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Once you’ve decided to launch an online store and selected one of the top business ventures, you must obtain a licence. Earlier, RAI wrote to state representatives of Maharashtra, Karnataka, Delhi, and Rajasthan, and sought that non-food retailers should be encouraged to take orders over the phone and other electronic means for home deliveries. After a period of uncertainty, 90% of Grofers’ warehouses are operational and the company has obtained permits for about 50% of its delivery staff, said Rohit Sharma, head of supply chain at Grofers. Still, delivery times will be longer as the authorities had forced the company to suspend its operations for a few days, he said.
Suneera reports on fast moving consumer goods makers, retailers as well as other consumer-facing businesses such as restaurants and malls. She is deeply interested in what consumers across urban and rural India buy, wear and eat. Suneera holds a masters degree in English Literature from the University of Delhi.
In case of touch screens systems, they permit further inquiries or give printouts from the database. A feature of both systems is that a credit card can be used in order to protect the sale. “E-commerce entities providing marketplace will not directly or indirectly influence the sale price of goods or services and shall maintain a level playing field,” it said.
Such goods will normally be reserved for an upper class of people who have the financial means to purchase such a product. The marketing of such goods is also so that it only targets that part of the consumer group that can provide such products. The ideal example of such goods is jewellery, luxurious cars, watches, accessories, etc. To cater to the needs of the consumers, shop owners need to be aware of some specific types of goods they can display in their store, encouraging the customer to buy them. Read on to find out more about how to set up an online business in India and get an e-commerce license.
These are goods that are readily available for the consumption of the consumer. Further, they include products used for daily use and immediate consumption, such as milk, vegetables, fruits, https://1investing.in/ etc., which are considered essential for daily life and routine. The E-Trader licence enables people or sole proprietors to market their goods and services through social media.
When conducting online business, you must keep an active account in your company’s name. You must ensure that your organisation is a corporate construct to accomplish this. Register with the tax authorities and receive an establishment licence to confirm this. An occupational licence is not necessary for every internet business; it all varies by your industry and the job you undertake. For instance, if you’re an accountant, you’ll need an occupational licence to do business need and build a reputation.
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The inventory-based model of e-commerce means an e-commerce activity where inventory of goods and services is owned by e-commerce entity and is sold to consumers directly, according to the guidelines. FSSAILicense or Food License is a certificate of registration that permits you to sell food products. This license will be granted to all manufacturers, traders, and restaurants which carry out food business in India. This license will be issued by the Foods Safety and Standards Authority of India.
The Shop and Establishment is a license or basic proof of your establishment or shop. Every state has a different process and procedure for registration, electronic retailing permits but it is mostly similar. The business owner has to apply for the registration and license within 30 days of commencing business.
The Trade License and the Shop and Establishment license are crucial for starting a business as they are your business’s identity and a regulatory body. Additionally, it is mandatory to have both documents to run a business in any state of India. Under the Central Goods & Service Tax Act, all online retailers must be registered irrespective of their annual revenue. “Given that most stores are already functioning on lower staff capacity at present, getting passes from local authorities was creating hiccups.
Different models for E-retailing
Khatabook does not make a guarantee that the service will meet your requirements, or that it will be uninterrupted, timely and secure, and that errors, if any, will be corrected. The material and information contained herein is for general information purposes only. Consult a professional before relying on the information to make any legal, financial or business decisions. Khatabook will not be liable for any false, inaccurate or incomplete information present on the website. Although most localities demand business licences, drop shipping enterprises may not be subject to all states’ requirements.
States like Delhi, Uttar Pradesh, Punjab, Rajasthan, Maharashtra, Madhya Pradesh, and West Bengal continue to place restrictions on opening up of non-essential stores. In Maharashtra, some districts have allowed non-essentials purchase by e-commerce. Hazari noted that during the initial stages of the lockdown many smaller grocery stores on m.Paani’s platform were forced to shut because of the lack of clarity on essential services.
