Business regulations take many forms. The lack of regulations often benefit big business
while making smaller businesses suffer. On the other hand, too much regulation can make it
difficult to remain in compliance while still being productive. Regulations put in place to protect
the consumer can dramatically affect how a company does business, but in the long run are
necessary for public health and safety (Carey & Francis, 2009).
Advantages of Business Regulation
Advantages of business regulation include reduced threat to the environment, better
opportunities for small businesses and more protection for the consumer. Regulations are not
placed on businesses to limit their ability to produce or sell products, but more to make sure the
company deals fairly with consumers and offers products of the highest quality that will not
harm the environment or the public. Regulations are also in place to keep the business market
competitive and growth oriented (James, 2010).
In the 1970’s, for example, the federal government imposed environmental regulations on
the automotive industry to prevent further damage in the way of air and water pollution. Exhaust
emissions were to be dramatically reduced to keep large amounts of lead and other chemicals
from being released into the air causing smog and acid rain. The automotive industry spent
millions of dollars to revamp their vehicles to reduce emissions and bring their automobiles and
factories into compliance. The result was better fuel efficiency and less pollution released into
Recently, regulations were toughened against toy manufacturers in China due to the high
level of lead found in the paint they used on the products they shipped to the United States. The
regulations placed on the toy manufacturers prevented them from selling the toys inside the
United States. The regulations prevented children from being exposed to toxic levels of lead and
made way for manufacturers within the United States to gain part of the market once held by the
Disadvantages of Business Regulation
Businesses that aren’t regulated often have free reign to do whatever they please when it
comes to manufacturing and pricing. Safety protocols are overlooked to save money and
products are made with defective materials. Toxic chemicals are used that have a devastating
impact on the environment and can cause health concerns for the public. With little or no
financial regulations, companies can charge more than what a product is worth and provide no
guarantee if something goes wrong.
Deregulation allows businesses to follow their own path. More often than not, it leads to
higher prices and reduced quality merchandise. Companies in the service industry often cut
corners by using cheaper materials or unsafe practices in an attempt to save time and money.
Without proper regulations, companies can pass off defective merchandise with little penalty or
punishment if someone ends up injured.
The federal government attempts to pave the way for new industry by lightening
restrictions on certain aspects of business, but in the end, the ones who pay are the smaller
businesses who can’t compete and the consumer who loses money purchasing defective products
or paying for services that do not meet quality standards. Officials who enact rules and
regulations do so in the hopes of creating business opportunities, but opposite occurs.
Business regulations have both advantages and disadvantages for everyone involved.
Depending on what end of the spectrum a business falls on will determine whether they consider
regulations to be a benefit or a hindrance. Stricter regulations force businesses, both big and
small to follow the same rules and guidelines. It may be harder for certain businesses to comply
with specific regulations but in the long run, the overall impact benefits consumers and
companies who must compete with one another for a fair share of the market.
has been added to your cart!
have been added to your cart!
You must log in and be a buyer of this download to submit a review.