Most people start dropshipping by building their own online store on a platform like Shopify.

But how about Etsy dropshipping?

Is it even possible to dropship from Etsy?

The short answer is: Yes, it's possible to dropship with Etsy. However, there are certain things you have to know to avoid any bans and legal issues with Etsy.

In this article, we will look into what you should be aware of when doing Etsy dropshipping, its pros and cons, and how to get started with it.

Let's start!

What is Etsy?

Home page of Etsy

Etsy is an online marketplace where merchants can sell and buy products, most of which are handmade.

In the beginning, it only had a few sellers, but now the platform has grown to have over seven million sellers and almost 100 million active buyers!

How does dropshipping on Etsy work?

So, how does dropshipping work on Etsy?

Like dropshipping with your own online store, Etsy dropshipping involves working with a supplier who sends the products directly to your customers:

The dropship model - Infographic

However, instead of creating your own online store, Etsy dropshippers list their products on the Etsy marketplace.

Another significant difference is that with Etsy dropshipping, you must be involved in the design process to be allowed to sell on Etsy's marketplace.

This is what Etsy states in their policies:

All handmade items are made or designed by you. If you work with a production partner, you must disclose that production partner in your relevant listings.

This means that you can outsource the production of goods to a supplier, but as Etsy states, you have to be involved in the design process (if your products fall under the handmade items category).

Keep in mind: If your products fall under the vintage or craft supply goods, it's possible to resell products on Etsy (you don't have to design them yourself). However, the market for this is relatively small. We'll discuss this in more detail under the Etsy policies and requirements section.

There is also another alternative if you don't want to design the products yourself.

You can use Etsy sellers as suppliers and sell their products in your own ecommerce store. For example, you could open a Shopify store and sell Etsy products there.

The downside of this is that you can't sell the products on Etsy's marketplace and take advantage of their existing customer base.

Etsy's dropshipping policies and requirements

We've already touched on the policies and requirements a bit, but let's go through them in more detail.

While it's most likely possible to 'hack' the system and find ways to sell typical dropshipping products on Etsy, we always recommend following the right guidelines.

(We mention this because we saw some dropshippers selling products directly from Alibaba or even AliExpress on Etsy.)

1. Products that are allowed to sell on Etsy

The products you can sell on Etsy are divided into three different categories: handmade, vintage, and craft supply.

Even Etsy states this themselves:

Everything listed for sale on Etsy must be handmade, vintage, or a craft supply.

To break it down, this is what it means:

  • Handmade products. These include any products that you have made or designed yourself. For example, if you design a print on demand product and use a print on demand fulfillment platform for making the product, it falls under this category.
  • Vintage products. Etsy allows you to sell vintage products as long as they are over 20 years old. Vintage items can be resold on Etsy (as long as you follow the 20-year rule). This guideline doesn't really make it suitable for dropshippers to sell vintage items on Etsy.
  • Craft supplies. Craft supplies include tools, ingredients, and materials that help to create an item or a special occasion. This can mean products like paints, DIY kits, and beads. You can also resell craft supplies, meaning they don't have to be handmade.

Here are some of the products that don't fall under the craft supplies category:

Prohibited craft supply products on Etsy

2. There are prohibited products on Etsy

Etsy has a list of items you can't sell.

The list is generally made for all sellers, but it similarly applies to people who want to dropship on Etsy.

  • Prohibited items. Prohibited items include any dangerous, violent, hateful, illegal, or alcohol-related items. Here is the full list:
Prohibited products of Etsy
  • Items not designed by you. If you're not involved in the process of creating the product you plan to sell, and it falls under the handmade products category, it's illegal to sell it on Etsy.
  • Reselling products. Etsy only allows you to resell vintage products and craft supplies on their platform. For anything other than those two categories, reselling is illegal.

If you want to learn more about the policies around selling, we recommend that you check out Etsy's article, where they explain fully what you can sell on their platform.

3. Guideline about disclosing your partners

If you work with partners outside of your Etsy shop, such as print on demand suppliers, you must transparently share this information with Etsy.

This is what Etsy states about it:

A production partner is a company or individual (who’s not part of your Etsy shop) that helps physically produce the items you sell. We require sellers using production assistance to transparently share this information on the applicable listings.

We tried to find examples of other dropshippers adding their partner information to their Etsy listings, but we couldn't find any.

Therefore, we don't think Etsy is extremely strict with this rule.

