Some sellers have thousands of dollars tied up.
, placing accounts on reserve is meant to protect buyers and make sure sellers are able to keep up with the flow of orders — the idea appears to be that it will push sellers to work through their backlog and ship purchases so that their full funds are released to them. Shops might have a reserve placed on their account if they just started selling on the marketplace, got an influx of orders, or if orders are consistently shipped without tracking.
Many Etsy sellers live “hand to mouth,” as D. puts it — though they might stock premade products in their shop, they often use money from a sale to purchase materials for that order. Lead time for orders from D.’s shop is about two weeks; in the meantime, they’re forced to dip into savings and credit to fund their business and personal expenses.
At times, Y.’s orders were late to ship out, and they acknowledge that the payment reserve on their account may be due to that. Their focus, though, has been on delivering the best to their customers by making custom prototypes and testing products before sending them out. The unexpected hold on a large portion of their earnings means that their business, ironically, has become less stable than it was.Y.
Each time a sale is made, a seller’s reserve minimum — that 75 percent portion of the sale — goes up accordingly, creating a running count that a seller must meet. If a seller buys a shipping label, pays for Etsy ads, or otherwise zeroes out the 25 percent portion that’s available to them, the remaining balance is pulled from the 75 percent set aside.
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