An Etsy order can lose money even at a healthy retail markup — Offsite Ads at 15% on top of transaction and payment fees eats margin fast. To know your true margin, model every fee: listing fee (charged on creation and renewal), transaction fee on the item and shipping, payment processing (percent plus flat), and Offsite Ads if triggered. This guide breaks each down and links to a free calculator.
If you can't opt out of Offsite Ads, price with it baked in — assume every third or fourth order will trigger it.
Etsy fees at a glance
- Listing fee — small, per listing, charged on creation and each renewal.
- Transaction fee — percent of item price plus shipping charged.
- Payment processing — percent plus a flat fee per order (rate varies by country).
- Offsite Ads fee — percent on orders that came from Offsite Ads, only for sellers who cannot opt out.
- Optional Etsy Ads (on-platform) — separate paid ads at a daily budget you set.
When Offsite Ads apply and when they don't
Etsy runs paid ads on external channels using your listings. If a buyer clicks one and purchases within 30 days, Etsy charges an Offsite Ads fee (typically 12–15% depending on your trailing sales). Sellers under a rolling 12-month sales threshold can opt out; sellers above cannot.
The fee is not charged on organic Etsy visits or on orders from your own social posts.
The profit formula
Profit = (Item price + Shipping charged − Discounts) − Listing fee − Transaction fee − Payment processing − Offsite Ads fee (if triggered) − Item cost − Shipping cost.
Example calculation (USD)
USD worked example — handmade candle
| Line | Value |
|---|---|
| Item price | $28.00 |
| Shipping charged | $5.00 |
| Gross (price + shipping) | $33.00 |
| Listing fee | $0.20 |
| Transaction fee (6.5% of $33) | $2.15 |
| Payment processing (3% + $0.25) | $1.24 |
| Offsite Ads (15% of $33) — if triggered | $4.95 |
| Item cost | $7.50 |
| Shipping cost | $4.50 |
| Profit without Offsite Ads | $17.41 |
| Profit with Offsite Ads | $12.46 |
Same listing, two very different outcomes. Use the Etsy Profit Calculator to run your own numbers.
Common mistakes to avoid
- Ignoring Offsite Ads entirely when opted in.
- Forgetting transaction fee applies to shipping revenue too.
- Renewing listings you don't want to promote and paying the listing fee.
- Setting prices from raw cost + margin without modeling fees.
- Treating Etsy Ads spend as a fixed cost — it varies with sales volume.
Best practices
- Price with Offsite Ads baked in if you cannot opt out.
- Turn off auto-renew for slow listings.
- Segment your COGS reports by fee scenario.
- Aim for a minimum 25% net margin after all fees.
- Review Etsy's fee schedule twice a year.
Frequently asked questions
Can I opt out of Offsite Ads?
Only if your trailing 12-month sales are below Etsy's threshold. If you cross it, you are enrolled and cannot opt out.
Is the transaction fee on shipping too?
Yes — it applies to the total the buyer pays for the order, including shipping.
How do I lower payment processing?
You cannot negotiate it. It is set per country by Etsy Payments.