Distance selling - What is distance selling?
Distance selling refers to the sale of goods or services without the buyer or seller being physically present simultaneously.
Traditionally, the term ‘distance selling’ has been used in discussing sales made via mail order, through phone or SMS, or even from a digital TV ad, for example. These types of sales don’t require the presence of both the buyer and the seller.
It commonly applies to contracts that involve a regular transaction, such as set grocery deliveries, catering arrangements, accommodation, etc. Today, many also apply this term to online sales, including those made via email.
While distance selling might seem relatively straightforward, for businesses in many locations, there are some rules that need to be kept in mind. In the UK, the gov.uk site on distance selling outlines the rules for distance selling. This includes providing:
Adequate information about your product/service to the customer (pre-purchase information)
The business name and contact details of your company
A description of the products/services you are providing
The price of the products/services
Whether a substitute will be provided if a specific product/service is unavailable
Information about how payment can be made by the customer (payment terms)
Details about shipping arrangements including cost and time
A clear indication of the contract length and billing period
The main aspect of distance selling is the right for the customer to cancel. Customers have the right to cancel an order within 14 days of it being delivered. No reason is required for cancellation.
Therefore, as a distance seller there’s some additional information that must be provided to your customer from the beginning:
Outline of conditions for cancelling a contract
How a customer can cancel and if/how they would not be able to do so
If any costs will still be required after cancellation and why
A cancellation form
Details about any deposit made as a guarantee
The 14-day cancellation timeframe is known as the ‘cooling-off period’. This means that even after agreeing to a contract, a customer can withdraw without any consequences. If you don’t inform a customer of this option, they then have 12 months to cancel. If they’re informed later on, it’s 14 days from that date.
These requirements generally apply to all distance selling, however, it’s always important to double-check whether there are requirements specific to your industry or business, for example, there are differences when it comes to selling online.
Although many consider online sales a type of distance selling, there are certain additional rules that apply to selling online. This means that the above rules for distance selling apply, as well as a set of other rules pertaining to before and after an online order is placed, as well as when it comes to providing digital services.
If your business sells online, you must also include:
Your company email address
A clear step-by-step of the order process
An option to pay when the order is made (for example, a ‘Pay now’ button)
An easy way for customers to make corrections to an order
Access to your Terms & Conditions
Distance selling goes beyond conditions for the experience that a customer should have before placing an order. They also extend to what happens after the order is made.
Once an order has been placed there are still rules, however, fewer than before the sale is made. The three main requirements are that:
The contract established with the customer is provided to them in a format that the customer can save (email, PDF, paper copy, etc.)
The contract must be delivered on or before the date that the products/services are delivered
Any products must be delivered within 30 days unless otherwise agreed with the customer
As with most things in life, there are exceptions to the rules. In this case, there’s a long list of exceptions. Most notably:
If the total value of the sale is £42 or less
If the sale pertains to financial services
A regular sale of food and/or beverages (milkmen, for example)
Bus, train, or plane tickets
Sales made from a paid internet connection such as an internet cafe
New building construction (excluding renovations or add-ons)
Contracts made for rental properties in which the customer will live
Timeshares, holiday packages, etc.
Vending machine purchases
Again, it’s always important to check whether the rules apply to your particular business.
Should you offer distance selling, these rules must be adhered to - failure to do so can result in a range of different penalties ranging from being required to provide the products/services as promised, to pay compensation, or even face jail time.