Following a record-breaking fourth quarter in 2021, e-commerce website Etsy is raising seller transaction fees from 5% to 6.5%, the firm announced today.
In a report released to investors, the e-commerce firm says the 30% increase will take effect from April 11th 2021. The transaction fee is the proportion of the total order amount the firm charges when a sale occurs.
The high seller transaction fee comes as Etsy announced fourth-quarter revenue of $717.1 million, which the firm attributes to a strong holiday shopping season. Etsy added nearly 10 million new buyers in the 2021 fourth quarter, bringing the total number of active users on the website to almost 90 million. Etsy’s stock prices shot up by more than 15 percent after a market close on Thursday.
Etsy says the rise in fees will mostly pay for seller tools, marketing, and creating world-class customer experiences. Higher seller transaction fees are likely to upset sellers on the platform, who for years have expressed displeasure about changes at Etsy as the organization grows. The last time Etsy increased transaction fees was in 2018 when it went up from 3.5% to the current 5%. Merchants also pay $0.20 for each item listing, plus fees for processing payments.