Two dropshipping websites under scrutiny by Sweden’s Consumer Agency for misleading practices

Two out of the three most reported dropshipping websites to Sweden’s Consumer Agency this year, which remain active, have been founded by young Swedes in their twenties. These websites engage in dropshipping practices, often changing their business address and ownership, complicating efforts for consumers to reach responsible parties.

Consumers have been facing significant issues with certain dropshipping companies, where it is common for websites to shut down and reappear under different ownership. The appearance of these websites is frequently altered compared to other markets, according to Johan Ohlsson, head of the Consumer Agency.

Dropshipping operates without the e-commerce store holding its own inventory or manufacturing. Instead, products are dispatched directly to customers from suppliers outside of Europe, often from China.

One website, Merley Stockholm, has received 130 complaints this year regarding delayed deliveries, undelivered items, and goods that do not match their descriptions. The Consumer Agency criticized Merley for misleading marketing practices this spring, particularly concerning information about the source of goods, warranty claims, and contact details.

Regarding violations of Swedish consumer law, misleading customers through marketing can pose a risk of breaking marketing laws. The Consumer Agency has investigated the site twice but closed the cases after the owners pledged to make corrections.

If non-compliance continues, the Agency plans to consider further actions to compel cessation of operations, which may include legal proceedings or banning specific marketing practices. The dropshipping business model has gained popularity recently, especially with numerous online courses on platforms like YouTube teaching how to quickly generate income through this method. While dropshipping isn’t illegal, many unscrupulous operators utilize it.