Understanding Faire's Commission Structure
Faire's commission rates aren't one-size-fits-all. The platform operates on a tiered system that rewards repeat business and direct acquisition, with rates ranging from 25% down to zero depending on how you acquire the customer.
The baseline is straightforward: 25% commission on a retailer's first order through the marketplace, dropping to 15% on all subsequent orders from that same retailer. This structure means your commission rate per order depends entirely on whether you're dealing with a new or returning customer.
But here's where it gets interesting—and potentially much more profitable. Orders through Faire Direct carry 0% commission, permanently. When you bring a retailer to Faire yourself (through your direct link, email uploads, or website widget), you never pay commission on their orders. Not on the first order, not on the hundredth.
This isn't a promotional rate. It's a permanent feature of how Faire structures its marketplace versus direct acquisition channels.
The Three Commission Tiers Explained
Marketplace First Orders: 25%
When a retailer discovers your brand through Faire's search, browsing, or recommendation features, their first order carries a 25% commission. This is Faire's customer acquisition fee—you're paying for access to a retailer you didn't find yourself.
For a $400 first order, you're paying $100 to Faire. That's the cost of entry for marketplace-sourced customers.
The 25% rate applies specifically to the order subtotal before any promotions you're running. If you're offering free shipping or a first-order discount, those costs come out of your pocket separately.
Marketplace Repeat Orders: 15%
Once a retailer places that first order, the commission drops to 15% for every subsequent purchase. This reduced rate recognizes that Faire already introduced you to the customer—they're not doing the acquisition work twice.
Using the same $400 order value, you'd now pay $60 instead of $100. Over time, this reduction significantly improves your unit economics as customers reorder.
One data point worth noting: 87.5% of purchases from established Faire sellers come from repeat customers. If you're building a business that depends on recurring orders (which you should be), the effective commission rate trends toward 15% over time, not 25%.
Faire Direct: 0%
Faire Direct flips the entire model. When you bring a retailer to the platform through your own outreach—whether that's email, social media, your website, or direct contact—you pay zero commission. Ever.
You still get all of Faire's infrastructure: order management, payment processing, net terms handling, returns processing, and logistics support. You're just not paying the 25% or 15% acquisition fee because you did that work yourself.
For sellers actively building their wholesale channel, this is where the real margin lives. With 130+ direct customers at 0% commission versus marketplace customers at 15-25%, your blended commission rate can drop dramatically.
How to Check Your Actual Commission Rate
Faire doesn't prominently display your effective commission rate across all orders. You need to calculate it yourself, and the number might surprise you.
Go to your Orders page in the Faire dashboard. Click Export, select "Payout Summary," and choose "All Time." This downloads a spreadsheet with every order's commission details.
In the commission status column, you'll see either a percentage (15% or 25%) or "Faire Direct" with 0%. Count how many orders fall into each category, multiply by the order values, and you can calculate your weighted average commission rate.
One sock brand we analyzed pays an actual commission rate of 7.68% across all orders. Another pays closer to 11%. The difference comes down to how many customers they acquired directly versus through the marketplace.
If you're not tracking this number, you're managing your Faire business blind. Your effective commission rate directly impacts your profitability and should inform pricing decisions.
Faire Direct: The Zero-Commission Channel
Faire Direct isn't just about avoiding commission—it's about building a sustainable wholesale business on your own terms.
When you send a retailer your Faire Direct link, they get £300 (or $300 USD) in credit toward their first order, plus a year of free shipping. You get a customer who will never cost you commission, no matter how much they order.
The process is simple. In your Faire dashboard, navigate to Faire Direct and copy your unique link. Share it via email, social media, or embed it on your website's wholesale page. When a retailer signs up through that link, they're permanently tagged as a direct customer.
You can also upload retailer email addresses directly to Faire, and the platform will reach out on your behalf. This works particularly well if you already have wholesale relationships you want to migrate to Faire's infrastructure.
