Etsy Dropshipping: Policies, Secrets & Getting Started in 2020

So you’re looking to start etsy dropshipping, right?

Youre not alone! Thousands are looking into this potential business opportunity as Etsy’s popularity surges!

Dropshipping on Etsy has many benefits, like the little investment needed to get started. But their are downsides too like high competition and unclear seller policies.

In this article we’ll share everything you need to know about etsy dropshipping.

So without further ado, let’s dive in!

What is Etsy Dropshipping?

Dropshipping is an order fulfillment method that does not require business owners to keep their products in stock and ship them. Instead, once a customer places the order on the vendor’s website, the vendor passes it on to a third party supplier who fulfills and directly ships the order to the customer. This is a common practice for early stage ecommerce businesses, and this fulfillment strategy can be applied to sites other than just Etsy.

What is Etsy?

Just in case you don’t know, Etsy is an online marketplace to buy and sell products, mostly creative or hand-made goods. It gives sellers the opportunity to create their online shop and have access to its 46.35 million active users and potential customers. It focuses on vintage, handmade, and unique arts craft products. Customers can search for and buy vintage, hand-made products, and unique arts and crafts that are usually difficult to find anywhere else! Almost everything on Etsy is made or sold by creative and passionate people starting their small business.


Etsy Dropshipping Policy?


If you go to Etsy seller policies and “whats allowed”, you’ll see something that reads the following.

Etsy is a very unique marketplace. Buyers come here to purchase items that they might not find anywhere else. Everything listed for sale on Etsy must be handmade, vintage or a craft supply.”  The do say in their policies that “If you work with a production partner, you must disclose that production partner in your relevant listings.”

Please be sure to read more about their seller policies, as things may change.

Dropshipping from AliExpress to Etsy

Dropshipping products directly from AliExpress to Etsy appears to be prohibited. This is because the goods sold on Etsy need to be handmade, vintage, or a craft supply.

Take this tshirt example, if you sell a tshirt it must be designed by you. There have been some instances where people sneak around this by having custom photos, but doing this could get you kicked off their platform.

Etsy Dropshipping Reddit Comments

People on reddit had some interesting comments about dropshipping on Etsy. Here’s a few of them.

In 2019, “rulesforrebels” said the following…

While this just appears to be an opinion (which we have NOT fact-checked), he/she is saying they have indeed seen people dropshipping.

Are people actually Etsy Dropshipping in 2020? (Use this to find out):

If you want to test his theory, watch the video to learn how to reverse search image for yourself.

Another reddit commenter said:

Again, another opinion from an anonymous source we can not consider credible.

The goal of this blog post is to inform you on all things Etsy. Please keep in mind these are just random peoples’ opinions.

And please remember, we strongly advise you follow Etsy seller guidelines.

Etsy Dropshipping vs Shopify Dropshipping

As you are starting to learn, dropshipping on Etsy may not be best-route. But Shopify on the other hand may be.

Using a platform like Shopify and it’s apps Oberlo and Dropified, anyone can easily set up an e-commerce store overnight. You can start using low-cost products from Aliexpress or Alibaba. 

Many people start their store by going directly to these third-party suppliers like AliExpress and Alibaba to source products because of how easy the import and fulfillment process is. However, while you can use the third-party supplier to source a wide range of low-cost products for your store, there is immense competition as many people will try to sell the same products that are already in other stores. To open and scale a successful Shopify dropshipping store, you need to present your market with unique and  eye-catching products that customers may not have come across. Use strategies that other experts from the industry have tested and used for years. 

While you can easily open your Shopify dropshipping store, there are some strict guidelines, as we discussed earlier, for opening an Etsy dropshipping store. Even though Etsy’s policies do not directly mention anything related to banning ‘dropshipping’ on their website, it’s clear they want to maintain their collection of high quality and original products.

Even though Etsy has strict guidelines and policies on dropshipping using its platform, Etsy in general has become very popular over the past years. As per Etsy’s Reports First Quarter 2020 Financial Result, active buyers grew 16.4% year-over-year in the first quarter, and it is a total of 47.12 million buyers had purchased goods through the Etsy ecosystem. These numbers are among the reasons why may people are starting to research Etsy dropshipping.


Benefits of Dropshipping


A dropshipping business is great to start with for aspiring entrepreneurs because of it’s low capital requirements. And let’s be honest, it’s easy to create a dropshipping website because of the resources you can find online. With dropshipping, you can quickly test your ideas with low risk. Here are some reasons why dropshipping is a great venue for business.

1) Less Capital Required

Having less capital requirement is the most significant advantage of dropshipping. It is simple to launch an eCommerce store without investing thousands of dollars. It is far from the traditional retailers requiring vast amounts of capital to purchase your product inventory and a place to store it.

With dropshipping, you don’t have to purchase inventory unless your customer made an order. Because of this, it’s possible to start sourcing your products and launch a successful eCommerce dropshipping business with very little money. Because of no commitment to selling inventory, there’s less risk involved in starting a dropshipping store.

2) Super Easy To Start

Opening an eCommerce business is much easier when you don’t have to think about where to store your physical products. It gives you less stress about managing or paying for a warehouse, packing, and shipping your orders, tracking inventory, and managing stock levels, etc.

Because of those reasons, your overhead expenses are quite low than the traditional ones. Many dropshipping stores are run as home-based businesses, with laptops and a few recurring fees to operate. But of course, as your business grows, expenses will likely increase as well but will still be low compared to traditional.

3) Work From Anywhere

One of benefits of dropshipping is that your business can be run from the comfort of your sofa or anywhere with a stable internet connection. As long as you can easily manage and communicate with suppliers and customers, you can work wherever you want.

4) A wide selection of products to sell

With a dropshipping business, you can list anything for sale on your online store at no additional cost. Since you don’t have to purchase inventory, you can offer an array of trending items to your potential customers. 

5) Beginner friendly & easy to test the water

Another great benefit dropshipping is that is really eassy test the market and the potential products to sell before committing to buy a large amount of inventory.

Dropshipping business is a useful method for launching a store and for business owners looking to test the appetite of the customers before adding new product categories or new product lines. 

6) Scale your business quickly

By leveraging dropshipping suppliers, the work to process orders will be on the supplier’s end and not the online sellers. Leveraging your supplier will allow the owners to expand their business with fewer risks and less incremental work. This is one of the few business models where its possible to scale to millions with a super small (< 3 person) team!


Is Etsy Dropshipping Worth it? (Conclusion)

The Dropshipping business is not perfect. And there are some clear Etsy policy restrictions that make impact your business strategy.

Dropshipping fulfillment model has some definite advantages, but also comes with problems and complexities.

The good side though, with some planning, consideration, and learning from others’ experiences, most of these challenge are. 

Depending on your plans, and your ability to comply with Etsy’s (always changing) seller policies, dropshipping on other platform may be your best bet!