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How to Start an Etsy Shop – Everything You Need to Know

how to start an etsy shop

Through its handmade and vintage marketplace, Etsy gives artists, crafters, and vintage sellers the tools they need to turn their creative hobbies into global online companies. Before you can start selling, you need to know Etsy’s format, rules, target groups, and best practices for selling handmade goods.

This complete guide of the UK covers everything you need to know to start selling handmade goods or carefully chosen antiques on Etsy, including how to do your initial research, listing best practices, legal issues, customer service basics, promotion options, and common mistakes to avoid.

Why Open an Etsy Shop?

In the UK and around the world, Etsy makes it easy for people who want to start a small business, work as a side job, or just enjoy making things to sell to a large ready made global audience quickly.

For less than £1 per offering, artists and makers can show off their one-of-a-kind, artistic goods to millions of buyers who are looking for unique shopping experiences that celebrate small-scale creativity beyond mass-produced goods.

Some of the best things about Etsy include:

Target Market Size & Reach

  • More than 90 million active buyers searched for Etsy in 2022
  • The number of shoppers on Etsy increased up to 64%
  • The gross global merchandise sale of etsy was up to $10.3 billion last year

Low Barriers to Entry

  • Minimal upfront costs-that are only payments for small listings and transaction fees
  • Easy to set up that you have to do yourself
  • You have access to the expensive pool of international shoppers in the start

Creative Autonomy

  • You can design shop branding and visuals in the style that suits your business
  • You can customise the catalogues for your products
  • You can set pricing and delivery processes that suit your business

Etsy gives business owners and crafters all the tools they need to market their own creations to the wider world for a reasonable cost.

Understanding Etsy Shop Setup Requirements

While Etsy makes it easier for new business owners to deal with typical obstacles like website development, payment handling, marketing, and storage, it’s important to know the basic rules of the Etsy platform so that you don’t have to make too many changes to your Etsy shop after you launch it:

Allowed Goods

Etsy has certain restrictions for sellers.

Some of them are:

  • They should create handmade goods by themselves using raw materials
  • They must have crafting supplies to make the handmade goods
  • Another one is the Etsy production criteria of print on demand goods

Some of the other restrictions are that it does not allow selling of unsafe, illegal, offensive or any products that are mass manufactured. You can read more about seller policies of Etsy on their website.

Account Types

Etsy offers sellers 2 different types of accounts.

These are:

  • Individual: For casual sellers they have individual account which has a processing fees under £16,300 yearly
  • Business: This account is for businesses that are registered and are earning more than the threshold needed for VAT collection. The platform looks at the projected sales when selecting the status of the account.

Etsy Fees

More than 3 recurring fees apply on sellers on Etsy.

They are:

  • Listing fees: That is almost £0.16 per item listed on the website
  • Transaction fees: They need to pay 5% of the final sale value to etsy
  • Payment Processing fee: It is almost 4% of the sale price adding in £0.20 per order

You have to add these as a part of initial strategies for pricing.

VAT Collection

If you are a UK Etsy seller and officially registered as a business, you may need to charge Value Added Tax (VAT). This makes things more complicated for casual sellers who are getting close to the £16,300 VAT threshold through Etsy sales.

GDPR Impacts

Etsy’s data infrastructure is in line with GDPR protections, but each store must keep buyer information safe by using privacy policies or permission forms for marketing contacts. Failure can lead to fines.

Once sellers are aware of these main restrictions, it leaves them free to customise their shopping experience in line with Etsy policies. .

Creating & Configuring Your Etsy Shop

Once you are registered on the platform you can personalise your preferences to attract a more ideal buyer for your product.

Shop Name

You can choose an authentic yet memorable name that is a combination of what you are selling. Names (4–20 characters; no spaces or special characters) can’t copy logos or structures.

Shop Language & Currency

You can select multiple locations that suit your target market. You can increase your area to multiple countries to make international purchases easy.

Product Photography

You have to use high quality photos of your products. This will increase the sales for your product. Make sure the pictures can be zoomed in to see the small details and multiple angles showing the scales and function of the product. There is a generous photo allowance per listing.


You can create compelling descriptions that highlight the unique qualities of your products. This will help translate features into benefits of customers using SEO optimised keywords .


You can compare similar for sale on the platform. This will help you to get a feel for where to pitch your own pricing against the competition whilst weighing up shipping costs and listing fees. Remember to take into account the fees of £0.20 or more per sale. A good way to adjust pricing to suit buyer preference is offer free delivery.

Payment Methods

You have to allow multiple ways to pay through Etsy Payments, which works with all major credit cards, Apple Pay, Google Pay, Etsy gift cards, and direct bank transfers to speed up international sales.

