items. For example, if you want to sell phone cases on eBay, you can find unique products on Etsy, contact the seller for permission then list them on eBay.
#2. Niche business support
Dropshipping niche products might bring both advantages and disadvantages. For niche markets, sellers might be expertise in selling their products instead of facing many challenges to be an expert in every field. However, it will be hard to reach potential buyers and challenging to find suppliers.
Some creative or craft products are also considered niche. Even so, Etsy is a comprehensive platform for mentioned items.
#3. Comprehensive handmade marketplace
Etsy is optimized to buy and sell handmade items. Customers literally can find what handmade products they are looking for with the search bar, categories or Etsy’s suggestion. Since the marketplace is working this way, so sellers will be able to approach customers better even though there are thousands of products on the floor.
The cons of dropship on Etsy
#1. Extra fees
Etsy charges a deposit and it is not ideal for new eCommerce sellers. The fees to sell on this marketplace include:
- Subscription fee: Free or $10/month if you want more features.
- Listing fee: 20¢ per item, plus 20¢ per sale (renewal fee).
- Transaction fee: 5% will be changed to 6.5% total cost of each transaction.
- Payment processing fee (only when using Etsy payment): 3% + $0.25 (for US).
- Advertising fee: 12% or 15% depending on annual revenue.
For more cost-effective, you can take a look at Etsy Pattern. With Pattern, you can build a basic branded eCommerce website, which costs $15 per month.
#2. No wholesale option
Etsy has discouraged dropshipping by shutting down the wholesale offering. The marketplace encourages sellers to join in the making process, which means it might require more time to produce with limited stock.
However, dropshipping business is expected to exclude the manufacturing process and the products to dropship are usually sold and bought in large quantities. As a result, the Etsy wholesale program, which makes it easier to dropship on Etsy, is no longer available.
#3. Challenges to grow
The point of the Etsy business is the store sells products that are not mass-produced. Since the products are carefully made, Etsy suppliers can not provide you with a large quantity. This makes it more difficult to expand your firm and increase revenue.
What Are Etsy Dropshipping Policies?
If you’re thinking about selling on Etsy, it’s important to know that the platform has specific rules for sellers, limiting certain types of dropshipping.
Here are some key guidelines to keep in mind before starting your own Etsy dropshipping business.
1. Sell vintage, handmade, or craft supplies only
Everything you sell must fit into one of three categories: craft supplies, vintage, or handmade. This is central to Etsy’s mission of promoting unique, creative products. “Handmade” can also include items with original or custom designs.
2. Ensure all products are made or designed by the sellers
The second rule for Etsy dropshipping is that all products listed must be created or designed by you, the seller. This reinforces Etsy’s focus on providing a platform for creators to showcase their own work.
Etsy isn’t for reselling generic, mass-produced goods from other sources. Instead, it’s about offering one-of-a-kind items that can’t be found elsewhere. Buyers on Etsy appreciate original designs and seek out a personal touch in their shopping experience.
3. Inform about your collaborations with manufacturers
Etsy requires sellers to be open about any partners involved in making their products. This rule is all about being transparent so buyers know exactly how their items are made and delivered. If you use third-party manufacturers or print-on-demand services for dropshipping, you need to include these details in your Etsy product descriptions.
4. Avoid some reselling practices
Etsy has clear rules against certain types of reselling, including:
- Repackaging and rebranding store-bought items (like gift baskets with non-handmade products)
- Selling a mix of handmade goods created by others without designing or making them yourself
- Selling products made or designed by another seller outside your shop
- Offering traditional crafts that you didn’t design or create
- Selling commercial items with optional personalization without changing the original product
5. Avoid selling prohibited items
Etsy is not an extremely strict marketplace. However, there are some reasons that Etsy’s policy prohibits some types of products from the platform, which may cause legal dangers to Etsy users; others are incompatible with the values, are harmful to their members, or are simply not in the spirit of Etsy.
So avoid selling prohibited items on items as below:
- Alcohol, tobacco, drugs, drug paraphernalia, and medical drugs
- Animal products and human remains
- Dangerous Items: hazardous materials, recalled items, and weapons
- Hate Items: items that promote, support, or glorify hatred
- Illegal items, items promoting illegal activity, and highly regulated items
- Internationally regulated items
- Nudity and mature content
- Violent Items: items that promote, support, or glorify violence
Be sure to follow these guidelines when setting up your Etsy dropshipping business.
