General Question

polycinco's avatar

What permissions do I need to start a store online?

Asked by polycinco (187 points ) April 22nd, 2010

I am new at this whole business thing and I’m trying to start my own store, but first I would like to start online, do I need any permissions to do that? or can I just open a store and start selling?

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18 Answers

Cruiser's avatar

You may want to get permission from the manufacturers of the products you wish to sell. Very important!

davids's avatar

You can just open a store and start selling. Depending on your location, you might need check your taxation laws to see if you need to add additional tax to the item pricing.

You’ll want/need a domain, basic hosting, and a shopping cart script of some form to start out. You’ll also need something like PayPal or a banking merchant facility to start processing transactions.

davids's avatar

Ah, and as @Cruiser said, if you’re selling other manufacturers products, you may need their permission to sell.

polycinco's avatar

ok, and how can I get in contact with the manufacturers? is there a website or something? I want to sell skateboarding clothe and accesories so I would like to get in touch with famous brands but I don’t know how to do that?

Cruiser's avatar

@polycinco You will then need to contact each one and ask for permission and get it in writing if you can. Google the Mfr. and contact them by phone preferably or e-mail if you are taking a shotgun approach here.

CyanoticWasp's avatar

@Cruiser I’m curious why you think that a manufacturer’s permission is required to sell his product.

I agree that you’d need an agreement in place to be an “authorized reseller” or any kind of “manufacturer’s representative”, but I can’t think of a single reason why permission should be ‘required.’ I see it as a ‘nice to have’, rather than a ‘must have.’

But I know that you’re in business at a different level than I am, so I’m seriously asking if you have anything to add to that. I’m really curious.

fireside's avatar

@CyanoticWasp – If you don’t get the manufacturer’s permission, then you will most likely not be getting a wholesale rate for the merchandise, at least not through an approved channel.

This would lead to poor margins and a lack of ability to compete at a minimum and at worst could lead to legal action if you don’t understand the rules the manufacturer’s have set up regarding the pricing and distribution of their goods.

Cruiser's avatar

@CyanoticWasp I have worked very hard to set up distribution of our products and to maintain a price point of what we manufacture here. I had this issue with someone who was buying our products and then reselling at a much higher price online and got complaints of price gouging! Plus a reseller could encroach on our online selling efforts. It’s a sticky and slippery slope as you would think the more people selling my stuff the merrier but that is not always the case. I like to know who, what, where and for what price my products are being sold.

CyanoticWasp's avatar

I agree with @fireside that you’d need some kind of business agreement with the manufacturer to obtain favorable pricing leading to better margins. Of course. But I don’t see any legal issues arising from that. (The link was unhelpful—we’re talking legitimate business here, not selling fakes, pirated goods, counterfeits or other ripoffs.)

But I still think that you’re the one flirting with illegality, @Cruiser, in your attempts to control the entire distribution channel. Depending on how you go about your efforts to “maintain a price point”, you’re skirting with restraint of trade issues. (It should be simple to fend off the complaints of price gouging—you weren’t the seller, and apparently you would offer the goods at a lower price than the seller did—so it’s a buyer issue, and his lack of due diligence or shopping ability.)

I can completely understand and support your “desire to know” the who, what, where and under what terms your goods are sold—that’s simple market research and cognizance, Business 101—but the attempt to “control” that is what gives me pause.

Cruiser's avatar

@CyanoticWasp I have every right to sell to who I want to and every right not to sell to who ever I want. What I can’t do is overly restrict their ability to re-sell my product once I agree to sell them my products. And if and when I agree to re-seller taking on my product line it is always spelled out in written contracts what we expect with regards to our products representation and customer service.

In the particular case I cited this reseller was directly linked to our website which created a huge conflict with our advertised price and with customers routed through to their site as his linked price was 40% higher. We were being accused of false advertising and price gouging.

CyanoticWasp's avatar

@Cruiser I agree with you completely on that account.

I’m not so sure that I agree (in today’s society) that you are so free to choose to “not sell” to a willing buyer. (Of course you aren’t often forced into unwelcome business alliances—yet—but if someone presents you with “your asking price” you can’t very well refuse to sell to them, can you?)

Cruiser's avatar

@CyanoticWasp That I am not sure about as my distribution is limited yet I do “try” to provide protections. I got a first hand lesson years ago when I was a distributor myself with a “protected” territory and the Iowa distributor ambulance chased a very large construction project I worked 2 years on and stole the sale and the Manufacturer’s hand were tied as stopping the sale would have been restraint of trade exactly how you postulated above. $60,000.00 sale up in smoke!! :(

polycinco's avatar

ok, so Cruiser I understand that you have your own company, well if I wanted to start my own brand of clothing, what permissions and stuff do I need?

YARNLADY's avatar

The first thing you need to go into a full fledged business – as opposed to casual selling as a hobby – is a tax ID number. You get that by filing an application for a re-sale number. Then you find out what the licensing regulations are in your area. Visit the various how to start an internet business sites on the net.

Cruiser's avatar

@polycinco Your own brand would or could be private labeled and I don’t know how clothing works, but I would give you my products under your label and you are free to do what ever our contract would allow for. Again there would be contracts that outline the details of the arrangement. It can be formal or informally written contracts but you will need to find a manufacturer who can support you.

MagsRags's avatar

Very few people have the cash on hand to launch their own line of manufactured clothing, and without skills, experience and a business plan, financial backers are few and far between.

Have you considered starting small by creating a small collection of what you want to sell and then trying a selling site like etsy? You can’t sell manufactured goods there but you can sell clothing that you have embellished or altered. It would be a good idea to get some selling experience in a structured environment like etsy to see if there’s a market for what you’re selling and get some basic experience before fully committing.

polycinco's avatar

that’s a good idea. Thanks for your help everyone.

dabbler's avatar

Looks like above answers have well covered the permission question.
I would add : write a business plan. Once you have done that you have answered the most important questions about how your business will run and make you some money.
Here are some sample business plans.

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