Decoding Depop‘s Fee Structure: Tips for Power Sellers

Depop has cemented itself as a go-to marketplace for the next generation of entrepreneurs looking to buy and sell unique secondhand apparel and accessories. The platform boasts over 30 million users globally as of 2022.

I‘ve been actively selling on Depop for over 2 years myself. In that time, I‘ve come to intimately understand the ins and outs of the fee structure.

Mastering this math is crucial for power sellers looking to scale up profits while remaining competitive on pricing.

Let‘s break down exactly what fees Depop charges, how the platform compares to rivals, and most importantly—how savvy sellers can optimize earnings within the billing model.

The Explosive Growth Behind Depop

Before we dive into the fees, it‘s worth contextualizing why Depop has become so popular with Gen Z consumers and individual resellers in the secondhand apparel space.

Some key statistics about Depop‘s size and demographic breakdown:

• 90% of users are under the age of 26
• Monthly active users doubled from 10 million to 20 million from 2019 to 2020
• Ranked 10th most popular shopping app by downloads in 2021
• 47% market share of the peer-to-peer resale sector in the UK

Beyond the sheer scale in terms of userbase, Depop has captured the ethos of sustainability and individuality craved by young buyers and sellers:

Now that we‘ve established Depop‘s commanding position—let‘s get into the money.

Breaking Down Depop‘s Seller Fees

The key to success selling on Depop lies in truly understanding what cuts the company takes from your earnings.

There are three major types of fees to be aware of:

1. Depop Transaction Fee
2. Payment Processing Fee
3. Additional Service Fees

I‘ll break down exactly what each entails and provide examples of fee calculations further below. But first—a helpful at-a-glance overview:

Based on these parameters, you can expect to lose between 10-15% of your total sales value to fees when selling through Depop.

Next, I‘ll explore each major fee category in more depth.

Depop‘s 10% Transaction Fee

This 10% seller fee applies to the total transaction value of each sale—including both the item‘s list price and any shipping paid by the buyer.

For example:

• You sell a jacket for $50 with $10 shipping

• Total transaction value = $50 (item price) + $10 (shipping) = $60

• 10% of $60 is $6

• So Depop takes a $6 transaction fee

This 10% transaction fee is non-negotiable and automatically deducted from your connected PayPal or bank account.

Payment Processing Fees

In addition to what Depop takes, you also have to pay for the service of processing buyer payments.

You have two options here with slightly different fee structures:

PayPal fee: 3.49% of total transaction value + $0.49

• On a $60 transaction, this equals $2.44

Depop Payments fee: 2.9% of transaction + $0.30

• On a $60 transaction, this equals $2.04

While the flat 2.9% Depop Payments looks cheaper upfront, PayPal allows you to retain buyer payments in your account balance to re-invest in inventory.

Additional Country-Specific Fees

Depending on where you are located and selling to, extra fees come into play:

• UK sellers with EU buyers: +1.29% fee
• International transactions: +1% fee

So for example, a UK seller with a EU customer would pay:

• 10% Depop transaction fee
• 2.9% + $0.30 Depop Payments processing
• • Additional 1.29% EU seller fee

Coming out to a total 14.19% in fees on the transaction

Make sure you understand whether these additional charges apply to your sales.

How Depop Compares to Other Marketplaces

Now that we‘ve broken down Depop‘s billing model—how does it compare against major competitors in the secondhand space?

I‘ve highlighted some key rivals below:

A few interesting conclusions we can draw:

• Depop sits in the middle-ground fee wise usually around 10-15%

• Platforms like Grailed and eBay take much smaller cuts, but don‘t provide the same managed marketplace benefits

• For high-value items, Poshmark‘s 20% bite into profits adds up quickly

• Etsy charges multiple types of fees adding complexity for tracking overhead

So while Depop takes a healthy share, the convenience and protections of selling through an established marketplace helps maximize profits in other ways.

Sellers have to weigh the tradeoff between fees and other sales drivers like exposure, convenience, and protections.

Optimizing Your Earnings Within Depop‘s Model

Just because Depop takes its cut doesn‘t mean you can‘t actively optimize your margins. Here are 5 key strategies:

1. Analyze competitor pricing

Use the pricing filter to see the range similar items have historically sold for, taking Depop‘s 10% fee into account. Price just below comparable listings.

2. Offer promoted shipping discounts

Provide buyers a small discount for purchasing multiple items to lower your per order overhead. Promote faster shipping options for an upcharge to offset processing fees.

3. Track ROI on boosted listings

Depop allows sellers to pay a small fee (~$1) to get items promoted in more user feeds. Monitor sales velocity to calculate if the boost investment pays off long-term.

4. Build external traffic to your listings

Depop fees only apply when a sale occurs on the app itself. Direct interested followers from Instagram or TikTok to purchase from your connected Shopify store to avoid the 10% fee.

5. Focus on high-margin products

Lean into trending or specialty items you can source for cheap. High margins make Depop‘s 10% transaction fee sting less, while allowing you to keep prices competitive.

Should You Sell on Depop in 2024?

There are clearly tradeoffs to consider with regards to Depop‘s billing structure compared to other peer-to-peer marketplaces.

But the reality remains: noplatform provides the same plug-and-play access to a young, vibrant community of secondhand enthusiasts.

Given the tools now available to analyze fees and sales data—savvy sellers can absolutely drive profits even within Depop‘s 10% take. You just need to be strategic.

If you have your finger on the pulse of current fashion trends and source unique pieces, Depop provides the ideal venue to transform products into profits.