Is Etsy thinking about getting into fulfillment with warehouses where sellers can send items and have the marketplace fulfill the orders for them?
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That is a question being raised on social media and in an Etsy community forum thread because Etsy has several job listings on its career page that seem to suggest they are looking for new employees to fill roles that deal with “fulfillment.”
But, after reading through those job listings, and considering the fact that many are in Mexico in a software development office the company opened last year, I think some Etsy users are reading way too much into these job postings and Etsy’s use of the term “fulfillment.”
Etsy Fulfillment Makes No Sense
First and foremost, the company empowers creative sellers, the majority of whom create limited edition, custom, or single-run pieces. Yes, I am aware that a number of sellers sell the same or similar products at volume, but that isn’t part of the company’s core business strategy.
It makes very little sense for the typical creative-type Etsy seller to use a third-party fulfillment service (3PL) to send items to a warehouse for storage which then fulfills orders as they are placed on the marketplace.
3PL solution providers typically require that items have product identifiers such as scannable bar codes and come with packaging designed for individual sale. Just a quick look at the Amazon FBA requirement makes it pretty evident how this would make very little sense in an Etsy environment.
Fundamentally, a 3PL solution really works best for higher volume sellers that maintain significant inventory flow to run their online business.
By using a third-party fulfillment solution, these types of vertical market products sellers can focus on running their business instead of dealing with fulfillment headaches such as storage, shipping, and returns handling.
The second reason I believe we won’t see such a fulfillment service from Etsy is that in one related job posting, Etsy identifies what it considers its “Core Fulfillment” initiative.
The company says the Core Fulfillment initiative “is a group that helps sellers manage and fulfill their orders, while also setting buyer expectations around fulfillment so they can make well-informed purchase decisions.”
Etsy goes further explains that this job within the Etsy fulfillment team requires deep knowledge of frontend and backend technologies and even provided examples of past projects such as:
- Developing a search filter based on delivery date.
- Injecting fulfillment-related data to impact search results.
- A/B testing on how best to improve seller fulfillment practices and communicate them with buyers.
While one job US-based job description for the position of Director of Product, Fulfillment mentions the candidate should have of understanding global trade and logistics operations and routes, on first read this would sound like overkill for a role that requires only on-platform shipping management.
However, today’s global trade is increasingly becoming more complex, requiring marketplaces like Etsy to adhere to import laws in the countries they operate in or provide guidance to sellers to avoid returned shipments.
In many cases, this may also require disclosing certain facts about the importation of the goods to buyers prior to making the purchase decision or even requiring the collection of taxes.
Already, Etsy collects taxes on shipments to Australia, New Zealand, Norway, and some EU countries. In addition, the company has to manage recently introduced VAT regulations for cross-border shipments that impact EU-based sellers even if shipping only within the EU.
Understanding how all of this works and what requirements are necessary is part of this job today and requires a good knowledge of global trade rules and how shipping carriers deal with these situations.
The days of printing labels and the recipients being responsible for all import and local taxes are slowly going to be over. Just like state sales tax laws in the US have changed online commerce over the last few years due to what many still see as a flawed US Supreme Court opinion, countries are seeking new ways to collect taxes on small shipments as cross-border trade has become easily accessible to even the tiniest of sellers.
The Mexico Connection
One Etsy community forum poster noticed that these “fulfillment” jobs are in Mexico and suggested maybe there is a pilot project in the works for Mexico. Highly unlikely.
Etsy doesn’t count Mexico as a focus country which as of the latest annual report are the US, UK, Germany, Canada, Australia, France, and India. (The annual report was produced before Etsy acquired Brazilian marketplace Elo7 and Brazil probably should be on that list now.)
However, as I had mentioned earlier, Etsy did open an engineering office in Mexico City last year and maybe that is a precursor to adding Mexico as a focus country for its primary Etsy marketplace. As of today, there are no Mexico City based job openings that suggest this possibility.
The bottom line for me is that I strongly doubt Etsy is considering a fulfillment service such as Amazon FBA as very few sellers would find it useful and therefore it would offer zero financial benefit (profit) for the company.
In other words, if you want an Etsy Fulfillment 3PL service to happen, don’t hold your breath
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