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How to choose the right food & beverage co-packer

Posted on October 05 2016 | Author: Alexandra Coccari

Are you an entrepreneur in the food and beverage space? Is there an established market for your product? If so, you have probably considered scaling-up production to meet the consumer demand for your product. This can be done in one of two ways: investing and manufacturing the product in-house or outsourcing production through a contract manufacturer, otherwise known as a co-packer.

Many start-up food and beverage companies utilize co-packing facilities for a number of reasons. Some of the benefits include a lower production cost, increased efficiency, having the expertise of an experienced manufacturer on-site, and most importantly, cutting the costs of equipment and other capital purchases.

Choosing a co-packing facility may seem like a daunting task; however, creating a plan of attack will ease this process. There are a number of things to consider before deciding what co-packing facility is right for your company. The following are some tips and factors to consider before navigating the co-packing industry.

Establish your production process and needs. Understanding every detail of your production process is crucial when deciding which co-packing facility to choose. Where will you source the ingredients for your product? Does the facility have the equipment you need? Where will you source packaging materials? Does the facility have available storage space? These are just a few of the questions you should be ready to answer when seeking out the right co-packer. The more you know about your manufacturing process, the smoother the production run will be.

Consider manufacturing costs. It is extremely important to ensure that choosing to outsource the manufacturing of your product is not only efficient, but is often financially beneficial. A number of co-packing facilities have a minimum order quantity for each production run. If your start-up company is looking to do a smaller production run, it is likely that you will be charged a premium fee, which may not be feasible. On the other hand, manufacturing too much of a product in order to avoid these fees may be detrimental if you cannot sell it before the expiry date.

Confirm food safety and quality assurance policies. In addition to cleanliness and sufficient organization, it is imperative to ensure that proper safety and quality assurance policies are in place. Deciding which certifications that will appear on your product label will narrow down the co-packing facilities that are suitable for your company. Food safety certifications such as HACCP, GMP, and SQF will contribute to the quality of your product and reduce the risk of contamination. If your product requires any front-of-package certifications such as Organic, Kosher, Halal or Gluten-Free, confirm that the co-packing facility is capable of meeting these regulations.

Leverage any additional services offered. A number of co-packing facilities offer services designed to accelerate start-up companies. Many of the innovation-focused co-packing facilities will offer R&D services, including recipe development to very early-stage companies. If your company lacks in the marketing and branding development, a co-packer who offers such services would be very valuable and may save your company both money and time.

Do your research. Once you have narrowed your list of potential co-packing facilities, you should then conduct preliminary background research. What clients have they worked with in the past? Do these past clients give the facility good reviews? These are some of the questions that can be answered by asking the co-packer for a list of current clients and contacting them. This may make it easier to determine what working with the co-packer would be like.

The factors listed above are just a few considerations to review before choosing a co-packing facility. Co-packing facilities can help accelerate the growth of your company. Once you have identified and chosen a suitable co-packer, a contract outlining the details of your partnership should be drafted.  This will protect your product and may benefit your business in the long run.

Co-packing facilities are great resources for start-up food and beverage companies. Having a clear vision and a trusting relationship with your co-packer can lead to your company’s success. By leveraging the services offered, you could save valuable time and money.

 

Alexandra Coccari  
Junior Analyst, Food & Food Systems

 

Sources
5 things to consider when selecting a co-packer   
Three main steps to choosing a co-packer  
4 tips for scaling your food start-up with a co-packer  
How to choose the right co-packer for your supply chain needs

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Pixabay






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