Manufacturers will vary in their production capabilities; some will be able to oversee the entire product cycle from raw ingredient sourcing to delivering the final, branded package to your warehouse. Others may only be able to support part of the production cycle. Often, multiple third-party manufacturers will be involved in the overall product development cycle, with some involved in the first manufacturing stages, before being passed on to other packaging and shipping partners. In the case of nutraceuticals, the split is often between ingredient suppliers and product manufacturers. For Fighter Shots and many other brands, Szymanowska explains that the company uses selected ingredient suppliers which all need to communicate with the manufacturers and be tied to a stock level management system. “Unfortunately, a lot of the ordering processes happen manually. We are very much aware of the benefits of an automated demand forecast and ordering system, though, and are working towards implementing one with one of our manufacturers,” she says. Aligning timelines is perhaps the most important and challenging factor to consider when involving multiple manufacturers. Guber explains that raw materials as well as other materials, such as packaging, need to be made available at the right time, which often necessitates longer lead times. In order to meet the needs of the various supply chain stakeholders, brands need to secure enough stockpile to cope with any disruptions across the value chain, which inevitably create more costs. Kristina Edvinsson elaborates that there is not much room for flexibility when involving several manufacturers. Brands must book their various production slots in advance, and any delays in the supply chain can toss the entire timeline out the window, she explains. Poor liquidity and ‘out of stock’ situations are often the result of poorly planned logistics. “I see a great advantage in quality control if one decides to use a full-service provider, as only one company is involved in the process, Edvinsson says. “The moment more parties are involved it is easy to blame one another.”
Before choosing a partner, it is critical to fully understand your own situation. A big part of that is knowing your technology readiness level. The TRL index is a well-known model used in many industries to assess how close an innovation currently is to the market. Levels 1-4 take place in the R&D lab and run from ideation to verification on a lab-scale. For food projects, that often means looking at sources and ingredients, extraction, characterisation and benchmarking. Levels 5-8 focus more on application and product concept, with validation and qualification in increasingly realistic operational set-ups and volumes. This takes place in a pilot facility. Contract manufacturing happens from TRL 9; before that, you may need a co-development partner rather than a co-manufacturing one. Having said that, you can’t leave contract manufacturing decisions until TRL 9. If you do, your project might suffer unnecessarily while you make a decision, and you could miss out on market opportunities. Rather, start thinking about contract manufacturing and its implications while the innovation is still in the lab. Decide then if you will use contract manufacturing and start profiling partners, and you will have a much better chance of a seamless transition to production. Having the right partner in place at early stages give you more knowledge of what will be possible in production, better informing your development decision making, and avoiding nasty surprises in transition.
Good communication is crucial, yet, it is an even more a complicating factor when enlisting multiple manufacturing partners. Additional parties involved can lead to higher chance of mistakes, which often has a great cost implication. De Jong’s bottom line is that partners might be excellent in their own part, but poor communication has an inevitable impact on project management and quality of the final product.