Why are co-manufacturers so hard to find?

At the very heart of what Rescale does, this question lingers: 'Why are co-manufacturers so hard to find?" Here are some common critiques I hear from people who don't understand the full picture:

• "Co-manufacturers are bad at advertising themselves. Their websites are impossible to find."
• "This is a brand, not a co-manufacturer - they don't have 'co-man' listed anywhere on their website!"
• " They don't have the slicer I need, I'm disqualifying them."

Of course any of those points can be valid, but it truly took me 10+ years of deep, granular level experience in the space to understand the dynamics from a more wholistic view. For those of you not familiar with my background, I have led over 100 co-manufacturing site visits, onboarding, and search processes for big players (Trader Joe's), and emerging brands (Atlantic Sea Farms, Zab's, Slutty Vegan, IPSA).

I've tried to break this article into 4 components that build on one another -- really let each one sit with you for a moment.  Once you understand them more fully, you'll have a better idea why manufacturers aren't google-able, and why it really does take a wide outreach to a broad set of options to find the best match.  (quick plug -- Rescale has been built with this deep industry expertise at the core of everything we do. All of our tools are specifically designed to help you get to trials 2x faster, with 30% more competitive bids.  Learn more here.)

1. Many co-manufacturers look like a brand

When I worked for Trader Joe's, I traveled the country visiting over 100 manufacturers. More often than not, the manufacturing facility would have signage everywhere with the manufacturer's brand name.  I don't mean "Cake Corp" or some other clinical manufacturing name, I mean "Cindy's Cakes" with great branding, a clear story and perspective, and a devout customer following. These manufacturers are brand names you'd recognize from your grocery store. Their website echoed this focus -- listings of their products, where to buy them, maybe or maybe not a picture of a facility. From any external presenting indicator -- website, facility, even trade show booth -- you'd NEVER know that this brand is also a co-manufacturer.  

When I walked inside the facility, however, the production floor told a different story.  I would see their products alongside Kirkland, WholeFood365, and emerging brands'.  Under the hood, this "brand" had invested in large scale equipment to bring "Cindy's Cakes" to scale with great COGS, but it meant lots of unused line time that they needed to fill.  No one wants their $5M ovens sitting unused half the time! They became a co-manufacturer from necessity, and it proved to be a great way to diversify their revenue, so it stuck. 

As another example, I once spoke with a former operations leader at a well known snack brand - something crunchy with a unique texture.  What I learned was the unique texture was only achievable through the use of a huge, expensive piece of equipment.  They bought the machine -- but they only needed it 20% of the time to fulfill all of their demand.  Over time, they filled the other 80% with co-man brands; brands that produced a snack with the exact same texture.  They prevented conflict of interest by carving out geographies and flavors exclusive to eachother's own brand. (This is where proper NDAs and agreements can be crucial — check out our post about NDAs and RFPs here).

2. For most, even being a co-manufacturer is a fluid state

Like I mentioned at the top of this post, take a moment to sit with #1. Once you really understand it, this point will be obvious. 

I'm going to use another story to illustrate point #2.  A couple of years ago at ExpoWest, as my co-founder and I were exploring what to build in the food&bev supply chain space, we walked the floor and asked brands to share their co-manufacturing story.  Typically, there were three paths:

(1) We make it ourselves, painfully, and we want to outsource to co-manufacturers

(2) We outsource to co-manufacturers

(3) We make it ourselves at scale

As a brand evolves, they can flow between these states or across multiple at once.  A new brand almost always falls in (1), but a 3-5 year old brand almost always falls in (2), whereas a 15 year old brand is likely to fall in (3), with maybe some new product lines in (2). Because we learned above that co-manufacturers are often brands, this applies to them, too.  A brand in (3) is often a co-man.

3. Capacity, capability, equipment, and MOQ is fluid as well

This is one of the most nuanced points to get across as we've built Rescale (best in class database of all co-manufacturing capability for food & bev manufacturing in the US + tools & expert guidance). We're often asked:

• "Do you have the exact capability that I'm looking for?"
• "Does their MOQ fit my needs?"
• "Is this information up to date?"

The short answer is yes - we're utilizing AI and manufacturer input to build the first real-time capability, MOQ, and capacity tracker to ever exist in food & bev co-manufacturing. The longer and more accurate answer is -- co-manufacturers need to see your exact project and map it to their exact current use to determine if it's a good fit.  

If a co-man just bought a new piece of equipment to support their own production, but they can only fill 20% of the line time -- voila! They have capacity, and they likely have low MOQs because they just want that machine occupied! If a co-man just lost another co-man client -- voila, capability (which they previously may have no disclosed because it had no capacity) unlocked! 

If you truly understand and internalize this point, you'll learn why experienced consultants from all walks of life do this process the exact same way -- the same way we've built tools for you to do seamlessly -- we start with a broad initial list, and quickly share non-proprietary information to verify current capability, MOQ match, and capacity.  (There's no easier way to pull this off than on Rescale -- it's why we've built our platform this way.)

4. Anyone with a manufacturing facility will consider a co-manufacturing opportunity if it's a good fit.

I'll end this list with another specific example.  We're currently in the final stages with a brand and co-manufacturing match that is really perfect.  Let's take a look at how their experience mapped to this list:

(1) Co-manufacturer is a brand, and has no mention of co-man anywhere on their website, at their facility, or trade shows (co-man looks like a brand) ✅

(2) Co-man has co-manufactured before, but are currently doing no co-man work (coman is fluid state for them) ✅

(3) They didn't have every piece of equipment needed for this project before beginning conversations (fluid capability) ✅, some items in the brand portfolio don't meet their standard MOQ (fluid MOQ) ✅, they recently bought equipment that increased line time (fluid capacity) ✅

Without the brand doing a deep, comprehensive co-man search (that involved 30+ options in their initial lead list), they never would have found and negotiated such a valuable partnership. The co-manufacturer looked at their project holistically -- they printed off the Rescale template RFP, sat around a conference table and discussed the potential of the brand opportunity with their R&D team, sales, operations, logistics, and finance team.  They determined this specific opportunity was a good fit.

If there's one thing you remember from all of my Rescale resources, please let it be this:

Finding the right co-manufacturer isn't about indexing the available options down to the minute details from the start. If the brand above had done that, they would have come up empty handed. If you expect to find a magic list where you can apply filters down to a single option, you'll end up empty-handed, too. The best way to find a great co-manufacturer is to start with a broad list of options that fit 80% of your expected requirements and then collaborate with them to reach 100%.

A great metaphor for this is dating—if you filtered every option down to each excruciating detail, you’d be unlikely to find the right match. If you look for someone with 80% of what you want, as you get to know each other, you can find common ground on the last 20%.

That's it for now - happy searching! If you have project specific questions, or blog ideas, don't hesitate to reach out via email or book a call with me.