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  • In July 2018, new food labelling laws will kick into effect. (Supplied)
'Made in Australia' can be an important point of differentiation for a business, but the rules on who can make the claim are getting stricter.
By
Source:
SBS Small Business Secrets
13 Aug - 5:35 PM 

At the Hank's Jam factory in Sydney, thousands of jars of jams, chutneys and soups are produced each year -  and they all feature a label that reads 'made in Australia.'

"99 per cent of the product we use is Australian product," says Bernie Rorke, managing director at Hank's Jam. "Sometimes you have to go outside that on certain [items] - more berries in that respect, seasonal wise and just price wise as well."

That percentage breakdown is set to become more important though, under new rules in the Australian Consumer Law.

By July 2018, labels on most food products made in Australia will have to clearly show the percentage of Australian grown or produced ingredients.

Food businesses will have four labels to chose from, ranging from a simple 'made in Australia' logo,  to a more detailed graphic.

ACCC deputy chair Dr Michael Schaper says businesses need to think about where they fit in.

"Firstly, work out what you can and can't say, decide also from a marketing point of view what kind of claims you do want to be making."

But the cost of compliance isn't cheap - Bernie estimates it will cost his business at least $10,000 dollars to design and print new labels.

"It just adds another layer of complication," he says. "You've also got to be able to be freed up to buy your produce from where you can, to keep your product at the right price point. But obviously, it encourages us to buy as much Australian [as possible], because we don't want to change our labels on regular basis."

But how much do consumers actually care about where their food, or even other products are made?

"I don't think care necessary is the right word, I think they're interested," says Alex Riggs, founder of children's clothing company, Oobi.

Her clothes were manufactured in Australia for the business' first five years in operation. She now manufactures out of  India.

"In terms of where a garment is made, I think people care about things like how ethical is the company, how sustainable is the company - that information you can never really just fit on a label, so your brand has to be able to express that information."

And even if customers do care, whether they're willing to pay for 'made in Australia' is the bigger question.

"Our dresses currently range between $29.95 to $59.95. I think you could say it would easily double if made in Australia. I don't think an embroidered dress at $120 would be accessible to most people."

And for businesses tempted to lie about where their products are made, the ACCC has this warning about the complaints it receives.

"Interestingly enough, we don't just get [complaints] from consumers, you'll also find that they come from competitors, and intriguingly we sometimes also get information from employees coming back, saying I don't think my business that I work in is telling the full truth."

So businesses beware - 'liar' is a label no one wants.

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