5X Your PROFIT on Etsy With These 3 Tips

About this video

Jahraus shares three lessons from her corporate e-commerce career at Zappos and Zulily, where she says she worked with $100 million portfolios, and applies them to Etsy. She says she has sold for almost seven years, claims $1.4 million in revenue and over $1 million in profit on the platform, and says that background taught her to build businesses on data using concepts like average order value, margin, sell-through, and turn. Lesson one is blended gross margin: do not fixate on margin per item. At Zappos, she says, expected margins differed by category — outdoor 18 to 24%, athletic 34 to 36%, action sports 38 to 42%, and street over 42% — and differed again by brand and product, yet blended to around 34 to 36% across the $100 million category; focusing on the blend lets sellers scale revenue. Lesson two is gross margin dollars over gross margin percent: a $20 t-shirt with $10 cost of goods including Etsy fees, sold 10 times a month at a 50% margin, makes $100 profit, while the same shirt at $14 and a lower margin selling 40 times a month makes $160 profit, plus more orders, reviews, and customer relationships that compound through lifetime value. Lesson three is sell-through: inventory sitting in a garage or closet ties up cash that cannot be reinvested, and it can be better to liquidate at cost and redeploy the cash into profitable items. Sell-through expectations should vary — higher for seasonal items with a short selling window, lower for core year-round items and for products with many sizes or variations to avoid stockouts.

Key takeaways

• Manage blended gross margin across categories, brands, and products rather than fixating on margin per item
• Prioritize gross margin dollars over percentage: lower margin with much higher volume can produce more total profit
• Lower prices that multiply order volume also compound reviews and customer lifetime value
• Manage sell-through tightly: tied-up inventory blocks cash flow, and liquidating at cost can beat holding out for margin
• Set sell-through expectations by product type — higher for seasonal items, lower for core items with many sizes or variations

Episode details: published December 31, 2022 · 8:39 long. Summary written by Self Growth Videos from the episode itself. Business results and any income figures mentioned are Dylan Jahraus’s own claims, shared for education — they are not typical or guaranteed.

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