Ever since retailers like Amazon showed up on the scene it seems like brick-and-mortar stores have been fighting off blow after blow as online retailers took over seemingly every industry. But on June 21, 2018, the brick and mortars landed an unexpected blow to their online retailer opponents.
In the final week of its current term, the Supreme Court, in South Dakota v. Wayfair, Inc., ruled states could tax online retailers even if they aren’t physically based in the state. While the ruling is far from a devastating knockout, it does put bring brick-and-mortars on an even playing field in one area of their business.
Beyond the initial win-loss for major companies, there are of course ramifications that reach the outside world as well. The first and most obvious is the likely increase in costs to consumers purchasing from online retailers. However, there is also the question of how this will impact smaller businesses.
For the mom and pop brick-and-mortars, this ruling could be welcome news; however, for those looking to start small businesses with less capital it may make things more difficult. In 2018, the barrier to entry on creating a website to sell goods is fairly minimal but for those start-ups looking to reach outside their home state, the barrier to entry was just raised.
While this ruling is unlikely to have a grand impact on small businesses looking to get off the ground, it does give entrepreneurs another issue to consider and another cost to factor in, as they look to begin or expand an online business. This ruling is another reminder that the laws an entrepreneur must be mindful of are ever changing and having an experienced business lawyer in your corner will help you keep track and stay on top of them.