Contract Juice Manufacturing (also known as Contract Manufacturing, Co-Packing, Contract Beverage Manufacturing, Private Label Juice Manufacturing or White Label Juice Manufacturing) is by far the most-used form of manufacturing by Juice, Cold Pressed Juice, Non Dairy and Beverage companies across the globe in need of outsourced manufacturing services.

Because the Juice and Cold Pressed market in Australia is quite small it is very common for start ups, and even small, medium and large companies to use contract juice manufacturers to scale their production to levels that would be otherwise impossible in-house.

As with any business model, contract juice manufacturing (CJM) has significant pros and cons.

By completely outsourcing your juice manufacturing services, you can save significant overheads, but you could also be giving away a large portion of control in your juice manufacturing process.

In this article we’ll explain what the business model is as well as some important contract juice manufacturing pros and cons:

What Is Contract Juice Manufacturing & Why Is It Important?

Contract juice manufacturing makes juice and cold pressed juice (and often non-dairy products, such as nut milks and functional beverages) possible to companies that lack a full-service, in-house manufacturing team, plant or resources.

Contract juice manufacturing involves outsourcing a company’s product manufacturing process to a trusted manufacturer.

Typically the owner or product developer from the company looking for a contract juice manufacturer will provide either existing ideas or completed recipes and documentation and the contract juice manufacturer will then manufacture the product from start to finish, therefore taking the production burden off of companies.

Sometimes a company will outsource the entire juice manufacturing process, including the recipe / flavour development, label, bottle, cap and box design to a contract juice manufacturer and sometimes they will outsource only some of their requirements.

The choice is essentially up to the owner of the product and their requirements and ideally a trusted manufacturing partner should be able to accommodate all manufacturing options.

Contract juice manufacturing is a vital component of the beverage manufacturing industry.

A high-quality contract juice manufacturer makes it possible for companies and start-ups with limited resources to manufacture products.

In addition to that, they provide specialized, technical manufacturing insight that an in-house team cannot.

Overall, contract juice manufacturer’s create more opportunities all-around for emerging technologies.

Advantages of Contract Juice Manufacturing

Contract juice manufacturing is a crucial tool for small business and entrepreneurial start-ups looking to make their juice, cold pressed juice or non-dairy beverage the next big thing in their market.

The following are a few more advantages CJM’s provide:

Save on Costs & Maximize Profits

With a CJM, you can save on costs significantly. By outsourcing your juice manufacturing, you will not have to dedicate valuable in-house time, money, staff, space resources to manufacturing.

Working with a CJM eliminates the need to juggle between vendors and helps you avoid running into unexpected costs. You’ll reduce your labour costs significantly.

By knowing exactly what your manufacturing process will cost you ahead of time, you’ll be able to balance your budget throughout the entire product life cycle.

Increased Technical Insight

Contract juice manufacturers also provide businesses with technical insight and innovations found nowhere else. Since CJM’s manufacture juice, cold pressed juice and non-dairy beverages for a variety of companies, they have valuable in-depth knowledge into design and production for various beverage niches.

CJM’s also have the knowledge to spot potential risks and flaws within the recipes and flavours from the outset. This can prevent serious issues with a product and will save you a lot of money in the long term.

Contract Juice Manufacturers Provide You a Lot More Flexibility Within Your Company

Because a CJM will take on all or some of your manufacturing process, you’ll not only free up more time but also create more opportunities within your company.

When you choose to outsource the beverage manufacturing process, you’ll free up time to create more innovative recipes and flavours and design additional innovative products. You and your staff will have a lot more flexibility to focus on what’s truly important in your company.

Scalability

As a small business or start-up, it’s difficult to scale your product with limited resources at hand.

Because contract juice manufacturers have significantly more resources, they’re should be more than able to scale your product a lot easier and faster.

Whether you’re experiencing a spike in demand or a seasonal decrease in demand, contract juice manufacturers can quickly scale your production needs to whatever is necessary.

With these scalable measures, you’ll be able to take your product to new levels as well as control demand fluctuations.

Disadvantages of Contract Juice Manufacturing

As great as contract manufacturing sounds, sometimes it isn’t the best fit for a company. Below are a few potential disadvantages to contract juice manufacturing that you should keep in mind when deciding what’s best for your business.

Difficult to Find a High-Quality Provider

As with any industry or business deal, without doing the proper research, it goes without saying that you could end up outsourcing your juice production needs to the wrong company.

To find the perfect CJM, you’ll need to conduct thorough research into a partner that fits your capacity, capability and cost requirements and not to mention feel like they understand you, your values and your vision for your product(s).

A low-quality contract manufacturer can easily disguise themselves as a high-quality, reliable partner so be sure to do comprehensive research.

Unreliable providers can delay processes and deliver flawed end products because they cut corners with quality control, food and safety regulations as well as some other dodgy practices.

As they say, ”You get what you pay for and it’s not always about price”!

Your Readiness to Outsource

Some contract juice manufacturers require specific documentation with detailed production instructions. 

They will produce exactly to the specifications you provide and will not take any responsibility for issues with your recipe or documentation.

This can create problems and misalignment if your documentation is incomplete or inaccurate or if you need improvements to your recipe(s), flavour(s), product(s).

For these situations it’s worth considering whether you outsource to these manufacturers or delay outsourcing until your recipe / product development is fully ready to go.

Alternatively, find a contract juice manufacturer who is flexible and that can work with you to get the best outcome for you and your product(s)

Loss of Control

With a CJM, once you are clear on your requirements, you will have to give up control of the manufacturing process.

When relinquishing this control, you risk losing critical knowledge and skills around production techniques.

Without constant supervision, your company won’t be able to pinpoint any problems within production.

This is not a problem if you have a good relationship with your juice production partner, but again this loss of control needs to be considered to ensure that contract manufacturing is right for your juice / beverage business.

Communication Gaps

When using a contract juice manufacturing partner, you could experience communication challenges that may cause a variety of problems for the production process such as:

  • Unrealistic timelines
  • No set transition plan
  • Improper internal communication amongst your internal team
  • Misunderstandings of capacity qualifications

Separating recipe / flavour design from manufacturing removes the valuable direct feedback between these functions and can lead to errors and misalignment. 

In a situation where the product is not your core value or competency, you would probably benefit from outsourcing both the design and manufacturing to suppliers who have expertise in both areas.

Integrating these functions can improve recipe / flavour design efficiency and end product quality and provide a seamless transition production for faster time to market.

Intellectual Property Risks

A significant disadvantage of contract juice manufacturing is the risk of your intellectual property being stolen.

When you outsource your manufacturing, there is the possibility that you give multiple workers access to your intellectual property.

You risk your intellectual property being leaked.

You also risk the possibility of your intellectual property being misused, meaning your supplier would use it to their own advantage with them potentially becoming your competitor.

Again this is where it is highly important to ensure you find a trusted partner that protects you and your company from this potential risk.

Ultimately, whether you decide to work with a contract juice manufacturer or not will depend on your specific requirements.

A high quality, and trustworthy CJM is a great choice if you’re looking for solely manufacturing, but as you can see from above there are always risks.

For help deciding if a contract juice manufacturer is right for you or if your juice or beverage manufacturing process may need more customization contact Synergy Food Group today to discuss your requirements.

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.

 

Contact Synergy Food Group