Shipping Policies

You should find the most cost-effective shipping options based on weight and service levels both within and between countries, as well as an idea of the production time so you can set realistic timeframes that your customers can expect to receive their item.

Returns Policy

You have to set rules for refunds and how long customers have to return items. Etsy offers policy templates that balance the needs of sellers with standard customer protections in the UK. By looking at choices through the eyes of customers, you can find the best configuration for your handmade niche.

Optimising Etsy Listings For Sales

In Etsy’s search-driven site, listings that are well-written get ahead of other listings. Bestsellers are made with great photos, interesting stories, and smart search engine optimisation. There is plenty of guidance available from Etsy on how to effectively market your products online.


Etsy gives greater visibility to listings with lots of pictures, so you should use photos to make your listings easier to find and interesting to look at if you want people to click on them.

Titles & Descriptions

You should include specialised keywords in a natural way within listing titles and detailed descriptions on the page itself. This creates an appealing overview of your product and can help to justify the cost if your listing has a higher price point.

Remember to highlight the little touches that are only achievable through means of independent manufacturing compared to mass produced products on the high street.


You should add tags to complement titles and descriptions using keywords and phrases that are less prominent but important to the niche. Buyers can then find your listing amongst the crowd by using search tags.

Reviews & Favourites

Etsy’s search rankings and suggested items are established by an algorithm that takes into account previous purchase rates as well as the number of favourable reviews. By fulfilling orders quickly and engaging positively with customers you’re more likely to get positive reviews, which in turn can lead to further orders from other customers.


To keep your listings visible, you should add new pictures and change the titles and descriptions every three to six months. When possible, buyers like to buy “Just In” things or listings that appear to be limited in quantity to feel like they’re getting unique one-of-a-kind items. To get the most publicity possible, keep your listings fresh and exciting.

Managing Operations & Growth

Regular Etsy shop maintenance helps to build your reputation online, which in turn transforms one-time customers into devoted brand advocates. Here are some of the tools you can use within Etsy to manage your operations and ongoing growth:


You can enhance your Etsy Ads by adding your products in a way that they have more search results. You can add banners on the homepage using the models of cost-per-click. This will help you reach more buyers at scale. It is good to create sales on the whole product list sometimes.

Customer Service

You should be providing great customer service. Things like prompt replies, quick dispatch and personal touches like writing a handwritten thank you note to include in the parcel will all add up to positive first impressions.

Product Expansions

Keep analysing your sales to see what is selling well and what isn’t. Invest time and effort into promoting the items that do well and scale back production of the items that aren’t as popular. Consider introducing new lines that are variations of best selling products for a great way to boost your sales.

Shop Improvements

Investing profits into improving your marketing efforts can pay dividends to your business growth. By investing in professional product photos, updated branded packing and digital marketing tools, you can ensure that your business looks as professional as possible.

Avoiding Common Etsy Pitfalls

Despite the fact that Etsy provides plenty of help for their sellers, new Etsy business owners can fall into some common mistakes. Try to avoid the following pitfalls if you can:

Minimal Listing Information

People who want to buy something want detailed information like the materials, measurements, and instructions on how to use it. You might not get many sales and get bad reviews if you use overly complicated language in your descriptions or fail to include enough detail at all.

Lack of Photography

Images that are blurry or badly lit are a clear sign of mediocrity, which makes buyers doubt the quality of the production. Before you list your handmade items, get professional photos taken or learn simple DIY photography tricks around lighting and angles to ensure you promote your items in the best way possible. .

Fickle Pricing Strategies

When setting your product prices, you need to make it both competitively priced, but also priced at a point where the time, effort and materials that go into are covered.

It’s important to think about all of the costs that go into making something, like the materials, the time it takes to make, taxes, the wear and tear on the tools used to make it, and the costs of putting and selling it on Etsy.

After that, you need to compare your goods to those of competitors to make sure you can make a profit.

Ignoring SEO

The development of amazing products is pointless if customers never find them when they look for them online. To overcome this, include keywords into titles and descriptions of your products. This will allow people with an interest in your type of product to find you more easily.

Final Thoughts

To sum up, here are the key things to remember when looking to understand how to start an Etsy shop.

  • Ensure your product descriptions are details and accurate
  • Use the SEO tips and best practice outlined by Etsy seller guidance to get your listings seen by the people most interested in your products
  • Offer excellent customer service when it comes to delivery, dispatch and dealing with customer enquiries.

Whilst it might feel daunting to start a new business, Etsy is one of the most user friendly platforms to help turn your hobby into a flourishing business or side hustle. One of the most appealing parts is the supportive Etsy community amongst its sellers and desire to support small businesses in sharing their crafts with the world amongst its customer base.



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