Ingredients are at the heart of your business, and they are the lifeblood of your product. While you may know “what” ingredients you need and the benefits they provide to your customers, finding the proper manufacturer to source your product is the difference between having a high-quality product and an average or low-quality product that sits on the shelf. Finding the right manufacturer can be as grave as success vs. failure.
It does not stop at ingredient quality. Manufacturing is essential to your supply chain. Having a good supply chain will help you meet the demands of your business during its highs and lows, give you an edge over your competitors, and ensure you meet the proper margins to make your business sustainable. The relationship you forge with your manufacturer and how well they are able to meet your goals is what takes your dream and turns it into a reality. To help you ease the process, here are some things to consider and ask your potential manufacturer before making the final decision.
It is important to match your demands with capacity in order to eliminate a potential bottleneck and pain point when it comes to the cost of goods. Additionally, if your manufacturer has long lead times, it is important to understand how that factors into your overall timeline, especially when you need time for tasks like bottling and labeling, to name a few. Ideally, you want to find a manufacturer that fits your overall needs so that you do not have issues with stock.
If you are just starting, choosing a match-capacity strategy is a way to minimize over capacity and under capacity. This will, in theory, allow you to meet the demands of your customers. However, depending on industry trends, lead time, and your manufacturers’ capacity, this strategy may sometimes leave you under capacity. Regardless, these are big business decisions that are important to think about when it comes to how much product you want to have on hand.
Do not forget to also ask if your manufacturer has minimums and how the pricing structure works. While it is important to pay for the highest quality ingredients, if your demand does not meet the minimums or means a high cost of goods, it may be worth considering another manufacturer while you scale your business.
In addition to understanding the manufacturing capacity, it is important to understand exactly what you are getting when it comes to certifications. For this reason, this tip is more black and white than the other tips. It is pretty simple: check which certifications the organization has achieved.
It is common for certifications and registrations to come from the following organizations:
Checking the certifications of your manufacturer will allow you to understand the validity, quality, and purity of the ingredients that make up your products. Looking for specific certifications will also help to ensure that proper techniques, quality control, and operating procedures are being followed.
Additionally, when you are talking to manufacturers, you want to understand how their QA works. All of their ingredients and processes should go through a rigorous QA process to ensure consistency and dependability. Make sure you get traceability and transparency of ingredients in addition to the certificates they provide.
To ensure the quality and accuracy of ingredients, you will want to understand the lab testing process, what testing services are available, and how transparent the manufacturer is with testing and testing results. Using an accredited third-party lab is a guaranteed way to ensure your product is not only consistent but is also objective, removing bias that may happen with in-house testing.
Some of our testing services include, but are not limited to:
Additionally, working with a manufacturer who handles the testing is a great way to save yourself on costs, and they have the experience to take you step-by-step through the process. Knowing what tests can and should be done to meet the needs of your industry and customers will ensure that your products are consistent and dependable.
Bottom line: relationships matter. Sometimes relationships are the difference between having or not having access to hard to find ingredients, being at the forefront of what is happening on the ground, and access to competitive pricing. When you are working with a vendor who not only has a long business history but long-term relationships with their partners, you will have the confidence to know that your ingredients are coming directly from a good source, leaving a lot of uncertainty and runaround at the door.
Often times, a one-stop-shop—or as close to that as necessary—is the best way to lower your lead time, decrease your cost of goods, and increase your profit margins. Understanding if the manufacturer offers anything from R&D to customizations to lab testing is a great way to shore up your supply chain.
And not to be forgotten, shipping and logistics are a big factor when it comes to your landed costs and your overall timeline to get your product into the hands of your customers. Looking for a manufacturer that has localized warehouses and distribution centers allows you to lower cost and lead time in a meaningful way.
While it is important to educate yourself and ask the hard questions in order to properly evaluate if a manufacturer will meet your goals, do not forget the importance of customer service and communication. Communication and transparency are essential to your success. If the manufacturer’s communication style is not working for you, then despite all of the information above, it may be necessary to look at other manufacturing options.
At Elite, communication and customer service are at the heart of what we do every day. We do not discriminate between new and old customers or high and low volume. Your goals are our goals, and we provide clear, transparent, and quick communication to all of our customers. At the end of the day, when our customers’ goals are exceeded, our goals are exceeded too.