The recent decision by Etsy to withhold up to a 75% ‘reserve’ on trader’s funds is now gaining spectacular press coverage and it is damning of the American trading platform.

This follows the February 17^th headline ‘Etsy shares fall after research firm says platform showcases fake goods.’ This is regarded as very poor governance for an ‘ethical’ trading company.

I trade on Etsy so have been affected by this. In short 75% of your funds are held up to 45 days by Etsy. At Amazon it is 3%, that is how draconian it is.

Etsy sellers are on the whole artisan and vintage traders many of whom keep their businesses going on a very tight budget, for the benefit of the Etsy shareholders. The withholding of funds for a small business is a critical move, many of whom exist on a week-by-week basis. The stories highlighted in the press are heartbreaking as numerous sellers resort to desperate measures to keep their businesses afloat.

It was a couple of weeks ago this first got traction in a Sky Newes article. Since then, momentum has grown and on Monday the biggest news website in the world, the BBC with 1.1 billion view p/a carried the ‘scandal’ as its fourth main story.

Of course, at times like these, the voices of doom and gloom predicting the end of Etsy are prevalent.

The threat of a further strike by sellers will not affect Etsy at all. A previous one has very limited uptake. Etsy sellers have zero power to change policy, strike but the only loser will be the seller as customers will buy from sellers not on strike.

But the board of Etsy will know it is not as simple as that.

Etsy has a ‘cute’ almost ‘organic’ brand, focused on middle income earners. Sellers trade with handmade and vintage goods. It is trendy.

Being named and shamed for draconian tactics in the national media in one fell swoop is destroying that brand. Reading the discussion pages, many Etsy customers are saying that they will refuse to use again. The shareholders must be melting with rage. But Etsy can ride this out.

What, however, will be troubling Etsy is the long-term affect. Numerous sellers are keeping their accounts but setting up accounts on other platforms. Especially if like me they have not been enjoying the mood music coming from the Etsy platform for the last few years.

In my next blog I will tell you how and why I am prising myself from selling on Etsy and if as seems apparent numerous other sellers are too and what the long-term affect will be for Etsy.

Coming soon, Part 2 of 3