Some companies choose to carry out every stage of their process – from manufacture to shipping – in-house. Others may contract out certain functions, including packing. There are both advantages and disadvantages to handing over packing responsibilities to an outside firm, so you should consider your specific needs before making a decision.
The definition of contract packing
Contract packing is when an outside organisation is contracted to carry out the packing and distribution of newly manufactured goods, normally sending them directly to the intended market. Other names for this process include contract packaging and co-packing.
Contract packers such as www.wyepak.co.uk/contract-packing/ will offer different packing services depending on their available equipment and expertise. Not every service will be suitable for every product. The Association for Contract Manufacturing, Packing, Fulfilment & Logistics is the relevant trade association.
When to use a contract packer
You may choose to use the services of a contract packer if you are running a short-term promotion for a product you do not intend to stock in the long term or if your storage capacity is limited. If you are understaffed, do not have the right equipment, the equipment you do have is faulty or anything else is preventing you from meeting demand, contract packing may be the way to go. It can also help bring costs down, especially for new products if you are not sure whether it is worth updating your packing facilities.
When not to use a contract packer
There are situations when a contract packer may not be the most efficient use of your resources, such as when you already have the appropriate staff and equipment available in-house or are unable to work with the packer’s processes and suggestions. Contract packing is often not the most effective way to manage smaller product runs.
Choosing a contract packer involves assessing your own capacity and resources, particularly equipment, staffing, and budget. Clear communication with the packer is essential, and your contract should be carefully drawn up. If chosen properly, a contract packer can make your packing and distribution process more efficient in terms of time and costs.