How Etsy Raped America

It seems that, for the past few years, the big flap with Etsy (if you trust social media) was a privacy issue that began in 2011 and to which details numerous blogs and links are easily available if one googles “bad press Etsy.”

But for other stores, there is a deeper concern. Recently my sister and I, both Etsy store owners, went back to Etsy’s own policy guidelines and lifted word for word the following description:

Etsy is a marketplace where people around the world connect to buy and sell unique goods.

Everything on Etsy must be Handmade, Vintage, or a Craft Supply

Handmade items are designed and created by the shops that sell them. Because transparency matters on Etsy, we ask sellers to list shop members and share information about manufacturers involved in creating their items. Reselling an item you were not involved in creating is not allowed in our handmade category. 

Vintage items must be at least 20 years old.

Craft Supplies are tools, ingredients, or materials intended for use in the creation of a new handmade item. Commercially made materials that are ready to use as finished goods may not be sold as craft supplies on Etsy.

This seemed very straightforward to both of us, especially the statement “Reselling an item you were not involved in creating is not allowed in our handmade category.”

And we played by those rules, and we ran our stores with integrity, and we answered every question and addressed every complaint…and then we watched as our sales began to, for no discernible reason, plummet.  We spent hours discussing this, hours attempting to adjust key words, adjust what we sold, adjust the looks of our stores…all in vain.

And then one day we stumbled on a website called “Alibaba.com”. Alibaba (out of China) is not trying to fool anyone. They are selling their items, in this case head wraps in packages of 300 pieces for between $.2 – $.5 each. FOB. In case anyone needs a translation, that’s as low as 20 CENTS per item plus freight, which we all know is pretty darn low and often built into the price on sites like Alibaba. So for a total cost of somewhere in the neighborhood of $100, any average citizen walking down the street could purchase 300 head wraps, such as the one pictured:

EtsyFraud2

and sell them, such as the one shown below modeled by a beautiful blonde (ostensibly American) woman for $28 + $5 shipping.

Fraud2-1

For anyone without a great grasp on math, what that really meant in financial terms is that it would only take the sale of FOUR cheap Alibabi.com head wraps to break even, and the rest of the sales would be….you guessed it…pure profit.

And for anyone not currently sitting next to a calculator, that would be approximately $7,000 of profit. $7,000 of profit on an initial investment of $100. Now those are some healthy returns!  Except that most companies would have to figure in nuisances such as wages, rent, utilities and taxes.  More importantly, if they didn’t have a great, respected platform/storefront on which to market and sell their items, the pure profit would be something they would dream about while they brewed up drinks at Starbucks for their customers.

But back to the matter at hand, because many of you are probably thinking along these lines…”so what does that have to do with Etsy, anyway….because I thought this article was about Etsy, not China.”

It is. It’s an article about how Etsy shot itself, and its entire seller’s community in the foot (and both hands and perhaps even the other foot). It’s how Etsy allowed itself to become polluted with greed, break its own guidelines ~ in fact FLAUNT its own guidelines, and drive small businesses, originally wooed in with promises of a platform for hand-made and legitimate vintage items, out of business.

And while this foot-shooting “corporately speaking” makes a somewhat twisted and short-term sense for the new April 2015 stockholders of Etsy, it will undoubtedly emerge as the death-knell of the once home-spun and sweet site that gave average Americans a crack at generating a small profit from their homes without the 9-5 grind. Without the daycare and the corporate outfits and the commuting costs of corporate American. Without the soul-sucking atmosphere and the timed coffee breaks and the inane water-cooler politics. Most importantly, without encouraging more cheap junk from an over-polluted country that doesn’t mind paying it’s own population nearly nothing to work 10+ hour days.

Don’t get us wrong, we have very little problem with cheap junk from an over-polluted country.  If that’s what you want to buy, go to a Dollar Store, pull out some change and get what you are paying for.  But Etsy, and it’s granola founders appeared to stand for something different, something more noble than a Dollar Store…and we embraced them for it.

To be fair, there are some differences in the items pictured above.  The first item is from Alibaba’s (made in China) site and the second item pictured is from the Etsy site “ThreeBirdNest”. We examined these differences, because apparently they were enough to convince Etsy that these items were hand-made, and that these items met Etsy’s own guidelines. First, the Alibaba item appears to be made from a type of fabric.  It also appears to be a certain color.  The most unique difference seemed to be that the Alibaba item is modeled on the head of a fake plastic doll with bad red eye shadow and grey hair.  The Etsy “ThreeBirdNest” item is modeled on the head of a woman most of us see only on magazine covers.  We seemed to have figured it out – that the difference between the two items was the MODEL!

