The FTC Shipping Rule Every Online Store Is Already Bound By

A small online brand runs a successful launch, sells far more than it expected, and quietly pushes back the ship date while customers wait. That situation is more regulated than many founders realize.

The Federal Trade Commission's Mail, Internet, or Telephone Order Merchandise Rule applies to sellers of physical goods ordered remotely, whether by website, app, phone or mail. It has been on the books for decades and covers businesses of every size. The FTC publishes a plain-English business guide to it, linked below, and it is worth reading in full.

The core promise: a reasonable basis

When you tell customers when an order will ship, you must have a reasonable basis for that statement at the time you make it. In the FTC's framing, that means having the information a prudent businessperson would rely on, such as current inventory, supplier commitments and realistic processing times.

If you do not state a shipping time at all, the rule supplies one. You are generally expected to ship within 30 days of receiving a properly completed order. When the order is paid with credit you extend to the customer and an application is involved, the period is longer.

This is why a vague promise of fast shipping on a product page can still create obligations. If the claim is specific, it has to be backed by something real.

Dropshipping and third-party fulfillment do not move the obligation. If a supplier or fulfillment partner ships on your behalf, the shipping promise on your store is still yours. Ask partners for reliable lead-time data, build a margin of safety into what you display, and review the promise whenever a partner's performance slips.

When you cannot ship on time

If you learn that you cannot meet the promised date, the rule requires you to notify the customer before that date and offer them a choice. They can agree to the delay or cancel and receive a prompt refund.

The details depend on how long the new delay is. For a first delay with a definite new date that is not too long, customer silence can be treated as agreement. For longer delays, or if you cannot give a new date at all, the customer must actively agree, and if they do not, the order is cancelled and refunded. Further delays require fresh notices.

The FTC guide sets out the exact conditions for each scenario. Build your delay process from that guide, not from memory.

Refunds, and what the rule does not cover

When an order is cancelled under the rule, the refund has to be made promptly. The guide sets out specific timeframes that depend on the payment method. Credit card refunds are credited to the account, and refunds for payments made by other means are due within a set number of working days.

Store credit or a gift card is not a substitute for a required refund unless the customer chooses it.

The rule applies to merchandise, not services. It has exclusions for certain categories and transaction types, which the FTC guide lists. If your business sells something unusual, read the exclusions carefully or ask counsel.

Building it into operations

Compliance here is mostly an operations problem. Your product pages, order confirmation emails, customer service scripts and inventory system all need to tell the same story about when goods will ship.

Keep records that show the basis for your shipping promises, including inventory levels and supplier confirmations. Prepare delay notice templates in advance for each scenario the rule describes, so customer service is not drafting legal notices during a rush. Make sure your refund process can meet the deadlines without manual escalation.

Peak periods deserve their own plan. Holiday sales, product launches and promotions are when stock runs out and carriers slow down. Before each one, decide at what inventory level the store will switch to longer shipping estimates or pause sales of an item, so the decision is made before a promise is broken rather than after.

What to do this week

Read the FTC business guide. Audit every place your store states a shipping time, including ads and marketplace listings. Set up an alert when inventory or supplier lead times threaten a promised date. Draft and approve delay and cancellation templates. Then test the refund flow end to end and time it.

Preorders, crowdfunded products and limited drops deserve extra care because they are where shipping promises are most likely to slip. If you sell any of those, have a lawyer review your process before the next launch.

This is general information, not legal advice. Speak to a qualified attorney in your jurisdiction before acting on any of it.

Sources

Federal Trade Commission — Business guide to the Mail, Internet, or Telephone Order Merchandise Rule