ETSY/PRINTIFY Business Model

Most of us are looking hard for side hustles. If we can set it up and let it run to generate passive income, that’s the best. Youtube videos showing how to make money seamlessly are prolific and pop up constantly on my social media. I watch, read, take notes, research, and consider multiple options. One that continuously pops up for passive income is using original designs and a print-on-demand service.

After watching multiple how-to-doit videos and reading blogs for a month, my partner and I started researching the ETSY/Printify combination. The strategy is simple and convenient. She is a fantastic designer who has created original shirts for years using a vinyl cutter and heat press for individual clients. Leaping a more extensive clientele looked like an easy jump.

The strategy is simple and hammered home repeatedly by several entrepreneurs. Create original designs on Etsy and link them to products on Printify. You carry no inventory; the customer is shipped directly from the manufacturer on the Printify system. There are over 200 manufacturers worldwide, so we spent a week reading the reviews and calculating price comparisons for similar products. We created a spreadsheet with all the charges Etsy adds for every design uploaded and every product sold through their site. My partner generated fifty designs because a wider selection expanded the opportunity for a sale. All our research indicated that free shipping was a pivotal point in sales. We were told multiple times that ETSY promotes businesses that offer free shipping first.

Setting up that first design took some time, but replicating the rest was easy. We calculated shipping expenses in an average cost to offer free shipping on all products. We decided to make a small profit, much less than a physical store would profit. We launched the store. We saw data that dozens of people looked at the designs in the first week, but no orders materialized. I looked at our store from my cell phone without logging in so that I could see the store. I saw ads running across the bottom of our store saying, "Get a similar shirt for only $8.” The design was not as detailed or colorful as ours, but the price was a third of what we offered.

Etsy pushed lower-cost designs from their top sellers and advertisers on our store page. After looking at the numbers, the shirts' profit margin must be in cents. We put their designs in and ran them backward through our calculations to determine their profit margins. They make it up in quantity, but a new store starting would not be able to compete. Our costs with small quantities with the Etsy charges and eating the shipping cost far exceeded the $8 advertised shirt. As a start-up print-on-demand with original designs, we could not purchase the shirt at our costs with free shipping under the $8 advertised shirt.

The Etsy/Printify model is flawed because Etsy does not protect the small and newer stores. Etsy sinks small and new clients because they advertise similar products at significantly lower costs on the store pages at the bottom under the title “You may also like.” We still like the idea of not carrying inventory and using a print-on-demand business model, this one will not work for us. Our choice is to convert the store over to just digital design, let people purchase the designs, and pray that others do not steal our ideals and undercut our price. Since we have invested weeks of research and time in setting up the store, we will stay with ETSY in the short term as we research other options, such as Shopify and Reddit.