Free Etsy Business Plan Template [2024 PDF + Sample Plan]

Etsy business owner works in their craft studio, preparing an order.
Author: Anthony St. Clair

Anthony St. Clair

Anthony St. Clair

9 min. read

Updated February 7, 2024

As Etsy itself likes to put it, “anyone with 20 cents and a creative idea can start a business.” Whether it’s a full-time gig or part-time side hustle—your key to success is not necessarily understanding how to start your Etsy business, it’s planning to run your business for the long haul. 

Etsy can be a big part of all of that for you. 

What is Etsy?

Since Etsy’s start in 2005, the selling platform has grown to annual revenues of over $2.4 billion, with 874 employees. The Brooklyn-based company is known to support sellers and prioritize ethical business practices. 

In 2021 and 2022 Etsy unveiled its models for environmental, social, and governance (ESG) structure. This included social impact goals, and how Etsy intends to deliver value to sellers like you.

How to write a business plan for an Etsy shop

Part of how you can set your Etsy business up for success? A simple Etsy business plan can help you better understand not only your vision for how to start your Etsy shop but:

  • How you’ll get things rolling
  • Your hopes for where the business can go
  • How to stay on top of day-to-day tasks and long-term strategy

Now, we’re not talking about a massive document. We’re talking about what’s called a lean business plan. In as little as one page, you can set down the main points you need to help you find—and stay on—the path to your Etsy shop.

As you take your Etsy shop from planning to startup to ongoing operation, here are a few things you’ll want to touch on in your Etsy business plan.

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1. Why are you starting your Etsy business?

Explain why you’re doing this, wrap in your value proposition, the market need, and your solution. This can also impact what your goals and strategy will be based on how much you intend to invest (side hustle vs full time).

The first thing to remember when launching your Etsy business is that you are starting an actual business. Etsy is just the platform you’re using to sell and distribute your products. 

Here are three crucial points your business plan needs to cover:

  1. Why are you starting your business?
  2. What do you want your business to accomplish, both for your customers and for you?
  3. How can Etsy be part of starting, growing, and running your business?

The better you understand your motivation and your goals, the more likely you can set up your business for success and profit, both on Etsy and elsewhere.

2. Research the platform

As a publicly traded company that’s popular with makers and small businesses, information about Etsy is not in short supply. Why is this valuable for your entrepreneurial efforts? It helps your explore where you fit in with Etsy, and where Etsy fits in with your business idea.

Etsy continues to grow

For example, according to Etsy’s 2021 Global Seller Census, 79% of Etsy sellers are women, 84% are solopreneurs, and 95% of Etsy sellers run their businesses from home. For about a third of sellers, their creative business is their primary occupation and source of income.

As of 2022, Etsy continues to hold strong in the ecommerce marketplace. First quarter revenue was $579.3 million, a 5.2% increase from the same time period in 2021. During Q1, Etsy also reported:

  • Adding 7 million new buyers
  • Over 89 million active buyers
  • Selling in approximately 250 countries
  • A seller base of 5.5 million
  • 70% of Etsy’s customer base are women
  • Etsy is prioritizing bringing in more male shoppers

Examine categories for how your products will fit in and how you’ll stand out

The market for products sold on Etsy is global—and growing. You need to decide what you’re selling. Then conduct research to determine how popular that type of product is on Etsy. 

For example, as of 2020, Etsy’s top 10 most popular product categories are:

  1. Home & Living
  2. Art & Collectibles
  3. Jewelry
  4. Clothing
  5. Accessories
  6. Bath & Beauty
  7. Toys & Games
  8. Bags & Purses
  9. Weddings
  10. Books, Movies & Music

As you identify the category that best fits what you want to sell, you can examine other products and sellers on the Etsy platform. It helps to understand how different sellers present their products with images and copy and to see what sort of marketing and promotional strategies they use. 

What can you do that will be similar? At the same time, what makes your products different. So, how can you stand out? As you further develop your Etsy offerings, you should also examine who your target customers will be—not to mention your primary competitors.

One last thing: Remember how we talked about how you were starting your business, not just your Etsy business? Etsy isn’t necessarily the only platform where you want to sell your products. In fact, it’s a good business practice not to limit yourself to one 3rd party platform where you lack full control.

Some makers might also sell on Amazon, through local or regional events such as craft fairs, on consignment with area or specialty retailers, or they might build their own direct sales through an eCommerce website.

3. Promotional strategies and your Etsy brand

Understanding your promotional and marketing strategies will be key to gaining visibility with your target customers, building trust, and earning every sale on Etsy. Use your business plan to identify how you can market online and/or in person. What sales channels and marketing activities can attract customers to your products?

