If you are in the business of providing goods to customers, it is important that you have a plan for delivering goods in a timely manner. In fact, the Federal Trade Commission (FTC) mandates strict deadlines for delivery times for products in The Mail, Internet or Telephone Order Merchandise Rule, also known as the 30-Day Rule.
What is the 30-Day Rule?
According to the FTC’s 30-Day Rule, when you advertise a product, you have two choices regarding shipping time. The first is to explicitly state the expected shipping time. While unplanned events may delay shipping, the advertised shipping time must be one that you have a reasonable basis for believing you can fulfill. If you have advertised a shipping time but must modify this at the time of the sale, you must be clear about the new shipping time before the customer places the order.
If no shipping time is advertised, the product must ship within 30 days. Either way, your advertising must be unambiguous about how soon the order will ship. If the product will take more than 30 days to ship, your advertising must reflect this.
The clock starts ticking the moment you have received full or partial payment and a completed order from a customer. If a check is returned or the credit is refused, shipping deadlines do not apply until the customer has submitted another form of payment.
Delayed Shipping
Once you have taken a customer’s order, if it becomes apparent you will be unable to satisfy the advertised shipping time (or the 30-day deadline if no shipping time was agreed upon), you must notify the customer and seek her or his consent to continue with the shipment. At this time you must provide a new shipment date that you have a reasonable basis for, or you must state you do not know when you will be able to satisfy the order.
The customer must be given a reasonable amount of time to consider the delay and whether he or she wishes to proceed with the sale. If you are unable to contact the customer or obtain consent, you must refund all money that has been paid for the unshipped merchandise. This refund must be made in full and cannot be given as store credit.
Drop Shipping and the 30-Day Rule
Some small businesses and companies without brick-and-mortar premises may choose to use a drop shipping service. It is the responsibility of the retail businesses, not the shipping agent, to ensure the merchandise is shipped in the time advertised or within the 30-day period. Choosing a reliable shipping agent can protect retailers from the backlash of a late shipment.
Credit Applications
If customers apply for an in-house credit account or increase their existing credit line to pay for their order, the shipping time may be delayed in order to give the retailer the time to review this credit application.
If you have not advertised a specific shipping time, then the 30-day rule applies to the order. However, you are allowed an additional 20 days to process the credit application. Under this provision, you must ship the merchandise within 50 days of receiving the order.
If you have advertised another shipping time, you are not allowed an additional 20 days to process the credit report. Presumably you have factored in the time needed to process the application either before the order was taken or at the time of the order.
The FTC’s 30-Day rule is not one to be taken lightly. Businesses that fail to comply can be sued for injunctive relief and may be required to pay fines of up to $16,000 per violation. State and local agencies can also sue for violation of consumer protection laws. Whether you advertise a shipping time or fall back on the 30-day default, be sure you have reasonable belief that you can meet that deadline before you take an order.
Legal Disclaimer
The content on our website is only meant to provide general information and is not legal advice. We make our best efforts to make sure the information is accurate, but we cannot guarantee it. Do not rely on the content as legal advice. For assistance with legal problems or for a legal inquiry please contact you attorney.