Etsy Solopreneur Creators Close Shops, Oppose Higher Fees
Etsy is an online platform that allows artists and creative entrepreneurs to sell their handmade vintage items, jewelry, bags, clothing, home decor, furniture, toys, and art to customers. During the pandemic, the e-commerce retailer has seen a huge spike in consumer interest, sending the company’s stock price to record highs of nearly $300 per share. As the virus outbreak waned and restrictions were lifted, the stock fell to around $117 per share.
Now it looks like Etsy has another challenge. Small businesses on the platform go on strike. Since Solo Entrepreneurs don’t work for Etsy, but sell products on its site, this isn’t a traditional strike with pickets, signs, and slogans. Instead, they’re shutting down their online stores for the week, in protest at rising transaction fees.
Earlier this year, Etsy CEO Josh Silverman announcement, “Last year, active sellers increased their sales by an average of 23% over 2019, and in 2021 alone, we showed more than 90 million active buyers worldwide that there is an alternative to automated big box shopping.” Silverman proudly added, “Together, we’ve made Etsy the global market for unique and creative products.
Much to the chagrin and dismay of sellers, Etsy’s Managing Director shared, “We plan to make significant investments in marketing, selling tools, and creating a world-class customer experience so we can continue this tremendous growth. To support this goal, on April 11, we will increase our current transaction fees from 5% to 6.5%. »
His justification for the cost increases was based on spending $600 million on marketing last year. Going forward, there will be spend, “including TV ads, influencers and likemakers, billboards, podcast advertising, and email marketing that bring new buyers to Etsy”. The company will also “launch a new seller app with enhanced features that will make it easy for you to manage your orders, connect with buyers, and understand how your business is doing.”
Retailers weren’t happy with the increases in transaction fees. Etsy seller Kristi Cassidy started a petition to organize the strike on coworker.org. The “Cancel the fee increaseThe petition, addressed to Silverman, now has approximately 52,602 signatures as of this writing.
Cassidy wrote in the petition, “In June 2021, they acquired Elo7, the ‘Etsy of Brazil,’ for $217 million in cash. In July 2021, they completed the acquisition of Depop, a marketplace for British fashion, to the tune of $1.625 billion, mostly in cash.They continued these record pandemic gains by turning around and stick it to their sellers.”
Cassidy lamented that Etsy’s philosophy had changed, saying the company was created with a vision to “keep commerce human” by “democratizing access to entrepreneurship.” This has resulted in a positive movement, as “people who have been marginalized in traditional retail economies – women, people of color, LGBTQ people [and] neurodivergent people make up a significant proportion of Etsy sellers. The Etsy seller added, “For many of us, Etsy is our main source of income. But as Etsy has strayed further and further from its founding vision over the years, what began as an experiment in marketplace democracy has come to resemble a dictatorial relationship between a faceless tech empire and millions of mostly exploited craftswomen.
The extra charge was called “profit from the pandemic.” Artists and artisans complained: “They plan to increase our transaction fees by 30%. We’re going on strike April 11 to demand accountability from Etsy to sellers and buyers. Sellers will put their shops on holiday mode in protest. Shoppers can show their support by agreeing to boycott Etsy from April 11-18,” the petition reads.
According to MarketWatch, strikers say Etsy has become “a downright hostile place to make genuine small businesses work. In the report, they went on to say, “For both full-time and part-time sellers, the changes on Etsy have brought many of us to the brink of financial ruin. After giving Etsy two years of record profits under the most difficult circumstances imaginable, we are tired, frustrated, and ready to fight for our place at the table.”
An Etsy spokesperson said: “We are committed to supporting our community of 5.3 million sellers worldwide by helping them grow their businesses. Sellers have consistently told us they want us to step up our efforts in marketing, customer support, and removing listings that violate our policies. Our revised pricing structure will allow us to increase our investments in each of these key areas, so that we can better serve our community and make Etsy a valued, trusted, and thriving marketplace.