Finding the best co­-packer for the job is tough.

There’s so many factors at play: space, time, money, capabilities, current kitchen tenants etc. Everything should influence your decision. Why? Because when and if you have to switch co­packers, it costs a lot of money and time to move everything over.

This section helps you make the right decision the first time.

Below, you’ll find a list of things to consider as you tour different kitchens, meet kitchen managers, talk with current producers, and assess the company. This is by no means an exhaustive list, but gives you a great starting point.

Before we get too far into this extensive guide, I wanted to let you know this is just one part of The Complete Guide to Profitable Co-Packing. Check out the step-by-step guide if you’re thinking about working with a co-packer to scale food production.

What You’ll Learn:

• 12 things to consider when selecting a co-packer
• 5 ways to know your co-packer is the real deal
• Narrowing the list of co-packers

12 Things to Consider When Selecting a Co-Packer

1. Size of the facility

How big is the kitchen? Is there enough room for you to produce? And don’t forget: take into account any space you’ll need should you have to bring in a specific piece of equipment to produce your product. I’ve produced in 700 square foot kitchens and 7,000 square foot kitchens. Both have met my needs, but the smaller space has met my needs better.

Think storage space, too.

You’ve got to keep everything stored there (or truck it in and out for each production). And by everything, I mean raw materials/ingredients, all of your packaging (glass jars, plastic caps, labels, boxes, hang tags, etc), and if you ship out of the facility, your finished goods will also need a pallet to stay on.

You’re not the only producer.

There may be a number of producers who already lay claim to much of the space. The question you (and the production manager) have to answer is, “is there enough room for your company to move in?” Large kitchens (3,000 square feet and up) tend to have space for a certain number of manufacturers. If you don’t get a meeting with a co­-packer, it could be because they’re at capacity in their facility.

2. Number of employees

A typical co­packer is made up of 3­5 employees. I explain who below, but bring it up as a concern because you may need more than one person to help co­pack for you. In my experience, it’s taken a team of 3 people to make 80 gallons of mustard ­ sometimes 4 or 5 if the facility is under a time crunch.

Does the kitchen you’re looking at have enough employees?

It’s something to consider. Are you going to hop in and help if something goes wrong? I’ve helped on several productions because it’s my company on the line. We needed product to meet large purchase orders. As a small producer, you hope for enough team members, but sometimes it doesn’t happen.

Ask about part-­time help.

Does the co­packer you’re looking at bring in help when they need it or are you responsible for finding extra help. One co­packer I know has an army of part­time workers who are called on when she needs help the most. All of them are great people willing to lend a hand. Truth is, the kitchen manager isn’t going to always be the only one handling your product. That means you should meet as many people as possible when you go for a tour.

Now, on to who typically makes up a co­-packer’s staff:

General Manager: This is the person who runs the show. They were likely instrumental in getting funding to open the facility. They know if you’ll fit in the schedule. And they have a general outlook on the industry.

Kitchen Manager: Sometimes the same person as the General Manager. The Kitchen Manager is the one who oversees and participates in all of the productions, 5 days a week. They know how to make every product, how much product they can make in an 8­ hour day and if you’ll be able to produce your product on the equipment currently in the kitchen. It’s also likely this person is ServSafe certified (mandatory for third­ party certified kitchens ­­ more on that later in the list).

Food Scientist: These guys are the brains behind the operation. They know everything there is to know about food processing ­ from pH to fill temperature, acidified foods, to scaling recipes. They’re knowledge is indispensable. Make sure someone knows something about food science at the co­packing facility.

1­2 production assistants: Need help weighing out ingredients, filling or labeling product? These people handle all the nitty gritty at the facility ­ even washing the dishes. As mentioned above, there may be more than 2 of these people because they rotate in and out.

Small Business Advisors (optional): One of the leading shared kitchen & co-­packing incubators in Vermont has a small business development liaison’s office in the building. This is super helpful to producers because now they have business planning and consulting (free, I might add) at their disposal. While this is likely to not be a position in many co­packing facilities, business management cannot be overlooked.

3. Production capability

How many units can the facility pump out in a day? Would they have to produce every day to meet your demand? If they do, it’s not a good fit. But, make sure they can produce on a regular schedule. The last you want is to be stuck with no product and purchase orders out your ears with no available kitchen time.

Plus, look at what equipment they have.

Do you need to furnish any special equipment to produce your product? Or, does the kitchen have everything you could ever dream of? Make sure to ask specific questions about equipment. And if they don’t something you need, see if you need to buy it outright or if the facility would be willing to purchase one for you if you sign a year­long contract. (More on that in the pricing section later).

