Small businesses on Etsy go on strike after the company raised fees

"All of a sudden, you have a price hike."
Posted at 4:51 PM, Apr 14, 2022
and last updated 2022-04-14 21:39:30-04

BAKERSFIELD, Calif. (KERO) — Shopping small, it’s something you probably do to support mom and pop businesses.

You may make those purchases online through a middleman, like Etsy.

Etsy works with 5.3 million businesses like these but recently, sellers have not been happy with their new policies during this time of inflation.

More than 16,000 of Etsy businesses are saying enough is enough.

Etsy Strike Organizer Lori Peterson said that they’re seeing a pattern of behavior with the online shopping platform.

Just two years ago, Peterson said Etsy raised fees by 40%, and then starting April 11 another 30%. Their transaction fees went from 5% to 6.5%.

Etsy CEO Josh Silverman confirmed that change, saying the increase is going toward efforts like bringing more buyers to Etsy through marketing and by growing their support team and technology.

With an ongoing pandemic and the highest inflation rate in 40 years, Kern County Black Chamber of Commerce’s President, Nick Hill said this is not the time to raise fees.

"All of a sudden, you have a price hike here in transaction fees. That's going to affect their bottom line, that's going to affect their production costs, that's going to affect the inventory and everything else that's involved. Right now, small businesses are struggling as it is."

Hill adds that the cost ends up being passed on to customers, but not as fast as the fees hit the shops.

“When you add this one and a half percent today, with all these other increases, and you’re trying to sell a product which you’re not selling it for that much in the first place, it makes a large difference in your profit margin.”

Peterson said tens of thousands of shops are going on “vacation mode” this week, opting not to sell their goods on Etsy. It’s their form of a strike.

For shops like Peterson, their shop is their main source of income.

Petersen said small businesses are not planning to return to Etsy after the strike ends on April 18. Then there’s customer loyalty; more than 60,000 customers signed pledging to boycott Etsy this week.

“We have rising prices and wage stagnations, so we’re expected to pass these fees onto our customers, you know, just because. Our customers are struggling too. So, it’s kind of immoral.”

Meanwhile, an Etsy spokesperson issued 23ABC a statement: “Our sellers’ success is a top priority for Etsy. We are always receptive to seller feedback, and, in fact, the new fee structure will enable us to increase our investments in areas outlined in the petition, including marketing, customer support, and removing listings that don't meet our policies.”

Petersen wants customers to know that they can still support their favorite shops by buying from them directly. All they need to do is contact them on social media and the sellers are willing to conduct business that way, or on other selling platforms.