Small business owner says Etsy shut down her shop and refunded all her customers

@ryercat/TikTok sdx15/ShutterStock (Licensed)

‘Etsy has so gone down the drain!’: Small business owner says Etsy shut down her shop, refunded all her customers. She had already shipped out all the product

'I have already shipped out hundreds of product.'


Braden Bjella


Posted on Jun 26, 2023   Updated on Jun 26, 2023, 3:27 pm CDT

A small business owner from Vancouver, Canada is pleading with Etsy after she claims the site shut down her store and refunded all of her orders, even though she had already shipped out the product.

In a video with over 177,000 views, TIkTok user Samantha (@ryercat) alleges that Etsy scammed her out of “hundreds if not thousands” of dollars.

For context, Samantha runs a cat-focused dental hygiene company. Knowing that many sellers had found success on Etsy, she recently decided to also list her products on the site.

To promote her new store, she reached out to previous customers via email and offered them a 30% discount for ordering via her new Etsy store. According to Samantha, this move was simply designed to draw more attention to the store, as the hefty discount meant she was not making much profit.

However, after she had already fulfilled many orders from this sale, Etsy informed her that her store was being shut down.

@ryercat I really hope the right person sees this 😭😭😭 #fyp ♬ original sound – RYERCAT

In the process of shutting down her store, Samantha claims that the site reached out to customers and told them they could get a refund or say they still wanted the item. This is despite the fact that, as Samantha says, she had already shipped all of the orders.

After many users claimed they still wanted the item, Samantha says that Etsy simply decided to refund her customers, leaving Samantha to foot the bill for all previous orders.

Samantha alleges that she has reached out to Etsy multiple times to figure out what happened, but she has only received replies from bots.

“I get that you need to create a safe environment on these platforms…[so that] people aren’t getting scammed as a consumer. I completely understand that,” she says. “But to be refunding orders that have already been placed, already have valid tracking, without contacting the seller like, ‘hey, what’s going on?’ I don’t even know what the problem is — they’re just refunding people!”

Numerous users online have complained about Etsy in the past, ranging from the site’s allegedly poor security to high fees for sellers. These complaints continued in the comments section of Samantha’s video.

“Etsy has soooo gone down the drain! If you’re on Reddit take a look at the Etsy seller subreddit,” stated a user. “there’s so many ppl this happens to.”

“@Etsy why haven’t you guys fixed this yet? You guys need to do better for sellers like this,” shared another.

“@Etsy hates their sellers…I’ve had issues with them as well. Terrible platform,” added a third. “I’m so sorry this is happening to you.”

“Every day another story on here makes me never want to shop on @Etsy again,” declared an additional TikToker.

The Daily Dot reached out to Samantha and Etsy via email.

Update 3:20pm CT June 26: In an email to the Daily Dot, Samantha said that Etsy admitted it had closed her store accidentally.

“As of yesterday afternoon our store was reinstated by Etsy,” Samantha wrote. She included a section of what she says is a statement from Etsy in which the company says the store was “suspended in error.”

“I am still waiting to check the total damages before I approach them regarding lost revenue due to auto refunds,” Samantha noted.

Etsy also confirmed via email that Samantha’s store was suspended and then reinstated. They also said she will be credited for the refunds that were withdrawn.

Still, Samantha is unsure as to what caused her store to be closed in the first place.

“I don’t believe we had any violation – and this was confirmed by Etsys statement…I believe the issue is that we sent an email announcement to our customer list that we were live on Etsy (for the launch) and that set off their system thinking we were some kind of scam,” she explained. “I know most new stores would not make so many sales initially, so that’s probably why we got flagged.”

“In order for Etsy to safe guard their customers, I completely understand that they need to have automatic AI systems in place to catch suspicious activity. That I have no issue with,” Samantha stated. “They could do a few things, however, to protect their sellers.”

Her suggestions include: video interview onboarding to verify sellers’ documents, phone support, and quick contact with human team members following sellers’ appeals.

“If their system flags suspicious activity, you should be able to appeal it and have a real person read your appeal,” she said. “In our case, our initial appeal received a reply within a few minutes (clearly automated) saying we were permanently suspended. It was clear no real human had read our appeal. Even something as simple as ‘hey we noticed you have a ton of sales, this is suspicious as a new store, what’s going on?’…. I could have easily shown them the email we sent to our customers and it would have been solved right away.”

Samantha also urged Etsy to hold off on auto-refunds for customers until a specified time has passed.

“There’s no way they should be refunding mass orders without speaking to the seller first to figure out what’s up—especially since we had valid tracking attached to our orders,” she wrote. “They should allow the seller time to respond to the store shut down if ‘suspicious activity’ has been detected. Honestly, this is what really got me, because after shipping an order out, I would be down the item price, shipping cost, and my time.”

“I believe Etsy has what it takes to be a great platform,” she concluded. “However, I really feel they need to be more prepared to assist their sellers, especially their new sellers. This really confused many of our customers and makes my business look sketchy and untrustworthy, which as a small & new business, is a hit our reputation cannot deal with.”

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*First Published: Jun 26, 2023, 12:31 pm CDT