How to Legally Start an Online Shop

One of my best friends is in the process of forming an online shop right now (which I personally will be using for my own business, so I promise to share with you), which has brought up one of my most common questions (or when not asked, one of the biggest issues that arises for online business owners) : what legalities do you need to know about to start an online store?

Before you start your online shop, you must be aware of these considerations:  

    1. Does your shop have a different name than your business (ie, Paige Hulse Law and the Creative Law Shop?)

      • You must start with a full due diligence search (in your state, nationally, the USPTO, etc). A full due diligence search is the first step of registering a trademark and is crucial in ensuring that your name does not infringe upon anyone else’s name. If you neglect this step, there’s always a looming chance that you may unexpectedly receive a cease and desist letter in the mail one day, requiring you to change your name. If you’ve established a following or recognition of your business name, this could cause great harm to your brand. Which leads me to...

      • You may eventually need a trademark to protect your name - but this step doesn’t need to come right away. Many people rush into registering a trademark- this is a step that should be taken when you know your online business will be around for the foreseeable future, and a good lawyer will be able to discern multiple other factors that should influence this decision.

    2. Copyrights

      • Are you creating “works of authorship” (ie, goods) you want to protect? You may need to register your copyrights to protect your work from copycats. This is a step that you’ll need to take if your goods are being copied or stolen repeatedly- and again, a good lawyer will be able to discern multiple other factors that should influence this decision.

    3. Contracts

    4. Any necessary disclaimers if you’re providing goods on finances, legal information, medical information- ie, anything that typically requires a license, that if relied upon, could cause harm to the purchaser

    5. When you begin making significant money from your shop, you’ll likely need to separate your business liability with a separate LLC.

      • Again, this is a step that most small business owners make. Not only could there be significant tax considerations for creating a separate LLC (which could save you significant money), but, most important are your liability considerations- when you begin making a significant income from your shop, you’ll need to separate your business liability and assets from one another so that your businesses won’t be on the hook for one another if an issue arises with one. This will mean creating separate LLCs for your shop and business, which is something an experienced attorney can advise you on.

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