When Tricia Robinson first got on Etsy in 2013, it was to help save her cat’s life.
“My cat got really ill and I was getting vet bills through the roof and I couldn’t afford to pay them,” Robinson said. “So I created an illustration that was inspired by him and I sold it.”
That’s when Robinson realized she could use the platform to sell more of her work and actually make a living off of it.
But after receiving her first payment from Etsy, the Montreal artist says she was struck by the difference between her sales and the amount that was being deposited into her account. That’s when she paid attention to all the fees Etsy charges sellers on the platform.
At first, she was okay with it.
Tricia Robinson has been selling her artwork on Etsy for nine years. Now, she’s planning to boycotting the website over Etsy’s fee increase. (CBC News)
“It kind of became this thing of like, okay, well, I’m making money as an artist. I have access to this online marketplace. It’s pretty cool for the most part,” she said.
Etsy was founded in 2005, offering an online marketplace for artists and craftspeople to sell handmade and vintage items as well as craft supplies. The website has attracted millions of buyers and sellers and provided a platform for artists to become entrepreneurs.
But over the years, Robinson says she started to see her margins shrink as Etsy’s grew. A policy introduced in 2019 incentivized sellers to offer free shipping for purchases over $35 US by promising to optimize those shops to U.S. buyers. Robinson first refused to opt in, but eventually caved as she saw her U.S. sales disappear.
Offering free shipping was taking off at least half her profit margin, she said. That’s when things started to go downhill on the platform for Robinson.
“[Etsy] was this really great marketplace that did celebrate handmade and local small business,” said Robinson. “But they’re not like that anymore.”
Now, Robinson is one of thousands of sellers who have said they plan to boycott the site from April 11 to 18 after the site announced it would be hiking its transaction fees from five to 6.5 per cent.
Fee hike sparks petition
This comes after Etsy’s strong fourth quarter earnings, which beat expectations.
The announcement led Kristi Cassidy, a seamstress from Westerly, Rhode Island, to start a petition after posting on Reddit calling for an Etsy sellers’ union. Cassidy told CBC News more than 17,000 sellers joined the boycott as of Monday morning.
“The post was basically asking when does this end because it’s just getting worse and worse and I don’t think it’s going to end unless we do something,” she said.
The petition also lists other demands, including letting sellers opt out of off-site advertising, which generates sales that Etsy charges sellers more for.
Cassidy says she stopped offering custom orders through Etsy because she could be charged as much as $100 for a dress sale that comes from an off-site ad.
In a statement, an Etsy spokesperson said the increase in fee will help boost their investments in marketing, customer support, and removing listings that don’t meet company policies.
“Our revised fee structure will enable us to increase our investments in each of these key areas so that we can better serve our community,” the statement reads.
Tricia Robinson, an illustrator based in Montreal, used Etsy to sell her artwork. (CBC News)
Company faces shareholder pressure to boost profits, says expert
Etsy has historically had an open and honest relationship with its sellers, says University of British Columbia professor David Clough.
However, Clough says it has become strained over the years.
“Since 2018, they’ve raised their fees twice, which suggests they’re trying to perhaps profit at the expense of their marketplace sellers,” he said.
Etsy became a publicly traded company in 2015, making it susceptible to shareholder pressure.
With over five million sellers on the site and 90 million customers, Clough says raising transaction fees is a new way for the company to boost its bottom line.
“As they’ve expanded their user base, it becomes harder to grow revenue by adding more users. So this makes them look for other sources of revenue.”
Kristi Cassidy designs gothic wedding dresses and costumes that she would sell on Etsy. She started a petition calling on Etsy to cancel its planned fee increase. (Kristi Cassidy)
Etsy’s fees are still lower than e-commerce competitors like Amazon, which charges eight to 15 per cent in addition to other fees.
Still, continuing to raise fees could risk Etsy’s reputation as they deviate further from the initial values of the company that allowed small businesses to make money, he says.
As for the boycott’s potential effect on Etsy, Clough says it could create momentum for more dialogue between the company and sellers as a collective entity.
“If they face pushback from sellers for this raise, then it makes them think twice about raising the fees down the line,” he said.
Cassidy says she hasn’t been in communication with Etsy about the petition and the boycott.
And while she’s not counting on Etsy rolling back its fee hike, she says she’s excited about building a community of sellers that want to advocate for better pay and company policies.
“The things that we could do together, it feels limitless,” she said.
TOKYO (AP) — Japanese technology group SoftBank swung back to profitability in the July-September quarter, boosted by positive results in its Vision Fund investments.
Tokyo-based SoftBank Group Corp. reported Tuesday a fiscal second quarter profit of nearly 1.18 trillion yen ($7.7 billion), compared with a 931 billion yen loss in the year-earlier period.
Quarterly sales edged up about 6% to nearly 1.77 trillion yen ($11.5 billion).
