Etsy vs Shopify Fees: Which Platform Saves You Money?
Are you an aspiring entrepreneur ready to launch your online store? Choosing the right platform is crucial, and one of the biggest considerations is cost. Two of the most popular options are Etsy and Shopify, but their fee structures differ significantly.
Understanding the nuances of Etsy vs Shopify fees can make or break your business’s profitability. This comparison will break down the costs associated with each platform, helping you make an informed decision aligned with your specific needs and goals.
Whether you’re selling handmade crafts or building a full-fledged e-commerce empire, knowing exactly where your money goes is essential. We will examine transaction fees, listing fees, and subscription costs to equip you with the knowledge to select the best platform for your budget.
Specs at a Glance:
| Feature | Etsy | Shopify |
|---|---|---|
| Target Audience | Handmade, vintage, and craft supplies | Various, from small to large businesses |
| Storefront Customization | Limited | Highly customizable |
| Payment Processing | Etsy Payments, PayPal | Shopify Payments, various third-party providers |
| SEO Tools | Basic | Advanced |
| Marketing Tools | Etsy Ads, social media integration | Email marketing, social media, SEO |
| Inventory Management | Basic | Robust |
| Shipping Options | Integrated shipping labels | Flexible shipping options |
| Analytics | Basic | Detailed |
| Domain Name | Etsy subdomain | Custom domain |
| Customer Support | Etsy support | Shopify support |
| Scalability | Limited | Highly scalable |
| App Ecosystem | Limited | Extensive |
Feature-by-Feature Breakdown
Transaction Fees
- Etsy: Etsy charges a transaction fee of 6.5% on the total sale price (including shipping) for each item sold. This fee is straightforward and easy to understand but can eat into profits, especially for low-margin items.
- Shopify Fees: Shopify offers several payment gateway options, each with its own transaction fees. Shopify Payments (their in-house gateway) charges between 2.9% + $0.30 to 2.4% + $0.30 per transaction, depending on your plan. Using third-party payment gateways also incurs additional fees.
- Winner: Shopify
Listing Fees
- Etsy: Etsy charges a listing fee of $0.20 USD per item listed, and listings expire after four months. This can add up quickly, especially if you have a large inventory or frequently relist items.
- Shopify Fees: Shopify does not charge listing fees. You can list as many products as you want, depending on your chosen plan.
- Winner: Shopify
Subscription Fees
- Etsy: Etsy has no monthly subscription fee for the standard seller account. However, they offer Etsy Plus for $10 per month and Etsy Pattern for $15 per month, offering extra features.
- Shopify Fees: Shopify offers different pricing plans, each with a monthly subscription fee (Basic, Shopify, Advanced) ranging from $29 to $299 per month. These plans provide access to various features and transaction fee rates.
- Winner: Etsy
Payment Processing Fees
- Etsy: Etsy Payments processes payments and charges a processing fee. This fee varies based on the location of your bank account and the buyer’s location.
- Shopify Fees: Shopify Payments charges processing fees that vary by plan and location. These fees are usually lower than those charged by third-party payment gateways.
- Winner: Shopify
Website Customization
- Etsy: Etsy offers limited customization options. You can customize your shop’s banner, profile, and listing descriptions. However, you don’t have control over the underlying website structure.
- Shopify Fees: Shopify provides extensive customization options. You can choose from various themes, customize the design, and even use custom code to build a unique online store.
- Winner: Shopify
SEO & Marketing Tools
- Etsy: Etsy offers built-in SEO tools and marketing features, such as Etsy Ads. However, you are competing with many other sellers on the platform, making it harder to stand out.
- Shopify Fees: Shopify provides SEO tools, marketing integrations (social media, email marketing), and the ability to run your own advertising campaigns. You have more control over your marketing efforts.
- Winner: Shopify
Domain Name
- Etsy: You operate under an Etsy subdomain (e.g., yourshop.etsy.com). You do not have your own domain name.
- Shopify Fees: Shopify allows you to use your own custom domain name, giving your store a more professional and branded look.
- Winner: Shopify
Scalability
- Etsy: Etsy is limited in scalability. While it’s easy to start, growth is constrained by the platform’s limitations and competition.
- Shopify Fees: Shopify is highly scalable. You can upgrade your plan as your business grows and easily manage a large inventory and customer base.
- Winner: Shopify
Winner by Category:
| Category | Winner |
|---|---|
| Ease of Use | Etsy |
| Customization | Shopify |
| Scalability | Shopify |
| Built-in Audience | Etsy |
| Control | Shopify |
| SEO & Marketing Tools | Shopify |
What They Have in Common:
- Payment Processing: Both platforms offer secure payment processing options, ensuring customers can easily purchase products.
- Marketing Capabilities: Both Etsy and Shopify provide tools to market your products, including social media integration and basic SEO features.
- Customer Management: Both platforms allow you to manage customer interactions and order fulfillment.
- Mobile Responsiveness: Both platforms offer mobile-friendly interfaces for both sellers and buyers.
- Order Management: Both systems provide tools to track and manage orders efficiently.
- Listing Capabilities: Both platforms allow you to list products with descriptions, images, and variations.
Etsy Vs Shopify Fees Buying Guide
Understanding Fee Structures
Both Etsy and Shopify employ distinct fee structures. Etsy primarily uses a listing fee, a transaction fee, and payment processing fees. Listing fees are charged for each item listed, while transaction fees are a percentage of the sale price. Payment processing fees are applied by Etsy Payments. Shopify, on the other hand, offers various pricing plans with monthly subscription fees. Each plan has different transaction fees if you don’t use Shopify Payments. Understanding these fundamental differences is crucial for assessing which platform aligns with your business needs and profitability goals. The volume of your sales and the type of payment processing you choose will significantly impact your overall costs.