However, they do ask you for your partner's information when you create product listings (we will show you later on what it looks like).

How do you get started with Etsy dropshipping?

After reading all of the above about Etsy, if you think it's something you would want to get started with, this section is for you.

Even if you're still unsure, this section will be helpful. We will go through the process of getting started with Etsy dropshipping!

Let's get started.

1. Decide how you want to dropship with Etsy

The first step is to decide how you want to take advantage of Etsy.

There are two ways:

  1. Sell on Etsy's marketplace. This is the primary method for most people. When you sell on Etsy's marketplace, you can take advantage of the existing customer base they have. It also means that you have to follow their guidelines more strictly.
  2. Resell Etsy products on your online store. If you have a Shopify store, for example, you can sell products from Etsy directly there. If you do it this way, you can't take advantage of Etsy's customer base.

The following sections will focus on the option of 'selling on Etsy's marketplace.'

If you want to go with the option of 'reselling Etsy's products on your online store,' the process is almost identical to setting up your Shopify store and linking it with a supplier or a fulfillment platform.

As we've gone through that process already on our guide to getting started with Shopify dropshipping, we will not go through it here.

However, you should know that you can use a platform like AutoDS to integrate Etsy directly into Shopify and import the products:

Etsy integration page of AutoDS

Note: You can also sell on both Etsy and Shopify as long as you design the products yourself. You can't sell other Etsy seller's products on your own Etsy shop. That's against Etsy's reselling guidelines.

2. Do product research and design your first product

Doing product research and designing your first product is a step before creating your Etsy shop because you can't actually create an Etsy shop without knowing what you sell.

Etsy wants you to create the first product listing during the registration.

After doing product research, you have to design your product.

If you use a print on demand company like Printful, this will be easier.

All of the top print on demand companies have built-in design makers that don't require much technical skill.

This is how the design tool looks for Printful:

Design tool of Printful

Not all platforms/suppliers offer built-in design makers, so in those cases, you have to use product design software.

Two popular options for creating product designs are Figma and Adobe's creative cloud apps. For more simple designs, Canva is great.

3. Create your Etsy shop and the first product listing

After product research, it's time to set up your Etsy shop.

To do this, head to Etsy's home page.

Home page of Etsy

If you scroll all the way to the footer section, you will see a button saying 'Sell on Etsy.'

Footer section of Etsy

Click on it, and you will be taken to the registration page.

On the registration page, Etsy will ask you to fill in basic information like your email, name, and password.

Once you have the account created, you can get started with creating the actual Etsy shop.

Creating Etsy store process

Here, Etsy will ask you a bit about your background.

If you have no previous experience with selling, they also offer you resources that may be helpful:

Free resources of Etsy

You must also set up your shop language, country, and currency:

Shop settings of Etsy

The big step after this is creating your first product listing:

Product listing on Etsy

You have to add a product photo, title, description, price, and information about the listing, such as the shipping details and your production partners.

Here is where Etsy wants to know who designed and made the product you plan to sell:

Product information of Etsy product

Etsy wants to know in more detail about your production partner:

Production partner of Etsy store

Once you have filled in all this information, you should get a success message for your first listing.

Successful Etsy listing

After this, you still have to fill in the information about how you will get paid, set up the billing information, verify your identity, and set up your shop's security.

These things take some time, but they are necessary if you want to get started selling on Etsy.

Once you're done with all of that, you will get access to your Etsy admin dashboard!

Admin dashboard of Etsy

Important note: Don't hurry with Etsy's registration process. They are quick to deactivate your store if the information is not correct. They may also deactivate your store if they want more information from you. To prevent this from happening, fill in the information correctly.

4. Integrate your supplier into your Etsy shop

Now that your Etsy shop is open and the first listing is done, it's time to integrate your supplier into Etsy.

The integration process depends entirely on the platform/supplier you chose.

If you decide to go with a popular print on demand platform like Printful or Printify, you will most likely find guidelines for Etsy integration from their website.

Printful has created a dedicated tutorial for the integration:

Etsy integration of Printful

The integration process may be more complex if you use a private label dropshipping supplier or dropshipping agent.

Likely, there is not even an integration available.

If that's the case, don't worry; there is also a solution for that.

If the platform you use doesn't have an Etsy integration, what you can do is head to Etsy's settings.

From the settings, you can download a CSV file of the orders you have made:

CSV file of Etsy orders

Once you have the CSV file, you can send it to your supplier, and your supplier can fulfill the orders with the help of the available information.

