Etsy Studio.

Etsy is gearing up to introduce Etsy Studio — an online craft supply marketplace billed as a rival to in-store craft leaders such as Jo-Ann Fabrics and Michaels Stores.

Etsy Studio will be the first stand-alone destination born out of since the marketplace hit the online crafts scene in 2005. Unlike its predecessor, where buyers can buy a range of handmade items from jewelry and baby clothes to furniture and even dreadlocks (Marc Jacobs commissioned Etsy seller Dreadlocks by Jena to make 2,500 pieces of pastel-colored, wool dreadlocks for his spring show in September), Etsy Studio will only sell craft supplies. No finished goods.

This story first appeared in the February 15, 2017 issue of WWD. Subscribe Today.

“We realized that craft supplies has its own unique needs of the sellers versus sellers of finished goods,” Chad Dickerson, Etsy’s chairman and chief executive officer, said, adding that the site will infuse the “inspiration and joy you don’t find from the craft supplies ecosystem on or offline.”

Etsy Studio will launch with eight million items, he said — about 200 times the inventory of a leading craft store that carries about 33,000 items.

The crafting space is estimated to be a $44 billion industry, with the majority of transactions taking place off-line, according to the Association for Creative Industries. And Dickerson is eager to disrupt and gain market share — online — in the largely off-line space.

Etsy has 27 million buyers and 1.7 million sellers of finished goods.

“We’re very much a tech company. We’re based in New York but our roots are very Silicon Valley. We’re a platform company, not just a retail company,” Dickerson said. “We’re expanding Etsy the company beyond Etsy the marketplace.…This is the first time that you’re seeing outside of Etsy how much bigger the opportunity is.”

Dickerson explained that the destination — which staked its claim as the go-to dot-com place for craft goods with buyers and sellers in nearly every country — was presented with a business opportunity when supplies emerged as a leading category on Etsy.

Of the 40 million listings (in 50 categories) on the site at any given time, craft supplies ballooned to about 20 percent, or eight million, of all listings. Keep in mind, Etsy’s gross merchandise volume, or GMV, in 2015 was $2.4 billion, which means craft supplies had become a sizable business for the marketplace.

“What Etsy Studio does is allows creative entrepreneurs growing on Etsy the past 12 years to manage their creative businesses across numerous channels.…We’re giving them a new venue,” Dickerson said.

In addition to the new site, a Shop Manager feature is rolling out for sellers to help manage listings on all Etsy channels, including Etsy Wholesale and Etsy Pattern.

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