Designing a Marketplace for the People Who Use It
This poll closed April 11, 2023 and we are analyzing the results. Watch this space for updates!
We want to create a better handmade online shopping experience for Artisans and Supporters alike – and that starts with you!
We created a survey to learn your expectations on the costs, commissions, and fees you expect on the Artisans Cooperative handmade marketplace. This survey is simple and straightforward: our shortest poll yet!
The poll was released on April 2, 2023 and will run for one week, closing on April 10, 2023. It should take 5 minutes or less to complete.
In this post, we’ll talk about why and how we developed a financial expectations survey.
About the Financial Expectations Survey
It’s never comfortable talking about money, but we want to understand your expectations as we shape the financial and business model of the co-op together with ours advisors at Start.coop and the US Federation of Worker Co-ops. These are the things we’re balancing:
Buy-in investments For Members
To build a better alternative to Etsy, we need enough artisans and supporters to buy-in (invest) as cooperative member-owners. Together, we must raise enough start-up investments to fund the website and initial marketing.
Once it’s built, membership would not be required to buy or sell on the website. If a member later chose to leave the cooperative, they would be eligible to get this buy-in investment back.
We’re trying to design a member buy-in that is:
- Low enough to be accessible to artisans and supporters, and attract a critical mass of early members. We need these initial investments to fund the website and perform initial marketing.
- High enough to reduce the number of initial members we need to recruit and meet our early funding goals.
Sales Commissions for Artisans
Once the marketplace is built and running, the revenue of the co-op will primarily depend on sales commissions. This aligns the co-op’s incentives with artisans: the more sales (and the more high-quality sales) that happen on our marketplace, the more income artisans and the co-op receive!
Our research on sales commissions at Etsy and other Etsy alternatives shows that typical marketplace sales commission vary from 5% to 20%. Etsy’s complex fee structure, which now includes twelve different fees and even more costly policies, can range from 10% to as high as 40% depending on the seller, buyer, and order.(Source, from our blog: The Best Etsy Alternatives You Can Try Right Now)
We’re trying to design a sales commission structure that is:
- Low enough to be competitive and workable for artisans.
- High enough to support a marketing campaign that will attract a critical mass of artisans and shoppers.
- Flexible enough that we can offer a lower fee for member artisans than non-members
Optional Set-up Service
In addition to the sales commission and member investments, we are exploring another option for early revenue and cash flow, which we hope would be a useful service to artisans: a fee-based set-up service.
The set-up service would have the co-op’s staff or volunteers set up the artisan’s shop on the marketplace for a fee. Service activities would include things like assistance with product uploads and CSV spreadsheet formatting.
In our quest to develop a fair and inclusive marketplace, we are following the principles of platform cooperativism. One of the most important amongst them, is that the marketplace needs to be designed for and by the people who will use it.
This is where the survey comes in. The answers to the survey will guide our Business team in developing the business and financial model, and designing a value proposition.
These results help us both design the member packets and help us forecast our revenue.
About Artisans Cooperative
We are crafting an online handmade marketplace for an inclusive network of creatives: a co-op alternative to Etsy.
Join the movement!
“If yes: what would be your personal maximum threshold for a fee to use this service?”
It’s difficult to put a number to this without knowing anything about quantity, or the work involved. Maybe a % per item? Maybe a flat fee for X# of listings? I don’t know, but the form does not allow me to enter any additional info or anything but a number. Entered 0 because there just isn’t enough info for me to say how much I’d pay for it. It would depend on how many listings I needed done, how much work the platform makes it to create listings, and the pricing structure.
Thanks for the additional context and feedback. I’ve added this to the survey comments so we’ll be sure to take it into consideration in the analysis. Thanks for taking the survey! -Valerie
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