Production capacity is important because you may be growing, too. What starts out as 50 cases of product a month may double or triple (like it did for me). That means you need to find a facility that can grow with you ­ not just one for your current needs. Keep that in mind.

4. Distance from your home

Pretty sure you don’t want to drive hours to your co­packing space. That would be crazy on so many fronts.

That means, you need to take proximity into account.

Find a kitchen that’s close by. Otherwise you’ll feel like all you do is drive back and forth ­ wasting both time and money. Two resources that are limited, right?

On a personal note, w​e used to drive an hour each way to our first co­-packer.​I chose to drop or ship all of my ingredients (to avoid a fee you’ll learn more about later). Sometimes, that meant driving back and forth 2­3 days a week. That ate up a lot of time I could have used to sell more product.

Currently, we’re 15 minutes from our co­-packer.​It’s made all the difference. I can coordinate more local deliveries of perishable product, if there’s an emergency, it’s easier for me to fix it, and well, the most obvious advantage being that my product is closer to me if I need it.

For some of you, you may have to drive long distances. On the plus side, the gas can be written off as a business expense, but don’t you want to be able to have time to build your company? Then travel distance should be taken into account when selecting a co­-packer.

5. Receiving capability

Your ingredients, labels, and packaging have to make it to the kitchen, right? Figuring out how that happens is important when you’re selecting a co-­packer. Here’s a couple receiving tips/questions to keep in mind:

Is someone always there?

Not only do you frustrate the UPS delivery man when no one is at your co­packer, but it’s frustrating for you, too. Make sure you know when and where to have deliveries dropped off. Why so important? Think about this: if you have refrigerated or frozen product being delivered, it has to stay at a certain temperature. Your butter or eggs can’t be left outside in the summer ­ that would just cost you a ton of money.

Do they have a forklift?

This is going to be kitchen dependent. If the kitchen is less than 3,000 sq ft, it’s likely there’s no room for a forklift. But, if you’re getting a pallet of all­purpose flour delivered, you probably don’t want to move it bag by bag. That’s why a forklift comes in handy. You can transport product from one end of the kitchen to the other.

Is there a loading dock?

Chances are you’re going to have to bring in a lot more raw materials than at your previous kitchen. That makes a loading dock handy. Large semi­trucks can pull up to the receiving area and simply slide a pallet off their truck. Without a loading dock, you have to request a liftgate from the trucking company and there’s an extra fee for the liftgate.

But, it makes your new co­packer super happy when they don’t have to climb onto the truck to disassemble a pallet with over 300 cases of glass jars (Yep ­ I’ve been there!). Bottom line: Get a liftgate on the delivery truck or ask if there’s a loading dock at your co­packing kitchen.

How do deliveries work?

Many co­packers are logistical nightmares. There’s deliveries coming in daily, product being made daily, and employees needed to handle large drop­offs. That’s why it’s smart to learn how deliveries work at the co­packer. Can they only come on certain days? Are there weight restrictions? And what about deliveries that take up all of your storage space?

It’s best to iron out these details before you sign anything. That way you know exactly what you’re getting into. For example, at my current co­-packer it requires a little more leg work, but I don’t pay a premium for it because I’m doing the extra work ­ even with deliveries.

It’s important though ­ you’ll be sending materials to the kitchen all the time. It’s best to know how it works.

6. Pricing structure

This is its own section later in the guide, but I’ll give you the quick version now. Co­-packing pricing can be some of the most confusing pricing you’ll ever see. It’s not as simple as a flat fee you pay every month. It gets much crazier.

How co-­packers price their service

There are two main ways co­packers price. The first way is a flat day­rate. It could be anywhere from a couple hundred bucks all the way up to $1,000 or more. This is the way I started out at my first co­packer. I paid a day­rate. That forced me to crank out as many units as I could on each day. Why? Because the more units I produced, the lower my labor rate was. It’s the only cost factor I could leverage.

The other way to charge is a per unit price. T​his is often figured out after you and co­packer meet to go over how your product is produced, how many people it takes, is there downtime, do things sit overnight, etc. Based on time involved (including prep), your unit price may fluctuate as I’ll discuss later. Per unit pricing is nice because you can predict your unit costs more accurately.

Where many co­-packers get you

There are all sorts of fees when you start to work with co­packers. Everything from receiving fees to consulting and storage. Again, these are listed out later in the guide.

Work through your numbers early

Whatever pricing gets handed to you when you engage with a co­packer, make sure you work through the numbers to see if you’re still going to make money. You do want to make money, right? If you’re going to be producing a guaranteed amount, you may want to look into contracting so that you get a flat rate throughout the year. It’s not only about the price of your product when it leaves the warehouse, but it also means your profit margins throughout the distribution channel.

7. Owner & employee personality