The website widget deserves special attention. Install it on your wholesale or stockist page, and any retailer who clicks through will land on your Faire Direct storefront. You're capturing interest at the exact moment someone is ready to learn about wholesale terms, and converting them at 0% commission instead of 25%.
For a $1,000 order, the difference between marketplace and direct is $250 in your pocket. For a $5,000 order, it's $1,250. These numbers compound fast.
The Hidden Costs Beyond Commission
Commission is the headline number, but it's not the only cost of selling on Faire. Your true cost per sale includes several additional fees that can push your effective rate significantly higher.
Payment Processing Fees
Faire charges payment processing fees on collected payments, typically around 1.9% for 60-day terms. This applies whether you're paying 25% commission or 0%—it's a separate charge for handling credit terms and payment risk.
For international transactions, add currency conversion fees on top. If you're a UK brand selling to US retailers, you're paying for GBP-USD conversion on every order.
Marketing Costs
Faire offers promoted listings and other advertising tools to increase visibility. If you're spending on these features, factor them into your cost per sale.
One brand we tracked spends roughly 5-6x their target cost per acquisition on Faire marketing, achieving a 17% conversion rate. When combined with commission and processing fees, their total cost of marketplace sales hits 43.57% of order value.
That's not necessarily bad—it depends on your margins—but you need to know the real number, not just the commission rate.
Returns and Damaged Goods
Faire's returns policy protects retailers, which means some orders will come back. You're refunding the full order value, but you already paid commission on the original sale.
For most businesses, damaged goods run 0.3-0.5% of total revenue. For fragile products like glassware or ceramics, it can hit 10% or higher. This is essentially a commission premium you're paying for the risk Faire absorbs by offering free returns.
Shipping Costs
Faire encourages free shipping, and most successful brands offer it above a certain order threshold. This isn't technically a Faire fee, but it's a cost of doing business on the platform.
One brand's shipping costs run 1.8% of revenue. Another offering flat-rate shipping regardless of order size pays closer to 4%. These costs exist on any wholesale platform, but Faire's expectations around free shipping mean you're likely eating more shipping cost than you would negotiating direct.
Commission Rates for US Sellers
US-based sellers face a slightly different fee structure than international brands. In addition to the percentage-based commission (25% or 15%), Faire charges a flat $10 fee per marketplace order.
This means a $200 marketplace order costs $50 (25%) plus $10, for a total of $60—effectively a 30% commission rate on smaller orders. As order values increase, the flat fee matters less (it's only 2.5% on a $400 order), but it disproportionately impacts brands with lower average order values.
The $10 fee doesn't apply to Faire Direct orders. Another reason to focus on direct acquisition if you're a US brand with an AOV under $500.
How Commission Impacts Your Pricing Strategy
You can't just add commission on top of your existing wholesale prices and hope retailers will pay. Commission needs to be built into your margin structure from the beginning.
Start with your cost of goods sold (COGS). Add your target brand margin—aim for 50-60% to leave room for Faire's fees and still hit profitability. That gives you your wholesale price.
If your COGS is $2 and you want a 50% brand margin, your wholesale price should be around $4. With a standard 2.5x markup to retail, that's a $10 retail price. The retailer makes 60% margin ($6 profit on $10 retail), and you make 50% before Faire fees ($2 profit on $4 wholesale).
Now factor in Faire commission. On a marketplace order, you're paying 25% of $4 ($1) in commission, plus payment processing (roughly $0.08), for total fees of $1.08. Your actual profit is $0.92 on a $4 sale—23% margin after fees, not 50%.
This is why reducing COGS is critical. Every dollar you shave off manufacturing cost flows straight to your bottom line, even after commission. And it's why Faire Direct matters—that same order at 0% commission nets you $1.92 profit instead of $0.92.
Comparing Your Commission to Industry Benchmarks
What's a "good" commission rate on Faire? It depends entirely on your acquisition mix.
Brands doing no direct outreach and relying purely on marketplace discovery might see effective rates of 20-25%. They're paying full freight on first orders, and even as customers reorder, the blended rate stays high because they're constantly acquiring new customers at 25%.
