A contract juice manufacturer (CJM) is a company that manufactures, (co-packs or private labels) juice and other beverage products for other businesses.
What do they do? What can they make? What are the benefits of using one? Find out in this blog post!
A contract juice manufacturer is the company another company will partner with to handle all of the juice production services. A contract juice manufacturer will typically oversee the entire manufacturing process and the product creation.
Picking the right contract juice manufacturer will take some time and research and therefore it is important to be clear on the following:
Why do you need a contract juice manufacturer?
Is it because you want to save time, money and effort in the start-up phase of your business or product?
Or do you have a higher demand for your product than you can service and need additional support?
Or maybe you just want to focus on your core business (or marketing of it) and think it’s easier to have another company take care of production?
What exactly would you like them to do?
For example, which part (if not all) of your process do you want to outsource?
Where do you need them to be based, location wise?
Obviously the closer they are to you the less transport and logistics costs and challenges you will have.
What are the production time frames you need to ensure are met so you can supply your customers on time, every time?
Is there anything unique, or complicated about your production process?
If so, you will need to ensure your contract juice or beverage manufacturer can handle this / these.
Why is contract juice manufacturing so important?
Working with a contract juice manufacturer enables companies with limited time, money, equipment and staff resources to be able to create great products.
Contracting gives the hiring company access to experts who can oversee the entire manufacturing process, handle quality control, and lead times.
Why contract juice manufacturing?
By letting a contract juice manufacturer handle the production process, the hiring company can reduce costs and simplify their supply chain management by not having to manage the whole manufacturing process and facility.
They can then focus their attention on the things they do best like selling, marketing, and customer service.
What is an example of contract juice manufacturing?
Some of the most obvious examples of contract juice manufacturing is in supermarkets such as Coles and Woolworths who private label their own brand of juice to sell in store but have it produced by a third-party contract manufacturer.
Forms of contract juice manufacturing
Using the contract juice manufacturer’s equipment or facility.
For example, a company may not want to buy a big facility but they still want to control the production. Companies essentially just lease the space or equipment of a contract juice manufacturer.
The downside is most contract juice manufacturers won’t allow this option because of the health and safety requirements as well as the need for their own space to produce for all of their other clients.
Producing smaller elements of a larger product
Some companies contract other companies to produce specific parts of their production.
For example, Synergy Food Group produces fruit peel for Ice Cream companies, Breweries and Distilleries but those companies still produce the ice cream, beer or spirit and just add the peel as an extra.
Full-scale juice or beverage production
Is the most extensive and common form of contract manufacturing.
Companies contract a juice manufacturer to oversee every aspect of the manufacturing process, but the hiring company’s brand gets the credit.
This is often referred to as private label, white label or co-pack(ing) manufacturing.
A unique hybrid juice manufacturing model
Synergy Food Group provides a unique addition to the full-scale production service in that they will work closely with your company to develop the recipes, flavours, label, bottle, cap and packaging design and sourcing with you (at no cost) before they engage in the full-scale production for your company.
How to choose the right contract juice manufacturer
Choosing the right contract juice manufacturer is an important decision and is critical to the success of your business.
If you can find and partner with the right juice manufacturer it will make your business and life flow a lot easier.
Pick the wrong manufacturer and the time, money, effort and emotional roller coaster you will experience could be worse than if you had set up your own production facility.
Here are some key factors to implement when looking for your ideal juice or beverage manufacturing partner;
- Be clear on what you want (as per the questions above)
- Interview lots of options
- Know the market value of their services
- Understand their and your capabilities
- Check their experience level
- Evaluate the staff’s competencies
- Compare cost savings versus doing it yourself
- If at all possible, speak to some of their existing clients
- Weigh up the pros and cons of all of the options and then
- Make your choice (but take your time)
- What to look for in a contract manufacturer
As you go through the process of selecting a contract juice manufacturing company, you’ll want to look for certain elements that can tell you a lot about the way they do business.
The most important factor to consider is whether or not the company has an HACCP or SQF accreditation.
This third-party evaluation helps ensure that the manufacturing company follows all the appropriate statutory and regulatory health and safety requirements.
If you don’t see any sign of HACCP or SQF accreditation then move on!
While the HACCP or SQF accreditation is a great starting point, you might want to also check for some of the following:
- A clean facility
- Proper facility management
- State of the art equipment and technology
- Ability to meet demand
- Internal quality standards
Benefits of contract juice manufacturing
The benefits of working with the right contract juice or beverage manufacturer are significant.
- Focus on your core business
The most obvious benefit is the ability for the hiring company to focus all of it’s efforts on it’s core business, be that marketing, customer service, or the day to day operations of their retail chain or brand, rather than adding more complications to their existing business.
- Significant cost savings
When you consider all of the expenses associated with running a juice or beverage manufacturing plant such as staff, factory, machinery, time and effort to set up supplier relationships, health and safety accreditations, training etc it can be daunting.
Most businesses just don’t have the capital to invest in all of that and then spend the time, money and effort on marketing, growing and servicing their company.
Contract juice manufacturers have already invested in all those expenses, enabling the hiring company to pay less in the long run and focus their dollars on factors that will improve their sales.
