A copacker, also called a contract packager, is in the business of packaging products for someone else. this can include services such as research and development, design, warehousing and distribution.
If you sincerely believe you can sell your product in much greater quantities than you do now, first look at what you can do yourself to increase production. Can you buy that special equipment you need? Can you rent out that extra space or hire those additional people? Whatever you can’t do from a production standpoint is where a copacker can take over for you.
Copackers are specialists. They might have specialities like liquid filling, shrink wrapping or blister sealing, for example. They can save you an enormous amount of time and energy getting certifications and ensuring production satisfies industry regulations. They can allow your company to make more time to concentrate on sales.
Hiring a copacker means entering into a business partnership. The copacker has the responsibility to deliver goods at a competitive cost, following your time schedule, with quality assurance. You have the responsibility of providing detailed instructions on product quantity and quality, the size and type of container to be used, the cost per unit, and the time-frame for completion. Together you can successfully launch a product and significantly increase your product’s distribution and sales as well as greatly increase your brand awareness.
None of this comes cheap however. Before you hire a copacker, you have to be financially and organizationally ready. Consult with your accountant, your lawyer and your insurance company before signing one on.
How to find a copacker that’s right for me?
- Start with asking around in your business circles, do a web search, look them up in their business associations (such as the Canadian packaging or the Contract Packaging Association and the Private Label Manufacturing Association in the USA)
and seek them out in industry events
- Look for ones that produce similar products and have excess capacity
- Look for the ones that operate the specialised equipment you need
- Make sure you find one that knows your industry well, with an organization that has a good personality match with yours
How to evaluate a copacker?
- Start with a phone interview to understand their specialities, production capacity and special licences or certificates
- Get written information. Ask them to provide details such as their organizational chart, ERP system, safety records. Ask them about their WMS
- Do an onsite visit. See and understand their processes in action. Talk to workers. Look for cleanliness and orderliness. Ask to see their quality control process. Ask for references from previous customers and call them
- Look for a real willingness to fulfill your needs from those in charge of product creation, production, and quality control
If you are convinced that they have the willingness and ability to deliver the product you need on your terms, then you can enter the negotiation phase. More about negotiation topics and the various responsibilities you need to share with a copacker in an upcoming blog post.