You’re allowed to sell whatever products you buy without legal troubles as long as you purchased them legally from a reseller. But is this the case with branded products?
You might be asking; Can I sell branded products on my Shopify store? Luckily, this is what I’m about to answer!
Brand name products are only sold through their website, stores, and authorized dealers. Their products are not available in wholesale. The best way to source these products is through liquidators. Liquidator is a supplier type that sells products at clearance/liquidation sales.
This article will explain to you exactly why should steer clear from selling branded products on your website, and give you all the information you, as a beginner, might need, to hopefully succeed in the dropshipping game!
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So, Can You Sell Branded Items On Your Shopify Store?
Selling branded products without being registered as a reseller not only violates the Shopify terms of service but can also land you in some trouble with the owner of the brand.
In addition to that, 3rd party payment gateways might restrict your account or delay your approval unless you remove branded products, and 2Checkout.com is just one great example of those companies.
There’s something called the right of the first sale. This means that you’re legally allowed to sell anything you’ve legally purchased from a verified reseller.
It’s like going to a local shoe store, buying a shoe, and reselling it on your own because you actually own it! However, many companies try to control the distribution and pricing of their products.
They actually own their market share by controlling the distribution of their products.
So, this is not the case when selling branded products on Shopify, or on any other website or eCommerce platform online.
Let me share with you what happened to me personally when I tried to sell a branded product with a trademark symbol!
Case Study Of Me Mistakenly Selling Branded Products
Back in 2015, I guess, I decided to dip my toe in the apparel industry and sell cool unisex t-shirts.
One of the products that I’ve imported from Aliexpress through the Oberlo extension had the same design as this t-shirt.
And since that I’m outside of the USA and Europe, Shopify payments were not available to me, so I ended up using a 3rd party payment gateway called 2Checkout.
What happened is that 2Checkout sent me an email, notified me that I’m not allowed to sell branded names or trademarks on my own, and refused to approve my account unless I remove that item from my store.
They were clear from the beginning that I’m not allowed to sell branded products as long as I use 2Checkout, but I didn’t think that I’m breaking the rules… I mean, it was just a cool T-shirt for me!
Since it contains that “Nike” symbol, it had become against their terms & services and they counted it as a branded product. So, I took it down!
Note – Unfortunately, PayPal and Shopify payments (which are powered by Stripe) are not available for all countries… If you want to learn how to set up PayPal in unsupported countries, check out this article here!
So, if you’re considering selling online and looking for a secured way to capture payments from your customers all over the world, 2Checkout could just be the ultimate solution for you! (Sign Up for a free 2Checkout account!)
Can I Sell Nike, Adidas, & Puma Products On My Website?
Normally for branded items, you need to request approval or permit from the manufacturer themselves to sell items under their brand.
High-end brands such as Nike, Puma, or Adidas protect themselves against dilution so finding a supplier with their latest shoe model can only be acquired through the manufacturer themselves, or through their authorized distributors.
Do You Need Permission To Sell Branded Products Online?
Yes indeed! In fact, it’s best to stay away from selling branded products if you don’t have the needed permissions.
Big brands usually control their product’s distribution by limiting the resellers in the market. So, a great way to outsource branded products and sell them on your online store is through liquidators!
A Liquidator is a supplier type that sells products at clearance/liquidation sales. Liquidation sales occur when a store wishes to get rid of stock and liquidize assets for a move, or when a company has gone bankrupt.
For license, members will have to reach out to these suppliers to legally re-sell items.
If you use one of the previously mentioned supplier marketplaces, rest assured that all suppliers are verified, reliable, and trustworthy. They’re also higher quality products and companies which will really help you out!
However, I won’t suggest trying to work with branded products. Here’s why…
If the original owner of the products comes across your Shopify store, they could simply reach out to Shopify’s legal team on the basis of intellectual property infringement.
If this was the case it would be required you to remove your products from the site, and you may even be removed from being able to use the Shopify payment provider.
In addition to that, there is some trouble that you can get into when selling branded products. Some are:
- Warranty issues
- Trademark issues
- Payment gateways issues
- Sales tax issues
- Advertising issues
Well, Can You Legally Sell Branded Products From Liquidators?
You can legally re-sell branded items from liquidators. Liquidators are supplier types that sell their items at clearance/liquidation sales for reasons such as the end of the season, overstocks, or shelf pulls.
Just make sure you let the liquidator know that you intend to resell their items online, so they can provide you with certain permits such as a certificate of authorization and certificate of authenticity, to sell their branded goods (this protects you when you sell them online later on).
If Shopify requests it, you can show them the permits provided to you by the supplier.
If unsure, you can contact Shopify directly before selling branded products so you’ll know the requirements needed from them.
Where To Find Verified Liquidators?
You can use the SaleHoo Directory, which is a supplier marketplace that connects brands and companies (including big ones) with resellers and dropshippers.
Members can filter their supplier search by “supplier type” such as wholesalers, manufacturers, and liquidators.
While you’re allowed to almost sell anything online, selling branded products on Shopify (or other eCommerce platforms) without permission might hurt your business, especially if you’re deciding to go serious with it.
This quick guide helps you understand why you should stay away from reselling branded items on your website as a beginner, and what issues you could get into.
I hope that you liked this post and that it has added something to your knowledge, hopefully!
Did you know that people nowadays are taking advantage of a new business model called drop servicing? A business model whereby you sell digital services instead of physical goods.
I’ve recently published an article on why is it better than dropshipping, you can check it here. But in short, drop servicing is better than dropshipping for the following reasons:
- No shipping involved as you’d be selling digital services.
- Higher profits for a lower volume of orders.
- Higher average order value.
- Monthly recurring revenue – (Higher customer lifetime value)
- Lower acquisition cost in the long run.
If you want to learn all the secrets of this new baby-born business model, check out the eComDimes Drop Servicing Secrets to claim your 50% discount.
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Frequently Asked Questions
Shopify is a cloud-hosted eCommerce company that has everything you might need to start selling online. It’s not only used for selling products but for digital services as well. Nowadays, people are taking advantage of a new business model called drop servicing.
Drop servicing is a business model whereby you sell other people’s services online without the need to provide them by yourself. It’s like having an agency but instead of having employees and paying monthly salaries, you hire 3rd party freelancers to do the work on your behalf.
Drop servicing is better because it has higher flexibility, profitability, and customer lifetime value! There’s also room for monthly recurring revenue as some services require a long commitment. In addition to that, it’s relatively less risky than dropshipping.
eComDimes Drop Servicing Secrets is the only blueprint you’ll need to start a viable and profitable drop servicing business online! It’s a course library of 8 courses that break down the business model into actionable steps easy to understand and implement.