etsy was asked about the impact of tariffs at the Q4 Conference Call, and had this to say:
"The short answer is it really depends because we're seeing all kinds of proposals and it's very difficult right now to know which tariffs, on which countries, will de minimis be allowed or not in those regimes, it's really hard to know. Etsy has much less dependence on products coming in from China, vastly less dependence on products coming in from China than most of our competitors.
So I think to the extent that we see tariffs that are very focused on China or other friction of products coming in from China, I think, at least in the near term, Etsy is a net beneficiary from that. I think it does speak to the resilience of our platform.
And beyond that, if -- what we shared is about 75% of purchase activity happens from the US. About 25% of that comes in from its imports, people from the US importing primarily from Europe. And so if there were broad-based European tariff regimes, that could create more friction on our buyers. It's a little hard to know depending on how broad the tariff regimes are, how much friction there are for generally relatively low-value packages, most of our items would fall under most de minimis thresholds. ... In general, though, I think Etsy will be more resilient than many of our competitors in these situations.
And I think it speaks to the resilience of our platform in general that we've been through a lot of global shocks of one kind or another. And this is where a cottage industry can really come to the rescue. Our sellers buy most of their raw materials from their own -- within 60 miles of their home. And I think that, that might turn out to be very useful for us."
ebay probably has more China exposure, and more exposure generally, because something like 50% of ebay's revenue is tired to cross border trade, so it will be interesting to see how ebay addresses this next week on the ebay Call. One thing struck me: that etsy crafters buy most of their raw materials within 60 miles of their home. In short, they are not heavily dependent on imports for this stuff, and I suspect etsy will lean into that.
So, it will be interesting to see if ebay realizes that it has some similar insulation in its small resellers. Many of us source near home (yard sales, thrift shops etc), so we are not dependent on imports the way many ebay drop shoppers, etc, are. Who knows (I can dream, can't I?) ...maybe ebay will realize that we are ebay's best protection against high tariffs?
Next week's call should be interesting, that's for sure....
