Bicycle shops in the United Kingdom are subject to a range of legal requirements. These include the need to obtain a license from the local authority, as well as complying with health and safety regulations. In addition, bicycle shops must also ensure that their products are fit for purpose and that they provide adequate customer service.
Failure to comply with these requirements can result in significant fines and even the closure of the business due to legal issues. As such, it is essential for bicycle shop owners to be aware of the legal obligations that they need to meet. By doing so, they can avoid any problems and ensure that their business runs smoothly.
Bicycle retailers are likely to be affected by some of the following key pieces of legislation.
What licences does a bicycle shop need?
Some of your other bicycle shop business activities may require a licence, even if you don’t need one to sell bicycles and related accessories.
Cycle safety regulations
New bicycles sold in the UK are subject to consumer protection legislation and special safety legislation. Newbicycles must meet safety standards set out in the Pedal Bicycles (Safety) Regulations. In addition to bicycles and helmets for children, there are also standards for bicycles. Products must comply with the standards before they can be sold. The Cycling UK website provides information on your responsibilities under the regulations.
Knowing which electric bikes can be legally ridden on the road is also important if you’re planning on selling electric bikes. On the Pedelecs website, you can find a useful summary.
Licensing of second-hand dealers
Obtaining a license or registration to operate as a second-hand dealer is required by local authorities in Scotland. Second-hand goods are not included unless they are incidental to the main business activity. Local authorities in other parts of the UK may license or register businesses (with some exceptions) where second-hand dealing is a significant part of the business rather than just incidental.
The exemption usually applies to businesses that have consumer credit authorisations. Your local authority trading standards department can provide guidance if you are uncertain whether second-hand dealer licensing applies to your business.
Selling general insurance
You may need to either be directly regulated by the FCA or become an appointed representative of an FCA authorised principal insurer if you sell, advise on, arrange, or assist in selling general insurance, such as bike theft/damage insurance or third-party liability insurance. Even if insurance is a small part of your business, you may need to become an appointed representative of the FCA authorised principal insurer. You can find more information on the FCA’s website.
Selling in-store finance
To offer finance to your customers, you must be authorised by the Financial Conduct Authority (FCA). Information about the FCA can be found on its website.
Selling food products
You will need to register with your local authority environmental health department if you intend to sell food products, such as energy bars and sports drinks. You will not be charged for this service.
In order to start selling food within 28 days, you need to register with your local authority’s environmental health department as early as possible in your planning.
Retailing
Consumers’ interests are protected by a wide range of legislation that applies to retail outlets. Retail prices, for instance, must be clearly displayed. It is your responsibility to ensure that all goods and services meet their intended purpose and are of satisfactory quality. Distance selling rules also apply if you sell online.
On the Trading Standards Business Companion website, you can find detailed information about your legal obligations to consumers. On the Gov.uk website, businesses like retailers can find guidance regarding consumer protection regulations.
You will be subject to food safety legislation if you sell food products (for example, energy bars and drinks).
Playing background music
You may need a Music Licence from PPL PRS Ltd if you play background music in your shop. The PPL PRS website allows you to pay the annual fee online.
Carrier bag charge
The charge in England is 5 pence, but small to medium-sized businesses (with fewer than 250 full-time equivalent employees) are exempt from paying it. The gov.uk website provides detailed guidance.
If retailers supply a single-use carrier bag to customers in Wales or Scotland, they must charge them at least 5 pence. This applies to all types of single-use bag, whether they are made of plastic, paper or plant-based starch. There is detailed guidance on the Gov.Wales and Zero Waste Scotland websites.
In Northern Ireland retailers must charge customers a five pence levy on all bags with a retail price of less than 20 pence (including any bags that would otherwise be free of charge), whether they are single-use or reusable.
Health & Safety, fire
Health and safety regulations at work and fire safety laws must be followed.
Employment legislation
Employment laws must be followed by anyone who employs employees. Employment legislation covers a variety of areas, including recruitment, employment contracts, pay, working hours, holidays, policies on sickness, maternity leave, paternity leave, discrimination, discipline, grievances, dismissals, and redundancies.
Insurance for a bicycle shop
Insurers and insurance brokers can explain what insurance cover you must have by law, and other coverages you should consider, once you explain exactly how your business will operate. The following might be included:
- Premises, premises contents and stock
- Employers’ liability (if you employ staff) and public liability
- Motor insurance (for any business vehicles, for example a van)
A business support organisation called ActSmart offers discounts on bespoke cycle shop insurance to its members. In addition to cycle insurance, they offer referral commissions to members for referring customers (based on their ActSmart subscription level). ActSmart’s website has further information. The insurance sector for cyclists has seen sector trend growth in 2022.
Conclusion
Bicycle shops need to be aware of any legal issues they may come across from employing staff to selling a regulated financial products such as finance or insurance to a customer. Attention should also be drawn to the sale of second hand bikes with a full audit of the bikes history, incase of it being stolen, it should demonstrate a full due diligence process has taken place to prevent any future legal issues for the bicycle shop in the future.
Lee Jones is a seasoned Business Finance Specialist with over two decades of invaluable experience in the financial sector. With a keen eye for market trends and a passion for helping businesses thrive, Lee has become a trusted advisor to countless organizations seeking to navigate the complexities of finance.