SoftBank credited income from royalties and licensing related to its holdings in Arm, a computer chip-designing company, whose business spans smartphones, data centers, networking equipment, automotive, consumer electronic devices, and AI applications.
The results were also helped by the absence of losses related to SoftBank’s investment in office-space sharing venture WeWork, which hit the previous fiscal year.
WeWork, which filed for Chapter 11 bankruptcy protection in 2023, emerged from Chapter 11 in June.
SoftBank has benefitted in recent months from rising share prices in some investment, such as U.S.-based e-commerce company Coupang, Chinese mobility provider DiDi Global and Bytedance, the Chinese developer of TikTok.
SoftBank’s financial results tend to swing wildly, partly because of its sprawling investment portfolio that includes search engine Yahoo, Chinese retailer Alibaba, and artificial intelligence company Nvidia.
SoftBank makes investments in a variety of companies that it groups together in a series of Vision Funds.
The company’s founder, Masayoshi Son, is a pioneer in technology investment in Japan. SoftBank Group does not give earnings forecasts.
Shopify Inc. executives brushed off concerns that incoming U.S. President Donald Trump will be a major detriment to many of the company’s merchants.
“There’s nothing in what we’ve heard from Trump, nor would there have been anything from (Democratic candidate) Kamala (Harris), which we think impacts the overall state of new business formation and entrepreneurship,” Shopify’s chief financial officer Jeff Hoffmeister told analysts on a call Tuesday.
“We still feel really good about all the merchants out there, all the entrepreneurs that want to start new businesses and that’s obviously not going to change with the administration.”
Hoffmeister’s comments come a week after Trump, a Republican businessman, trounced Harris in an election that will soon return him to the Oval Office.
On the campaign trail, he threatened to impose tariffs of 60 per cent on imports from China and roughly 10 per cent to 20 per cent on goods from all other countries.
If the president-elect makes good on the promise, many worry the cost of operating will soar for companies, including customers of Shopify, which sells e-commerce software to small businesses but also brands as big as Kylie Cosmetics and Victoria’s Secret.
These merchants may feel they have no choice but to pass on the increases to customers, perhaps sparking more inflation.
If Trump’s tariffs do come to fruition, Shopify’s president Harley Finkelstein pointed out China is “not a huge area” for Shopify.
However, “we can’t anticipate what every presidential administration is going to do,” he cautioned.
He likened the uncertainty facing the business community to the COVID-19 pandemic where Shopify had to help companies migrate online.
“Our job is no matter what comes the way of our merchants, we provide them with tools and service and support for them to navigate it really well,” he said.
Finkelstein was questioned about the forthcoming U.S. leadership change on a call meant to delve into Shopify’s latest earnings, which sent shares soaring 27 per cent to $158.63 shortly after Tuesday’s market open.
The Ottawa-based company, which keeps its books in U.S. dollars, reported US$828 million in net income for its third quarter, up from US$718 million in the same quarter last year, as its revenue rose 26 per cent.
Revenue for the period ended Sept. 30 totalled US$2.16 billion, up from US$1.71 billion a year earlier.
Subscription solutions revenue reached US$610 million, up from US$486 million in the same quarter last year.
Merchant solutions revenue amounted to US$1.55 billion, up from US$1.23 billion.
Shopify’s net income excluding the impact of equity investments totalled US$344 million for the quarter, up from US$173 million in the same quarter last year.
Daniel Chan, a TD Cowen analyst, said the results show Shopify has a leadership position in the e-commerce world and “a continued ability to gain market share.”
In its outlook for its fourth quarter of 2024, the company said it expects revenue to grow at a mid-to-high-twenties percentage rate on a year-over-year basis.
“Q4 guidance suggests Shopify will finish the year strong, with better-than-expected revenue growth and operating margin,” Chan pointed out in a note to investors.
This report by The Canadian Press was first published Nov. 12, 2024.
TORONTO – RioCan Real Estate Investment Trust says it has cut almost 10 per cent of its staff as it deals with a slowdown in the condo market and overall pushes for greater efficiency.
The company says the cuts, which amount to around 60 employees based on its last annual filing, will mean about $9 million in restructuring charges and should translate to about $8 million in annualized cash savings.
The job cuts come as RioCan and others scale back condo development plans as the market softens, but chief executive Jonathan Gitlin says the reductions were from a companywide efficiency effort.
RioCan says it doesn’t plan to start any new construction of mixed-use properties this year and well into 2025 as it adjusts to the shifting market demand.
The company reported a net income of $96.9 million in the third quarter, up from a loss of $73.5 million last year, as it saw a $159 million boost from a favourable change in the fair value of investment properties.
RioCan reported what it says is a record-breaking 97.8 per cent occupancy rate in the quarter including retail committed occupancy of 98.6 per cent.
This report by The Canadian Press was first published Nov. 12, 2024.