It was an “ah-hah Oprah moment” that vibrated from my home in Arizona to her home in Michigan. How could we have missed this defining difference?

It seemed almost too easy, so we started looking further and found the following on that very same site, (made in China) Alibaba.  In another section that seemed to have chucked the grey-hair, red-eyeshadow plastic model’s head into the trash (something Etsy leaders not do, they compost all of their trash and bike to work in long skirts and Birkenstock sandals.) we found this model:

Fraud3
Yep, that’s her. That’s our American blonde Etsy model who somehow morphed over to China and appears in the Alibaba Group’s marketing pages. There’s not even an attempt to fool us by using a brunette! It’s the very same, genetically identical person. The woman who appears everywhere on ThreeBirdNest’s site. Sexy pout, lips half open, long black lashes, gently waved blonde hair, flat eyebrows with very little arch.

Wow.  There went all of our theories.

So we started thinking.  Just who is this Alibaba Group and how did they kidnap ThreeBirdNest’s model?  Glad you asked.  Here’s the readers digest version of who they are.  The Alibaba Group was started in 1999 by a teacher from Hangzhou, China. Laughably, its “company overview” states that it was started to “level the playing field by enabling small enterprises…to compete…in global economies.”  That’s very noble, but it didn’t bring us any closer to the mystery of how they kidnapped the model.

We may may never figure that out, let’s be honest here.

However we will admit that they effectively leveled the playing field for at least two entities when they hopped into the sandbox with ThreeBirdNest. They leveled it for the Alibaba Group and ThreeBirdNest. The question is, who did they level it with. Because ThreeBirdNest is no longer on a level playing field on good old granola Etsy. It has chalked up 100,000 sales since November 2011. That’s approximately 3-1/2 years in existence, approximately 28,500 items per year, approximately 78 items per day, every single day, even including Christmas.

Who are the people making all of these items? Thank you for asking.  Because we have news for you, it isn’t Ms. ThreeBirdNest. On her site it lists five other LOCAL people as “seamstresses/makers”, so apparently these five people sit in her home and each of them pumps out 15 items per day, 7 days a week, 365 days of the year.

Not likely.

In an even more improbable scenario, there are five “managers” also listed on her Ms. ThreeBirdNest’s site, so each of her workers, who churn out either a watch, a headband, a shirt or a leg warmer every hour or so needs his/her own manager. Wait, what? Why do five people need five managers?

Good question.

Hang in there with us, because we forgot to mention that ThreeBirdNest founder “Alicia” in Livermore California “loves naps.” We didn’t make this up, its straight from her website. In fact, she can nap all day long since she’s got five workers and five managers working around the clock for her. But let’s do the math here. Minimum wage in California is about $9 an hour. So these workers and these managers are, between the 10 of them, making $90 per hour. Plus the other give or take 7 people who ship, market and design these items, at a total of $63 per hour. Again, if you don’t have a calculator, that is $153 per hour. Before benefits, taxes, paid vacations, fabric purchases, leather purchases, lace purchases, watch face purchases, beads, soldering tools, warehouse rent….well, you get the idea.

It’s obviously not a successful business model. It doesn’t take a genius to see that the only way a “hand-made” business like this succeeds is by, well, by NOT being a hand-made business. And that’s not playing nice, ThreeBirdNest, that’s playing dirty corporate games. It’s playing in a global sandbox with China as your only playmate, and using a blond model, the very SAME model on Alibaba Group’s website, to sell your “hand-made” items.

And the worst part about it is that Etsy looks the other way. Why bother kicking her off the site, she’s bringing in a boatload (from China) of profit for them, and after their huge 2014 losses, they need more than just the little cottage industries (like my sister’s shop and my shop) to push them to the next level. Because America is all about the “next level” which means more money, IPO’s, stock options, vapid soulless corporations…all of which Etsy had fooled us into thinking they weren’t.

Maybe there’s a little karma for ThreeBirdNest, because her latest reviews are about as bad as reviews can get.

From Leah Sullivan: “this headband is not green at all like the picture! I received it and it was bright turquoise, and it looked like a child stitched it! No returns, this shop is really shady!”

(We don’t know how to tell Leah that China has a different idea of what “green” is, and that a child probably DID stitch it)

From Liz Spaulding: “extremely poor service due to the ‘moving of their warehouse’. Took over a month to receive my order.”

(Liz, Liz, Liz…you can’t get these things from the factory in China to the docks in China on the boat in China, across the ocean, off the docks in California and mailed to the customer in three days. It appears it’s an average of 3-4 weeks, without the “moving the factory” excuse. And just as a side note, why do you need a factory for 18 people in California?)

