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How to build a successful service-provider relationship

So, you’ve decided to employ a contract manufacturing strategy for your secondary packaging to improve manufacturing flexibility and customer service, and reduce costs.

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This decision is not just a tactical approach to manufacturing but more likely a very strategic initiative. Your company is embarking on a path that will put your final packaging in the hands of a contract manufacturer. How significant will that be? The contract manufacturer will control your product’s appearance and quality as it appears on the retail shelf. How much of your total sales and potential profit will be in its hands, influencing both the first and second moments of truth with consumers for your product?

Given the weight of the decision to outsource, you will want to put processes in place that will provide the strongest chance for a successful venture. At a very top-level assessment let’s look at:

• Organizational capability. Does the contract manufacturer possess the facilities, equipment, and organization to meet your current and future needs? What evidence does the company provide to support a track record of successfully providing secondary packaging services? Does the contracted firm’s strategic business plan support your objectives?

• Business processes. Are the contractor’s processes and IT structure compatible/supportive of your own? How will you transmit your requirements, track financial performance, and record quality performance?

• Organizational culture and compatibility. It is important when selecting a packaging partner that the company’s values and culture will fit effortlessly with your organization. Is your organization prepared with the skills and initiative to create a successful relationship?

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