Can I sell my Etsy shop? — Yes, and no....Sort of.
An Etsy shop, in some ways is exactly like any other business—and in some ways, it really isn’t. It doesn’t happen all too frequently, but occasionally an Etsy seller may want to move on for whatever reason, and the question of selling an Etsy shop comes up.
If the Etsy shop is registered as a corporation or an LLC, it is, indeed possible, to sell all of the shop’s inventory and other assets, lock stock and barrel, to an interested purchaser. What would not transfer, which is of great concern to buyers and sellers alike, is access to the shop on the Etsy marketplace. This is prevented by Etsy’s terms of use, which doesn’t allow the transfer of accounts from one person to another.
Account Transfer: You may not transfer or sell your Etsy account and User ID to another party. You are responsible for all activity of the account and User ID. If you are registering as a business entity, you personally guarantee that you have the authority to bind the entity to this Agreement.
In other words, you can sell every item in your shop, and everything you used to create those items (supplies, equipment, patents), and every marketing/finance methodology you created (quickbooks, website assets, mailing lists (collected outside of Etsy), but you cannot transfer your actual Etsy shop without violating Etsy’s marketplace Terms of Use. This, of course, does not prevent you from taking the aforementioned assets and selling them either through a brick-and-mortar store, another marketplace, or a website with a platform-flexible e-commerce functionality such as BeesWax. Having an off-Etsy web presence is truly key to the successful transfer of a brand identity.
It’s important to note that your Etsy brand equity (user reviews, favorites, likes, and sales stats) are unique to the account you created on Etsy, and that account is not transferrable to another user. Furthermore, while a potential buyer could sell supplies or vintage items transferred in the sale of an LLC or S-Corp, sales of”handmade items” on Etsy require in most circumstances for the account holder to be the same individual who made those items by hand. This means that the sale of a handmade shop that operates on Etsy would require the transfer of that shop’s stock off of Etsy in order for it to be sold.
One thing we talk about a lot at BeesWax is the importance of building brand equity outside of the Etsy marketplace, and this is just one of the reasons why such equity is important. A shop that operates exclusively on Etsy has limited brand assets to transfer in the event of a sale. Such a shop depends on Etsy for all of its marketing, and when a shop like this is transferred, a large amount (sometimes all) of the shop’s name recognition and brand value is lost.
On the other hand, with a reasonably well-trafficked website that operates outside of Etsy, a number of brand assets maintain their value in the event of a sale: mailing list subscriptions, URL/pagerank, name recognition, and other intangibles such as website layout and design, are all transferrable along with the sale, so the sale is no longer simply a transfer of physical assets, but the transfer of an entire business, branding, name recognition, and marketing collateral included.
