Contract Manufacturing

The term "Contract Manufacturing" is used a lot in industries such as nutraceuticals. But it can be a tricky term/concept to understand. Don't worry you're not the only one that may be confused by the term. So what does it really mean?

What’s a contract manufacturer?

A contract manufacturer is a company that under contract manufacturers products for other companies per their requests. It is considered a form of outsourcing. It is often compared to private labeling. For example, take a clothing company. They are likely to design their own garments and decide on the quality and material and outsource that to a contract manufacturer. 

There are many different types of products that you can hire a contract manufacturer for, these include and are not limited to:

• Health Supplements
• Beverages
• Cosmetic products
• Frozen produce
• Personal Care
• Clothing

Why should you consider a contract manufacturer for your venture?

• You get control: Because third party manufacturers work at your discretion, you get complete control over the ingredients/raw materials used, as well as the quality of the final product
• Flexibility: Smaller brands have more adaptability to get new products into production to meet market demand whereas larger companies tend to struggle with this
• Branding: You get full control of the branding of your product from packaging to design

CSN Pharma is a contract manufacturer for Natural Health products. We help people who are new or experienced in the natural health product industry, bring their products to market. Want to learn more? Click here.

White Labeling

White labeling is a similar concept to private labeling. The key difference is that white labeling is using a pre-made product and selling it as your own. Whereas in private labeling, you would have your own specific product that third party manufacturers for you. Essentially you would be selling the same product as others but with different branding. Take for example your local supermarket, they are likely to carry products with their own brand name. But they would have actually used white-labeled products from a manufacturer and put their own brand name on it.

Why should you consider white labeling?

• Reduced cost: You are able to benefit from reduced costs as you don't need to develop a product since that's already been taken care of for you. Your main responsibility would be to manage the branding and marketing to your liking
• Increase production: With white label product you are easily able to keep up with demand by simply contracting for more product through your supplier and not having to worry about the increased production limitations 
• Easy Market Entrance: It's far easier to enter the market as you would only need to worry about the packaging and labeling