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How to know when it's time to grow your business off Etsy

It's the path that most makers take when starting a small business. They open up an Etsy shop and list a few products for sale. And that's great. It's exactly what you should do. Etsy has a lot of things going for it that are attractive for hobbyists and people dipping their toes in the business waters for the first time: it's easy to get started on; it has a ton of traffic that you can get your product in front of (377.4 million per month, on average!); it's very reputable and has built a ton of trust with its great customer service and built in payment processors; not to mention the large network and tight-knit community of sellers you join on various platforms and social media groups.

Overall, it's kind of like having an established, well-oiled corporate team working for you along with a bunch of built-in business besties who are going through the same things you are.

But once the excitement wears off and the honeymoon phase ends, things start to look less shiny. Over time you'll start to see some of the realities of selling on Etsy and they'll feel less helpful and more hindering.

Etsy is a great place for hobbyists to make some extra money and sell off their accumulation of completed projects, or for makers to dip their toe into the idea of starting a business. It gives them a place to refine their formulas and prove their concept by getting a few quick sales under the belt.

But once you decide to go from "hobbyist" to "business owner" you'll come to realize that you've quickly outgrown Etsy.

For starters, Etsy can chip away at your profits through all their various fees. Etsy charges a fee for listing products, selling items, and processing payments. It's commonplace to hear Etsy sellers lamenting the rising fees, and be warned— fee increases can happen at any time. It may not seem like a big deal at first, but after you start selling more and more you'll start to resent the amount of money you're losing in fees each month.

And yes, Etsy has a lot of organic traffic but that also means a ton of competition. On Etsy, you're one of many. When a buyer comes to Etsy, they are searching by product, not by seller. They want a new candle or a silver gold necklace. They're not loyal to your brand. Which means you're in competition with everyone else based on one thing... price. And competing on price is a quick way to burnout and run yourself out of business.

While Etsy shops do offer some limited ability to customize the look of your shop, there's really no way to stand out from the crowd. When you're selling on Etsy you're selling under their brand recognition, not your own. When someone compliments one of your customers on their new necklace and ask where they got it your customer is going to respond, "I got it on Etsy!" They may not even remember the name of your shop. You're building your business on Etsy's land, which means you're completely at their mercy. Etsy has their own policies you have to abide by, they have their own way of customer communication, their own way of operating and all of that impacts your customer experience and, in turn, your business and bottom line.

Because of the low barrier of entry, many wholesale outlets won't consider doing business with you if you don't have a unique brand built off of Etsy. If you're a shop owner hoping to sell other brands or makers goods in your shop, or if you're a product business hoping to get your goods into big retail you need to have a stand-alone website and strong brand presence outside of Etsy. Having a well-done website and put-together-brand your business looks more legitimate and builds trust with your customers as well as potential wholesalers and retail buyers. They need to know you're taking your business seriously before they'll invest with you. An individual online shop of your own gives you more control over your brand and allows you to scale your business the way you want to without the limitations of a third party. By limiting yourself to Etsy, you're limiting the growth of your business.

A website allows you to build the business you've always dreamed of. It allows your customers to shop in a way they're accustomed to. Etsy has very limited shop organization, which can be frustrating, especially if your shop has a larger catalog. Customers aren't going to want to sift through pages and pages of products. With your own website on a platform like Shopify, you can organize your products more easily into easy-to-navigate categories and collections so your customers can easily find what they're looking for. Etsy runs on tags and keywords which means your product titles become overstuffed until they become something like this: "Handmade Pink Sparkle Glitter Birthday Candles for Girls Kids Women Baby Shower Teen Birthday Cake or Bachelorette Party Pack of 12." That's one of the reasons product photos are so critical on Etsy; people are glazing over the product titles. With your own website you're able to name your products with normal, easy-to-digest names like "Pink Birthday Candles" or even get creative and title them unique like "Strawberry Milkshake Birthday Candles." Your SEO is built into your website holistically rather than completely dependent on your product titles.

Etsy is a very helpful tool for new business owners, and once you get started on Etsy there's no reason to shut it down if it's performing well for you. In fact, the more streams of revenue, the better! But it can be really beneficial to build a shop of your own and start building your own brand recognition so you can grow your business.

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About the Author

Brittany Wong

Brittany Wong is the Founder and Creative Director of Happyland Creative®, a design studio helping small business owners make more money with their branding.