Why you cannot just add a markup
Etsy’s fees are percentages of the sale, so they grow as the price grows. If you add 30% to your cost, the fees then take a slice of that markup. With 6.5% transaction and 3% payment processing, a 30% markup on cost leaves a smaller real margin than it seems. Solving for the price from the target removes the guesswork.
Margin or profit: which to target
- A target margin keeps the same share of each sale however the price changes. It suits shops with many items at different prices.
- A target profit keeps a fixed amount per order. It suits made-to-order work where your time per piece is fixed.
- Margin here is net profit divided by order revenue (item price plus shipping charged).
A worked example
For an item costing $8.00 with $4.50 shipping cost, $5.00 shipping charged and a US account, a 20% margin needs an item price of $13.37, a 40% margin needs $20.66, and a flat $10.00 profit needs $20.36. Each price is the lowest one, rounded up to the cent, that reaches the target.
Checking the price before you list
- Compare the result with similar listings. If you are far above, look for ways to lower cost or shipping before you cut the margin.
- Re-run it when you change country, because payment processing differs by bank account country.
- Include Offsite Ads if a large part of your sales comes through them, so the margin survives on those orders.
Frequently asked questions
How is the target price calculated?
The calculator finds the lowest item price at which net profit, after all Etsy fees and your costs, reaches your target margin or profit, then rounds it up to the next cent.
What does margin mean here?
Margin is net profit divided by order revenue, which is the item price plus shipping charged to the buyer. It is not a markup on cost.
Why does the price get so high for a high margin?
Etsy takes percentages of the whole sale, so every extra point of margin needs a higher price to cover both your profit and the fees on it. At very high targets no price works, and the calculator tells you so.
Should I include the listing fee?
Include it unless the listing is not renewed because of this sale. It is a small fixed cost but matters on cheap items.
Does it work for sales in other currencies?
Yes. Pick the country of your bank account, and use amounts in that account’s currency. Etsy quotes the listing fee and Offsite Ads cap in USD, so adjust them under Advanced.