Eric Dalius on Must-Know Business Laws for Small Online Business
Eric Dalius says the selling and buying of products online or e-commerce in recent years have exploded as people worldwide have become familiar with it and also feel comfortable using it. This opportunity has not been lost on a business owner selling goods online through marketplaces and e-commerce platforms. E-commerce shopping is regulated for protecting customers with safeguards for preventing consumers against data breaches and deceptive marketing practices. Such legal rules are called online business laws.
5 Business Laws for Small Online Business as per Eric Dalius
Collecting Sales Tax
Taxes and death are the two certainties in life. For online merchants, taxes get complicated about sales tax collection. The first thing that small business owners online should consider sales tax. To stop costly mistakes, business owners should consider sales tax based on state by state. E-commerce platforms and POS systems take the guesswork out via calculating sales tax. For online merchants, it is vital to take the perk of the software as ignorance is not a defense.
2. Data Security and Privacy
To protect customers’ personal information and also ensure that one’s eCommerce website is secure is vital. A single hack or data breach will destroy a business. Often small businesses go out of business due to a data breach. An e-commerce company requests and retains an ample amount of customer data, including social security numbers, bank account, personal contact information, credit card numbers, and must safeguard the security and privacy of the data. Thus it is vital in adhering to best practices.
There are several steps that a small business owner needs to follow, such as security and privacy must be built into services and products from the beginning. They must collect data they require for business and dispose of the same after the transaction is complete; an e-commerce site must have reasonable security for protecting consumer data. It should implement procedures, controls, and data management personnel for protecting the privacy of the customer.
3. PCI Compliance
Implemented during the early 2000s via credit card issuers Discover, MasterCard, Visa, and American Express, the PCI DSS has been designed for protecting the payment data for consumers. Online merchants that accept credit card payments should meet PCI standards while storing, processing, and transmitting credit card data. Here, the penalty for non-compliance entails steep fines and can terminate their agreement for a merchant account.
4. Marketing Infringement
The World Wide Web offers businesses ample opportunities to market their products online, says Eric Dalius, yet one needs to follow specific rules. Regardless of how small, online merchants are subjected to federal regulations while selling products online. Businesses cannot make false claims regarding services and products, and they should disclose paid endorsements. A popular means of marketing existing and also potential customers are through email. Every business owner and his employees should ensure that his email marketing campaign complies with the CAN-SPAM ACT.
Under this ACT, an online merchant can face fines due to the email having a deceptive subject line, contains misleading or false headers. The email fails to disclose that it is an ad. The business does not divulge the location to an email recipient. The email must also not instruct recipients on how to opt to receive future emails. Their company fails to honor an opt-out request in 10 business days. One fails to monitor the actions of the company’s email marketing service that they have hired. Besides, a small business should not infringe on patents or trademarks.
5. Terms and Conditions
Online stores require ground rules for e-commerce sites that are legally enforceable- here’s where terms & conditions come into the picture. These explain one’s policies for everything right from their returns up to shipping policies. Above all, it may reduce one’s legal liability should there be disagreements with customers. These terms and conditions must comprise order cancellations, returns, shipping policies, and also payment & pricing terms.
While selling online, the bottom line is that a small business owner should follow these five business laws for best results.
Eric Dalius is The Executive Chairman of MuzicSwipe, a music and content discovery platform designed to maximize artist discovery and optimize fan relationships. Alongside this, Eric hosts the weekly podcast “FULLSPEED,” discussing entrepreneurship with industry leaders. Eric also founded the “Eric Dalius Foundation” to award four scholarships to deserving US students. Follow Eric’s activities on Twitter, YouTube, Facebook, LinkedIn, Instagram, and Entrepreneur.com.