This involves some manual work, but it's not much when you think about it. You can even outsource this once your store grows.

5. Market your Etsy products

If you think you will start getting sales just by listing your Etsy products, you're unfortunately wrong in most situations.

Your Etsy journey only begins once you have added listings to your Etsy shop.

To get sales, you have to find ways to get visitors to your product listings and make the listings convert.

How can you do that?

Let's go through four of our favorite ways.

  • Learn the best SEO practices for Etsy. Your Etsy success is largely dependent on whether people can actually find you from the Etsy search. Etsy has its own SEO practices that work well for the platform. To learn these best practices, we recommend using YouTube (it's full of tutorials teaching this exact thing).
  • Use social media. TikTok and Instagram are two social media platforms that Etsy sellers commonly use to drive traffic. If you go with this route, do research on your niche, find the accounts that are doing well in your niche, and learn what works for them.
  • Etsy ads. This is optional. If you want, you can spend some money and increase the position of your listing on Etsy's website. This means that when someone searches for specific products, your product listing will show up on the first page. Plus, it will have this 'Ad by Etsy seller' text:
Paid listing on Etsy's website
  • Keep your product listings updated. Update your product listings at least once a month. This shows both the customer and Etsy as a platform that you care about your Etsy shop.

Those are four of our favorite ways!

Ready to level up? Our ultimate dropshipping guide for 2024 is full of our best insights, ideas, and steps to follow.

The pros and cons of Etsy dropshipping

Let's go over the pros and cons of Etsy dropshipping.

The pros

We will start with the pros.

1. Established audience

What's great about Etsy dropshipping is that you get access to a huge audience.

Etsy has close to 100 million active buyers on its platform, and looking at Statista's graph, we can see that the amount of buyers has pretty much increased every year (other than the slight drop in 2022):

Etsy buyers in Statista
Source

We don't see Etsy and its buyers disappearing anywhere anytime soon, which is a good thing for the sellers.

2. Proven business model

What's good about Etsy dropshipping is that it's proven to work.

If we look into Etsy, we can quickly find thousands of other dropshippers who are successfully selling products there.

To give you an example, let's search for a niche product 'bee necklace':

Search bar of Etsy

Just with that search, we were able to find hundreds of sellers selling different bee necklace products. Not all of them are dropshippers, but many of them are:

Search result for bee necklace products on Etsy

If we look into the number of sales and reviews some of these Etsy dropshippers have, it's quite a lot:

Seller reviews of Etsy

We're sure they have put a lot of work into getting this many reviews for their products, but it's good to know that it's possible.

We guess that the above dropshipper works with private label dropshipping suppliers or with dropshipping agents that allow them to be involved in the design process, and then they list the products on Etsy.

Many Etsy sellers also hold stock on their own, but it's not necessary if you work with a good supplier.

3. Good for selling print on demand products

If you're looking to start dropshipping on Etsy, using print on demand companies to sell POD products can be a great idea.

This is because many print on demand products fall under the 'handmade products' category.

To give you an example, let's look into a print on demand platform called Printful:

Home page of Printful

In total, Printful has 338 products that you can customize on your own, plus the products get shipped from fulfillment centers on different continents, meaning you can provide customers with fast shipping times, too.

Product and shipping info of Printful

You may think print on demand suppliers only have clothing products, but there are available products in many categories.

Just with Printful, you could sell custom products like:

  • Bags
  • Wall art
  • Holiday decor
  • Notebooks
  • Beauty products
  • Clothing

If you design the products yourself and use your own photos, all of the above products fall under Etsy's selling guidelines.

Plus, the print on demand market has been proven to work on Etsy, too.

Just by searching for a niche keyword, 'funny t-shirt,' we found hundreds of sellers selling their custom designs:

Print on demand products on Etsy

Extra note: Many print on demand suppliers like Printful and Printify offer direct integrations with Etsy. So, if you're interested in selling POD products on Etsy, be sure to take advantage of the integrations.

4. There is less competition than with basic dropshipping

Etsy's tight regulations for reselling products make it a bit hard platform for dropshippers to work on.

For this reason, not that many people do it.

Plus, it's just not as well known as the basic dropshipping model.

If we look at the Google Trends graph for 'Etsy dropshipping,' it shows that it is more popular than ever:

Google Trends view of Etsy dropshipping
Source

However, this doesn't tell the whole truth.

