In general, the costs for producers will be higher the shorter the period that compliance is required.
A long transitional period will minimise costs. We understand that industries change product lines as part of the normal course of business. So using a phasing-out approach rather than a hard cut-over will reduce your costs.
Because the needs of your business are unique, we welcome you to contact us so that we can understand how your business works. This will enable us to provide you with an accurate assessment of what your costs are likely to be, and why they exist.
The extent of compliance costs depends heavily on the range of regulation requirements. Previous studies on the benefit and costs of NIPs and percentage labelling – see AGG (2001) – focussed on the size of these costs and how they may change.
The costs of compliance for industry are made up of two parts;
• Transitional or Implementation Costs – that require changes in investment in new machinery or process, training, product testing, and redesign packages; and
• Ongoing Costs – which depend on the level of compliance required and whether your products are destined for domestic market or overseas markets i.e. exporting.
There appears to be no one universal systemic approach to estimating the extent of compliance costs. A common approach that we use is to estimate the number of product lines or stock-keeping units (SKUs) that will be affected by changes in regulation.
