18 Sep Shopping for a Profitable Contract Manufacturing Partnership
Companies turn to contract manufacturing or private label for a variety of reasons. For established businesses, it’s usually an ambition to increase scale of production or to diversify into a new area. For smaller players, it can be a lack of sufficient production capacity or a need for technical expertise in a category. And for complete newcomers with little knowledge of the practicalities of getting a new product to market, it’s often the only way to get started.
Ultimately, finding the right contract manufacturer to work with can be the difference between success and failure. It’s about finding the company that is most able to meet your needs. Ensuring that they meet your level of expectation is crucial to avoid a waste of time and money.
However, knowing where to find the new partner can be difficult—don’t expect any recommendations from the competition. The demand to meet the right manufacturer has become so high that there are even professional connectors that specialize in bringing partners together. These third-party influencers can facilitate meetings where you can not only meet the company and tour the facilities, but you can talk to people you might be working with, which can be extremely useful to understanding their culture and workplace dynamic.
It is a critical move to look at your options, cast about, go and visit your contractors. Where are they located? What are their capabilities? What do the premises look like? Do they demonstrate attention to detail? Potential problems to look out for include risks of contamination, and anything else that could affect quality.
Of course, if something goes wrong, it’s your customers and your brand that are affected, so due diligence is strongly advised. After all, by outsourcing the manufacturing of your product, you are entrusting a third party with an essential factor of your company’s business success.
It’s common practice to pick a contract manufacturing partner because of their expertise in a specific area. Working with a single trustworthy manufacturer, rather than a range of less-well known contractors, can be attractive from a risk reduction point of view. And increasingly, premium contract manufacturers offer customers a one-stop shop, meeting a variety of their customers’ needs.
As in most relationships, communication is the foundation of a strong contract manufacturing partnership. When both parties are open, any problems can be resolved. Transparency is important to keep the trust between partners.
When the right companies connect, the result can be a productive, long-term relationship for both parties.