If you compare 'Etsy dropshipping' with 'dropshipping,' you realize it's only a small part of the entire dropshipping industry:

Comparison of Etsy dropshipping and normal dropshipping on Google trends
Source

So, if you think the typical method of dropshipping is too saturated, you may want to consider starting dropshipping with Etsy.

Before you do that though, read the rest of our article so you know all the good and bad about Etsy dropshipping and how to get started (if you decide to do so).

The cons

Now that we've gone through the pros, let's continue with the cons.

1. Reselling is not allowed on Etsy

Reselling means selling an item that you, as a seller, didn't design.

Most dropshipping products tend to be mass-produced, and you cannot be involved in the design process yourself, while Etsy requires you to be involved (in most situations).

This makes it practically impossible to resell products in Etsy's marketplace.

This removes any chances of doing dropshipping from AliExpress on Etsy or even from most basic dropshipping suppliers.

Etsy did have a wholesale program previously, where sellers could resell products on a separate Etsy marketplace, but they shut it down in 2018.

2. High seller fees

Generally speaking, Etsy has four kinds of fees:

  • Listing fee. For a new product listing, Etsy charges you $0.20. This is only for creating the listing. If you edit your listing, you will not be charged extra.
  • Transaction fees. For every sale you make through Etsy, you will be charged a transaction fee of 6.5% of the price you displayed.
  • Shipping fees. As a seller, you're responsible for paying any shipping and package wrapping fees that may be involved.
  • Advertising fees. This is optional. If you want, Etsy offers both 'Etsy Ads' and 'Offsite Ads' to boost your listings on and off the platform.

If you're used to paying minimal fees for listing products (such as with Shopify), Etsy's listing fees may feel like a lot.

Conversely, Etsy does not require you to spend money on advertising (unless you select one of their optional packages), so you will save money there.

3. Lacks scalability

When it comes to scalability and automating your dropshipping business, Etsy may not be the best solution.

This is what Etsy states themselves:

Etsy is a home to a universe of special, extraordinary items, from unique handcrafted pieces to vintage treasures. In a time of increasing automation, it’s our mission to keep human connection at the heart of commerce.

If you read between the lines, you quickly realize that they are not in favor of businesses that operate at scale and want to automate their production.

Sure, you can scale, but not in the same way as with normal dropshipping, where you can add endless products to your online store (that are not designed by you) and scale with the best-performing products.

Designing the Etsy products will involve some manual work, so it may not be the best platform if you're looking to fully automate your dropshipping business.

4. Listing products is time-consuming

Not only does listing a new product cost $0.20 every time, but it's also a bit time-consuming.

There are many more steps than with platforms like Shopify that make product listing quick for its users.

There are tools like AutoDS that integrate with Etsy, and they make the product importing and listing process faster.

AutoDS Etsy product importing process

However, AutoDS requires that you use their suppliers. That's not necessarily a bad thing, though, as they are known for having good suppliers.

3 Popular Etsy dropshipping categories

This one is interesting!

You might wonder what some of the most popular Etsy categories are.

Because Etsy requires you to be involved in the design process of your products and it is a niche marketplace, the popular dropshipping products differ a lot when compared to eBay dropshipping, for example.

Based on our research, some of the best Etsy dropshipping categories are the following:

1. Gifts

Note: While you should always take inspiration from good Etsy product designs, you shouldn't copy them directly. Etsy is a platform for unique and handmade products, where you can't resell/reproduce other sellers' products.

Gift products aren't just limited to a single product category; there are gift products in many different categories.

Some examples are:

1. Frames. Any frames, preferably frames that customers can customize, are popular amongst sellers on Etsy. Here is an example of a customizable frame product:

Customized frame product on Etsy

2. Candles. Under the home accessory category, there are many gift product ideas. Here is one of them, a friendship candle:

Friendship candle product on Etsy

3. Gift boxes. More of a bundle product, gift boxes are popular amongst Etsy sellers. Here is an example of a gift box:

Gift boxes on Etsy

During holidays, Etsy even boosts all kinds of gift products for their buyers by making categories like the following on their home page:

Gift products of Etsy

Plus, by looking into the Etsy platform, many dropshippers have had great success with gift products. For that reason, we can recommend them.

2. Clothing

All kinds of clothing products are popular on Etsy, especially for dropshippers.

