These are my hands, they created, along with my heart mind and soul the business I am running. They ache, they have had to work hard, to learn and to grow… so many growing pains. The ache is both metaphorical and real. Both the ache to create, the ache that creating causes.
In light of the recent call to businesses to ‘strike’ or to borrow from @unfettered to boycott themselves to protest Etsy’s fee increase, I want to share a bit more about the cost of running a maker business, because information is power. I want to share this information, information that has taken me on a journey like no other from mistakes to triumph, because let’s be real ~ corporate greed makes the collective blood of makers everywhere boil. Nothing is more frustrating then being asked regularly by the concerned and well meaning, “What on earth you do with an art degree?.. Oh dear, I understand why your serving tables in this restaurant… because really how do you make money as an artists??? and in the same breath, “I have this fundraiser coming up and we would just love you to donate a piece of your art, no we won’t be providing compensation to the artist…” the list of course goes on. So I understand the want to protest, to rail against the universal unfairness that yet again someone else will be taking a larger piece of that which we work hard for, that which visual artists in particular in the crafting industry are undervalued for, a living from our passions and the massive cultural contributions all of us makers offer from the very beginner to the most elite professional.
I have come to understand through a variety of circumstances that it is not our individual accomplishments, but those of a movement as a whole where we see the most impact and nothing is more impactful then thoughtful information, which is what I would like to offer here.
What follows (on my blog, because it turns out way to much to say for instagrams word limits, even when using comments to add space 🤦🏻♀️😁💁🏻♀️) are the changes and changes in costs that I have seen over the last seven years of running my business. It is not a judgment on others or the way I think anyone else should do it. It is simply the way I did it. I am throwing my perspective into the mix.
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Last week on my Instagram Stories, (shown above, text in alt text) I briefly laid out the costs of running a website off Etsy and I am going to expand, because when I started, with these hands (blog image and IG image). I started on Etsy.
I researched and I calculated. I priced out what it was going to cost me to either commit to a domain or build my own website or use an existing platform and check the boxes. Back then Etsy fees were in around $0.25 cents a listing and 3% commission and it was low risk.
It was accessible.
I paid for a class on launching a successful Etsy site and I followed along. I launched my shop and then I got to work marketing because the sales did not just arrive.
Fast forward a year later and I have attended my first Olds Fibre Week, numerous local farmers markets and even some not so local ones. I sell a Spinning Wheel and then another through Etsy, the commission, plus competing on shipping almost wiped out any profits once all the expenses are paid. When you only make 30% of the retail price, keeping costs tight is the difference between paying bills and falling short.
I redo my math and realize quickly that on top of other things I was not keen on ~ Etsy owns your site, they have all the control, plus at the time Etsy did not have a system for the varying tax rates of PST or GST, let alone how they vary province to province ~ Etsy, although convenient in some ways, was going to cost too much to be sustainable.
One huge thing I did was I checked out my analytics, looking into where my Etsy traffic was coming from. Who was sending customers to my site? Well it turned out that I was. Over 90% of the traffic (customers) hitting my Etsy site was coming either from my Social Media or my Newsletter and I had done the work to grow those. Not Etsy. To me this said loud and clear that I did not need Etsy.
So I did more research and made a new decision. I invested in my own website. A platform I would have complete control over. I did not end up with a $1300 bill overnight, as much of a leaper as I am, even that was too great a leap for me. I also tried out more then one e commerce platform before I ended up on Shopify.
Since I have never met a perfect human, I don’t expect to meet a perfect business and Shopify is far from perfect, what it was and is , is the e commerce platform that works for me.
Taking control of my own website was scary. Aside from the massive learning curve, there are more significant upfront costs. It was a commitment in a different way. I started on Shopify’s least expensive plan, way back in the day, five years ago 😂, that was $9 USD ~ Here’s an aside 🙄 ~ that’s right they are a Canadian company and to this day I am billed for everything in USD, it’s a book keeping pain in the butt! ~ Soon I graduated to the $29/mth USD plan. Then I paid for it yearly, saving me essentially a month and gaining me access to rate calculated shipping.
I will hit fast forward again and here I am in 2022. Post worst part of the pandemic, post pivot from a trade show based business to a shop front in a rural town with less then 5000 permanent residents, post physical and mental health collapse and well I still have my website and I am still here ~ Pivoting, transitioning, growing, making mistakes, learning from them, conquering the never ending learning curve that is entrepreneurship ~ still making the choice to run my own business every single day.
Every year it gets more expensive and it’s not just Etsy fees and e commerce platforms. Canada post sends out a newsletter annually before the new year letting us business owners know that the shipping rates will be increasing by 2% to 4% again. I have received this newsletter every single year for the past seven years. It’s cliche, but true. The only constant is change.
So…
$1300 for my website subscription
$70 for domain names
$1300 for my POS subscription
+credit card swipe fees, which as I mentioned range from 2.7% to 4+% depending on whether the swipe is in person, a foreign card, keyed in or an online transaction. If I have to refund or cancel the order for any reason, my error or customer error, Shopify & PayPal keep those fees. Then there are the apps ~ need an invoice after the fact that’s printable? I pay $15 a month for that. ~ want to integrate it with your book keeping software fees from $15 to $35 a month. I am not there yet, but in a year or so I will need to have more customized shipping options thats $17 a month plus. This is not a list of fee woos, it is simply the reality. It costs me money to run my business.
For that money I own my own website, I have a user friendly interface which helps to streamline inventory management and the customer experience, as well as integrations that save time and energy. My biggest costs are fixed and spread out over the many products I carry diluting into my overhead costs. This effectively works out to a percentage cost which is accounted for in the markup I put into each product, along side rent, utilities, insurance, freight, etc. So that the cost of something looks a bit like this.
Product $10
MRSP (minimum recommended resale) $19
Additional costs on top of the product cost can include: Freight Costs on average 5% to 10% of my product cost depending on if it crosses an international border or not = $0.50 to $1.00
Website Overhead (website, pos, domains, apps) 10% of my product cost = $1.00
Total product cost with website overhead $11.50 to $12.00
There are additional costs listed above 👆🏻 that also get included in overhead, for comparisons sake I left rent utilities and labour off.
I pay a percentage too, it just looks different. I put money upfront, on Etsy you only pay if the sale is made. Every year the percentage I pay goes up, from inflation, from general rising costs, etc) and so I find new ways to spread it out over more ideas so that I can keep my prices competitive and keep paying the bills while I do what I love.
There has always been a marketplace and the marketplace has always been owned by someone. I am not arguing for the right or wrong of it. I wanted to lay out a different perspective because we build success by sharing information. The marketplace is not a marketplace without all my fellow vendors.
To be a vendor is today’s marketplace, well it’s a lifestyle choice as much as a career one, and I repeat, a choice I make daily, right along with a whole bunch of other ones. 😉
~ Sarah 🧶🦔❄️ ~