Brands and consumer packaged goods (CPG) companies are looking for ways to improve their partnership with contract manufacturers and packagers (CM/CPs) and get into longer term contracts to unlock a different level of value.
During a brand panel at the 2022 F4SS: The Foundation for Supply Chain Solutions event, the brands expressed that this entails CM/CPs taking on the role of innovation and growth partner, meeting with the brands marketing and consumer insights teams on to ensure both companies are on the same page. Brands are looking for CM/CPs that will tell them when they are being difficult to work with and who will offer services to improve product and process innovation, including those not already included in the contract.
“We actually entered a five year supply agreement with one of our key external manufacturing partners because we wanted their innovation and the partnership. And it's their formula. Traditionally we would own all the formulas,” said Steve Weinstein, representing Johnson & Johnson.
Another aspect the panelists honed in on was digital connectivity and an interconnected ecosystem to increase transparency to share operational and production data. Especially as supply chain issues have been brought to the forefront during the COVID-19 pandemic, collaboration between brands and CM/CPs is growing increasingly important to meet deadlines.
Though these abilities are what brands are searching for, a CM or CP first needs to get accepted on as a partner and given a contract. Suggestions the brand panelists provided were to develop connections in research and development (R&D) or supply chain, etc. in order to help the CM/CP get past procurement. Being a member of F4SS and similar associations can provide opportunities to develop such connections. Otherwise, focusing on the capability statement can prove how valuable of a partner the CM/CP will be.
 | The Future of CM&P Magazine |
By Robby Martin, Sr. Packaging Engineer at Bush Bros.
There is not a one-size-fits-all answer to this question of how CM/CPs can get noticed, but I’ll try to provide a few ideas that I’ve seen used, and that can be employed.
Trade Shows
Some presence where your information and participation lead to your organization being spotted in exhibitor searches, etc. can provide inroads or contacts you might not otherwise be able to generate. I didn’t realize the value of this approach for the brand owner until one of our suppliers expressed surprise to me that we did not attend a Private Label trade show where many CM/CPs exhibit every year. I’ve met some there and at other such shows that I would have struggled to meet anywhere else.
Missional Organizations
Organizations like CPA, provide opportunities for CM/CPs to have their profiles included in RFP and other search requests. The organization known as F4SS also provides lead and search assistance to brand owners and CM/CP providers alike via events and newsletters.
Price of Entry
Another key aspect of getting noticed is being prepared for follow-up needs that brand owners have. How you’ll handle NDA’s, requests for baseline documentation like SQF audit results, and other initial inquiries are questions you should have dealt with before you get such requests. So, be prepared to respond in a timely fashion.
Limitations
It is important that you know where you have limitations so that time is not wasted on a potential engagement that will be fraught with tension because expectations of the two parties are not lining up. Know how you will and won’t be able to work and know how to communicate these matters clearly in the earliest possible conversations. That includes things like minimum runs, minimum annual volumes, and access to your manufacturing facilities and production floors.
