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Sunday, July 17, 2011

Doing Business On the Internet is a Sign of the Times - Be Sure You Know Who You Are Doing Business With | CEO SPACE

We are all used to clicking the "I agree" button and frequently we click without reading the lengthy terms and conditions. While many are long, these virtual agreements bring with them rights, responsibilities and restrictions. By clicking "I Agree", you have created a contract. In the on-line order process, frequently you will click on an agreement button, again creating a contract. While we easily create contracts on the Internet, there may be uncertainty about the most basic term of a contract - the identity of the party that you've entered into a contract with.

Before you hire a service provider or order goods on-line, know who you are doing business with. This is a simple concept. Due to the ease of on-line purchasing, people are frequently entering into contracts without knowing the person or business on the other side of the computer screen.

The Internet has long been known as "the great equalizer." A technologically savvy web developer can design a website for a small company that rivals that of a large corporation. A professional and robust website may signal stability and a great company to do business with, but it could just as easily be a cash-strapped start-up organization. Investigate the company beyond just visiting and viewing their website.

If ordering goods:

  • Check seller ratings if available.
  • Order using a credit card, as the credit card company may assist you in attempts to get your money back that you spent on an order.
  • We do NOT recommend using a debit card for any on-line purchases.
  • Consider using a single credit card with a very low limit for all on-line purchases.
  • Check consumer sites such as to see what other's experience has been with this seller.
If you are considering entering into a contract for services or ordering goods that have substantial value, engaging in basic due diligence is not time consuming and it is a better alternative than trying to find someone after they owe you money or you have received a defective product. For example, you are looking to hire a web designer to create a website for your company. Steps that you would likely take to find a developer are:
  • Seek out a web developer on the internet
  • Ask for referrals from other business owners
  • Interview someone that you met at a networking event
  • Traditional media advertising
It is likely that the developers will come to your office to make their presentation or they might even perform their services on-line through a webinar or web meeting. Chances are good that you will never visit their office. If your new website is unacceptable, or the website was not completed after you made a payment or paid a deposit, do you have the information to get your money back or to file a lawsuit if necessary? Before you decide to do business with an individual or company, consider the following:
  • Make sure you have verified the physical address of the person or company. A physical address is usually necessary to serve the person with a lawsuit. Even if the address does not look like a post office box, check it out on the Internet using one of the map tools such as Google Maps or Mapquest. One of our clients found out that the address for the service provider was actually a UPS Store. Not surprisingly, the address was no longer accepting mail because the service provider had not paid their bill to the UPS Store! We knew it was a UPS Store because we looked at it on Google Maps satellite and saw a shopping center rather than the home office. There are many other ways to use the Internet to confirm an address, including directory listings and property tax records. If you only have a post office box for an address, you will want to perform some additional due diligence.
  • For businesses, check with your Secretary of State. It will also list the statutory address for the corporation and their address.
  • Some businesses are licensed by the State such as a contractor, electrician, plumber, or handyman. Check for state licensing information to be sure the business has the appropriate license. You can also see if any complaints have been filed against the business.
  • While very brick and mortar, you could always take a drive to see the physical business and make a site visit.
Spending a little time before you click the "I Agree" button or enter into a contract with a previously unknown service provider can protect you and your company.

This article is not intended to provide legal advice. Always consult an attorney for legal advice for your particular situation.


Founded by Berny Dohrmann over 20 years ago, CEO Space is a private entrepreneurial business club with an environment that we created for people to be able to get quick results with their business through networking, education, and resources. Berny Dohrmann recently won the 2011 Inpex Ambassador Award for tireless contribution to inventors worldwide. For a one-time tuition payment Entrepreneurs receive a Lifetime membership and one free class, as well as a lifetime of mentoring, contacts; resources, and most of all a lifetime of support for you and your business as you grow. CEO Space is certified for Continuing Education credits. You can learn about Contracts, Government Contracts, I.T., Business Planning, Licensing, Marketing, Transformational Leadership and other topics at CEO Space.

ABOUT: Maria Crimi Speth is an IP attorney and is a shareholder in the Phoenix business law firm of Jaburg Wilk. She heads the intellectual property law department and assists client with trademark, IP law and Internet issues. Maria is a frequent speaker on intellectual property law and is the author of the book, Protect Your Writings, a Legal Guide for Authors. This article was co-written by Sharon Sprague whose primary practice area is commercial litigation, in addition to her work in intellectual property, collection, and corporate matters.

For more information on CEO Space please visit or call CEO Space at 256.850.4700.

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