They are a good product group to go into because you can work with print on demand fulfillment platforms to design your clothing products.

Here are some product examples:

  • Humorous shirts. Especially during the holiday season, humorous shirts have a good potential for sales.
Humorous shirts on Etsy
  • Pajama sets. For both men and women, pajama sets have been popular on Etsy, especially during wintertime. Here are some examples of those:
Pyjama sets on Etsy

3. Jewelry

When it comes to selling jewelry on Etsy, there is a lot of competition.

However, if you can come up with a jewelry product that's unique to the market, you might have a good chance of becoming successful with it.

Let's look into a couple of examples:

  • Customizable text necklaces. Many Etsy dropshippers are successful with necklaces that customers can partly customize on their own. Here is a good example:
Handwriting necklace on Etsy
  • Pet necklace. Related to the theme of custom products, pet necklaces where customers can add an image and name of their pets work well. Here is one of those products:
Pet necklace product of Etsy

Features of a winning Etsy dropshipping product

Now that you're familiar with some of the best categories on Etsy, let's look into some of the characteristics that winning products have:

  • High quality. This applies to Etsy especially. Because the platform is known for handmade products and the reviews are at the center of customers trusting in you, your products have to be high quality.
  • High demand. Etsy is mainly a search-focused marketplace. If your product has no market demand and no one searches for it, it's tough to make any sales on Etsy. To find products that people are searching for, you can take advantage of Google Trends.
  • Unique to the market. Because Etsy is a niche-focused marketplace, your products have to really be unique to stand out.
  • Maintainable profit margins. After calculating all the expenses, including Etsy's fees, product, shipping, and potential advertising costs, what do the profit margins look like?

Etsy dropshipping FAQs

Want to learn a bit more about Etsy?

We will go over a few frequently asked questions about the Etsy dropshipping business model.

Is it legal to dropship on Etsy?

Yes, as long as you follow Etsy's guidelines. The main guidelines involve being part of the design process of the handmade products you sell, informing Etsy everyone involved in the making of your products, and using your content for the Etsy listings.

Can I have both Etsy and Shopify dropshipping stores?

If you design the products yourself, you can have both Shopify and Etsy shops. If you resell products from other Etsy sellers, you can sell them on your Shopify store, but you are not allowed to list them on Etsy.

Is Etsy better than Shopify for dropshipping?

Both platforms have their pros and cons. If you're ready to spend your own money on advertising and creating your online store, Shopify may be a better option. If you want to take advantage of Etsy's existing customer base and not spend money on advertising, you may want to look into Etsy.

Taking action

Reading and absorbing information and knowledge is great (definitely if it's free!), but do you know what's even better?

Taking action!

So, to help you with taking action with what you have learned in this article, take a look at the bullet points:

  • Get yourself familiar with Etsy's guidelines. Etsy is quite strict on its policies for dropshippers. Before you start selling on their platform, make sure to check the guidelines (we went through them in this article).
  • Decide how you want to use Etsy. You can either use Etsy's marketplace for dropshipping, or you can resell products from Etsy in your online store. Both have their pros and cons, and depending on what direction you want to take your business, you should decide between the two.
  • Do niche and product research. What niche would you want to sell your products on Etsy? What products exactly? How are you gonna design them? These are all questions you have to ask yourself before you can create your Etsy shop.
  • Create your own Etsy shop. If you decide to sell your products on Etsy's marketplace, the first step is to create your own Etsy shop.
  • Create product listings. Once you have found the niche and the products you want to sell, it's time to add them to Etsy. Make sure to update your product listings frequently.

Conclusion

There you go!

A detailed breakdown of what it takes to start an Etsy dropshipping business and an explanation of how it compares to the basic dropshipping business.

The biggest takeaway is that if you want to sell on Etsy, you have to design the products yourself, but you can outsource the production of goods. If you decide to go that route, there are many great opportunities you can hop on!

Did we miss something?

Feel free to let us know if we did! If you have any questions about the whole business model, remember that you can always leave us a comment down below!

Good luck!

Want to learn more about dropshipping?

Ready to move your dropshipping store to the next level? Check out the articles below:

Plus, don’t forget to check out our in-depth guide on how to start dropshipping here!

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Author

Hello, I am Elmeri Palokangas, owner of multiple different ecommerce brands! I have been involved in the dropshipping space for over four years, and have learned a lot during that period. To help you, I want to share my knowledge of what I've learned during my years of dropshipping.

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