How to Leverage your Contract Manufacturer

In surveys of the Nutraceutical and Dietary Supplement industry, industry leaders have revealed the key to their brand’s success as having what they need (Finished Goods that meet spec), when they need it (often sooner than their manufacturing partner can produce it).

For brands that do not manufacture their own finished goods, a big piece of this puzzle is who you choose as a manufacturing partner and how you leverage their capabilities to build your brand.

Top 4 Ways to Leverage your Manufacturing Partner:

1.      Quality – It’s not an accident. Lean principles teach that Quality is successful when it is achieved by thoughtful design. Quality cannot simply be inspected in but comes through anticipation of problems before they arise with proactive solutions implemented before the problem occurs.  “Quality” from a manufacturing partner is a very broad term but should provide your brand with the following elements:

·        Certifications of cGMP compliance with detailed knowledge of FDA requirements and international regulations so as not to create liability for your brand

·        Quality agreements defining the “who” and “what” of the relationship along with a high level of transparency (i.e. audits of batch records as soon as requested)

·        All raw materials qualified and tested to meet specifications

·        All manufacturers and suppliers qualified

·        Accredited Lab services that can facilitate finished good testing quickly and provide stability data on raw materials

2.      Research & Development – Innovation is the lifeblood of any thriving and growing brand. For those that don’t have the resources in house or choose to invest those resources in other areas, a manufacturing partner can become a critical extension your brand.  A strong R&D group should provide you the following benefits:

·        Concepts of current trends in the market

·        World class flavoring systems-- gone are the days of “the worse it tastes, the better it must be for me” mentality

·        Reduce time- to-market because you have a team working for you on the back end

·        Understanding how to work within defined parameters to produce a cost effective product that meets your specifications

3.      Supply Chain – Don’t fall victim to the dreaded words “our supplier couldn’t get enough of it” or “it was delayed due to failing test results.”  An excellent manufacturer with a poor supply chain, is an OK partner at best. Your Manufacturing partner should be integrated with you to assist in the following:

·        Overcoming supply challenges and absorbing variability in demand

·        Reducing lead times of product fulfillment – PO to delivery

·        Carrying costs of raw materials for raws with long lead times

·        Reviewing market trends in pricing – keeping you updated on both increases and decreases in market price and conducting quarterly pricing reviews

4.      Business Relationship – A full Brand Solutions partner can really help you focus on the core business of building your brand. In these relationships, communication is paramount. You should have a dedicated team as your integrated partner that will handle the account, provide production updates, manage quality concerns and release of finished goods, and most importantly, get you what you need, when you need it. Partners can range from a toll shop to a full turnkey partner. Integrating with your manufacturing partner should you help with the following:

·        Privacy and accountability through NDAs, Supply Agreements, or other contracts

·        Reduce your finished good inventory by shorter fulfillment lead-times (allowing you to invest your capital in growth of your brand instead of stocking finished goods)

·        Offer credit terms enabling a brand to leverage its capital

·        Will continue to invest in capital-intensive manufacturing equipment to meet your needs

·        Provide competitive pricing  due to large order quantities but organized in a way to service all clients with the level of service they deserve – Value Streams are an organizational architecture philosophy that has its genesis in lean manufacturing

·        Pricing is a factor but cheaper on the front end does not always equate to best value overall (consider the cost of recall and what that could do to your brand)

When you depend so much of your brand’s success on your contract manufacturers’ ability to delivery finished goods in spec and on time, it’s vital that you choose one that is going to be an integrated, strategic partner.

Click here to learn more about Genysis Brand Solutions – a turnkey manufacturing partner delivering finished goods in days, not weeks.

As the SVP of Quality, R&D, Project Management, and Business Development at Genysis Brand Solutions, Shayne brings much to the manufacturing conversation. Shayne has experience in small business development, procurement, and product management. He was formerly with Nutraceutical Corporation (NASDAQ:NUTR). He holds a BS in Human Resource Management from Utah State University, and an MBA from Brigham Young University.