How to start an Etsy shop

Do you create personalised stationery, craft handmade tables or make fun t-shirts? If so, Etsy could be a great place to start your business and sell your items.

Etsy is an ecommerce platform that focuses on small businesses and artisans selling handmade goods and vintage items. Globally, there are over 96 million active buyers on the website, and 8.3 million sellers. 

The potential customer market is huge. Opening an Etsy shop gives a small business a ready-made platform to showcase  goods – and the beauty is that anyone and everyone can set up a page if that want to.

This article will explore how to start an Etsy shop, including the best products to sell on the platform, tips and pitfalls to avoid, and how to set up payments.

You can also download our free business plan template to map out your goals, organise your ideas and set your Etsy shop up for success.

What to sell on Etsy

Etsy is designed specifically for the sale of goods that are made, designed, handpicked or sourced directly by a seller.

Let’s take a look at what this actually means:

• ‘Made’ items refer to those that have been created by hand, or by using a computerised item. Examples could include spun pottery or knitted jumpers
• ‘Designed’ goods refer to items that are designed by the seller but which use a third party to print or produce the actual item, and also include designs that are available by digital download. Such products can include a unique design printed on a sustainably made t-shirt, or a downloadable greeting card design
• ‘Handpicked’ items are those that have been personally curated by a seller and most commonly refer to vintage items that are over 20 years old. This can range from a skirt from the 1970s to mid-century furniture
• ‘Sourced’ goods are items created that help a buyer be creative. These could be party decorations, craft supplies or similar, but they will have the seller’s unique branding on the packaging. The main aim for goods in this category is to help the buyer create their own items or host a special occasion like a birthday party

Some of 2024’s most popular Etsy items have included jewellery, wall prints, party and craft supplies, clothing and in particular, wedding-related supplies like stationery and decorations.

Etsy sellers allow brides and grooms to create an expert, personalised touch to their big day without having to pay expensive suppliers to do the legwork for them. From sewn initials on linen napkins to neon lights spelling out surnames, there is a huge market for weddings on Etsy.

Another niche is personalised gifting. It can be tricky to find a gift for a loved one, and buying something that is personalised can make it extra special. With a wide range of goods in this field on Etsy, including newborn cardigans embroidered with first names, mugs with faces printed on them and art prints with your own chosen wording, the choice is pretty much endless.

Before launching your own Etsy shop, think about three key things: 

• Consider your own skill set and what you would like to create 
• Do your research on Etsy to check what the market is like for your idea
• Look into the cost of creating your items versus what you could sell them for

Also, it’s important to note that some items are prohibited on Etsy despite being homemade or sourced by the seller. 

How to start an Etsy shop

There are many steps involved when it comes to creating an Etsy shop, so it’s important to take your time and prepare for each one.

Rushing through the steps at this stage could create problems for your business later down the line, and you want to give your business the best chance of success from the get-go. 

Let’s take a look at how to start your very own Etsy shop.

Step 1. Set up an Etsy account

If you’re thinking of setting up an Etsy shop, you’re probably already a customer of the site. It’s a good idea to set up a separate account for your business to avoid any confusion – it’s a good idea to set up a separate business email address for this too to keep all business-related communication in one account.

Step 2. Set up your shop

Once you’ve set up your new account, go to Etsy.com/sell and click ‘Get started’. You’ll be directed through a few simple questions, including what has brought you to Etsy, and if there are any aspects you need additional support with, like marketing.

Next, you’ll be asked to confirm the language, currency and country of your shop, and then to name it. We’ll go into more detail below on tips for naming your shop, but it’s important to note that the shop name must be four to 20 characters and can’t include special symbols, spaces or accented letters.

Step 3. Create a shop listing

Now it’s time to show off your handmade or sourced goods! It’s not possible to skip this step, so even if you aren’t quite ready to share all of your items for sale, you must have at least one item to upload at this stage.

Having a consistent approach to photography is a great way to build your brand. You could take photos of your products with the same background, or maybe your thing is photographing the item in the setting the buyer will use it in. 

Regardless of your chosen approach, it’s a good idea to have your style in mind before setting up your shop because how you photograph your items will have a big impact on whether customers want to buy them. It can set the theme or tone for how you want to be perceived, and the type of customer who wants to build a collection, for instance. 

You can upload up to ten product photos and one video per listing. Remember to pick your best photos to be shown first – internet browsers and landing pages often have a short attention span so might not look at all of them!

Next, you need to fill out the listing information:

• Use a short title for your item and keywords to help improve visibility on search engines. For example, a floral mug that can be hand-painted with someone’s name could have the title ‘Personalised hand painted floral mug’
• Pick the category your item sits within
• Write out your description of your item. Be sure to use short paragraphs and bullet points to make it more readable for customers, and include all the crucial information about your product that someone may want to know, like measurements
• Fill out all 13 tags per listing with keywords related to your item. If you sell sourced mid-century furniture, tags could be ‘mid-century’, ‘furniture’, ‘vintage’, ‘dining table’, ‘dressing table’ and so on
• Fill out the price of the item and how many you have available for purchase
• List the time it will take you to post or deliver the item, where you ship to and the related delivery fees. If you are happy to accept returns, note that too and your terms related to this

Regardless of the currency you use, there is a 16p listing fee per item applicable and a 6.5% fee per transaction. You’ll also pay 4% plus 20p per transaction in payment processing fees. In the UK, you will be charged a one-off fee of £14 to set up your shop too.

