Answer to Question 1
In addition to federal laws, many states and municipalities have passed legislation regulating retail activities. Some of them are mentioned below.
Zoning laws prohibit retailers from operating in certain locations and require building and sign specifications to be met.
Safety practices have become a new rallying point for state and local governing bodies. Today, there are laws banning the sale of cigarettes by pharmacies, the shipping of wine directly to a consumer's home by a winery, the use of plastic shopping bags, fast-food places from using certain ingredients, and so on.
With regard to unfair trade practices, most states have established their own set of laws that prevent one retailer from gaining an unfair advantage over another retailer. They prohibit the retailer from seeking unfair advantages from vendors or selling merchandise below cost with the intent of using profits from another geographic area or from cash reserves to destroy or hurt competition. A number of states have also introduced laws preventing both zero-down car leases and zero-percent financing programs because they claim such programs mislead consumers.
The franchise laws in many states assume that, unless otherwise spelled out in the franchise agreement, there is an implied agreement not to locate another outlet near a current location without the current franchisee's permission.
Many localities have strong building codes that regulate construction materials, fire safety, architectural style, height and size of building, number of entrances, and even elevator usage.
Some states enforce blue laws that restrict the sale of certain products such as automobiles on Sundays. Various cities have passed laws governing retailing, such as Green River Ordinances, that restrict door-to-door selling.
Students could refer to Exhibit 6.1 for federal laws affecting retailers.
Answer to Question 2
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