Selling your own products is a great way to express yourself creatively and to make money. Many platforms, such as Etsy, allow you to list homemade items for sale online. Or you can create your own website through a platform like Shopify. You might also choose to sell at a farmer’s market or other in-person community venues. Once you take the leap and chose your platform, make sure you’re aware of all of the laws that apply to your business. To make sure you’re selling items legally, learn about all the licenses or permits you might need.
Six Steps to Selling Items Legally
1. Get a Seller’s Permit
A business must obtain a seller’s permit if it sells physical items to the public. Your state will most likely issue this. They will ensure that you charge the appropriate taxes, if applicable. In addition, some states may require that those who provide services get a seller’s permit. Check with your state’s Department of Taxation to determine whether your business is required to have this permit. The Ohio Department of Taxation explains what kind of business needs this sort of permit and how often you’d be required to send those taxes to the state. You’ll also want to make sure you have the correct occupancy permits, professional licenses, and safety permits. The Small Business Association is a great resource for this information.
2. Get a Wholesaler’s License
A wholesaler’s license allows you to purchase items in bulk for a discounted price and re-sell them. You won’t have to pay the sales tax when you purchase these items with a wholesaler’s license. It may also be called a seller’s permit, depending on your location. Sometimes they are two different things. First, obtain an employer identification number (or EIN). Your state’s department of taxation or labor may be able to help you with this. The Small Business Administration also provides assistance.
3. Make Sure You Have No Trademark Issues
Make sure that your business name and the names of your products do not infringe on any filed trademarks. You may also obtain trademarks of your own. In doing so, you protect your business’ reputation and make it easier for customers to find you. Ensuring that your business or product name doesn’t conflict with other businesses can limit the potential for conflict with other established businesses as well.
4. Choose a Payment Gateway and Understand Their Limits
Paypal, Stripe, Square… there are many processors that you can use to collect payments. Research these so that you fully understand the fees each charge, and any restrictions on products you can sell with them.
5. Understand Shipping Restrictions
Like payment gateways, depending on what you sell, research restrictions on shipping items. If your products are perishable, sold in aerosol cans, for example, there may be difficulties in shipping them. In some cases, shippers may refuse. Others may require an added fee or paperwork.
6. Understand Customer Privacy
Whether or not you sell items specifically for to children, read up on the Children’s Online Privacy Protection Act. It requires parental consent to collect information from individuals under age 13. Regardless of your target audience, you’ll need to have a privacy policy. Spell out, with input from a lawyer, how you collect customer information and how you will use it. If you’re interested in speaking with a lawyer to ensure that you’re following all of the rules and requirements of the state of Ohio, contact the team at Rapier & Bowling. We are experienced in business law and have advised a variety of entities, from sole proprietors to corporations, and limited liability companies. Reach out today to see how you sell items legally and grow your business. IMAGE: Pixabay / CC0 Public Domain