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What is a retail license?

Updated March 23, 2017

A disagreeable task of starting a new business is getting all the required licenses or permits. The effort is worth the paperwork, however, since some states charge a sizeable fine or may even file criminal charges against businesses that operate without the proper licensing.

Retail Licenses

All businesses selling retail products are required to obtain a retail license or resale certificate, whether the business is operated from a store or out of a home. Some local governments may require certain home-based businesses to obtain a home occupation permit as well.

Significance

Your license allows you to legally conduct your business and stipulates how the business must be run to comply with state and local laws. It also provides a resale number for tax purposes.

Considerations

The cost of obtaining a retail license varies from state to state, but typically, the process involves a one-time fee, and the license is valid for as long as you are actively engaged in business.

Where to Start

Your local Chamber of Commerce is a good source of information on where you need to go to apply for various types of business licenses.

Warning

Check with your city or county government offices to see if you need a separate business license in addition to your retail license.

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About the Author

Based in California, Debbie Donner is a freelance online writer who primarily writes articles related to personal finance. Donner received a Mensa scholarship in 2006 while attending California State University, Fresno. She holds a Bachelor of Arts degree in liberal arts and a multiple-subject teaching credential.