The key questions to ask a manufacturer: Oppo
How do you go from creating a product on your kitchen counter to manufacturing it in for mass distribution?
Charlie Thuillier, founder of Oppo, has done just that. He came up with the idea for a healthy ice cream brand while kitesurfing along the Brazilian coast. The original business has now scaled up massively - their ice cream is now stocked in Waitrose, Ocado, Wholefoods, Holland & Barrett, Co-Op, Budgens and a host of restaurants, health food stores, spas, gyms and more across the UK. In this blog he shares the story of how he did it, and reveals the twenty questions you should always ask a manufacturer.
"Manufacturing can easily be one of the hardest aspects to get right when starting a product-based business - especially when it comes to scaling up. Your product might well be something you’ve hand-made, and suddenly you're faced with the task of turning it into a viable product you can sell on a mass scale. Here are my top tips, based on my own experience.
In 2011 my brother and I travelled to Brazil and (inadvertently) broke the unofficial world record for the longest distance travelled by kite unsupported. Soon we ran out of food, forcing us to search for alternatives along the remote coastline. What we discovered was amazing - fresh coconuts and other wild superfoods, all equally indulgent as they were healthy. This sparked an idea to make indulgent foods guilt-free, using the natural superfoods we found in Brazil.
I quit my job, founded Oppo and started the (very) long process of creating an all-natural, healthy ice cream. It took two years of failed attempts and broken freezers to perfect, but in October 2014 we launched straight into Waitrose and Ocado. A year later we were also stocked in Budgens, Holland & Barrett, Co-Op, Wholefoods, and a host of restaurants, health food stores, spas, gyms and more across the UK.
What's the best way for you?
Scaling up is hard. There’s no easy way around that, and I wish I knew then what I know now. I quickly realised my first question should be twofold - “Where am I going to sell this product, and how much of it am I going to sell?” This end goal should then guide and trickle down to everything else - packaging, sales strategy, brand, product, and where and how you manufacture.
Once you know this you then need to consider the best method for manufacturing. These fall into two basic categories:
- Do it yourself.
- Don’t do it yourself.
This topic is a blog post in itself, but my one recommendation would be to be aware of what you’re good at and what you’re not good at. This is easier said than done. It’s important to stay lean as a business, especially in your early years. ‘Do it yourself’ means renting or certifying your own manufacturing space (if you’re a food startup, platforms like Kitchup will help find a suitable certified kitchen). Whether this is the best thing for your business depends entirely on your end goal – where you want to sell, and at what quantity.
For the remainder of this post I’m going to discuss the ‘Don’t do it yourself’ method i.e. contracting the manufacture of your product to another business – a factory.
Finding a manufacturer
If you decide to sub-contract the manufacture, the company you choose will likely be your business's most important relationship. Everything is about your product, and you don’t have a good product without a suitable manufacturer. This relationship is crucial – but where do you start?
Finding them is the first hurdle. Googling, asking your network, asking buyers, and analysing where similar products are made are all successful strategies to building a list of potential factories.
Then it’s all about getting in contact and presenting yourself as a potential customer with great potential. Most factories are hungry for volume. They are often only really successful and profitable when running at high capacity (95% is ideal), yet very few are. You turning up on their doorstep could be a goldmine for them.
However, they often get hundreds of people turning up on their doorstep with an idea. So what’s different about yours?
Getting them on board
Your fledgling relationship with them now turns into a sales pitch – be confident and realistic about what you want to achieve and how you’re going to achieve it. Know your product, know your market, and know your timelines. And then - this is key - if your product has unique features, it's okay not to spill every detail about it. However, this is a balance. Remember that they are investing time into you, so don’t be rude; there are some factors they will have to know before you can progress. NDAs can of course be drawn up, but with companies of our size they can rarely be enforced. Make sure you trust the manufacturer.
Your first meeting should be all about relationship:
- Do you trust them?
- Do you like them and have a hunger to work with them?
- Can you trust they will do a good job in manufacturing your product on time, to the right recipe, and that they will look after your interests?
- Do they ‘get’ what you’re doing and have a passion for your brand and product?
- How open are they with costings, processes and manufacture?
- Will they steal your recipe and IP? Remember that at this stage this is all you are likely to have (it happened to me… twice!)
- Do they see the urgency behind your opportunity? Markets move fast.
The questions you need to ask
If the relationship clicks, then it’s down to the specifics. Below are twenty questions to ask your manufacturer. This certainly isn't an exhaustive list and it’ll change enormously depending on your industry, product, category, brand, company life cycle, relationship you want, how much you want to be involved in the manufacturing - but it's a good guide to covering the things you need to know! Make sure you ask product-specific questions too (whether they have the appropriate machines you want to use!)
- Do you co-pack (manufacture and package)?
- Who do you currently co-pack for?
- Would you be interested in co-packing for me?
- What are your packaging capabilities?
- Do you have any packaging restrictions?
- Are there any restrictions/ things we should be aware of with other brands that you work with or own?
- Do you have the capacity to run x units? What are your product development capabilities?
- Do you have an onsite product development team?
- Do you have a pilot plant?
- Do you have any restrictions in product development?
- What is your standard lead-time?
- Accreditations – who are you accredited by, and what grade did you achieve?
- Do you have a technical organogram (a diagram showing the structure) of the site?
- What allergens do you handle on site?
- Do you have any references who you're happy for us to contact?
- Logistics - where are you based and how are you going to get raw materials shipped, or the finished product removed?
- What is your category knowledge like?
- Admin details - who orders and keeps track of raw materials?
- Do you want to look after the entire product delivery (raw material ordering, manufacture, stock control etc), or do you want us to order all raw materials?
- Who is responsible for a recall and in what circumstances?
But remember, the most important factor to look for initially is relationship click. Without a decent manufacturer, you don’t have a decent product. Without a decent product, you don’t have a business. This is the most important relationship you are likely to ever have in your business. Invest in it. Grow it. Look after it. Don’t neglect it.