Costs
Etsy Fees vs Shopify for Handmade Goods: Which Costs Less?
Etsy fees vs Shopify for handmade goods, compared on US sales tax duties, listing costs and monthly totals. See which platform fits your volume.
What to take away
- Etsy charges per listing and per sale, so costs rise with volume; Shopify charges a monthly subscription whether you sell or not.
- Etsy collects and remits state sales tax in most states as a marketplace facilitator. On Shopify, that duty is yours.
- Shopify usually wins on total cost once you pass roughly 100 to 150 orders a month, using illustrative figures below.
- Neither platform files your income tax return or resolves nexus questions for you.
What is being compared
Two ways to sell handmade goods online in the United States: a marketplace that hosts you, and a store you run on your own domain. Etsy supplies traffic and handles tax collection in most states. Shopify supplies software and leaves the rest to you.
The fee question hides a second question. Who collects the state sales tax on an order shipped to Ohio, and who remits it? The answer differs, and it changes your real cost.
The criteria that matter
| Criterion | Etsy | Shopify |
|---|---|---|
| Fixed monthly cost | $0 | About $29 to $399 depending on plan tier |
| Cost per sale | About 6.5% plus payment processing | Payment processing only, roughly 2.9% plus 30 cents |
| Listing or setup fee | About $0.20 per listing, renews every four months | None |
| Sales tax collection | Collected and remitted by Etsy in marketplace facilitator states | Seller collects and remits |
| Traffic | Built-in search demand | You generate it |
| Domain and brand | Etsy owns the storefront | You own the domain |
Percentages are illustrative and shift with category and payment method. Check current published rates before you commit.
Option by option
Etsy
Etsy takes a listing fee, a transaction fee and payment processing on each order. There is no monthly bill. For a seller doing 20 orders a month at $30 each, the fees scale with revenue and stay small in absolute terms.
Marketplace facilitator laws are the quiet advantage. Most states now require the marketplace to collect and remit sales tax on third-party sales, so Etsy handles that registration and filing burden in those states. Confirm the rule for each state where you ship, because thresholds and effective dates differ.
Shopify
Shopify bills monthly, plus payment processing on every order. You also pay for a domain, and often for apps that replace features Etsy bundles. A realistic entry point is one of the lower tiers plus a domain, which is a fixed cost before the first sale.
The trade is control. You own the customer list, the domain and the checkout. You also own sales tax registration in states where you have nexus, plus filing calendars and remittance deadlines.
A platform fee is visible. A compliance duty is not, and that is where most first-year sellers get surprised.
Where each one wins
Etsy is right when your monthly order count is low, when you want demand handed to you, and when you would rather not register for sales tax in a dozen states. A hobby-scale maker selling 10 to 40 orders a month usually comes out ahead on cash and on hours.
Shopify is right when order volume is steady and high, when repeat customers matter more than discovery, and when you want a brand you can move later. At several hundred orders a month, the percentage fees on Etsy can exceed the flat Shopify bill by a wide margin.
A common middle path is to keep an Etsy listing as a discovery channel and run the main store on Shopify. That doubles some costs, so it only pays if the Etsy traffic converts.
What none of them solve
Both platforms leave the same work with you. Neither files your federal return, tracks your cost of goods, or tells you when a state threshold triggers a filing duty. Neither guarantees sales.
If you are still choosing what to sell, work through the home-based ideas checklist before you pick a platform, because the product decides the tax and shipping profile. Sellers comparing several storefront options can use the online business tools test to judge apps on the same terms.
Budget planning follows the same logic as any small venture. The SBA's market research guide covers demand testing before you pay for software, and its business structure guide covers the entity choice that affects how you file.
Common questions
Does Etsy collect sales tax for me in every state? No. Marketplace facilitator rules vary by state, and thresholds and effective dates differ. Check each state's revenue department page for the states you ship into, and keep your own records regardless.
At what order volume does Shopify become cheaper? Using the illustrative rates above, the crossover sits near 100 to 150 orders a month. Run your own numbers with current fees, because payment processing and category rates move the line.
Do I need a business entity to sell handmade goods? Not always, but an entity affects liability and how you file. The IRS self-employed tax center explains the default treatment for sole proprietors.
Can I run both at once? Yes, and many sellers do. Keep one inventory record and one set of books, or the reconciliation cost will exceed the extra sales.
