Internet Law: Does an online store really need a TOS?

Yes, you really do need Terms of Service for your e-commerce store. While I realize that most people who visit a website (from e-commerce to social media) just blaze through those terms and hit accept. A well-drafted Terms of Service (ToS) is more about protecting you from various forms of potential liability.

Imagine for a moment that you have an iconic brand of your own. You have your very own products. You have your very own recognizable logo. Why, you’re a regular household name! (Even if you don’t become a household name, what I’m about to explain will still apply to you).

If some scoundrel creates a knock-off of your product (let’s say an electric razor for men), slaps your logo on it, and sells it online as one of yours (hey, maybe this person bought one of yours and decided to take it apart to make it “better”), you could end up facing a lawsuit over the defective product (unless you could prove it was a knock-off or that it was purchased and something was done to violate your…Terms of Service).

I know that seems like a far-fetched example, but sometimes those far-fetched examples can be useful in illustrating a point!

For an e-commerce outlet, your Terms of Service is primarily used to:

  • Protect you from various types of liability (and some federal acts require that you comply in certain ways to get that protection…and that means a clause in a ToS)
  • Explain the process of purchasing and goods
  • Allows you to cancel accounts that do not follow your Terms of Service (such as abuse of other users or abuse of your system in some way)
  • Protects your intellectual property and explains the ways in which others may use it
  • Explains how disputes between your e-commerce store and consumers will be handled
  • Explains your use of their private information

And for those wondering, no…you should not just go find a similar e-commerce site and take their ToS and change their information to your information. ToS should be customized to meet your needs. It’s not a waste of time – it’s an investment of time.

You should speak with a business attorney to learn more about creating a Terms of Service (and potentially a Privacy Policy) that will fit your e-commerce store. LawTrades is a legal marketplace that makes it easy for startups to hire and work with vetted tech attorneys. Our site offers hassle-free price quotes, end-to-end project managements, and all projects are backed by a satisfaction guarantee.