Etsy success story not all that: cheap imported goods marked up = "success" [View all]

[ND-Dem]

Here's the original feel-good story:

California Mom Says She Grosses at Least $70K a Month on Etsy

Alicia Shaffer started her site on Etsy, selling homemade headbands and socks, in November 2011 just hoping to make a few bucks...Shaffer told "Good Morning America" special correspondent Becky Worley.

Now, nearly four years later, Shaffer's site, "Three Bird Nest," is one of the top five-grossing stores on Etsy, grossing anywhere from $70,000 to $80,000 per month.

https://gma.yahoo.com/california-mom-says-she-grosses-least-70k-month-152400291--abc-news-personal-finance.html

Here's the rebuttal:

How to make a million dollars on Etsy — buy from Alibaba and run your store like eBay

Shaffer claims her store, ThreeBirdNest, earns her just shy of a million dollars a year. The second-most successful store on the entire site, Shaffer's store sells clothing and accessories — socks, headbands, boot cuffs, and T-shirts with slogans such as "Feed me and tell me I'm pretty." ThreeBirdNest advertises its products as "handmade boutique" fashion, but Shaffer...employs a team of 15 women who help sew some of the items in her store, and controversially, a number of the other products are bought wholesale from retailers in India.

The resale of wholesale items is common for sellers on eBay, Amazon, and other e-commerce sites, but Shaffer's business model has attracted criticism from other Etsy sellers and shoppers who argue that the site, with its focus on homemade crafts, is not the place for such tactics. The site's struggle is one of handcrafted idealism versus cut-throat capitalism...

ThreeBirdNest might not follow Etsy's projected philosophy, but it does make money — profit margins for such items, Shaffer told Fast Co. Design, are around 65 percent. There are examples with even higher markups: a pair of lace socks appear in her store for $28. The same socks are also available from Chinese retail giant Alibaba's eBay-esque marketplace Aliexpress for around $6 a pair.

...By buying cheap wholesale items... wholesale goods are turned from cheap socks into boutique must-haves. Certainly it's a commercial approach that has allowed Shaffer to climb to the top of the table while others have a trickier time.

Etsy made $895 million in 2012 alone, but the spread of that wealth was uneven... Etsy said 65 percent of its sellers reported making less than $100 a year from their stores....

http://www.theverge.com/2015/2/18/8059835/how-to-make-money-on-etsy-buy-wholesale