Shopping Local in the Era of Etsy

Does buying from Cities-based sellers on Etsy have the same impact as shopping from local storefronts?

By Holly Gilvary

In 2021, almost everyone's heard of Etsy. It's an expansive online marketplace where pretty much anyone can start their own business. I've purchased a fair share of goods from the website over the past decade, including everything from a cringe One Direction tank top when I was 14 to a customized pillow for my freshman dorm room. Shopping on Etsy is a feel-good transaction compared with other online shops or marketplaces such as Amazon. It's nice to know that, while you could have purchased a similar product at a big-name online store, you made the conscious decision to support a small business for a much higher-quality product, even if that means sacrificing a lower price or faster shipping speed. 

However, Etsy is not without its faults. Like any business, it has to make money somehow--and sometimes that means taking profits away from its sellers. According to its website, Etsy requires a 20 cent listing fee for each product a seller wants to list, along with a 5% transaction fee and a payment processing fee of 3% plus 25 cents. Etsy also encourages sellers to provide free shipping to customers on orders over $35 and ranks shops and products lower on its search algorithm if they don't. 

However, different Etsy sellers have different views on the website's business model and its requirements for sellers.

Amy Kulseth, the owner of Etsy shop AmyMarieArtsMN in Minneapolis, has a generally positive view of the website, especially for beginners. Kulseth started her business in 2010 and began selling her paintings at art festivals and other events before later moving her business online. 

"I think Etsy is a great place to begin. You can learn a great deal about business, and they have great tools to help beginners," Kulseth said.

At the same time, Kulseth acknowledged that Etsy could only get small business owners so far. "Etsy is great but only reaches a specific audience," she said. "I find great success in marketing on other social media platforms as well."

Other Etsy shop owners echo this sentiment. In February 2020, the Star Tribune published an article highlighting multiple Twin Cities small business owners' decisions to move their businesses from Etsy to brick-and-mortar storefronts. The owners featured in the article, including Lindsey Cason, co-owner of Carousel + Folk in south Minneapolis, emphasized that Etsy's seller fees were hard on their profits. Nevertheless, there was a shared sentiment that Etsy, which started mainly to promote small artists and quality products, has turned into another corporate marketplace. Jessie Witte, the owner of AudreyRose Vintage, said in the article that while her Etsy shop is still open, she's now more focused on her physical storefront and catering to local customers. 

So what does this mean for local, Twin Cities-based Etsy shops? Should consumers continue to buy from them on Etsy? Should we seek out other forms of business from the sellers (if they have it)? Or, if supporting small and locally-owned businesses is our primary goal, should we stick to brick-and-mortar shops where we can support local artists in person, especially now that COVID is (hopefully) on the decline?

I think we should be doing all three. Browsing physical storefronts in the Twin Cities seems like the best bet in terms of supporting locally owned businesses. Still, not everyone has access to adequate transportation to store-hop—and not every business owner has the ability to open a storefront. On the flip side, some may prefer to shop in person because of the absence of shipping prices and other buyer fees or the ability to try on garments before purchasing. Overall, a healthy mix of online shopping (both on Etsy and businesses' websites) and in-person shopping seems to be the most effective way to support as many small businesses as we can. And if one form of local shopping works better for you, do that. 

Especially in these times where marketplace giants such as Amazon have a monopoly on almost every product—along with the added blow of a global pandemic—small, local businesses deserve (and could use) all the support they can get. While Etsy may not be the most ethically perfect way to shop small and local, there's no need to feel guilty over purchasing an item on Etsy versus visiting a local shop in person; at the end of the day, we as consumers should feel good about choosing small, local businesses when deciding where to put our money.