E-marketplace Etsy Wholesale wants buyers at retailers to be nice to its sellers, many of them small, independent designers and artisans who can’t afford to haggle much over prices, payment terms and shipping requirements, Etsy says.
This week Etsy issued a set of six guidelines that it will require retailers with three or more stores and “an advanced purchase order system” to follow when placing orders. Etsy describes an advanced purchase order system as one that would require suppliers to comply with technical standards, such as placing bar codes on products for use in scanning inventory. In effect, the guidelines—called the Etsy Retail Wholesale Commitments—require those retailers to recognize that the more than 4,500 sellers on Etsy Wholesale often don’t have the financial resources and staff to adhere to demands big merchants typically place on their suppliers. At the same time, Etsy wants retailers to work with its sellers to develop long-term relationships.
“A goal for many Etsy Wholesale sellers is to grow their business through relationships with large retailers, but the traditional wholesale practices of these retailers can present operational and financial challenges that can be insurmountable when applied to small, independent designers,” says Dana Mauriello, director of seller category growth.
Mauriello says retailers, for example, need to realize that sellers may find it difficult to meet demands for quick fulfillment of large orders. “An independent designer is likely to be operating without a staff to oversee logistics,” Mauriello says, adding: “We’re asking our retail partners to provide a personal point of contact for questions that sellers may have as they get up to speed. They will also provide quick and fair payment terms especially when the relationship is new, as independent designers rarely have the cash up front that is needed to sustain their business while fulfilling large volume orders.”
Several large retailers have already agreed to adhere to the new rules, Etsy says. They include department store chains Macy’s Inc. and Nordstrom Inc., supermarket chain Whole Foods Market and children’s furniture retailer The Land of Nod. “At The Land of Nod, we are dedicated to supporting small artists and makers,” managing director Michelle Kohanzo says. “These Etsy Commitments will help further artist opportunities to grow and thrive as small businesses owners. We love working with these designers because they offer a fresh, unique and inspiring viewpoint.”
Nearly 11,000 retailers buy products from Etsy Wholesale, Etsy says. Etsy says retailers subject to the new rules are those that operate three or more stores, but Etsy didn’t immediately respond to a question about how many of those 11,000 retailer buyers it classifies as large retailers required to follow the new rules.
Etsy Wholesale, located on the web at Etsy.com/Wholesale, is the business-to-business side of retail marketplace Etsy.com.
The new guidelines state that “all large retailer partners” must:
Pay the full price designers list on products, for at least the first six months after a designer introduces the product on Etsy Wholesale;;
Offer Etsy sellers quick and fair payment terms, “that will keep a designer cash-positive and allow them to fulfill large-volume orders”;
Provide Etsy sellers with a personal point of contact at a retailer, who can help the seller understand and meet what can be complex order requirements;
Respect the Etsy seller’s intellectual property;
Recognize product authorship by including the designer’s name in product merchandising whenever possible; and
Respect Etsy sellers’ preferences related to the production process and material selection of their products.
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