For many entrepreneurs, the idea is the easy part. Whether it comes via a flash of inspiration or is the product of years of dedication to a craft, the product idea is why they jump out of bed in the morning ready to go.
Taking that idea and then building a business that can scale is where it gets hard. That's where emerging brands can lose focus and get lost in the multitude of tasks required to be successful.
"It's just endless," said Cathy Bacon, owner of Freedom Foods, a Randolph, Vt. co-packing company, during the opening panel discussion at the Emerging Brands Summit that took place on Oct. 23 at PACK EXPO International in Chicago.
The summit, a daylong series of educational sessions and networking opportunities that took place on the first day of PACK EXPO, also served as the public debut for the Emerging Brands Alliance, a new online community for founders of start-up consumer packaged goods companies launched by PMMI Media Group, the publisher of Packaging World and sister brands ProFood World and Healthcare Packaging. The alliance provides a forum where brand owners can access educational content, network with one another and access resources, including an online supplier directory.
"Now more than ever, brands need support and adequate resources to keep up with the rapidly growing demands they are facing," said Kim Overstreet, director of the Emerging Brands Alliance.
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Co-manufacturers and Co-packers Can Help
One place that many emerging brands stumble is in manufacturing and packaging their products. It can be fiendishly complicated, extremely capital intensive and, perhaps more importantly, can pull founders away from focusing on the fundamental work of marketing and branding their product.
That's where co-manufacturers and co-packagers can help fill the gap by providing start-up CPGs with a production facility for hire. Co-manufacturing and co-packing is the use of a third party to manufacture and package a product. It's a way for emerging brands to speed their time to market, reduce their cost and remove a level of risk from the capital equation. Working with a co-manufacturer allows businesses to put their resources into building their market and brand, not in figuring out how to manufacture it.
“I can say without fail, those companies that build their own facility are out of business,” said Bacon.
That's not to say that co-manufacturers are a panacea for the growing pains a start-up company can face. Relationships are key to a successful CPG/co-manufacturing partnership.
Focus on Relationships in Co-manufacturing and Co-packaging
Co-manufacturers and co-packagers are busy, warned panel moderator Carl Melville, consultant and managing partner at The Melville Group. That's why it's especially important that emerging brands do their homework before approaching them to avoid wasting their time.
Be clear about your goals and what you need, said DeAnn Devenney, director of sales and marketing at Elkhart, Ind.-based Maverick Packaging. If the co-manufacturer feels like they have to do a lot of handholding then it's not going to be a great fit. That's not to say that brands need to have all the answers; rather they should have a clear idea of how they envision a co-man or co-packer can fit into their business plan.
"The more information you bring to the table when you first start talking to co-mans the better that opportunity is going to look," she said. "As much as you can bring to the table, that's going to help build a relationship out of the gate."
Transparency Is Key to Building a Successful Relationship
From there, it's just like any relationship. It takes continued effort from both parties to deliver results.
"If you are growing your brand, everyone has to roll their sleeves up," Bacon said. "Be prepared to work. Just because you're handing it off to a co-packer, doesn't mean you're walking away from it."
Transparency, honesty and communication are essential. Not only can they help work through the inevitable challenges that arise, they can also be the source of new ideas, said Leslie Dahlin, director of finance at GreenSeed Contract Packaging Company. Test days and onboarding processes are a great place to work through problems and build relationships.
"Really getting to know the people you're working with is key," she said.
It comes down to sharing your goals and objectives, so your co-man or co-packer can get on board with where you're trying to go.
"The co-packing relationship is personal," Bacon said. "If you grow, we grow. We all grow together."
