Selling cards on Etsy

There are a lot of card sellers and from what I could tell everyone does things differently and it’s hard to tell what’s the “right” approach. I’ve had my shop about 3-4 years and I still don’t know what I’m doing! You might want to do a direct test and see which idea sells better. I think there’s probably a market for either one - the trick is finding those people...

I mostly sell individual cards and sell far fewer birthday cards than any other type, and my sets are mostly blank sets.

Do you have friends and family who already want to buy your cards? That can be a huge boost to a new shop. The more you sell the more you’re seen, and Etsy’s algorithm rewards shops that sell out and restock products rather than what I do which is generally a brand new listing for each card (because they’re mostly ooak). I don’t spend a lot of time working on my shop (busy shops, active shops get more traffic) and in return I don’t do a lot of business - a lot of my sales are to friends, except around Valentine’s Day. But it’s fun (except when I have to count all my cardstock and figure out Cost of Goods Sold for the taxman).

Yes, if I knew about card donations/card drives before I started my business I probably wouldn't have started the business. I loved making mountains of cards and didn't need them all for myself. And my friends were asking to buy cards and I felt like I should document that income for the taxman... 

Managing inventory and documenting COGS and producing a schedule C for the taxman is a PITA but I get to write off the stamp/die sets that I use for business personal and charity work which is nice. In return my responsibility is to account for every single sheet of paper and cardstock and die cut I own every year, which does have the side effect of encouraging minimalism. I also pay $14 a month for the software (Craftybase) to keep track of all that crap, which pretty much guarantees my business always posts a loss to offset some taxes owed. 

That's where it gets tricky and there are different opinions on how to deal with it - some may be more legally correct than others.

I did the least complicated and least likely to break the rules way. If it's something that I have to document to determine the cost of goods sold (things you can measure/inventory like paper, twine, stickers) I just ignored them when I used them on a card I was going to sell. They were free (I can't show a receipt for the business buying something) so they're not an expense I can claim against the profit for the card. So some of my early cards had almost no cost/expenses to offset the profit.

I believe the most correct way is to put the things you already own into your inventory manager with a zero cost starting adjustment. So 20 sheets of black paper cost $0. Next time you buy black paper it will be a business expense and the prices average across all the places you used that black paper once you sell the cards. I just looked at the card and reminded myself "that paper was personal stash" and didn't put it into the "manufacture" for the card. Not the best way to do it, but I figured I was going to buy totally different stuff once I was an official business and I wasn't sure which personal items might end up in a card I sell and which wouldn't.  

I think some people try to "sell" products to their business from their personal stash, but then if you get audited you have to justify the price you charged your business and show a receipt... I don't know if that's legally ok or not, it wasn't worth it for the small stash I had and the small "profits" I made which were all offset by overhead losses anyway. 

There are some helpful resources on this site I use for inventory management:
craftybase.com/resources/ebooks

In short: running a crafty business is quite complicated. You are both a manufacturer and a retailer, and while you are making a little money, suddenly your hobby is also a giant headache, especially on Jan 1st when you have to inventory. 

A friend once asked me if she could pay me to make cards for her. I told her that she wouldn’t want to pay what I would have to charge. Too many people don’t have a clue how expensive pretty papers and other supplies can be. However, having said that.....

I haven’t sold cards, so I don’t know how well this applies, but it’s food for thought, and might be helpful as far as the pricing and taxes.

Until COVID-19 hit, I was doing a monthly card making class in my home. I don’t sell for any company and never have. I don’t want to be limited or restricted in what I can use in the way of stamps, other tools, or supplies. I did the class for free. It was more about getting together with others and making friends. I started with gals at church, but it wasn’t limited in any way.

In order to offer the class for free, I needed to keep my own costs as low as possible. I have a ridiculously huge stash, much of which came from Tuesday Morning, with price stickers still on the packages. Yes, I stored them that way instead of taking them out of the cellophane wrapping. I limited myself to what I had on hand from TM because per sheet, it was inexpensive. It rarely cost me more than 25 cents per card, and since I used what stamps and dies I had on hand, I didn’t count them in the cost to make the cards. This was, after all, my hobby, NOT my business, but it shows that you could feasibly sell cards and charge based solely on your time/trouble to make them. If all you are doing is charging for your time, would you really need to go to the hassle of figuring out cost of materials for tax purposes? Wouldn’t it just be a matter of keeping track of your time? Yes, I understant that means you don’t have materials to deduct, so you pay more in taxes, but “time is money,” too. For me, the hassle probably wouldn’t be worth the time required to figure out the cost for deduction.

Or you could plan the card(s), purchase the necessary papers, and keep your receipts.

In the end, selling crafts of any kind, whether cards or anything else, probably doesn’t really pay well enough for the hassle, IMO, but if you enjoy it, it may give you a little bit of money to buy new supplies, use up older stash, have fun, and make those who want your cards happy.