Internet and Mail Order Business Opportunities 8
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What laws do I need to know about?
Most of the laws that affect mail order businesses are the same as those affecting any business selling any product. Your advertising can't be deceptive or purposely misleading, and you may need to be concerned about product liability, warranties, and the legality of selling your products. You should also be aware that you can't ship unordered merchandise and bill customers for it. You must be able to deliver what you have advertised within the time you state in your ads or within 30 days of the time you receive orders if no time is stated in the ad. If there is a delay due to some unforeseen circumstance, you have to notify the customer and offer to refund his or her money.
Do I have to collect tax on out-of-state mail order sales?
At the time this book was written you were not required to collect sales tax on out-of-state purchases unless your business had a physical presence (office) in the state in which a sale was made.
How do I ship orders?
You can ship orders using either the United States Postal Service or any private shipping service. It is important to find out ahead of time how the merchandise should be packaged for safe shipment. There are any number of packaging companies that can supply boxes, tapes, cardboard envelopes, or other packaging supplies for shipping. When you are just starting out, you may want to buy the supplies you need in small quantities from the large office supply stores such as Office Max, Staples, or Office Depot. But once you need to buy more than a few boxes, envelopes, or other packaging at one time, you'll do better purchasing your supplies in bigger quantities elsewhere. If you can't find a local distributor for packaging in the Yellow Pages, search the Internet for paper and box suppliers.
TIP: Not all products can be shipped to all locations by mail. Be sure to check with the U.S. Postal Service or any other shippers you plan to use. You should also call the Department of Commerce to determine whether there are any regulations restricting the sale or shipping of your merchandise to any foreign countries.
What is drop shipping?
Drop shipping is an arrangement in which you take orders for a company that manufactures or supplies one or more products your customers want. You send the orders to the suppliers along with shipping labels (usually), and then the manufacturer or supplier sends the product to the customer. You don't need to retain inventory or do any actual shipping, but you also don't control when the product is shipped or how it is shipped, which can be a problem if a customer claims never to have gotten a product or that it arrived damaged. If you work with drop shippers, investigate them thoroughly. Start out with small orders, and get to know the company. Wait to increase the number of orders and/or the size of orders until you are sure the company ships on time, packages the products so they arrive safely, and tracks shipments so you can shipment tracking details when your customer calls and says "my order never arrived."
Will I have to spend a lot of time running a mail order business?
In the beginning you can run a small mail order business in your spare time from home, but as it starts to become profitable and generate a lot of customers you will find that your spare-time business is taking up 30 or 40 hours each week.
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