When you start a new business because you love the product you’re selling, especially one centered around fashion, we tend to see the process with rose colored glasses thanks to our personality types. Those who choose this avenue as their work tend to be more creative, idealistic, and imaginative. This is not to say there aren’t’ fashion resellers that are great with the numbers aspect, or people who are great at both. But, most of us aren’t particularly inclined towards the analytical side of the business.
So, there are certain factors like platform pricing we might forget to consider when choosing the best marketplace for our brand. After all, if you’re looking to make a profit from your effort you should really factor in how much you’re losing by choosing Depop – or any other marketplace platform.
In this guide, we’ll touch on how much those Depop fees actually cost by breaking them down by type. We’ll also show you how to fully calculate this cost, and we’ll share our thoughts about Depop fees as a concept.
How much are Depop fees?
As a business, Depop isn’t just offering its platform services out of the kindness of its heart. And, because the objective is to attract buyers who will shop on the website, the majority of the ways in which they make a profit is by dinging sellers instead.
With that in mind, we’ve explained a bit about how each of the main three Depop fees you might be dealing with work in the section below.
What percentage does Depop take?
While they don’t charge any listing fees (like Etsy, for example) or subscription fees, they do charge when you sell the item. If the purchase is made through their buy button, then you can be sure you won’t be getting the exact amount you sold the listing for.
Depop fees are 10% of the selling price (this includes the price of the product and any applicable shipping fees) in both the UK and US. The fee is taken automatically from either your PayPal or Depop Payments account, and it can take up to 21 days for that to happen after you’ve closed the sale. The most important aspect to remember, however, is that this charge is on top of any of the other applicable Depop fees you’ll read about below.
What percentage does PayPal take?
PayPal, like all other payment processors, will charge a transaction fee every time you make a sale and your customers choose PayPal as the payment option of choice. The amount will vary depending on if you’re located in the US or the UK. If you’re in the United States then it’s generally a 3.49% cost, plus an additional U$D0.49 per transaction. If you’re in the United Kingdom then that number changes to 2.9%, plus an additional £0.30 per transaction.
That said, these numbers aren’t set in stone and PayPal has been known to make some slight variations from transaction to transaction. For more information on that, it’s always useful to reach out to them directly. The last aspect to keep into account is that this amount is charged directly through your PayPal account, and will show up as a separate payment from the selling transaction.
What percentage do Depop Payments take?
Depop Payments is the platform’s very own payment option. Where previously the majority of the transactions were done via PayPal, as of 2019 they started offering their own payment processor. By choosing Depop Payments during checkout, customers are now able to pay with their credit card, debit card, Apple Pay account, or Google Pay account.
One of the benefits they offer in comparison to PayPal however is the fact that your funds are available immediately. With PayPal, you need to wait around two weeks for them to clear so that you can transfer them to your bank.
The issue, because otherwise, this would be too good to be true is that Depop will take a percentage of your sale when selecting their payment processor. This amount is 2.9% of each sale, plus an additional U$D0.30 per transaction (or £0.30 if you’re in the UK).
How do I calculate my total Depop fees?
Once you have a better understanding of what type of Depop fees you’ll be looking at when setting up your store, you still have to sit down and calculate them. The main goal for this is to find out what the potential profit from each item sold could be.
There are two main ways you can get that number.
Do it manually
One option is to calculate them by hand. Good old pen and paper, or if you’re feeling a bit more modern your phone’s calculator and the post it notes app on your laptop. Even a properly made excel sheet with some strategic formulas would do the trick.
Start by jotting down all the possible variables that would come into play. How much you paid to ship the item to your customer, how much they paid you to ship it, how much you paid for the product initially, and then how much you charged the customer for it. Also important, of course, are Depop fees and PayPal fees if applicable.
From there add what you charged (basically what you charged your customer) and subtract everything else. You’ll end up with your estimated profit.
Do it via apps
Another option is to go via a more tech based route and use an app to calculate your Depop fees. One like this one from Selleraider is a great option. It’s essentially a calculator designed for Depop specifically and created by a pretty reputable company.
Selleraider was born around the idea of making selling on marketplace platforms easy and efficient, so you know they put plenty of thought into their calculator tool. You can input item cost, shipping costs, and the percentages Depop and third party companies (like PayPal) take as well. Selleraider’s calculator tool does its thing and bam! Your potential profits are in front of you to see.
So, are Depop fees actually fair?
Well, it depends. Depop offers you the ability to access thousands of potential customers in one place. They have countless apps, integrations, and features on the platform that make running your business a breeze. They offer “free” marketing in the sense that you don’t need to do much to attract viewers, and they’re an established and credible selling platform. All imperative things you’d have to work at from scratch if you were to start from zero on your own.
However, it’s also true that the fees they take can be quite steep. Much higher in terms of money than if you’d research, learn, and implement them yourself. But, you need to have time to do all that. So the question shouldn’t be if they’re fair as a general concept, but if Depop fees are fair for the business you’re running. If you’re doing it as a side hustle? Then they’re fair. You get to save time in exchange for money. If you have a more full time schedule to dedicate to the process? You might want to consider slowly branching out on your own, and with time, close down shop at Depop and build your own.