Brands actively working Faire Direct can push their blended rate under 10%. With 950 direct orders and 1,220 marketplace orders in one example, the weighted average commission was around 8%. That's the power of building your own pipeline.
The absolute best performers—brands with strong wholesale relationships they migrated to Faire—can run effective rates of 3-5%. Nearly every order is direct, and they're using Faire purely as infrastructure, not acquisition.
Your target should reflect your growth stage. Early on, marketplace sales matter because you're building awareness. But your long-term business model should aim for 50%+ of orders through Faire Direct to keep commission costs manageable.
The Faire Direct Rewards Program
Faire recently launched Direct Rewards to incentivize seller-driven acquisition. The more customers you bring to Faire Direct, the more marketplace customers Faire promises to send your way.
The exact mechanics vary, but the concept is simple: bring 10 direct customers, Faire will send you 2-3 marketplace customers. Bring 100 direct customers, they'll send 20-30.
This creates a flywheel effect. Your outreach generates 0% commission orders and unlocks additional 15-25% commission orders you didn't have to work for. The program effectively rewards brands for doing the acquisition work themselves while still providing marketplace visibility.
One brand brought 130 customers through Direct and banked 50-60 additional customers through Rewards. That's a meaningful volume boost, and while those reward customers carry commission, you didn't spend time or money finding them.
Strategies to Minimize Your Effective Commission Rate
The brands paying the least commission share a few common practices:
Build an email list of potential wholesale customers. Every retail store owner, buyer, or gift shop operator you encounter should go into a database. When you're ready to push wholesale, you have a built-in audience to invite to Faire Direct.
Add a wholesale inquiry form to your website. Capture interest from retailers who find you organically, then direct them to your Faire Direct link instead of the general marketplace.
Use the Faire Direct widget on your wholesale page. This is the easiest implementation—Faire provides the code, you embed it, and any click-through is automatically tagged as direct.
Reach out to existing wholesale customers. If you have retailers buying outside of Faire, migrate them. They get better terms (the £300 credit, free shipping), you get 0% commission, and both of you get Faire's infrastructure for payments and logistics.
Promote the £300 credit aggressively. This is a massive incentive for retailers, but many are skeptical because it sounds too good to be true. Your job is to overcome that objection through education, testimonials, and persistent outreach.
Follow up with direct customers. The 0% commission applies forever, but only if they keep ordering. Build relationships, check in on their sales, offer reorder reminders. These customers are your highest-margin accounts—treat them accordingly.
When Marketplace Commission Makes Sense
Despite the higher rate, marketplace commission isn't inherently bad. Faire is doing real work to connect you with retailers you'd never reach otherwise.
In year one, expect to pay closer to 20-25% blended commission. You're building awareness, and most orders will be first-time marketplace purchases. That's fine—you're paying for customer acquisition, and it's working.
By year two or three, your repeat rate should increase, your direct customer base should grow, and your blended rate should drop toward 10-12%. If it's not moving in that direction, you're either not focusing enough on direct acquisition or not converting first-time customers into repeat buyers.
The brands struggling with commission are those stuck at 20%+ in year three or four. They're constantly churning through one-time customers and never building a repeat business. That's a product-market fit problem, not a commission problem.
The Bottom Line on Faire Commission
Faire's commission structure rewards brand-building and customer relationships. The platform takes a larger cut when it does the acquisition work, and gets out of the way when you do it yourself.
Your effective commission rate is a choice. Pay 25% and rely on Faire's marketplace, pay 15% by building repeat relationships, or pay 0% by acquiring customers directly. Most successful brands blend all three.
The key is understanding your actual rate, not just the headline numbers. Export your data, calculate your blended commission, and track it monthly. If the number is moving in the wrong direction, adjust your strategy toward more direct acquisition.
Commission is the cost of doing business on Faire, but it doesn't have to be the cost of building a wholesale business. With the right approach, you can use Faire's infrastructure while keeping the majority of your margin.