Etsy Dropshipping Supplier – Advantages & Disadvantages

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Etsy was started in the year 2005 by IOspace.
This is a different dropshipping supplier than others in the market.
Their main focus is on handcrafted, hand-made crafty products and vintage items.
It requires these vintage items to be at least 20 years old.
The products are well segregated into categories such as clothing, home decor, jewelry, furniture, and the like.

Dropshipping On Etsy

There are two ways of dropshipping on Etsy.
You can open your own Etsy storefront, but this does not mean that you have to be the actual producer of the product.
It allows you to outsource production. But there is a catch.
The owner of the storefront shall be involved in the designing process of the product.
Since Etsy promotes handmade goods, it expects its sellers to be original creators of the product and not merely traders.
Thus, you can outsource just the production of products that have been conceptualized by you.

Another way is you can dropship products from other Etsy sellers’ storefront to your online store or even eBay.
However, in this case, you cannot sell handcrafted products and your dealings would mostly be in vintage products.
The major advantage of this method is that you get an opportunity to create your own brand name and not be hidden under the veil of Etsy’s brand.
However, finding the right product to dropship on your own store can be challenging.

Not all products on this platform can be dropshipped as the platform imposes restrictions on the same.
And the ones that are allowed to be dropshipped do not perform well in terms of sales.
It is important to understand that the sellers on this platform are mostly small businesses that sell customized handmade products.
Thus, even if you find the right product to dropship, your seller would not have the production capacity to sustain a huge demand.
Thus, the growth of dropshipping revenue from Etsy is limited.

Advantages Of Etsy

Etsy has become popular for a reason.
Let’s learn about those.

Unique Customers

Etsy is known to have customers with an eye for art.
Buyers here are conscious of their buying habits and exercise a great deal of vigilance during their purchases.
They are often willing to pay a premium price for the desired product.
This provides the benefit of high-profit margins for sellers using this platform as their dropshipping supplier.
The platform provides the sellers with an opportunity to be creative with their products due to the presence of human-centric shoppers.
The key to successfully dropshipping products from here is to find the right customer base.

Niche

Etsy is slowly becoming the place for niches.
Niche sellers operating in sectors such as clothing, home decor, and baby products tend to thrive in this place.
Thus, if you want to operate in a particular niche, Etsy can be the perfect dropshipping supplier for you.

Transparency

Etsy is known to be the transparent platform as compared to its contemporaries.
While shopping on the internet, buyers do not know the location of the seller and where the products are actually being manufactured.
This is important to maintain the uniqueness of the handmade product platform.
While it doesn’t disclose your business model to buyers, it does require you to disclose your location and place of production to buyers.
This instills confidence among buyers that they aren’t being hoaxed.

Disadvantages Of Etsy

Following are the shortcomings of Etsy as a dropshipping supplier.

Listing Process

The listing process on Etsy can be tedious.
It is also expensive as compared to some other platforms.
It charges $0.20 for every item that is listed on it.
However, it is worth considering that each listing lasts for only four months.
Thus, if your product is not sold within this time and you want to re-list your item, you would have to spend another $0.20.
A processing fee of 5% is charged for every sale made and the above charges do not include a shipping fee.

It works in a highly regulated manner and has a strict operating policy and intense scrutiny of transactions.
Thus, it can be uncomfortable for sellers as they feel their independence being curbed.

Listing Prices

Products on Etsy are often listed above their retail prices.
Although, products on the platform are unique many resembling products can be easily found in the market as well.
A conscious buyer who has time for market research may not be willing to spend a higher amount to get a product from this dropshipping supplier, where he can get a similar one at a cheaper price.
Thus, dropshippers can face problems in terms of margin.
If they want to compete for market prices of the products, then dropshipping from Etsy would not be economical.

Thus, if you want to dropship original products from Etsy, the quality of your customer base is important.
This platform is recommended for those dropshippers who already have a storefront with conscious and responsive buyers.

Highly Regulated

Payments on Etsy are secured and convenient with Paypal and several other options.
However, it authorizes these payment platforms to keep a watch on the seller’s activities.
Also, it prefers to work in a highly controlled and regulated environment and thus there are many strict policies and guidelines in place.
Not only the sellers have to be aware of them, but also adhere to them.
Non-compliance can result in fines and penalties.

Final Thoughts

Etsy is not the regular e-commerce website or dropshipping supplier from where you can dropship whatever you wish.
The exclusive products coupled with a well-created and managed niche make it a formidable foe in the market.
Moreover, dropshipping through Etsy can be slow-growing.
Thus, if you are looking to use it for dropshipping as your mainstream business, it can take years of hard work before you start making a reasonable profit.
You would need to put the hard yards on a consistent basis.

However, Etsy can be best used as a side business where you can make decent money regularly.
Thus, it can be used as a secondary source of income to strengthen your financial goals rather than being dependent on it for a living.

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