To run Etsy sales without losing money, work out the lowest price at which an order still covers your product cost and Etsy's fees, then pick a discount that stays above it. Percentage fees shrink with the price, but your product cost and the fixed fees do not, so a discount takes a far bigger bite out of your profit than out of your price.
This matters most for print-on-demand sellers, whose product and shipping cost is set by the production partner and often takes a large share of the price. A few minutes with the numbers before a sale starts tells you whether you are running a promotion or a loss on every order.
What changes when you discount
Etsy's main fees are percentages of the order. The transaction fee is "6.5% of the total order amount", and it includes shipping when you charge it (Etsy fees). Payment processing is a percentage plus a fixed amount that depends on the country of your bank account: 3% + 0.25 USD in the United States and 6.5% + 14 TRY in Türkiye, for example (Etsy payment processing fees). Sellers in some countries also pay a regulatory operating fee, such as 1.67% in Türkiye (Etsy regulatory operating fee).
When the price drops, those percentages drop with it. Your product cost, the shipping you pay the partner and the fixed fees do not: the processing fee's fixed amount, and the $0.20 Etsy charges "per each additional quantity" when a multi-quantity listing sells. That is why a 20% price cut can take around 40% of your profit.
Find your floor price first
Your floor price is the lowest price at which an order still covers its costs. For a US seller with shipping built into the price, it is:
Floor price = (product and shipping cost + $0.45) ÷ 0.905
The $0.45 is the 0.25 USD processing amount plus the $0.20 listing fee. The 0.905 is what is left of each dollar after the 6.5% transaction fee and the 3% processing fee. With a product and shipping cost of $18, the floor is $18.45 ÷ 0.905 = $20.39. Any sale price below that loses money on every order, before you are paid for your time.
Sellers outside the US use their own rates. In Türkiye, the transaction, processing and regulatory operating fees together leave 0.8533 of every 1.00 of the price, and 14 TRY per order is fixed. Listing in a currency other than your payment bank account's adds a 2.5% currency conversion fee (Etsy fees). Depending on your business status and location, Etsy may also collect VAT on seller fees (Etsy VAT on seller fees).
The floor is break-even, not a target. Add the profit you want to keep per order, and the result is the lowest sale price you will accept. The gap between that number and your list price is your maximum discount.
What a discount does to one order
An example with round numbers: a US seller, a hoodie listed at $40 with free shipping, and $18 of product and shipping cost. The fees are the 6.5% transaction fee, 3% + 0.25 USD processing and the $0.20 listing fee. Sales tax is left out to keep it simple, although Etsy also takes processing fees from "any applicable sales tax" (Etsy payment processing fees).
| Discount | Sale price | Etsy fees | Product and shipping | You keep |
|---|---|---|---|---|
| None | $40.00 | $4.25 | $18.00 | $17.75 |
| 20% | $32.00 | $3.49 | $18.00 | $10.51 |
| 30% | $28.00 | $3.11 | $18.00 | $6.89 |
| 40% | $24.00 | $2.73 | $18.00 | $3.27 |
| 50% | $20.00 | $2.35 | $18.00 | -$0.35 |
The 20% sale cuts the price by $8 and the profit by $7.24. You need about 1.7 orders at 20% off to earn what one full-price order earns, and more than five orders at 40% off. At 50% off, every order loses money. A sale only pays when it brings in enough extra orders to cover that gap.
Offsite Ads can turn a thin sale into a loss
If a sale order comes through Offsite Ads, Etsy adds its advertising fee. Shops that made less than $10,000 on Etsy in the past 365 days pay 15% of the order total, and shops above that pay 12% (Etsy fees), capped at $100 per order (Etsy Offsite Ads). In the example above, a 15% fee on the $32 order costs $4.80 and leaves $5.71. On the $24 order it costs $3.60 and turns a $3.27 profit into a $0.33 loss.
Since you cannot tell which orders will come from an ad, build the fee into the floor. With 15% included, the US formula becomes (cost + $0.45) ÷ 0.755, which is $24.44 for an $18 cost. Keep your deepest discount above that.
Traffic you bring yourself has an offset. Etsy's Share & Save page says that from October 20 to January 4, enrolled sellers earn 6.5% back on eligible orders that came through links they shared, except when the buyer's last click was an Offsite Ad (Etsy Share & Save).
Choose the offer that fits your margin
Etsy's offers do not all cost the same. A sale can be a percentage off or free standard shipping, and a promo code can be a percentage off, a fixed amount off or free standard shipping, with percentage discounts set in whole numbers between 5% and 75% (Etsy sales and promo codes).
A fixed-amount promo code caps your cost per order, which a percentage does not on a high-priced item.
A maximum number of uses on a promo code limits how many discounted orders you take on.
Abandoned-cart and favorited-item offers go to buyers who already showed interest.
A discounted bundle can include up to 3 listings, so the discount buys a bigger order instead of a cheaper one.
A free-shipping sale costs you the full shipping on every order, though Etsy prioritizes US listings with domestic shipping under $6 in search (Etsy search visibility).
If a listing fails the floor check, fix its regular price and keep it out of discounts until the margin works. Black Friday falls on November 27, 2026 (Black Friday) and Cyber Monday on November 30 (Cyber Monday), and our guide to Black Friday and Cyber Monday for POD sellers covers how to prepare.
Check what you kept after the sale
A sale is a test, so read the result. Compare the sale weeks with the weeks before on profit per order and total profit, since revenue can rise while profit falls. Note how many sale orders came through Offsite Ads. Tracking profit per order on Etsy shows a simple way to keep that record, and margin vs markup explains why a healthy markup can still mean a thin margin.
How Alomations helps you price a sale
In Alomations, the listings manager shows every connected shop's active and draft listings in one list, on every plan including Free. Bulk edits change prices by a percentage or to an exact amount across the listings you select, so fixing the regular price of everything that failed your floor check takes one pass.
After the sale, the profit view (paid plans) shows the profit you kept on fulfilled orders after Etsy fees and product cost. When you fulfill through production partners from the orders screen, the item cost and shipping are shown separately before you pay, so the cost in your floor formula is the real one. The full method is in pricing print on demand products on Etsy.
Frequently asked questions
What is a safe discount for an Etsy sale?
No single percentage is safe, because it depends on your cost. Your maximum discount is the gap between your list price and your floor price plus the profit you want per order.
Do Etsy fees go down when I discount?
The percentage fees do. The fixed parts, such as the processing fee's fixed amount and the $0.20 listing fee, stay the same, and so does your product cost.
Should I join Etsy's own sales events?
Etsy runs its own events, such as its Cyber Sale (Etsy announcements). Join only with listings that still clear your floor price at the event's discount, and check your lowest-margin products first.
Check and bulk edit your prices across every connected shop on the Alomations free plan.