Dropship on Etsy: How to get into dropshipping as a business in Malaysia

Are you a budding artist-entrepreneur eager to tap into a global customer base through dropshipping? Then, Etsy might be a viable platform for you.

While many marketplaces support traditional dropshipping, Etsy stands apart with its unique focus on handmade, vintage, and craft-style products. This distinction means that classic mass-market dropshipping is generally not permitted on their platform.

However, a significant exception exists: craft and party supplies can be dropshipped. This opens a niche opportunity for you to connect with a passionate community of creators and enthusiasts worldwide.

This guide will walk you through how to start a dropshipping business on Etsy in Malaysia while maintaining full compliance with their specific regulations, ensuring your venture flourishes.

H2How to find products to be dropshipped on Etsy

Etsy’s core philosophy prioritizes items that are handmade, vintage, or craft supplies, aiming to maintain a marketplace for unique creations¹. Correspondingly, their guidelines limit the range of goods that can be dropshipped – mass-produced or commercially available products that you haven't designed or significantly altered are generally not allowed.

However, certain product categories do offer legitimate avenues for you to dropship on Etsy¹:

• Print-on-demand products: You can sell items like custom-designed t-shirts, mugs, or art prints if you create the original design and then use a production partner to print and ship them directly to your customers.
• Craft and party supplies: These are materials, ingredients, or tools used for creating items or for special occasions, such as beads, fabric, or party decorations. You can source these from a third-party supplier and have them dropshipped directly.

It's crucial to understand these distinctions to ensure you maintain compliance and secure business continuity for your dropshipping venture in Malaysia.

How to register your Etsy dropshipping business in Malaysia

As an individual entrepreneur, you’ll most likely be establishing a sole proprietorship for your Etsy dropshipping business, given its relative simplicity and lower setup costs.

You will need to register your business with the Suruhanjaya Syarikat Malaysia (SSM). This formal registration is crucial for various reasons, including compliance with Malaysian tax regulations, facilitating the opening of a business bank account, and enabling official advertising for your shop.

The main application steps typically involve²:

• Register as Ezbiz Online user
• Submit supporting documents, such as agency permission letters for certain business activities
• Pay registration fee (ranges from RM30 to RM60 per year based on business name)
• Receive Certificate of Registration upon approval

H2How to find suppliers for dropshippingon Etsy

Next, you’ll need to find a dropshipping supplier while adhering strictly to Etsy’s rules. Unlike traditional dropshipping models, Etsy places significant emphasis on originality and craftsmanship, meaning that your supplier should be able to meet these criteria³.

For example, Etsy sellers cannot dropship from AliExpress as the platform typically features mass-produced items that do not align with Etsy’s core values of handmade, vintage, or uniquely designed goods.

Additionally, Etsy requires full transparency about your production process, especially if you work with external partners³. Under its production-partner disclosure rule, you must clearly state if you use a production partner in your shop's ‘About’ section and on each relevant listing.

This disclosure should explain how you collaborate, emphasizing that you are the original designer or creator and that your partner physically produces the item based on your design.

The following sections will outline how to find suppliers for dropshipping that align with Etsy's specific requirements, based on the type of product you intend to sell.

Supplier platforms for print-on-demand goods

If you plan to sell print-on-demand goods as part of your dropshipping business in Malaysia, several reputable supplier platforms can help you fulfill orders while adhering to Etsy’s policies:

• Printify: This platform integrates directly with Etsy, allowing you to create custom designs on various products and have them produced and shipped by their network of printing partners.
• Printful: Offering high-quality print-on-demand services, Printful handles product creation, warehousing, and shipping, letting you focus on your original designs.
• Art of Where: Known for its diverse range of custom-printed products and fabric options, Art of Where allows you to turn your unique artwork into sellable items that are then shipped to your customers.

Supplier platforms for craft and party supplies

For those specializing in craft and party supplies, you have several supplier platforms to consider:

• Eprolo: This platform offers a selection of general dropshipping products, including various craft and party supplies, which you can source and have shipped directly to your Etsy customers.
• Shop3D: While primarily known for 3D printing services, Shop3D can also be a source for unique craft components or party-related items that align with Etsy’s guidelines.

Additionally, local wholesalers can provide benefits like faster same-day delivery options and potentially lower shipping costs for operations within Malaysia.

Setting up payments

Ensuring a smooth payment mechanism is crucial for an optimal customer experience on your Etsy shop. As such, it’s advisable to use Etsy Payments, the platform's integrated payment system.

