Local Etsy sellers frustrated with fees and payment reserves consider looking elsewhere - CBC.ca

Summary

Several Etsy sellers in Waterloo region say it's becoming increasingly less feasible to have a store on the online platform and some are even considering leaving Etsy all together.

The site has billed itself as a way for individual makers and crafters to reach a worldwide audience. But in recent months Etsy has faced criticism over some of its policies, fees and ads.

Several Etsy sellers in Waterloo region say it's becoming increasingly less feasible to have a store on the online platform and some are even considering leaving Etsy all together.

The site has billed itself as a way for individual makers and crafters to reach a worldwide audience. But in recent months Etsy has faced criticism over some of its policies, fees and ads.

Sarah Dymond in Kitchener, Ont., said she's looking at potential alternatives after a payment reserve was put on her account in May.

Payment reserves are normally in place for 90 days. Reserves can be issued after making a first sale, if a seller has a sudden increase in sales or if a seller has received notice of counterfeit, notice of unauthorized reproduction, or a report of alleged intellectual property infringement.

Dymond said she did not receive any of those notices and the payment reserve has left her with access to just 25 per cent of her sale revenue.

"The issue is that all the fees that you pay on Etsy, including ad fees, transaction fees, Etsy fees, are all taken from that 25 per cent," Dymond said, adding some of that also has to go to pay her manufacturers.

Sarah Dymond has been an Etsy seller since 2018. A payment reserve was placed on her account in May, which has been hard on her finances and her mental health. (Submitted by Sarah Dymond)

"At the end of the day, you're left with a 10 per cent profit to make and produce your orders, which can be fine if you have the supplies at hand and and you are capable to ship out orders, but eventually you're going to have to restock."

On its website, Etsy says a percentage of funds from each new sale is withheld under a payment reserve until the order is in transit with tracking. If tracking is not provided funds are withheld for 45 days.

Dymond said the company has not been able to give her clear answer as to why a reserve was placed on her account.

"If I had a policy violation, you'd think they could go to my account and say, this is what you violated or this is the reason for the reserve and they were not able to give me a reason," she said.

"There's been close to 50 emails sent back and forth between me and Etsy support and it's always the same copy and paste response," she said.

'We're just cogs in a machine'

Jon Johnson has been part of Etsy as a buyer and seller for roughly a decade. (Submitted by Jon Johnson)

The entire experience has been hard on Dymond's finances and her mental health.

"My credit card is maxed, my savings are half gone. It has not been fun," she said, adding money she had put away for a vacation this fall is now being used to keep her afloat.

Kitchener's Jon Johnson shares a similar experience. He had a payment reserve placed on his account after two shipping complaints in December.

"If that would have been my only source of income going into Christmas 2021 and I was losing over 70 per cent of my sales for 90 days ... I would not have been able to make it through Christmas," Johnson said.

Johnson has been an Etsy seller and buyer for roughly a decade and said the sense of community the site once fostered is fading.

"The site has become more seller hostile and more customer friendly," he said.

"What Etsy doesn't get is that Etsy customers are us, the sellers, and our customers are the customers. But Etsy's acting like their customers are our customers and we're just cogs in a machine."

Dymond agrees, saying when she joined Etsy in 2018 as a graphic designer, Etsy was "the place to be" to connect with a large customer base and fellow crafters.

"[Etsy] doesn't treat their shops like businesses is what I think the problem is," she said.

Jon Johnson has been on Etsy for about a decade. Johnson sells pins, patches and t-shirts on his Etsy store, as well as this coin, which he says has been very popular in the U.S. (bearface.ca)

'It's not very affordable'

Lize Knapp in Cambridge, Ont., said she's considering closing up shop after having a small antique store on Etsy for three years as a side hustle.

She joined because the platform offered a global market, but she's found that almost 40 per cent of her revenue has gone to pay site fees.

"Over the past few years, I started to notice there's fees on top of fees and as a small shop owner, it's not very affordable for me to continue," she said.

Knapp is not sure what she plans to do, but closing her Etsy shop is now an option on the table.

Johnson said he's had to charge his customers more for his items and for shipping to make up for the costs Etsy charges him as a seller.

Raina Moskowitz, Etsy's chief operating officer, said in an email to CBC News, "We value transparency, and we recently provided an update to our entire community on how investments from our transaction fee increase will benefit sellers in the areas they've said they care about most."

"We're reinvesting the substantial majority of this fee increase back into the community to grow sales for our sellers and provide even better service," said Etsy chief operating officer, Josh Silverman during a job summit in April.

He added Etsy's fees are still "very affordable compared to other marketplaces."

Looking elsewhere

Johnson and Dymond are keeping their options open. There aren't many platforms with the customer base that Etsy does. For now, the pair have set up their own Shopify stores.

"I've been a part of Etsy for so long, I've bought so many different things on it and it does get my stuff all over the world, so I'm not ready yet to fully leave, even when there was that strike recently," Johnson said.

And Dymond said she's now learning how to use Shopify in her downtime.

"There's a long list of things that you have to understand to get traffic to your shop. You can't just open a website and expect Google to pick it up and send shoppers to your place," she said.

Dymond adds Etsy lifted the reserve on her account on July 1,after her store qualified for the star seller program.

Despite that, she says she's worried the company could place another reserve on her account. She plans to evaluate her next steps.

"If I could get off this platform for good, that would be great, but this is my income. Etsy is my main source of income," she said.

Local Etsy sellers frustrated with fees and payment reserves consider looking elsewhere - CBC.ca
Photo Credit: CBC.ca

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