Potential Legal Issues Affecting a Click and Drop Business

‘Click and drop’ or ‘click and collect’ businesses are types of businesses that demonstrate online and offline retail merging. This type of business is one of the most successful models for the retail industry. However, it is essential, as it is for any type of ecommerce business, that you avoid legal pitfalls for your online click-and-collect business. This article will explore potential legal issues affecting a click and drop business.

How to Start an Online Business in the UK

This guide sets out how to set up, finance and grow an online business in the UK.

Download Now

Identification Errors

A potential legal issue affecting a click and drop business is handing a package to the incorrect person. This can occur, for example, once a person places and pays for their order on your website and you fail to check the ID of a customer who then picks up the goods. Therefore, your staff at an intermediary must:

• check customer’s ID;
• ask the person collecting the goods to show the card that paid for the product; and
• potentially use a security question at pick up.

Age-Restricted Goods  

Another legal issue that can affect your click and drop business occurs when you sell products with age restrictions. For example, if your business sells alcohol, you must comply with the Licensing Act 2003, which states you must have an age verification policy. If not, you face the potential legal issue of either:

• fines; or
• imprisonment. 

Therefore, your business must consider how to undertake age verification checks, both when purchasing online and when collecting the goods, where click and drop is the mode of sale. Your business policy should state your chosen approach and be in your terms and conditions. 

Cancellation

When your customers purchase from your business, they enter into an online contract with your business. Legal issues arise if your click-and-drop business does not comply with consumer law, which protects your customers. For example, you need to allow customers the right to:

• cancel within 14 days of collection of goods; and
• request extra information, including who you are (as the trader) and how you allow your customers to cancel their purchases.

Not complying with consumer legislation can lead to legal issues. For example, if you do not provide your customer with 14 days to cancel, this could extend to 12 months right of cancellation. An extended right-to-return period like this can potentially impact your business model and cash flow. 

Personal Data Laws

Further, you must comply with personal data laws when you run an online business that offers click-and-collect. Your ecommerce business most likely uses a third-party processor facility for your customers to collect their purchased goods. The third-party will subsequently need personal information about the purchase and collection of the product. Importantly, your business must ensure that the third party complies with personal data legislation when they process personal information. 

In addition, you should draft a privacy notice and policies around your use and processing of customer data. It is also a good idea to complete a data protection impact assessment.

Key Takeaways

When running a click-and-drop or click-and-collect business, there are legal issues that you must consider, including:

• identification errors;
• age-restricted goods;
• cancellation; and
• personal data laws.

For more information on setting up a legally compliant click-and-drop business, our experienced ecommerce lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents for a low monthly fee. Call us today on 0808 196 8584 or visit our membership page.