fashion

The Internet Shopping Age

The changes in how we buy and sell goods and commodities has commerce one of the industries that have seen the most changes in the 21st century. The 20th century had been no slouch in this department, with the rise of shopping centres and out of town retail parks being the original death knell of the High Street, in the same way that supermarkets had killed off many local shops in the 1960s and 70s. But the changes in the 21st century have seen a rise in the amount of internet only businesses, from small etsy shops and eBay sellers, to the likes of ASOS, a large multi national company that only sells online with no physical stores of any kind. These companies can ship worldwide, with a reach far wider than the original market giants, and have less overheads, which can make their prices far more competitive. This has proved problematic for the likes of Woolworths, BHS, Mothercare, Toys R Us, Comet and Poundworld, who have all disappeared from the High Street.

Wayfair Sales Tax Nexus

Internet only businesses, and companies with an online presence, do have new considerations to be aware of, particularly if you are based in the US. In the past, sales tax regulations required a company to have a physical presence in a state in order to have to collect taxes on any sales – i.e. have shops, workers or offices based there. This was clearly balanced in favour of online companies, who may be solely based in one state, but can sell in many, indeed any, states.

The Wayfair sales tax case has changed this. The court deciding that ‘nexus’ – i.e. having a physical presence in a state, can be established by economic activity alone, basically if you are selling there in enough quantity, then you are a presence there and should be sales tax compliant.  (June 21, 2018, the U.S. Supreme Court determined in South Dakota v. Wayfair Inc et al) . There will still be companies who are able to claim wayfair sales tax exemption as they don’t reach enough sales or transactions in a particular state, but the Wayfair case has certainly been a massive change for internet companies.

Bucking the trend

There are some businesses though, that have bucked the trend by actually avoiding an online presence. Primark is a key example of a business that seems to go from strength to strength and yet does not have a website or any capability to buy online. Instead it has regularly changing lines at affordable prices that keep customers returning again and again.

JD Sports has in store technology, the latest lines in sportswear and have totally tapped into the trend for sports wear as coveted everyday wear worn by fashionable teens and adults alike and has lots of large stores that are as much a destination as a shop.

Other stores doing well include Lush, Disney Stores and Zara, and there has also been a rise in independent stores who offer something different than the big chains.

 

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