Deposit return scheme will start in August insists minister.
Small firms warn it may cause them to stop selling in Scotland due to "multitude of costs".
Scotland's controversial deposit return scheme will go ahead as planned this August, according to the minister spearheading its introduction.
Circular economy minister Lorna Slater is pressing ahead with the initiative, despite warnings from producers that a "huge number" of smaller drinks firms could stop selling their products in Scotland.
She held an "urgent meeting" with small drinks firms on Friday, with the minister pledging to look at what additional support they can be given.
Holyrood, however, has heard concerns that some firms could go out of business as a result of the scheme, with hundreds of leading figures from the hospitality sector sending an open letter to Ms Slater last November calling for the initiative to be paused so changes can be made.
Businesses may choose not to sell in Scotland.
Chris Jones, managing director of Manchester-based Paragon Brands, said there is a "multitude of costs" arising from the deposit return scheme.
Businesses could need different labels and barcodes for products sold in Scotland, as a similar, separate scheme is not due to reach the rest of the UK until 2025.
Speaking on BBC Radio Scotland's Good Morning Scotland programme, Mr Jones said: "I am part of a wider drinks forum group of approximately 300 smaller producers, and it is fair to say there is a huge number of smaller producers who have simply taken the option to stop selling in Scotland.
"The complications and the cost and the complexity involved in setting yourself up for this scheme just mean that the commercial returns are not there."
That runs the risk that firms will not be able to afford to trade in Scotland after the deposit return scheme comes into force on August 16.
This will mean fewer products for shoppers north of the border to choose from, with Mr Jones estimating there could be "somewhere in the region of 40%" fewer drinks brands available.
The initiative is “all systems go.”
Ms Slater said there were "relatively small numbers of small producers who still have some concerns" about the scheme.
But with producers having to sign up to the deposit return scheme before the end of February, she added that the Scottish Government and Circularity Scotland - who will implement the scheme - were working with these companies.
Asked if deposit return will come into force from August 16 as planned, the minister said: "Absolutely, it is all systems go for Scotland's deposit return scheme."
The move will mean shoppers in Scotland pay an extra 20p when buying drinks in a can or bottle, with this then returned to them when they bring back the empty container for recycling.
Speaking on BBC Radio Scotland, Ms Slater continued: "Our scheme is very similar to successful schemes around the world that do increase recycling but also reduce litter on our streets.
"We've got to do something about it and the deposit return scheme is our answer to that."
She said she was "really proud" that Scotland would be the first part of the UK to have a deposit return scheme in place.
Ms Slater continued: "The Scottish Parliament passed the legislation on this back in 2020 and we have been working really closely with industry towards this August launch date. In fact, we already pushed it back by a year to allow businesses to recover after Covid.
"And now we have been working through concerns of industry."
Action has been taken to reduce the cost to drinks producers, she said, with the minister saying she was "working through" the concerns that had been raised by those in the sector.
She stated: "I am aware there are still some outstanding concerns from small producers and importers particularly, which I absolutely take seriously and we are working through solutions to these as well.
"I met with small producers on Friday and I am taking their concerns really, really seriously.
"So we are looking at what solutions we can put into place to support small producers because we really want all businesses in Scotland to be able to fully participate in this really exciting scheme."
Backing from environmentalists.
Environmental campaigners meanwhile insisted the initiative must start in August as planned, with Kim Pratt of Friends of the Earth Scotland saying businesses had had five years to prepare for it.
She stated: "Suggestions that DRS will cost consumers are irresponsible - like existing deposit return schemes in other countries, it will be simple for customers to claim their 20p deposit back from any shop participating in the scheme."
Dr Kat Jones, director of the Association for the Protection of Rural Scotland (APRS) which has been running its Have You Got The Bottle? campaign since 2014, said the Scottish scheme had been "delayed twice in response to industry foot-dragging".
She stated: "We have seen the support among the Scottish public for deposit return since the outset of the campaign.
"This scheme works well in other countries where it has reduced the litter we see in our towns and countryside, cut carbon emissions, and resulted in savings for local authorities.
"We need industry to work with the Scottish Government in order to create a scheme that works for businesses, communities and the environment."