Etsy’s Fee Breakdown
Etsy’s fee structure is relatively straightforward. There’s a small listing fee per item, which is charged regardless of whether the item sells. When a sale occurs, Etsy charges a transaction fee, a percentage of the item’s price plus shipping costs. Additionally, payment processing fees (handled by Etsy Payments) are deducted from the sale. These fees can vary based on your location and the payment method used. Etsy’s fees can be more manageable for low-volume sellers, as the base cost is relatively low. However, high-volume sellers might find the transaction fees add up quickly.
Shopify’s Subscription Plans and Fees
Shopify operates on a subscription-based model. You choose a plan (Basic, Shopify, Advanced) that best suits your needs, paying a monthly fee. Each plan offers different features and transaction fees if you don’t use Shopify Payments. Transaction fees are charged on sales if you use a third-party payment gateway. Shopify Payments has its own processing fees. The Basic plan is suitable for new businesses, while more established businesses benefit from features in higher-tier plans. Consider your expected sales volume and the need for advanced features when selecting a Shopify plan.
Payment Processing Costs: Etsy vs. Shopify
Both platforms have payment processing fees. Etsy uses Etsy Payments, which processes payments and charges fees per transaction. These fees vary depending on the payment method and your location. Shopify offers Shopify Payments as a default, which has its own rates. If you opt for a third-party payment gateway on Shopify, you’ll incur transaction fees based on your subscription plan. Both platforms offer competitive rates, but it’s essential to compare them based on your anticipated sales volume and the payment methods your customers prefer. Consider the currency conversion fees too.
Transaction Fees: A Key Comparison
Transaction fees are a significant cost component for both platforms. Etsy charges a percentage of each sale, including shipping costs. Shopify charges transaction fees if you do not use Shopify Payments. The percentage varies based on your Shopify plan. For high-volume sellers, minimizing transaction fees is critical to profitability. Carefully compare the transaction fees of both platforms, taking into account your projected sales volume and average order value. Consider the potential savings from using Shopify Payments versus Etsy Payments.
Hidden Costs and Extra Considerations
Beyond the core fees, consider potential hidden costs. Etsy sellers may incur fees for offsite ads, which are optional but can increase visibility. Shopify users should factor in the cost of apps and themes, which can add significant expense. Both platforms may have currency conversion fees, especially for international sales. Also, consider the cost of marketing and advertising, regardless of the platform chosen. Analyze all the potential costs and hidden fees before making your final decision. Consider the cost of customer support from each platform.
Who Should Buy What?
Buy Etsy If…
- You sell handmade, vintage, or craft supplies.
- You want an easy-to-set-up platform with a built-in audience.
- You prefer to avoid the complexities of building and maintaining your own website.
- You are looking for an affordable solution.
Buy Shopify If…
- You want complete control over your brand and storefront.
- You plan to scale your business significantly.
- You need advanced features like SEO, marketing, and inventory management.
- You prefer to have your own domain name and a professional-looking website.
Frequently Asked Questions
What is the listing fee on Etsy?
Etsy charges a small listing fee, currently $0.20 USD per item. This fee applies each time you list an item, and the listing is active for four months or until the item sells. It’s important to factor this cost into your pricing strategy, especially if you sell a high volume of low-priced items. The listing fee is a fixed cost that impacts your profit margins directly.
What transaction fees does Etsy charge?
Etsy charges a transaction fee of 6.5% of the item’s price plus the shipping cost. This fee is applied when a sale occurs. This percentage is deducted from the total sale amount. This fee, coupled with payment processing fees, affects your overall profitability. It’s crucial to factor this into your pricing strategy.
How much does a Shopify Basic plan cost?
The Shopify Basic plan is the most affordable subscription plan, it typically starts at around $39 per month. It includes essential features for starting an online store, such as unlimited products, a blog, and 2 staff accounts. It is important to check the current pricing on the Shopify website, as it may vary based on your location and any promotional offers. The Basic plan is suitable for new businesses.
What are Shopify’s transaction fees?
Shopify charges transaction fees if you don’t use Shopify Payments. The percentage varies based on your chosen plan. Basic plan has higher transaction fees compared to the Shopify and Advanced plans. Using Shopify Payments avoids these fees. Transaction fees are charged on all sales processed through other payment gateways.
Does Shopify offer free trials?
Yes, Shopify offers a free trial period. This allows you to explore the platform and test its features before committing to a paid plan. The trial period typically lasts for a few days, giving you ample time to set up your store and experiment with different features. Check the Shopify website for current trial length and terms.
What payment gateways are available on Shopify?
Shopify supports a wide range of payment gateways, including Shopify Payments (its own gateway), PayPal, Stripe, and many others. The availability of specific payment gateways may vary depending on your location. Shopify Payments offers competitive rates and integrates seamlessly with the platform. You can choose the gateway that best suits your needs.
How do I calculate my Etsy fees?
To calculate your Etsy fees, add the listing fee, the transaction fee (6.5% of the item price plus shipping), and the payment processing fee. Etsy provides a fee calculator in your shop manager. You can also use online fee calculators to estimate your costs. Ensure you account for all applicable fees to accurately assess your profitability.
Final Verdict
Both Etsy and Shopify offer viable platforms for online selling, but their fee structures differ significantly. Etsy is easier to set up for beginners with lower initial costs, but transaction fees can accumulate with higher sales volumes. Shopify provides more control and customization but requires a monthly subscription fee. For those prioritizing flexibility and control, Shopify might be better. However, for those starting out with lower sales volume or who value ease of setup, Etsy can be a good choice.
Winner: Shopify