Step 4. Set up your payment preferences

Next, it’s time to set up how your customers pay you. Etsy requires all shops to offer Etsy Payments – this allows sellers to accept payment methods like credit cards, debit cards, Apple Pay, Google Pay and Etsy gift cards. 

Etsy will recommend that sellers use its integrated PayPal account for payments to go straight into your account, but you can choose to be paid into your own PayPal account if you would prefer this.

You will also need to insert your own payment details to pay Etsy’s fees mentioned above.

Step 5. Verify your ID and set up security

The next step when setting up your Etsy shop involves verifying your identity by uploading an ID from your country of residence, like a driving licence or passport. 

Enabling two-factor authentication to make your shop account extra secure – you can choose to do this via phone, SMS or via the Google Authenticator app.

Step 6. Ready, set, launch!

You’re at the final hurdle of launching your Etsy shop! So now, have one final review and customise your shop before going public. Fill out the ‘About’ section and your ‘Shop Policies’, including factors like whether you accept returns and your returns window terms. Be sure to check out our guide to regulations for selling online for more tips.

Edit your shop’s bio and image to give customers a quick feel for what you’re all about, too. Brand personality is so important and can set you apart from other sellers, so double points here if your shop image reflects your shop items and photography style – consistency is key when it comes to successful branding.

How to find your niche

As there are millions of small businesses on Etsy, it can feel overwhelming to try to stand out from the crowd. However, finding your niche as part of your business plan can help you create a successful shop from the get-go. 

Here are some tips on how to find your niche:

• Play to your strengths: if you’re incredible at pottery and your loved ones always compliment your items, opening an Etsy shop selling your pottery is an obvious path. If you don’t see many similar goods on Etsy, your product could help to fill the gap in the market, but be sure to look into shops that are selling similar products and see how successful they are to check whether there is a demand
• Know your customer base: if you’re part of a community that supports a famous musician, for example, you are already halfway there to having customers – particularly if you have the skills to make a great item
• Learn from being a customer: if you’ve once been a keen customer for a specific item but haven’t been able to find it, this is your opportunity to fill the gap in the market and create that item – because there’s a high chance other people are looking for those products too

How to name your Etsy shop

Naming your Etsy shop is a big decision – remember, the name must be four to 20 characters without special symbols, spaces or accented letters.

It could simply be your own name, something that links directly to the product type you sell, or it could be something random altogether that you simply like. 

Take time to consider your business name so you’re unlikely to want to change it – building up a solid customer base is easier when there’s consistency, and a business name is a big part of this.

• Make the name easy to pronounce and spell
• Make sure your shop name is available on other platforms, such as on Instagram and TikTok – social media can play a big part in the success of an Etsy shop and consistency across branding is key
• If you’re struggling to think of a shop name, use online business name generators for inspiration
• Once you’ve decided on some contenders, check online that other businesses with the same name don’t exist – you don’t want trademark issues plaguing your business

How do you start taking payments?

When opening your shop, you will sign up for Etsy Payments – this allows your customers to choose from multiple payment methods like credit and debit cards, PayPal, Apple Pay, Google Pay, Etsy gift cards, and so on. 

Buyers use these payment methods to buy your goods and your sales funds will be made available in your Etsy Payment account. Fees deducted by Etsy for making sales are automatically deducted.

You can manage your shop finances in the ‘Payment Account’ under the Shop Manager tab.

How to grow your Etsy store

Many people who launch an Etsy shop use it as a side hustle – growing it into a main source of income is a dream for some.

To grow your Etsy business, it’s important to be mindful of a few key elements:

• Build a strong social media presence so that you resonate with your target audience. For example, if you create products related to a popstar that has a younger fan base, it’s a smart idea to have a TikTok account. Use relevant hashtags to boost engagement, consistently post content, and make sure you are interacting regularly with your fanbase via your account.
• Make sure you are using keywords related to your goods in your listing names and descriptions to boost your search engine optimisation (SEO) rating, i.e. the process of improving website traffic to a web page from search engines like Google.
• Plan to offer discounts to encourage customers to buy from your shop, such as discount codes that can be created via Etsy directly. You could also launch a competition to win a free product and have the competition terms include following you on social media or tagging a friend in the comments to spread awareness of your shop. 
• Track customer habits and lean into them. If a certain type of product in your shop is proving considerably more successful than others, consider expanding your offering to similar products to utilise that spike.

Final thoughts

Launching your small business via an Etsy shop is an exciting first step in selling your handmade or sourced goods. It offers a more exclusive platform and tailored customer base than selling on platforms like eBay and Amazon, giving your products the best chance of success.

It’s important not to rush the process of setting up your shop, so take some time to consider key aspects of being a seller like your shop name, your niche and how you want to market your business.

Remember, branding is a big part of any successful business, so make sure you feel confident in your shop name, logo and how you photograph your products before going live with your shop. 

It’s natural to make changes along the way when being a business owner, but having a clear idea of the identity you want for your shop from the get-go will help potential customers have faith in your small business and return again and again. Good luck with your Etsy launch!

Ready to take the first step? Download our free business plan template and launch your Etsy store today.

Kirstie Pickering - business journalist

Kirstie is a freelance journalist writing in the tech, startup and business spaces for publications including Sifted, UKTN and Maddyness UK. She also works closely with agencies to develop content for their startup and scaleup clients.