Which Etsy fees enter the calculation?
For this single-item example, allocate a $0.20 listing fee and a 6.5% transaction fee on the item price. Etsy also applies the transaction fee to charged shipping and gift wrapping; U.S. sales tax is excluded. Listing renewals and unsold listings can add costs beyond this allocation.
For a U.S. bank account, Etsy Payments processing is 3% plus $0.25. Its base includes shipping and sales tax. These fee bases differ, so combining them into one flat percentage can miss costs. Check Etsy’s current policies before updating a live price.
Reference: Etsy — Fees & Payments Policy ↗Etsy Help — Payment processing fees by country ↗
A $32 tumbler: the complete worked example
Assume one tumbler sold for $32, with no separate shipping charge or gift wrap. For arithmetic only, assume the buyer pays 8% sales tax ($2.56). That is not a nationwide tax rate: the applicable amount depends on the transaction. Sales tax collected for remittance is not included in the $32 of seller revenue.
The blank costs $8.20. Ten minutes of hands-on work at an assumed $24 hourly rate costs $4. Machine runtime is not necessarily hands-on time; include actual setup, personalization checks, cleanup, customer communication, and packing in your labor record.
| Item | Calculation | USD |
|---|---|---|
| Seller revenue | Item, shipping included | $32.00 |
| Blank | Assumed landed cost | −$8.20 |
| Hands-on labor | 10 minutes × $24/hour | −$4.00 |
| Packaging | Assumed | −$1.25 |
| Carrier postage | Assumed | −$5.50 |
| Listing allocation | One listing fee | −$0.20 |
| Transaction fee | $32 × 6.5% | −$2.08 |
| Payment processing | $34.56 × 3% + $0.25 | −$1.29 |
| Contribution | Before fixed overhead and income taxes | $9.48 |
Stress-test an order attributed to Offsite Ads
Etsy’s Offsite Ads charge can be 15% or 12% on attributed orders, depending on the policy’s sales threshold and participation rules. In this U.S. example, a 15% fee on $32 removes another $4.80, leaving about $4.68. A 12% fee removes $3.84, leaving about $5.64.
Do not apply that cost to every order unless every order is attributed. Equally, do not ignore it when deciding whether an individual promoted order is worth fulfilling. Keep ordinary Etsy Ads spend separate so it is not confused with the Offsite Ads fee.
Reference: Etsy — Fees & Payments Policy ↗
What the $9.48 still needs to cover
Contribution is the amount available for fixed workshop expenses and business profit after the modeled order costs. This example excludes rent, insurance, machine depreciation, subscriptions, shop setup fees, extra listing renewals, currency conversion, discounts, returns, and other advertising. Add the items that apply to your shop.
A remake can consume another blank, another shipping label, and more labor while generating no new revenue. Track actual remake costs over several batches and allocate a reserve per order. Use packed weight and destination quotes for shipping; a single sample postage assumption should not become a promise to ship anywhere at that price.
- Quote each personalization tier separately if artwork effort differs.
- Recalculate the contribution after a coupon or bundle discount.
- Set a revision limit and approval deadline in the offer.
- Reconcile the estimate against the order’s actual payment statement.
Test willingness to pay, not just your spreadsheet
A cost-based price tells you what a sale leaves behind. It does not prove customers will pay that price. Offer one clear design to a specific buyer group and record paid orders, production time, remakes, and delivery costs. Avoid reading views or favorites as purchases.
Use the tumbler calculator for the initial material and production model, then subtract the channel, labor, and fulfillment costs above where they are not already included. Compare offers on contribution per hands-on hour as well as per item. A higher-priced custom order can earn less per hour when revisions consume the afternoon.
Common questions
Is free shipping actually free for the seller?
No. The carrier still charges you. Include postage in the cost model even if the buyer sees no separate shipping charge.
Is a $32 selling price a recommended market price?
No. It is an illustrative input. Validate the price with your own buyers and replace every assumed cost with actual records.
Sources & method
Prepared by Maker Business Lab from the primary sources below, checked September 23, 2026. Cost models are our own illustrative calculations, not measured seller earnings, supplier quotes, or market averages. Amounts are rounded for display; formulas use unrounded inputs. Policies and prices can change.
PUT YOUR OWN NUMBERS TO WORK
