Is a “Direct-to-Consumer” Business Model Permissible?

Hanafi Fiqh

Answered by Shaykh Abdul-Rahim Reasat

Question

I have an online “direct-to-consumer” business whereby I have created a product and work with contract manufacturers for its production. I sell my product online and at times it will be made the following day/two days after the purchase, by the manufacturer. I will then receive it and package it ready for delivery.

All product details are made clear on the website and the customer is informed of a time period whereby they should expect it to be delivered (i.e. 3-5 days).

Is this permitted?

Answer

I pray you are well.

In the current form, the business is not permissible, but it can be made permissible with a slight adjustment to the process. As you are not producing the product yourself, your sale comes under the category of selling what is not in your possession. This is impermissible. [Usmani, Fiqh al Buyu‘]

You should have a certain quantity of the product produced – the amount would depend on the demand. When someone purchases your product online, ship one of the items that are in your possession to him, and have another made to replace it. This way there will not be any impermissible elements in your transactions.

It would be a good idea to study the rulings of trade, and istisna‘ (manufacturing) in particular. That way you’ll be able to ensure that your dealings are all permissible.

May Allah grant you the best of both worlds.
[Shaykh] Abdul-Rahim
Checked and Approved by Shaykh Faraz Rabbani

Shaykh Abdul-Rahim Reasat began his studies in Arabic Grammar and Morphology in 2005. After graduating with a degree in English and History he moved to Damascus in 2007 where, for 18 months, he studied with many erudite scholars. In late 2008 he moved to Amman, Jordan, where he continued his studies for the next six years in Sacred Law (fiqh), legal theory (Usul al-fiqh), theology, hadith methodology, hadith commentary, and Logic. He was also given licenses of mastery in the science of Quranic recital and he was able to study an extensive curriculum of Quranic sciences, tafsir, Arabic grammar, and Arabic eloquence.