What happens when the small business you started in your living room creating candles becomes too much to do at home? Then it’s probably time to look into choosing a co-packer to take your business to the next level. Here is a look at how copacking reduces costs for businesses.
A co-packer, or a contract packer, will help manufacture and package your product in order to have them shelf-ready. These co-packing services may be used for a number of different product types, including pharmaceuticals, cosmetics, foods, household products, and industrial products. Hiring a co-packer allows you to scale-up your business and focus on other parts of the business beyond producing large quantities of your product.
Getting your products shelf-ready can require a number of staff. If you are not in a position to hire the required number of staff, or if your team would not be needed full-time, then it can be beneficial to turn to a co-packing company for your manufacturing and packaging needs. They assume the full cost of the employee because they can have each employee work on a number of different products. In this way, the cost of each employee is essentially distributed across the number of clients using their services.
Another way that co-packing can reduce costs for your business is that you do not need to invest in expensive automation and equipment. Because the co-packer you choose is doing this for multiple clients, the cost of automation and equipment is essentially being spread out to a number of clients instead of each individual client needed to take on this expense.
Utilizing a co-packer enables you to offload the primary responsibility for the production of your product. A co-packer can provide access to space, permits, technology, equipment, and expertise that would be difficult for you to obtain on your own. You are not only buying their services, but also the experience they have in the manufacturing industry. This experience can help reduce your costs in that you do not need to spend countless time and money researching permits, guidelines, laws, etc.
The logistics of scaling a product based business can be overwhelming. There are so many different aspects to consider and evaluate. Outsourcing to a co-packer who has already made significant investments in infrastructure allows you to focus on other areas of your business including marketing, product development, and customer experience. When you are able to focus on these other areas you can increase revenue. Combined with the cost reduction benefits of finding a co-packer, this can mean higher profits for your business.