Etsy Payments simplifies transactions by allowing buyers to choose from multiple methods like credit cards, PayPal, and Apple Pay, which can boost your sales by offering convenience.

Additionally, the flow is straightforward – after a sale, funds are securely processed and deposited into your linked bank account, typically on a weekly schedule⁴. If you’re selling to international customers, you can avoid currency conversion fees on your payouts by listing your items in the same currency as your payment account.

However, do note that a payment processing fee of RM2 + 4.5% of the total sale price will apply⁵.

Shipping and fulfilment options for dropshipping in Malaysia

In a dropshipping model, you typically won't be directly in charge of the physical supply chain, as your supplier handles warehousing and dispatch. That said, efficient shipping and fulfillment are crucial for business success, so it’s good to understand the options:

• Partner ships direct to buyer: This is the most common dropshipping method, where your chosen print-on-demand provider or craft supplier handles all packaging and international shipping directly to your customer.
• Self-ship from Malaysia: In certain scenarios, particularly for unique or custom craft supplies you might hold, you could opt to self-ship from Malaysia using reliable logistics services. Providers like DHL Express offer robust solutions for international shipping.

Here’s what you can do to ensure a smooth shipping and fulfillment process:

• Have clear policies: Clearly communicate your shipping times, return policies, and international delivery options on your Etsy shop to manage customer expectations effectively.
• Utilize shipment tracking: Provide tracking information for customers to monitor their orders. This builds trust and reduces inquiries about delivery status.
• Understand customs requirements: For international orders, familiarize yourself with the destination country’s customs regulations and required documentation to prevent unnecessary customs delays.

Essential tools to leverage

After setting up your Etsy shop, you'll want to ensure smooth operations and reach out to as many customers as possible. Here are several tools to maximize your marketing and operational efforts as you dropship on Etsy:

• Etsy Shop Manager: This all-in-one dashboard helps you efficiently manage listings, track orders, process payments, and engage with your customers directly within the Etsy platform.
• Etsy POD integrations: Utilize integrations like Printify or Printful within Etsy to automate the fulfillment of your print-on-demand products, streamlining order processing.
• Zoho: Consider an order and inventory automation tool like Zoho to manage your backend processes, from customer relationship management to financial tracking.
• eRank: This is a valuable keyword research tool for Etsy, enabling you to write search engine-optimized product listings with relevant terms to increase visibility and traffic.

How to ensure customer satisfaction

In e-commerce, exceptional customer service makes a significant difference in customer experience and the success of your dropshipping venture. Here are some tips:

• Communicate promptly: Respond to customer inquiries and messages quickly, building trust and showing that you value their business.
• Strive for positive reviews: Encourage satisfied customers to leave positive feedback, which significantly enhances your shop's credibility and attracts new buyers.
• Write clear and honest listings: Provide accurate descriptions, high-quality images, and transparent information about your products to set realistic customer expectations.
• Effective customer care: Handle returns, exchanges, and other customer cases professionally and efficiently, turning potentially negative experiences into opportunities for positive engagement.

Launching a Malaysian Etsy store as a dropshipper: A sample walkthrough

Let’s walk through a hypothetical example to better understand how to get into dropshipping on Etsy from Malaysia.

Imagine you’re launching an Etsy shop called MyBatikCrafts, specializing in custom batik-inspired print-on-demand products. You’ll need to foot several initial costs and fees. Here are some ballpark figures:

How to start the business

1. Pick a niche: Consider focusing on items that appeal to customers, such as apparel or stationery with modern batik-inspired designs.
2. Create Etsy shop: Set up your shop on Etsy and design an attractive shop banner.
3. Register business and open bank account: Formalize MyBatikCrafts as a sole proprietorship with SSM and open a dedicated business bank account in Malaysia.
4. Link Etsy Payments and bank account: Configure Etsy Payments to seamlessly link your sales to your new bank account for payouts.
5. Design products and source supplies: Create your batik-inspired designs for your chosen product. For example, you might create notebook covers with batik prints. In turn, you’ll want to work with a print-on-demand supplier platform that offers notebook covers.
6. Add listings: Create compelling product listings with keyword-rich titles and tags, detailed descriptions, and high-quality mock-ups of your designs. For example, your notebook covers should include dimensions and high-res images for customers to understand the product.
7. Set shipping profiles: Configure accurate profiles on Etsy, ensuring clear shipping costs and estimated delivery times for international customers.
8. Publish and run test orders: Publish your listings and then place a few test orders to check the entire process from order placement to fulfillment.

Laying Foundations for Long-Term Success