As a start-up beauty brand, your Contract Manufacturer (CM) will be one of your most important partners. It’s important to do your homework, gather the facts and choose carefully. Know what you’re getting into:
How do I make the choice initially?
Interview as many CMs as you can. Get personal recommendations from experts.
Understand their capabilities:
- Their Minimum Order Quantities (MOQs). Many contract manufacturers either don’t work with startups or work with a limited number. Running small product batches and sourcing small quantities of components can be challenging.
- Their familiarity with regulatory issues
- Their specialties (category, OTC, organic)
- If they provide packaging. Do they handle sourcing and what is the charge for doing that?
- If they print cartons
- How they handle fragrance development. Do they work with fragrance houses to create the fragrance or do they have a library of stock fragrance options?
- If you’re using stock product from their library or creating your formulas, who owns the formula?
- Is that ownership important for your company?
Be clear on exactly what the CM provides:
- Direct and monitor outside testing for
- Drop test
- Warehousing/Shipping/Inventory management/Fulfillment
- Identify who will be your devoted account manager
- Get a commitment for the turnaround time for submissions and redirects
Know exactly what you’re paying for. Get the details for each part of the project in writing. Determine if there are up-charges for not meeting the MOQ for packaging, ingredients or manufacturing capacity.
Establish a transparent, honest and professional relationship in the very beginning and work hard to nurture it. If something goes awry – and it always does – you want to know the CM has your back.
How do I ensure I get the products I envision?
Write a robust, thorough, accurate Product Profile. Include the following:
- Timing: when do you plan to launch? Is there flexibility?
- Competition: provide information. You may think you’ve found white space, but chances are very good someone has tackled this positioning before.
- Restricted ingredients: do you have any based on your claims, your positioning or your demographic target?
- Fragrance direction: is there a fragrance in the formula? Is it fragrance free? Do you need a masking agent to cover a strong raw material smell?
- Aesthetics: define every aspect of the product aesthetics in great detail and provide benchmarks. Your idea of cushion and playtime may be different from your chemist’s notion.
- Cost of Goods (COGs): be very precise about what you can afford to spend on the formula (and the packaging). This is dictated by your distribution channel, your margins and your financial plan.
- Benchmarks: provide prototypes or competitive products to illustrate every criterion. -Claims/Benefits/Testing (cosmetics vs OTC drugs): be clear and precise about what you want to claim.
- Markets/Distribution/Demographics: focus on your target demographic. Define your ideal consumer and stay on message. The channel in which you choose to sell your product is critical and must be taken into account.
- Packaging/Applicators: are there applicators or specific delivery systems involved? This work must be factored into the formulating at the beginning.
What’s the best way to manage the process?
- Set weekly, standing meetings, even if by phone. Communication is critical.
- Create a timeline everyone commits to. Make sure the entire team is held accountable.
- Get all-inclusive cost sheets on all products/packaging.
- Spend time at the facility and understand the processes.
- See pre-production samples of EVERYTHING before final production starts.
How long will all this take?
That depends on a variety of factors. Once you’ve presented your Product Profiles, the CM should be able to map out the time table.
Word to the wise, it will almost always take longer than the plan. There are so many variables, speed bumps, unexpected circumstances and if you’re new to the process, you may find you change your mind.
Be prepared! Enjoy the journey.
The Young Group