How to Dropship on Etsy? – Full Guide
This is the part you’ve been waiting for How to dropship on Etsy. In this guide, we will walk you through 7 steps of outsourcing your products and dropshipping them on Etsy.
Step 1: Conduct product research
The first step in Etsy dropshipping is deciding what products to sell. You have a wide range of choices, from handmade crafts to rare vintage items. A good place to start is by checking out Etsy’s Best Sellers and Top Sellers sections, which highlight popular products. To make your search more specific, you can filter results by price and shipping options to find the most profitable and in-demand items.
You can also find product ideas with Top 10 Best Selling Items on Etsy for New Sellers.
Step 2: Find your dropshipping supplier
The next step is finding a dropshipping supplier that matches your product focus. Since Etsy prohibits reselling handmade items from other sellers, you need to make sure all products are crafted or designed by the supplier.
Below are some helpful tips for you to choose the right supplier:
- Do thorough research: Look for suppliers with strong reviews and transparent business practices.
- Check their policies: Ensure they support dropshipping and meet Etsy’s rules.
- Order product samples: Test the quality before listing them.
- Maintain communication: Pick a supplier who responds quickly and clearly.
- Confirm shipping details: Ensure shipping times and costs suit your business needs.
- Review return policies: Understand their return process to ensure smooth handling of customer returns or exchanges.
Step 3: Choose your preferred dropshipping method
As I mentioned above, dropshipping on Etsy offers two main different approaches. It’s your job to choose the one that fits your business goals, market strategy, and resources. Here are the breakdowns of each method for Etsy dropshipping.
- Selling outsourced products on Etsy storefront
For this option, Etsy has approved partners you can collaborate with others to create and produce your items with your own ideas. One example is Printify, a service that lets sellers dropship custom print-on-demand products directly from their stores.
- Another option is Art of Where – a dropshipping partner that specializes in print-on-demand products and offers customization features for labels and stickers.
If you wonder about the methods of reselling products from AliExpress or Amazon, they are prohibited. This is because Etsy requires that products must be handmade, uniquely crafted, or true vintage. Suppliers on AliExpress, Amazon, or any other marketplaces, however, generally offer mass-produced items that don’t fit these criteria, as they are usually manufactured in factories or large production facilities.
Step 4: Create your listings on Etsy
If you don’t have an Etsy store, follow this short guide first before learning how to create a listing on this marketplace.
- Go to Etsy’s website > Register a new account by entering your mail or via Google, Facebook, or Apple.
- Scroll to the bottom of the page and click “Open your Etsy shop.” Then click “Let’s do this” and “Start your shop.” This will initiate the setup for your Etsy dropshipping store.
- Choose your store’s language, country, and currency for your store preferences. Click “Save and continue.”
After having your own Etsy store, follow these steps to publish your first products:
- Log in and navigate to Shop Manager
- Click on Listings
- Choose Add a listing
- Complete the required fields in the listing form.
- When done, click Publish.
Your item will now be active in your shop. Keep in mind that it might take up to 48 hours for your listing to show up in Etsy’s search results and categories.
Find more details at How to Sell on Etsy for Beginners in 2024: 8-Step Guide
Step 5: Market your shop
Once your Etsy dropshipping shop is set up with products ready to sell, the next step is marketing your store. Even though Etsy provides a platform with a large built-in audience, effective marketing is essential to drive traffic to your listings and increase sales.
1. Utilize Etsy ads
Etsy offers paid advertising options within the platform. You can promote your listings through Etsy Ads to reach a broader audience. Etsy Ads work on a pay-per-click (PPC) model, which means you only pay when someone clicks on your ad. The more you invest, the higher your chances of reaching a larger audience.
2. Optimize your listings for SEO
Search Engine Optimization (SEO) is key to making your products more discoverable both on Etsy and through external search engines like Google. You should use relevant keywords in your titles, descriptions, and tags while doing dropshipping on Etsy asl well. Let’s think about the terms potential customers might type into the search bar when looking for products like yours.
