Etsy clarifies policies on reselling goods, factory-made items

It’s clear that Etsy has seen remarkable growth in both traffic and transactions in the last few years, tripling its user base to 30 million and growing to a billion-dollar company. But its had some growing pains in the process, and its base of independent vendors has lashed out against what they fell is the company’s apparent inaction towards resellers and factory-made items.

In response, the Brooklyn-based company released new guidelines Tuesday aimed to help ease the tension between long-time independent sellers and Etsy’s newer, more production-oriented options. The changes also came with an apologetic blog post by Chad Dickerson, who admitted that the company hasn’t done a good job vocalizing or enforcing policy abusers:

As a young company (still), we’ve spent too much time debating and figuring it out inside our offices and not enough time discussing it with you. We’re committing to fixing that — starting with regular quarterly updates to share with you what we’re planning on working on and why.

In its new policies, Etsy has called for transparency from all of its vendors, requiring each shop to list all people who help make each item on the front page. Etsy now provides shipping fulfillment (similar to Amazon’s vendor options) and even partnerships with small manufacturers to produce a greater number of products, but those details must also be apparent on a seller’s website.

The company has also instituted a mandatory application process for all vendors working with outside manufacturers, aiming for full compliance by 2014. This is a change from the original policy, which allowed sellers to have “partial production assistance” without disclosure to buyers.

In addition to the new changes, the company also released a blog post tackling the problem of resellers — people who buy products (either on Etsy or elsewhere) to be resold on the website. Stressing that reselling remains prohibited from the site, the post says that the company won’t immediately take down any reseller for duplicate images, but it will continue to investigate each flagged shop.

It’s clear that the tension between Etsy the company and Etsy the community reached a breaking point, and the changes won’t quiet all complaints. But, it’s a process the company needs to begin if it wants to keep thriving.