- Quality control
The best contract juice manufacturers take pride in what they do, and while your company likely has its own set of quality control processes, having another set of eyes on the manufacturing side of things never hurts.
- Increased production capacity
Contract juice manufacturers are experts at scaling because they are used to adapting to the needs of their hiring companies including changing product lines, recipes, flavours, batch sizes, adjusting lead times and maintaining quality standards.
What are the risks of contract juice manufacturing?
Obviously finding a high-quality contract juice manufacturing partner will provide your company with some amazing benefits, but there are some risks involved.
Like any business relationship, there’s always the chance that the contract juice manufacturer you work with could end up causing you some unexpected problems.
On occasion, some less-than-ethical contract manufacturers have sold one client’s product ideas to another client they favour.
Others have just straight-up stolen the idea because they saw an opportunity in their local market.
This highlights how important it is to take your time with the selection process.
DO NOT go with any company that feels untrustworthy.
A more foolproof way of avoiding situations like these can come in the form of a clear legal contract protecting your product and any intellectual property that goes with it. Any expense or work in this process will be well worth it in the long run.
Downsides of contract manufacturing
Other challenges that could arise, but that are less risky include:
Cultural differences like social expectations or language barriers.
Loss of control in the production process because they’re outsourcing that part of the production process to the contract manufacturer. Some business owners or leaders find it very difficult to surrender that power.
You are not the only client and it’s important to understand and accept that your contract juice manufacturer works with other clients. This means that your needs may need to wait sometimes because they have to handle a different client’s problem.
When should you use a contract juice manufacturer?
Contract juice or beverage manufacturing is best used when companies fit any of the following categories:
- Limited internal capabilities.
Sometimes companies just don’t have the people in place to kickstart, manage, and scale a manufacturing process.
Doing so can become a distraction for their leaders and take their focus off of growing the company.
Contract juice manufacturing allows the product to still get made while empowering the team to focus on their core competencies.
- Limited resources
Similar to point one above, companies would rather utilize the time and money required for in-house manufacturing on other aspects of the business and will benefit from contract manufacturing because of the cost savings associated with it.
- Overwhelming production process
Is your production process too complicated? The best contract juice manufacturing companies can simplify supply chain management and reduce the complexity of the entire production process.
- Fluctuating demand.
Most companies have a hard time forecasting the ups and downs of their sales, making it difficult to produce the right amount of their product at the right time. Contract juice manufacturers are highly skilled in this area and can help you reduce excessive spending and/or ramp up your production needs as required.
- Multiple flavours or product lines
If your company is growing rapidly and wants to innovate with new flavours or completely new product lines, having a competent contract juice manufacturer that can accommodate is a huge benefit.
Questions to ask a contract juice manufacturer
If you have decided that using a contract juice manufacturer is what you would like to do, it’s important to remember it is like any relationship, it takes effort and is a big commitment, so you want to make sure you ask them the right kind of questions so that you know what to expect.
You don’t want to leave anything to chance.
Some quality questions depending on your company’s needs, might include:
- How will our intellectual property be protected?
- What kind of pricing transparency do you offer? Should I expect any hidden fees?
- Who will be our company’s dedicated point of contact?
- What processes are in place to maximize efficiency and flow on-site?
- What do you need from us to help you understand what recipes, flavours, products we want produced?
- Will my orders be consistent each time?
- What are the next steps to getting this relationship started?
Contract juice manufacturing agreement
Not all contract juice manufacturers are created equal, so you want to make sure you protect your company from any potential problems that may arise.
You can do this with a clear agreement that sets up expectations on both ends, protects you from theft, and states any other specific concerns that may arise.
Picking a solid contract juice manufacturer can bring significant benefits to your company, but the process shouldn’t be taken lightly. Make sure you cover all your bases.
When you do, you’ll be able to fully experience the incredible advantages of contract juice or beverage manufacturing.
If you would like to speak to Synergy Food Group about your contract juice, cold pressed juice, non-dairy, peel or functional beverage requirements then Contact Us.
Synergy Food Group contract manufacture for Australia’s leading juice & specialty beverage brands.
We were the first Australian company to innovate fruit and vegetable based Cold Pressed Juice, utilising High Pressure Process (HPP) technology, plus we produce a variety of specialty beverages such as Nut Milks, Protein Waters, Functional Beverages, Superfood Smoothies & Coconut Waters.
Some of our clients also use our juice as a premium ingredient to enhance other products such as Ice Cream, Cider & Beer.
Situated in central Sydney has allowed us to build a strong network of Farmers and Producers to source the freshest ingredients.
Synergy Food Group is licensed to produce both raw unpasteurised juice & juice utilising HPP technology and we are SQF certified, ensuring the highest food safety standards.
Our clients range from large retail chains, to boutique juice & specialty beverage brands who have a passion for providing high quality, innovative products to their loyal, health-conscious customers.
Whether it’s for the markets, cafes, restaurants, retail outlets, supermarkets, or international distribution we’ll tailor a cold pressed juice brand or specialty beverage that you can be proud of.