Selecting a Contract Manufacturer

A contract manufacturer is a company that is hired by another company to produce goods or provide services on their behalf. The client company benefits from contracting out the manufacturing process as it may allow them to test the market and focus on other business needs such as product design, marketing, and distribution, while leveraging the expertise and resources of the co-manufacturer. Contract manufacturing offers several advantages to the client company, including cost savings, access to specialized manufacturing capabilities, scalability, and flexibility in production volume. It allows companies to bring their products to market quickly and efficiently without having to invest heavily in infrastructure, equipment, and personnel.

Define Your Requirements

When researching a co-manufacturer, first clearly identify your specific needs, product requirements, production volume, and timeline. If a manufacturer doesn’t specialize in your specific product or needs, then obviously they won’t be the best choice for your company. Determine any specialized certifications or expertise you want to require, such as current good manufacturing practices (cGMP), International Organization for Standardization (ISO), organic, allergen-free production, kosher, and so on.

Research Potential Contract Manufacturers

Look for contract manufacturers with experience in cannabis or fungi production and preferably those who specialize in your unique product category (capsules, gummies, beverages, and so forth). You can find potential candidates through networking, trade shows, referrals, online searches, and so on. Dig deep when doing research. Ask around, talk to others who have worked with them, look at their past regulatory reports, and go see the facility in person. If a company won’t give you a tour, this is a red flag. Many times we at Allay Consulting will be hired to conduct a due diligence compliance audit for companies to get an idea if a manufacturer is in compliance, and would be a good fit to manufacture for a client.

cGMP Compliance and Certification

Selecting a co-manufacturer that adheres to cGMP and prioritizes product safety is crucial to ensuring the quality and integrity of your product. Do not trust that they are cGMP complaint based on just what they say. Verify that the contract manufacturer follows cGMP regulations, by getting a third party audit conducted. Bonus if the company is cGMP certified by an accredited certifier; this means they have an audit every 6-12 months proving they are compliant with the standard. Request documentation, such as their US Food and Drug Administration (FDA) registration, valid license, third-party audit reports, or a cGMP certificate. Review these documents to ensure compliance and assess their commitment to safety to make a more educated decision.

Evaluate Quality Control Systems

Inquire about the contract manufacturer's quality control processes, including raw material sourcing, ingredient testing, and finished product analysis. Ask for details about their quality assurance procedures, quality control personnel, and any internal testing capabilities they possess. Make sure they are also getting testing from a licensed third party laboratory as well to ensure no false testing is taking place.

Tour the Facility

As mentioned before, schedule an on-site visit to the co-manufacturer's facility. Observe their manufacturing processes, storage facilities, and overall cleanliness. Assess their sanitation practices, pest control measures, and employee hygiene protocols. This visit allows you to see anything that you might not be comfortable with. You can also hire a third party to evaluate compliance with cGMP regulations and assess the commitment to product safety. It’s always better to be safe than sorry.

Request References

As part of your research ask the contract manufacturer for references from their current or previous clients. Contact these references to gain insights into their experience working with the manufacturer, including their adherence to cGMP regulations, commitment to food safety, and product turnaround time.

Evaluate Communication and Collaboration

Assess the contract manufacturer's ability to communicate effectively and collaborate with your team. Evaluate their responsiveness, willingness to address concerns, and ability to provide regular updates on production progress and quality control measures. This also includes their billing and payment methods. If it is complicated to pay for their services, or if you pay them and the manufacturing timelines can’t be met, you will have major problems in the future.

Review the Contract

Once you have narrowed down your options, review the proposed contract carefully. Ensure that all important aspects, such as production timelines, quality control requirements, liability clauses, and ownership of intellectual property, are clearly defined. We always recommend having a lawyer take a look at anything binding before signing anything.

Consider Cost and Capacity

Evaluate the contract manufacturer's pricing structure and payment terms. Compare costs with other potential manufacturers, considering the value provided in terms of quality, expertise, and safety measures. Additionally, assess their production capacity to ensure they can meet your volume requirements consistently.

Start with a Trial Run

Before committing to a long-term contract, consider starting with a small-scale trial run. This allows you to assess the contract manufacturer's performance firsthand and verify their ability to meet your quality and safety standards.

Narrowing Down Co-Manufacturers

We hope these steps help narrow down potential contract manufacturers to a few suitable contenders. Interview each company based on talking points listed above. Talk with industry leaders who have used their services. After your research, narrow down your search to a single company who you believe will be the best fit for your manufacturing needs.

In Need of Compliance and Certification Support?

If your company’s values and goals include compliance, we are here to help! Allay Consulting compliance services work one-on-one with your company to create realistic safety and quality management systems that are unique to your company’s values and goals. Contact Allay Consulting to learn more about implementing FDA compliance, cGMP and good agricultural and collection practices (GACP) or organic systems, OSHA safety compliance, written documentation, facility compliance, certification readiness, and employee education.

Contact Allay Consulting to learn more about implementing a cGMP system, written documentation, facility compliance, certification readiness, and employee education!

About the Author

Kim Stuck is the CEO and founder of Allay Consulting. Direct correspondence to: kim.stuck@allayconsulting.com.