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Using tools such as the National Employment Licensing Database, you can assess if you require occupational approval. You must get the relevant occupational permissions if your company needs specialised education, training, or licence to function lawfully. It’s doubtful that you’ll require occupational approval if all you’re doing is selling goods online. It said that an e-commerce firm, however, will not be permitted to sell more than 25 per cent of the sales affected through its market place from one vendor or their group companies. To bring clarity, the DIPP has also come out with the definition of e-commerce, inventory-based model and marketplace model.
- All types of businesses and professionals in India require their own business license.
- It is these stores that are in need of access to e-passes because they have a grassroots presence,” said Akanksha Hazari, founder of m.Paani.
- As per the guidelines issued by the Department of Industrial Policy and Promotion on FDI in e-commerce, foreign direct investment has not been allowed in inventory-based model of e-commerce.
- These are goods that are readily available for the consumption of the consumer.
- It is related to wages payment, working hours’ regulations, leaves, holidays, terms of services, and other conditions.
- In a set of letters written to several state governments, industry body Retailers Association of India has once again urged state governments to permit non-food retailers to operate.
The government has already allowed 100 per cent FDI in business-to-business e-commerce. “In order to provide clarity to the extant policy, guidelines for FDI on e-commerce sector have been formulated,” DIPP said. After becoming informed about business licensing, read a few eCommerce books or blogs to gain insight into other facets of managing an online store. Your chances of success increase with the knowledge you possess at the outset.
Types of Goods Sold in Retail Shops
If you have a business banking account but you don’t have a licence, then your revenue earned can be taken from you, and you can risk severe penalties. The exact licensing requirements apply to other enterprises and e-commerce companies. A company owner who holds one of these licences is also shielded from penalties or termination by municipal or state authorities. E-commerce, often called digital commerce, refers to transactions conducted via electronic means. E-commerce is the exchange of money or the buying and selling of goods through an electronic network like the internet.
Licences and Permits Required for Your Online selling Business
“At least non-essential stores be allowed to open up for some hours and give some window for consumers to buy these things,” Poddar said. Marketplace model of e-commerce means providing an IT platform by an e-commerce entity on a digital and electronic network to act as a facilitator between buyer and seller. Market place model of e-commerce means providing of an IT platform by an e-commerce entity on a digital and electronic network to act as a facilitator between buyer and seller. The inventory-based model of e-commerce means an e-commerce activity where the inventory of goods and services is owned by an e-commerce entity and is sold to consumers directly, according to the guidelines.
The act sets several regulatory standards for the manufacturing and selling of those drugs and cosmetics. It also sets testing authorities and inspectors to check the drug and cosmetic sample before it is allowed to be on sale for public use. The process of obtaining such a license for selling drugs and cosmetics is under the Drugs and Cosmetics Rules, 1945.
The official website of Taxpayers Identification Number will include all the details you require to obtain a tax identification number for your company. Don’t expect your firm to last very long if you utilise an e-commerce payment gateway and digital commerce processing of credit cards platform, even without the state getting a share. In a set of letters written to several state governments, industry body Retailers Association of India has once again urged state governments to permit non-food retailers to operate. As state governments start lifting lockdowns with the decline in covid 19 cases, retailers and industry bodies say they should be allowed to keep stores selling essentials open for longer hours. They’re also seeking permission to sell non-essentials such as apparel, general merchandise and electronics. The licensing authority for the sale of drugs and cosmetics is the Drugs and Cosmetics Act, 1940.
They only fulfil a particular requirement and are only bought by consumers when the need for such a product arises. The information, product and services provided on this website are provided on an “as is” and “as available” basis without any warranty or representation, express or implied. Khatabook Blogs are meant purely for educational discussion of financial products and services.
It acts as a reassurance to consumers that they are not becoming victims of unethical practices. It acts as a watchdog and regulates every trade or business with guidelines, rules, and measures. A trade license is vital for business when starting a retail shop as it legitimizes your business in the eyes of the government and the consumers. A retail shop is a subcategory of the retail sector that sells goods directly to consumers.