How to find a manufacturer for your new food/drink brand
By Tom Lock, Founder, AP Brands
Many people have excellent ideas for food and drinks products. Sometimes it’s a popular family recipe that could prove equally popular with the general public, or it might be a new technique for creating better flavours and textures. However good the product there is a major transition to be made from cooking up delicious treats in your home kitchen to starting your own food or drink business.
As an entrepreneur with potentially huge demand for your product you’ll need to approach food and drinks manufacturers who can make the product at scale. This can feel like a daunting task with the financial and logistical aspects to consider as well as ensuring the product tastes just right.
Ensuring a high-quality flavour without additives is the unique point of differentiation for all four of the snacks brands I’ve launched over the past five years. That meant a clear focus on finding the right manufacturer. Here are some tips for you borne out of this experience.
Take account of the size of manufacturer
There are small manufacturers and there are large manufacturers, each requiring different ways of negotiating with them.
Small manufacturers will usually be more flexible, more willing to help with product development, and able to handle small order volumes. They are usually more expensive, however, and could struggle to meet larger volumes.
Larger manufacturers, on the other hand, will often be able to deliver the best prices but they often need larger volumes. As a result, you will need to be more bullish with your forecasts. I suggest you get onto Companies House and investigate their accounts to help understand their business before you reach out.
Get in touch
One of the most important pieces of advice I can offer is to speak to as many manufacturers as possible, especially if you have no prior experience in the industry.
Start by talking to smaller manufacturers to learn the process and find out how they might be able to help with product development. Then go on to speak to larger manufacturers to discover their volume requirements and the price difference.
It’s vital, especially in the early days, to be able to leverage your position to get the best pricing, and the best way to do this is to have as many options on the table as possible. By shopping around you will discover what is available, what the key points of differentiation are, and be able to plan a number of scenarios.
Learn the lingo
The more knowledgeable you sound, the more you’ll be taken seriously. Do your best to understand the lingo before you reach out.
Read books, trade publications like The Grocer, and as many other trade publications as you can and try to brush up on the relevant food law as well as general industry lingo. Terms like “ex-works” are alien to newcomers but are basic terminology in the industry.
Using the wrong word or being caught out on a piece of law may seem like a relatively minor error but companies may use that as a signal that you’re new to the industry and take advantage. A little research will go a long way!
Avoid being overly demanding
Manufacturers don’t like hassle. They are in the business of “making it” and then “shipping it”. Going in with a long list of complex demands straight out the gate will likely put them off working with you.
It helps to be as flexible as possible. Many manufacturers are put off by complex projects. So, at least at the start, make your project sound as simple and easy as possible, and wait until the second or third meeting to introduce complexity.
Start by defining the absolute essential aspects of your product, things that are fundamental to your brand. With Awfully Posh, for example, it was essential for the pork scratchings to be full of flavour without any additives. Aside from these considerations, which comprised our USPs, I could be fairly flexible. As such, it was relatively easy to find a manufacturing partner.
Sell your brand and vision
You need your manufacturer to believe in your vision, especially if you are pre-launch. Make sure you come prepared with a detailed strategy and share as much of it as you can with your potential manufacturing partners. Obviously, there will be aspects you don’t want to share, but the mission and vision need to be clear, practical and exciting.
Most manufacturers understand building brands is difficult, but if you can get them to “believe” in your growth plan then you should be able to convince them to start with smaller volumes and help you grow sustainably.
Spend time on detailed forecasting
It’s vital you are able to deliver a detailed forecast to your manufacturing partner. Don’t be scared to be optimistic, but make sure it is still realistic. Manufacturers will want to know that your brand is likely to grow, that the price works with your commercials, and that the relationship has longevity. Remember, manufacturers will have some skin in the game, having worked out the setup and production methods for your products, so they need to know the order volumes, profits, and range is likely to grow.
Don’t divulge sensitive informative but consider breaking it down by channel and by month, and doing it at least over two years. The more prepared you are the more seriously you’ll be taken.
Approaching food and drink manufacturers is an essential step for any new brand. You’ll be on a steep learning curve and will feel out of your depth at times. However, it’s important to remember that the manufacturers are there to support your vision and ideally form a long-term partnership which works for both of you. By doing as much research and preparation as possible you’ll give a positive impression while minimising the chance you’ll be taken advantage of. I wish you every success.
ABOUT THE AUTHOR
Thomas Lock is the founder and Managing Director of Awfully Posh (AP) Brands, a FMCG snacks company. Referred to by the Daily Telegraph as “the man who made pork scratchings posh”, Tom launched his pork scratching brand, Awfully Posh, in 2013. He soon launched a further three snacks brands, The British Crisp Co., The British Popcorn Co., and Create A Crisp, selling a total of over 5 million bags to date. AP Brands’ snacks are now stocked in supermarket giants such as ASDA, Tesco, Waitrose, Amazon & Wholefoods Market.