In today's post, I'll talk about 4 Points every E-Commerce Business needs to focus on.

E-commerce businesses are quite common nowadays. 

And primarily, there are two models of e-commerce:

(a) Inventory Model: The platform operator itself holds inventory and ships products.

(b) Marketplace Model: The sellers on the platform fulfill the order themselves.

Amazon is an example of both of these, as they have their native brands as well.

Setting up an e-commerce business is pretty easy with a number of solutions in the market.

However, many new entrants, especially, are unaware of the legalities that they need to take note of.

And it honestly makes sense why too.

Because the law can be confusing.

So in today's post, I will give you 4 points that you absolutely need to nail down!

(1) Consumer Laws Compliance

The most important aspect that e-commerce businesses should be aware of is consumer law.

In most jurisdictions, there is a separate framework for e-commerce businesses to prevent any unfair trade practices.

Under consumer law, there are legal obligations on e-commerce providers:

a) Disclosure of Provider’s Information on the website

b) Disclosure of adequate product details

Then, information related to return, refund, exchange, warranty, and guarantee.

There's also information related to delivery and shipment, and modes of payment.

And lastly, the grievance redressal mechanism.

All these are required to be provided on the platform.

Some providers just say they won’t provide returns under any circumstances.

But they can’t really do this.

If the goods are defective/deficient or different from what was shown.

Or if there is a delayed delivery.

Then the customer usually has a statutory right to return the goods.

And this information information is provided on the product page along with the Terms of Use of the website.

(2) Privacy Considerations

Obviously, like any other online business, digital commerce relies heavily on consumer personal data.

This data could be used for the delivery of products, email marketing, running product algorithms, etc.

Data laws have become stringent everywhere, especially in the EU region.

Compliance with data privacy laws requires obtaining consent for data collection.

And also providing users with the right to access and erase their data.

Companies also need to implement security measures for data protection.

Now all this information is usually shown through a privacy policy.

And this document itself is mandatory for practically every online business.

(3) IP Concerns

Like any other online business, your greatest asset is your brand value, especially if you are running a marketplace model.

Before launching your platform, you should apply for IP registration.

It’s the first-mover advantage when we are talking about securing IP rights.

Having IP rights becomes important too when taking down any fake website that is imitating your website.

Another legal issue related to IP that e-commerce platforms face is the sale of counterfeit goods on their platform.

As an intermediary, if sufficient measures have not been taken on your end, your platform becomes liable too.

(4) Regulatory Compliances

Depending on the sector in which you are operating, there could be an additional set of laws applicable.

For example, you can’t operate a pharma e-commerce without a license.

Then, there are marketing regulations that need to be considered:

a) Fake Reviews

Many e-commerce entities indulge in posting fake reviews - this practice itself is not allowed.

b) Consistent Advertisements

You need to ensure the advertisements of products are consistent with the actual characteristics of the same.

That's it.

Running an E-commerce business might seem like a good idea for many people.

But just like any business model, you must take the right steps for it.

On the legal side, these 4 focus points will definitely help you!

P.S. Are you planning on running your own E-Commerce business?

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