Below is a typical action plan for identifying, qualifying, and selecting an external manufacturing or packaging partner. Any actual plan should be specific to your specific situation.
(As with all content on this site, this should not be construed as legal advice. Anyone engaging a contract should engage with appropriate legal counsel for guidance. The purpose of this document is to provide background information on this contract topic. Anyone contemplating types and structures of contracts must perform their own due dilligence and seek trusted professional advice.)
- Define Your Needs: Clearly articulate your product specifications, production requirements, and any certifications needed. Understand your current production volumes and future scalability needs.
- Research Potential Partners: Utilize industry associations, trade shows, online directories, and professional networks to compile a list of potential copackers or manufacturers. Focus on those with experience in your product category and market.
- Evaluate Technical Capabilities: Assess each potential partner’s technical capabilities, machinery, and technology to ensure they can meet your product’s manufacturing and packaging requirements.
- Check Certifications and Compliance: Verify that potential partners have the necessary certifications (e.g., organic, non-GMO, FDA compliance) and a strong track record of regulatory compliance.
- Consider Operational Flexibility and Scalability: Determine if the copacker can adjust production volumes based on demand and growth, ensuring flexibility and scalability.
- Analyze Cost Structure: Request detailed quotes from potential partners, including breakdowns of costs associated with production, packaging, and any additional fees. Understand their pricing model and how it aligns with your budget.
- Assess Quality Assurance Processes: Inquire about each potential partner’s quality control measures, safety standards, and process for handling non-conformities or recalls.
- Review Location and Logistics: Evaluate the logistical advantages or challenges presented by the location of potential partners, including proximity to raw materials, distribution channels, and target markets.
- Initiate Contact and Share Product Briefs: Reach out to selected potential partners, sharing detailed product briefs to gauge their interest and capability in meeting your requirements.
- Request References and Samples: Ask for references from current or past clients and request product samples to assess quality and expertise firsthand.
- Visit Facilities: If possible, visit the facilities of shortlisted copackers or manufacturers to evaluate their operations, meet the team, and discuss your project in detail.
- Negotiate Contract Terms: Once you’ve selected a partner, negotiate contract terms that cover production volumes, timelines, costs, quality standards, IP protection, and confidentiality.
- Develop a Transition Plan: Work with your chosen partner to create a detailed plan for transitioning production, including timelines, responsibilities, and communication protocols.
- Establish Communication and Review Processes: Set up regular communication channels and schedules for updates, feedback, and performance reviews to ensure ongoing alignment and address any issues promptly.
- Monitor Performance and Adapt as Needed: Continuously monitor the partnership’s performance against agreed-upon KPIs and be prepared to adjust the agreement or processes to optimize the relationship.
This action plan is designed to guide brands through the critical steps of finding, qualifying, and selecting an external manufacturing or copacking partner. By following these steps, brands can make informed decisions, establish fruitful partnerships, and achieve their production and business objectives. More information on finding and selecting an external manufacturer or copacker can be found at copackconnect.com.
By Carl Melville Managing Partner, TMG and Founder of CoPack Connect