You can more helpful tips at Etsy SEO: 10 Helpful Tips to Cut Through the Noise
3. Social media promotion
Promoting your shop on social media platforms such as Instagram, Facebook, TikTok, and Pinterest is another best strategy. These platforms are ideal for sharing product images, behind-the-scenes content, and promotions. Don’t forget your Etsy shop to these profiles to make it easy for followers to visit and purchase from your store.
4. Offer discounts and coupons
Everyone loves a good deal! Offering discounts, free shipping, or coupons to first-time customers can be a great way to entice buyers to make their first purchase. Etsy allows you to create promotional campaigns directly within the platform, so take advantage of that feature to boost your sales.
Step 6: Fulfill your dropshipping orders
Fulfilling orders is where the dropshipping model comes into play. When someone places an order on your Etsy store, you’ll relay that order to your dropshipping supplier.
One way to meet customer needs is by manually fulfilling orders. This means you should go to the supplier’s website, buy the product, and enter the customer’s information for delivery. While this approach works for a few orders, it can become slow and inefficient when handling many orders, leading to delays and unhappy customers.
On the other hand, if you can integrate with your POD service like Printful or Printify, orders can be automatically forwarded to your supplier for fulfillment. Automation reduces the chance of human error and speeds up the process, allowing you to focus on growing your business.
Step 7: Communicate with your customers
Since dropshipping relies on third-party suppliers for fulfillment, ensuring a positive experience for your customers is key.
Providing outstanding customer service sets your Etsy business apart from competitors. In the same way, how satisfied customers are with their experience can significantly influence the success of your Etsy dropshipping business. Here are what you can do:
- Respond to messages promptly: You can use Etsy’s built-in messaging system that quickly responds to your customers.
- Address complaints and issues: Whether it’s a delayed shipment or an item that didn’t meet expectations, addressing issues calmly and professionally can turn a potentially negative experience into a positive one.
- Keep buyers updated: Sending customers updates at every stage of the order process, such as shipping status and tracking information, goes a long way toward customer satisfaction.
- Add some extra touches: You can include thank-you notes, offer small bonuses like discount codes for their next purchase, or even free samples to make your shop memorable and increase the chances of repeat customers.
Top Winning Products to Sell on Etsy for Dropshipping Business
#1. Phone cases
Phone accessories have shown a consistent development in five years, peaking in the winter months and then remaining in demand the rest of the year. Screen protectors or phone cases are in high demand.
#2. Home decor
The global value of home interiors, decor, and furnishings is expected to exceed $202 billion by 2024. Search interest has remained consistent over the years, with minor peaks in January and July. Numbers have reached an all-time high in 2020.
#3. DIY craft fabrics
Etsy allows sellers to list DIY materials. Therefore, this item might be a potential for dropshippers. Finding a good supplier and listing on the marketplace with an affordable price can help you better stand out from other DIY material providers.
#4. Ceramic vases
Ceramic vases are potential in the home decor category. There are thousands of styles that you can find on other platforms. Moreover, you can sell some blank vases that buyers can create their own by painting.
#5. Frames
You shall not sell vintage frames since the policy for vintage products is complicated. Instead, selling pre-made frames would work. It is also the craft supplies category. You are not limited by the Etsy policy.
Do you want to set your dropshipping business up for success? Check out the list of best-selling dropshipping products with LitCommerce!
Etsy Dropshipping: FAQs
Yes, you can dropship on Etsy. However, you can not search for any policy or regulation that specifically mentions dropshipping on the Etsy Help Center. Therefore, dropshipping is allowed on the site as long as you adhere to their product criteria. Etsy might not an optimum platform for dropshipping. Nevertheless, Etsy is still promising as the platform has around 2.1 million sellers and nearly 40 million buyers. Etsy is the global marketplace for unique and creative goods, offering anything from handcrafted items to vintage pieces.
Get Started For Etsy Dropshipping
Etsy dropshipping might require more effort than other platforms. Thus, it is not an ideal platform for everyone to start a dropshipping business. However, if you are into creative products such as handmade items, craft materials, or vintage pieces, this platform might be a good fit for you. By reading this dropshipping Etsy guide, dropshippers who want to sell the mentioned products might have more insight into starting their own business.
On the other hand, if you are interested in eCommerce and want to find a successful solution for your Etsy shop – one of the best selling platforms, drop us a message!
