Most Etsy sellers price by feel: they look at what similar shops charge, pick a number that "sounds right," and hope there's profit in it. The problem is that "sounds right" and "actually makes money" are two different numbers — and the gap between them is exactly the size of Etsy's fees plus your costs. Your break-even price is the floor: sell below it and every order quietly loses money, no matter how busy your shop looks.
What break-even actually means
Break-even is the price at which your profit is exactly zero — the point where the money coming in equals the money going out on that order. Above it, you make something. Below it, you pay for the privilege of shipping. It is not your target price; it's the line you must clear before "profit" is even a word that applies. Your real selling price should sit comfortably above it. (For turning break-even into an actual margin, see how to price Etsy products for profit.)
The 2026 formula
Etsy's fees come in two shapes, and you have to treat them differently:
- Percentage fees that scale with price: the 6.5% transaction fee plus the percentage part of payment processing (3% in the US). Together that's about 9.5% of the sale for a US seller.
- Fixed fees that don't move with price: the $0.20 listing fee (charged again each time the item sells) plus the $0.25 fixed part of US payment processing — $0.45 per order.
Because percentage fees come off the selling price, you can't just add your cost and the fees together — the fee grows as the price grows. The clean way to solve it:
Break-even price = (your cost + fixed fees) ÷ (1 − percentage fees)
For a typical US seller that's (COGS + $0.45) ÷ 0.905. The "÷ 0.905" is what accounts for the percentage fee eating into whatever price you land on.
A worked example
Say an item costs you $8 in materials and packaging (your cost of goods sold). Plug it in:
($8 + $0.45) ÷ 0.905 = $8.45 ÷ 0.905 = $9.34
So $9.34 is your floor. Sell at exactly that and you net zero. Price it at the tempting round number of $9 and you're actually losing about $0.30 every single order — and the busier you get, the more you lose. Notice how close the floor is to your $8 cost: on low-price items, fees swallow almost the entire gap between cost and price, which is why cheap products are the ones that most often sell at a loss without the seller realizing it.
Three things that push your break-even higher
The formula above is the bare minimum. Real orders have more going on, and each of these raises the floor:
- Shipping you don't fully recover. If a label costs you $5 but you only charge $4 — or offer free shipping — the difference is a cost, and Etsy even charges the 6.5% on the shipping the buyer pays. Add unrecovered shipping to your COGS before you run the formula. (See does Etsy charge fees on shipping.)
- Offsite Ads. If a sale is attributed to Offsite Ads, Etsy adds 12% or 15% (capped at $100/order). That turns your ~9.5% percentage fee into ~21.5–24.5% on that order, pushing the break-even sharply higher. You can't predict which orders trigger it, so leave a cushion.
- Non-US fees. Outside the US, payment processing is higher and often has a bigger fixed part, and many countries add a small regulatory operating fee, a 2.5% currency conversion fee, and even VAT on the fees themselves. All of those raise both the percentage and the fixed side of the formula. (See payment processing fees by country.)
The mistake that sets the floor too low
The most common error is marking up cost instead of solving for price. A seller thinks "my item costs $8, I'll add 15%, so $9.20 is fine." But that 15% markup is calculated on the cost, while Etsy's fees are calculated on the higher selling price — so the markup doesn't actually cover the fees, and $9.20 is below the real $9.34 floor. The two percentages look similar and quietly point in opposite directions. The only reliable way is to run the formula: fixed costs on top, then divide by one minus the percentage fees.
Know your floor on every product
You can sanity-check the fee on any single price with our free Etsy fee calculator. But a calculator uses published rates for one hypothetical order — it can't tell you the break-even across a whole shop where shipping recovery, ad attribution and country fees differ order by order. That's the gap Seller Profit Lens fills: it connects to your shop read-only, reads the exact fee Etsy charged on every real order to the cent, subtracts your costs, and shows which products are actually clearing their break-even and which are quietly selling at a loss. It's in free beta now. Join the waitlist →