Hana has been making jewellery for quite some time. At a local exhibition, her products appealed to a larger number of people, and so she decided to build her business on her hobby. Over the past few months she has easily managed to set up a trade licence, purchase the necessary materials, and she now devotes herself fully to making her products. The people interested at the exhibition collected their orders, but after the initial wave of customers their number dropped rapidly. To make more people aware of her products, Hana decided to offer her products online as well.
If you too are considering offering goods and services over the internet like Hana, do not forget that in this case as well you are obliged to legalise your business activity. You can read about setting up a trade licence or a company in our previous article.
Setting up an e-shop
At first, Hana advertised her products on various classified-ad portals. For the ads she usually paid fees of varying amounts, and given the large number of listings her offer often got lost. Advertising was a quick way of offering her products, for which she paid low one-off fees, but overall such an offering of goods was inefficient and, in the long run, also expensive.
Hana therefore began to think about setting up her own e-shop. She had to answer several questions for herself, however:
- Is setting up my own e-shop right for me?
- How much am I willing to invest?
- Do I know everything it involves?
Is setting up an e-shop right for me?
If you too have been considering the option of your own e-shop, you should first and foremost think about the quantity of goods you make. If you make products or offer services only in a limited quantity (for example, alongside another job or maternity leave), this could be a reason to consider whether it is worth investing in an e-shop. If, for example, alongside your job you offer dressmaking services at weekends but take only a small number of orders, setting up your own website may be disproportionately costly for you.
Hana's business was to be her main source of income and, more importantly, she had both the will and the capacity to make goods for a larger number of interested people, so it was appropriate for her to create her own website on which her products would be clearly displayed and through which many more people would learn about her.
How much am I willing to invest?
At first, Hana was drawn to many offers for a free e-shop. Since she was only starting out in business, the idea of a website with no fee appealed to her, but this later proved to be the wrong option. Free websites often have problems with their functionality, so it can easily happen that either your entire e-shop does not work, or customers cannot, for example, order a product. If your site does not work, you have no guaranteed service, and if you are not exactly the technical type, fixing the error can be a problem for you.
If Hana wanted a solid website, she had to pay for it. In general, you have websites available for rent, where you pay a monthly amount for which you can use the site, which may be enough at the start of a business. In the long run, however, it is better to find a professional who will create your own e-shop, provide service, and tailor the appearance and functionalities of the site to your requirements.
Pros
- Professional e-shopreliable functionality with guaranteed service.
- Tailoredthe appearance and features are fitted to your requirements.
- Rental to starta monthly-fee site can be enough at the beginning of a business.
Cons
- Free e-shopoften has problems with functionality.
- No guaranteed serviceif the site stops working, you are on your own.
- Hard to fixrepairing errors is a problem if you are not the technical type.
Do I know everything it involves?
The sale of goods and services over the internet has a complex legal regime that imposes many obligations on sellers. When doing business over the internet, you must master these rules yourself, or engage the services of a professional who is well versed in consumer law as well as IT law. Otherwise you risk sanctions, for example from the Slovak Trade Inspection or the Office for Personal Data Protection.
Statutory obligations
In general, it can be said that the following basic obligations apply to you:
- Draw up and place on the website the general terms and conditions and the complaints procedure,
- Inform customers about the manner of processing their personal data and apply the rules under GDPR,
- Bring the rights granted to customers into line with both Slovak and European legislation.
Even though you will come across a large number of sample general terms and conditions (GTC) or personal data protection documents online, in particular so-called privacy policies, you must reckon with the fact that their content should reflect precisely your business activity and respond to the goods and services you offer. If you use a template downloaded from the internet, it may happen that it either does not meet the legal requirements or is not sufficient for your business activity.
A downloaded template of GTC or a privacy policy may fail to meet the legal requirements or may not cover your specific business activity.
To avoid the risk of a fine, you should first and foremost make all the necessary information available to customers on your website.
As an entrepreneur, Hana was obliged to display her details on the website in the form in which they are entered in the relevant register. This means that even though she labelled her products with the name "Jewellery by Hanka", such a detail was not enough.
To consumers, i.e. her customers, she is obliged to state her full business name, IČO, DIČ, registered seat or place of business, as well as details of where and under what number she is registered, a telephone number and an email address. In case of a complaint about her goods, she was obliged to state the address at which her customers can lodge a complaint and, last but not least, to state also the name and address of the supervisory authority, in this case the Slovak Trade Inspection.
Details you must display for consumers
- Business name — the full name as entered in the relevant register.
- IČO and DIČ — company identification and tax identification numbers.
- Seat or place of business — and where and under what number you are registered.
- Contact — a telephone number and an email address.
- Complaints address — where customers can lodge a complaint about the goods.
- Supervisory authority — its name and address, here the Slovak Trade Inspection.
General terms and conditions
In addition to this information, she is obliged to publish her general terms and conditions, which represent an overall overview of the information that the customer should be aware of. This concerns in particular information about the possibility and manner of lodging a complaint, about withdrawal from the contract, especially withdrawal from the contract without giving a reason together with the time limit for such withdrawal, about the costs of returning goods, delivery, payment terms and any other fees.
Important
Special legislation obliges you to grant customers the right to withdraw from the contract without giving a reason within 14 days of receiving the goods.
GDPR and personal data protection
Last but not least, this also concerns information about the manner and extent of processing customers' personal data. This should include, in addition to your details, the purpose and legal basis of the processing, the period for which you will retain the personal data, the right to erasure of personal data, and other information for the given type of processor.
If the extent of your statutory obligations has frightened you, do not despair! Nowadays there are countless e-shops whose owners had to deal with the same obligations too. If, to begin with, you invest in quality services, namely setting up the website and drawing up the necessary documentation, you will be able to start selling without worry. Online selling can increase your profits very quickly, gaining you customers from various corners of Slovakia, and perhaps abroad too. Do not be afraid to seek advice, and do not be afraid to do business!
Frequently asked questions
Do I need to legalise my business if I only sell online?
Yes. Offering goods and services over the internet is a business activity that you are obliged to legalise, for example by setting up a trade licence or a company, just as with offline selling.
Is a free e-shop a good idea?
Free websites often have problems with functionality and offer no guaranteed service, so your shop or ordering may stop working and errors can be hard to fix. In the long run it is better to invest in a professional e-shop with service tailored to your needs.
What statutory obligations does running an e-shop involve?
You must draw up and publish general terms and conditions and a complaints procedure, inform customers about the processing of their personal data in line with the GDPR, and bring the rights granted to customers into line with Slovak and European legislation.
What details must I display for consumers on the website?
Your full business name, IČO, DIČ, registered seat or place of business, details of where and under what number you are registered, a telephone number and email address, the address for lodging complaints, and the name and address of the supervisory authority (the Slovak Trade Inspection).
Can customers return goods bought online?
Yes. Special legislation grants customers the right to withdraw from the contract without giving a reason within 14 days of receiving the goods, and you must inform them about this right.