Contract packagers can help you improve your packaging operations as well as reduce costs. But when should you seek a copacker and how do you go about selecting one?

Partnering with a contract packager is a strategic business decision. First, companies must carefully decide if outsourcing suits them and then embark on the process of selecting a contract packager that meets their needs. To help companies manage the process, Thomas Bacon, president of the Contract Manufacturing & Packaging Association, discussed how to choose a contract packager at the recent Packaging Machinery Management Conference, which was organized by the Packaging Machinery Manufacturers Institute (PMMI).

According to Bacon, who is also president and founder of contract packaging company Aaron Thomas, using a contract packager can help firms reduce costs, speed time-to-market, boost flexibility or compensate for the effects of downsizing. Companies should think about outsourcing their operations if their product volume is too much or too little for their existing packaging lines, either in the long or short term. Relying on a contract packager could also be a good idea if there’s a short-term job that calls for packaging expertise or equipment that the company does not possess. Additionally, other reasons to outsource include brief runs or promotions, plant closings, exceedingly labor-intensive work or work that requires special machinery, an unmanageable short-term workload, and regulatory and environmental requirements that demand huge investments.

Many contract packagers (or copackers) specialize in a particular market, such as beverages or pharmaceuticals, or on a certain type of packaging, such as shrink wrapping or blister sealing. All copackers furnish one or more of the following: packaging services, facilities and/or equipment. While a few copackers offer complete turnkey solutions, others may supply labor only. In selecting a contract packager to work with, companies should look at location (proximity is a plus), experience and expertise, financial strength, staffing and equipment. Moreover, firms should examine the copacker’s ethics, its pricing (is it fair relative to the services offered?), its procedures, size, references and its approach to quality control. For example, companies should check if the copacker has worked with other clients with comparable product lines and requirements.

According to Bacon, following a five-step approach can steer companies toward a well-qualified contract packager. First, firms should identify prospective outsourcing partners through the Internet, directories, yellow pages or trade magazines. For example, companies can refer to the Directory of Contract Packagers and their Facilities to search copackers by expertise. Second, firms should interview prospects over the phone, asking them questions that ascertain whether their experience fits the particular project or longer-term relationship.

Once companies have whittled down the list of candidates, they should then mail those still in the running a written vendor survey that assesses ISO or GMP status, safety records and organizational setup, among many other considerations. Fourth, firms should visit the facility and conduct an audit, by the end of which they should be prepared to either confer the contract or hold it until changes are made. Finally, companies should make the assessment and outline the project or business proposal to the contract packager. Ultimately, says Bacon, firms should assign equal importance to what they know about the copacker and to how they feel about the organization as a prospective partner.

In short, contract packagers can help you jump-start, put into order, modernize or enhance your packaging operations. And if you approach the decision to outsource carefully and choose a copacker following Bacon’s thorough approach, you can make the most out of this strategic option.

Sources:

When and How to Choose a Contract Packager
Packaging Digest, November 2003
www.packagingdigest.com/articles/200311/50.html

How to Select an Outsourcing Partner
Contract Manufacturing & Packaging Association
www.contractpackaging.org/select.html

What to Look for in Deciding
Contract Manufacturing & Packaging Association
www.contractpackaging.org/deciding.html

How to Hire a Contract Packager
Contract Manufacturing & Packaging Association
www.contractpackaging.org/howto/how.html