Majority entrepreneurs there is resistance to “move” such a thing commodity. They are afraid that the customer will suddenly show up after six months and demand that they hand over the items. As a result, warehouses turn into cemeteries of unclaimed parcels. As a legal advisor, I have good news for you. The Civil Code does not force you to be the perpetual guardian of someone else’s property.
Story 1: Designer “ghost” sofa
A company from the furniture industry produced a corner sofa in a bright lime color at the customer’s special request. The client paid a small deposit and then disappeared. The sofa occupied half the showroom for three months. The owner was afraid to sell it because “it’s the customer’s property.”
Business applied the procedure under Art. 551 § 2 of the Civil Code. She gave the buyer an additional deadline, and after that deadline, the sofa was sold to another customer. From the amount obtained, the company covered the missing part of the price and storage costs. The rest was secured for the “missing” client.
Story 2: 1000 personalized gadgets
E-commerce store prepared 1,000 engraved power banks for the company, which in the meantime ran into financial problems and stopped receiving correspondence. The goods were useless (with another company’s logo it is difficult to sell on the market).
Here the law allows saleif the item is at risk of deterioration or its storage involves excessive costs. Although a power bank does not rot like apples, the technology loses value, and the cost of renting warehouse space quickly exceeded the margin. Sale on the debtor’s account (even as components) allowed recovery of at least part of the invested capital.
Sale on the debtor’s account and storage at the buyer’s expense
If the buyer delays collecting the goods, as a seller you have two main options (beyond simply suing him for payment):
- Putting items into storage at the buyer’s expense and risk. You can export the goods to an external warehouse and send the invoice for this warehouse to the customer.
- Sale of items on the buyer’s account This is a “pro-business” option. You can sell the goods to someone else, but you must exercise due diligence (you cannot sell them for cheap). To use this option, you should set an additional deadline for the buyer to collect the goods (preferably in writing/e-mail) and clearly warn him that if he does not collect the goods by a given day, you will sell them on his account. After the deadline, you can sell the item and settle the accounts with the customer. From the money obtained from the sale, you take what you were entitled to (price + storage costs + advertising costs), and you must return any surplus to the customer (or deposit it in a court deposit).
Why do you need a lawyer to “clean” your warehouse?
While the procedure sounds simple, the devil is in the details (and the evidence). Client can later claim that you sold it commodity too cheap or that he didn’t get a warning.
How a legal advisor can help e-commerce company? First of all, in creating store regulations that contain precise provisions on storage costs (this allows you to charge specific amounts for each day of delay). A legal advisor can support the company in the process of substitute sales, ensuring that each summons and notification is evidence-based. Selling to the customer’s account is a chance to recover frozen cash and release warehouse congestion.