From SherwoodGirl1: “DO NOT BUY FROM THIS SELLER. Take it from me and dozens if not hundreds of other disappointed customers of threebirdnest. I wish I had listened to the bad reviews more seriously. They DO NOT communicate with buyers and they flat out lie about where your order is and lie about it being shipped. Then, if they get bad reviews, they send out some half assed cut and paste apology on the etsy review page. SAVE YOUR MONEY. FIND A BETTER SELLER.AVOID THE FRUSTRATION. With any luck this seller will be banned from selling on etsy all together and no one else will have to deal with this shitty, dishonest service. Even If there was a lower star rating than one star, that wouldn’t be low enough to give this seller.”

(We feel you sherwoodgirl1. Kind of. We’ve been doing things like really finding our vintage items, or really making our hand-made items and you haven’t purchased those items because we couldn’t price them low enough to complete with China, I mean ThreeBirdNest.

Unfortunately, Etsy has burned its bridge with me, with my sister and no doubt with hundreds and hundreds of small businesses across the United States. I now have 400 pieces of inventory that absolutely do not sell. That absolutely no one even looks at.

To figure out why, we had to look closer at the situation, because ThreeBirdNest was very, very guilty of a bunch of corporate dirty politics, but there had to be more.

And then we found it.

About a month ago, Etsy introduced some “changes”, which appeared to be little more than a frantic goat rodeo exercise involving 20 minutes of adjusting EACH listing, re-categorizing products, etc. Etsy never told us why they made those changes.  They just did.  And if that didn’t suck the daylights out of any potential profit, the huge 2014 losses Etsy suffered due to their marketing/search engine spending seemed to have screeched to a halt as soon as an IPO offering was on the table.  What had been thriving, prior to the IPO offering, became like the dust bowl, even as the granola-founders of Etsy traded in their very last few pounds of conscience for a few corporate dollars and cycled their winnings home with gold-soled Birkenstocks and really flashy new skirts.

I can’t help thinking that if a few of us had taken the time to get in the sandbox with China and make a quick killing, even as Etsy was folding, and we had to go back to making money the good-old-corporate way, we’d be sitting on a big enough pile of money to cry golden tears instead feeling our mixture of disgust and envy.

Silly us.  We’d really believed that Etsy was a unique site, and we really believed Etsy was going to play by it’s own rules, and we really believed….oh never mind what we really believed.  No one really cares.

Congrats sites like ThreeBirdNest, you made your money by ignoring the guidelines that the rest of us adhered to, and you took all of us down in the process.  We have some inventory that perhaps you’d be interested in – maybe 10 cents on the dollar?

We’ll wait for your call.

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117 thoughts on “How Etsy Raped America

  1. In my humble opinion, Etsy never cared about their sellers. Ever.
    They only care about making money for themselves. Plain and simple.
    Google the Wedbush report on them and you’ll find out all about their actions and the “fake goods concerns”.
    Sad but true.

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  2. I used to sell on Etsy, but very soon i noticed that they sold out to China and big manufactors . That they were in this for the big bucks and not for us the homemakers.
    Soon homemade seemed like made in China.
    Everyone was complaining in the forums, how they had not only their pictures stolen and appearing on China sites such as the Alibaba and on Ebay from China sellers , But even their full discription they wrote themselves as well.
    But if you dare mention one bad thing about China, a admin from Etsy would appear on the thread and scold everyone and then ban a few people or remove the entire thread.
    I am smelling a sold out to China rat and the name is ETSY .
    They were bought and sold i am sure to some body in China that has been and bought up all the Manufactoring in the US.
    Was not enough that they bought up all the brick and mortar manufactoring businesses in the US, but they also wanted all the online Manufactoring from the US .
    They are like roaches waiting in the dark to come out and feast on all we have to make themselves fatter and starve us .
    I can not prove it, but sure that ETSY was sold to someone in China and this is why they changed and all for the big buisness and screwed the very craftors that made them a name and got them popular,

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  3. Is there an online business like etsy or ebay that is honest? I remember years ago when I was selling on ebay, a huge tip they pushed was “create an interesting, long ago story”. The reason it works, people like stories true or not.
    You describe an item that you bought at an auction as originating from Britain in 1884 that young prince Henry found while playing hide and seek with cousin whoever and how you can back it up with made up paperwork, blah blah. Your item sells for 100-200 bucks because you can write a great story.
    People need to get a copy of, “Things I Learned From House”, and pin it by their computer!

    Now my rant is over. I would like to know if people can make money selling on etsy? Is there a new, honest homemade goods online store? Thank you for any help!
    Sincerely,
    A mom trying to earn a living while staying home with my kids

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