What are standards in business?
Standards specifies ways of doing business that help make your products and services safe, reliable and fit for purpose. This is important when making sure your products and services do as your customers expect.
Benefits of using standards
Some benefits of using standards can include:
- less legal risks by making sure your products and services are safe
- better access to international markets
- improved efficiency as you adopt best practice.
Mandatory standards are compulsory standards that all businesses must follow if they operate within a particular industry or sell certain products. Different mandatory standards apply for different products and industries. In Australia, the Australian Competition and Consumer Commission (ACCC) is responsible for most mandatory standards.
Examples of mandatory standards include:
- safety standards for baby dummies
- cosmetics ingredients labelling
- tobacco health warnings.
Check out the full list of mandatory safety standards on the ACCC's website to find out more.
A voluntary standard generally represents best practice and is not an automatic legal requirement. Non-government bodies such as Standards Australia make voluntary standards.
Examples of voluntary standards include:
- motorcycle helmet safety standard AS 1698-1988
- International Standard Book Number standard
- fishing line breaking load standard AS 4470-1997.
Visit the ACCC's What is the difference between Australian standards and mandatory standards page to learn more.
Voluntary standards and the law
While voluntary standards aren't automatic legal requirements, they can be compulsory under contract law or a mandatory standard.
Check out these examples:
- James is a software engineer. AS/NZS 1519:2006 is a voluntary standard for library book numbers. A library offers James some work to design an AS/NZS 1519:2006-compliant software system. James accepts the offer. Under contract law, James must follow AS/NZS 1519:2006.
- Jess designs children's nightwear. AS/NZS 1249:2003 is a voluntary safety standard for children's nightwear. A mandatory standard requires using parts of AS/NZS 1249:2003. Jess must follow the mandatory parts of AS/NZS 1249:2003. It's optional for her to follow the voluntary standards, but Jess finds that doing so will differentiate her products from her competitors.
Check out Standards Australia's Standards and the law page to learn more about how voluntary standards can apply in law.
Certifications are similar to standards. Certifications help show your products and services:
- are good quality
- suit a particular task
- were manufactured at a particular location or using a particular process
- use certain ingredients or materials.
What to do...
- Check out Standard Australia's What is a standard page to learn more about voluntary standards.
- Read the ACCC's mandatory standards page to find out more about mandatory standards.
- Visit our Standards and Codes of practice checklist page to learn about Australian product standards and your business.