The column below reflects the views of the author, and these opinions are neither endorsed nor supported by WisOpinion.com.
I’ve been running my online business out of Wisconsin for a long time now. This past year, especially around the busy holidays, was a huge success for me thanks to my ability to operate quickly and efficiently for my customers. I’ve built my virtual business from the ground up and I take great pride in what I’ve done. But I’m worried that Congress could pass a bill like Senator Tammy Baldwin’s Country of Origin Labeling (COOL) Online Act and turn my business model on its head.
Reintroduced this year in the 118th Congress by Senators Baldwin (D-WI) and J.D. Vance (R-OH), the COOL Online Act is supposed to better educate consumers about where the products they purchase online are coming from. While I understand the idea, there are a host of problems with the bill that could hurt the economic progress made in Wisconsin and the nation since the pandemic with untenable regulations.
Just like brick-and-mortar retailers, I’m already legally required to disclose information about where my products come from on the packaging. However, the COOL Online Act would force me and other small online sellers to include additional advertisements about where components of every product are sourced from in the online listing. It may not sound like much, but it’s an additional layer of red tape for me to deal with in my already busy schedule. Online businesses import materials from all over the world, and some materials are purchased second-hand. Are we really going to hold sellers responsible for the history and lifecycle of materials that could even be older than the seller?
Bookkeeping and logistics are already difficult for small businesses like mine. We simply don’t have the extra time, money, or manpower to deal with the amount of additional paperwork COOL Online requires. Let’s say for argument’s sake that I did have the resources and ability to comply with the COOL Online Act’s proposed new standards; I would still have to raise prices to compensate for the additional overhead. We all know that raising my product prices will put me at an even further competitive disadvantage by driving customers away from my small business to larger retailers that can afford to absorb extra overhead costs.
Even though the COOL Online Act attempts a carve-out for some online sellers, the “small seller exclusion” that covers sellers who bring in less than $20,000 annually will only apply to a narrow group of small businesses, given that many online sellers use their businesses as their primary source of revenue. It changes nothing as far as the strain the COOL Act would put on Wisconsin and America’s virtual businesses.
The COOL Online Act is a bill with far too many drawbacks that obviously weren’t taken into consideration during the drafting process. Making small online businesses more as the economy continues to grow is the last thing this state needs. Wisconsin’s small businesses have enough to deal with as it is. As our representative, Senator Baldwin should support policies that help sellers like me succeed and forget about bills like the COOL Online Act.
– Mike Jadin is owner of Gratata Controllers in Milwaukee.