For example, a jewelry maker might develop a social media strategy on Instagram and TikTok. Those channels could showcase making jewelry, sourcing materials such as gemstones, and different looks or outfits that the jewelry enhances.

You can also utilize various promotional strategies directly on Etsy. The platform supports its own Etsy Ads campaigns, along with offsite ads, coupons, sales, shipping specials, and more.

In addition to front-facing marketing and promotional strategies, also use your Etsy business plan to mark out tasks and processes that can help you stay consistent. For example, how will you produce and maintain stock levels? What customizations will you need to fulfill? What relationships do you need to build with suppliers, shippers, and other makers?

4. Financials and pricing

As a business that makes and sells products, your Etsy business will have costs including supplies, fulfillment, shipping, storage, listing fees, sales taxes, and more. All of these factors will influence how you price your products, and how you’ll examine your business finances to see your timeline for covering costs and generating profits.

As part of setting prices, examine similar products and categories on Etsy for an idea of where customers will expect your prices to be. And remember, the only constant is change. Costs change, including fees. In April 2022, for example, Etsy raised its transaction fee from 5% to 6.5%.

When your business plan includes financial factors around costs and profits, you can make better plans, and monitor the financial health of your business.

5. Looking ahead

You started your business for reasons that matter to you. As you handle day-to-day tasks and tackle challenges though, your business plan can help you reconnect with that underlying spark, motivation, and inspiration. Regularly looking over your business plan can also help you look ahead.

As you launch and run your business, you can better set goals, such as sales goals or revenue milestones. You can also plan for equipment or other investments, such as better product photography, a trade show, a computer upgrade, or the development of a new product line.

Your business plan helps you look back and ahead. You can use it to set goals and stay tapped into your Etsy shop’s fundamentals. Just those two things can keep your business sustainable in the short term and primed for long-term growth.

Tips to run a successful Etsy business

Every business is unique. Your Etsy shop is no different. Here are a few tips that can help you run a more successful Etsy shop—and grow a business that lasts.

Etsy search is a complex algorithm that aims to match a customer’s search to the right products. Your product copy, or the text that describes each item, needs to include search terms that are relevant to the words a buyer might use in their search. Selecting the right tags in Etsy’s tag system can also better match your offerings to searches.

Another key to performing better in Etsy search? Complete your About profile, Shipping profile, and Shop Policies. While not directly related to a search query, these factors are part of a positive customer experience and influence how Etsy weighs your shop’s relevance to searches.

Set up coupon codes and build a customer list

Etsy’s promotional tools for sellers also include sales, discounts, and promo codes. Through Etsy’s Shop Manager, you can set up and schedule promo codes (including a fixed amount off, a percentage off, or free shipping). Etsy also gives you access to tools for targeted offers, such as sending emails for abandoned cart reminders, recently favorited items, and a post-purchase thank you.

Along with building sales, you’ll want to build up your own customer list, especially for email marketing. It can become a direct channel between you and your customers, where you can take them behind the scenes, send out special offers, and keep in touch.

Focus on personalization and being memorable

If Etsy’s 5.5 million sellers were a state, they’d be about the same population as Minnesota. With so many sellers and potential competitors, part of how you can succeed on Etsy is by standing out and being memorable.

After all, starting an Etsy shop often isn’t just about the product. It’s about the relationship between you and your customers, and that can come through in different ways. For example, how can your marketing relay your story as a maker and business owner? Or, can you offer personalization on your products? Touches like these can help you stand out—and build a loyal base of returning customers who also recommend you to others.

Have simple and customer-friendly shop policies

From returns to shipping, every shop has to have its own rules of the road. Aim to focus on Etsy shop policies that are easy for the customer to understand. You need to make customers feel like you understand them and truly want them to have a good experience.

Download your free Etsy business plan template

Download our free Etsy business plan PDF can give you the template you need to start setting up your Etsy business—and your dream shop. It’s just one of the hundreds of free sample plans that have been time-tested by our team and by thousands of entrepreneurs all over the world.

Selling on Etsy is competitive, but it’s also a solid platform for establishing and growing a product-based business. Your Etsy business plan can help you think through the challenges and opportunities that you’ll face in a demanding industry. You’ll also be able to examine your shop idea from different angles, identify potential challenges, and build a stronger business than you could otherwise.

The question is simple: What business, and products are you yearning to make? Whatever you want to sell on Etsy, get your free Etsy business plan today to start making both your products and an awesome Etsy startup.

Brought to you by

Create a professional business plan

Using AI and step-by-step instructions

Create Your Plan

Secure funding

Validate ideas

Build a strategy

Content Author: Anthony St. Clair

Anthony St. Clair is a business copywriter, author of the Rucksack Universe travel fantasy series, and a craft beer writer specializing in Oregon. Learn more at anthonystclair.com.