Outsourcing manufacturing nutraceutical products strategy will define which Indian company would become rich and which will be wealthy in the long run.
Outsourcing Manufacturing nutraceuticals products is Key?
What is the primary Difference between rich and wealthy nutraceutical companies? –
Rich nutraceutical manufacturers earn profits & money by putting all their time in production & selling their branded formulations via dedicated channel.
However the wealthy nutraceutical companies spend their money to earn time by outsourcing manufacturing nutraceuticals products thereby focus on exploring new buyers, via being able to their expand their demographics, look for ways to enhance market share by getting new formulations in pipeline, and are also able to focus on human resource development by strengthen their team & internal operational systems.
What volumes of individual product you sell should be of less concern to you and how much profits your are left after selling your product must be your priority concern, because your true wealth of your business is what is left in positive money after your sale has been concluded, one of the foremost strategy in gaining excellent profits is by outsourcing manufacturing of your nutraceuticals products to third party manufacturers.
Factors which prevent company owners to opt for outsourcing manufacturing of nutraceuticals?
Idea that Becoming the Pharma / Nutra Factory owner is the real deal:
Most of the company owners today within the pharmaceutical or nutraceutical manufacturing setup start off their journey by working as a Marketing Representatives (MR) or at executive capacity within the industry, where in they ensure either the production or sales of their employer company’s brands by getting in touch with health care professional.
Over (MR’s) career, they understand that in this sector margins are key to reaching great money goals and that just by trading or deploying affiliate marketing and working for other companies will not pave a way in achieving great success.
Mostly they make a transition from earning incentives on their sales and meeting targets to trading finished good and being their own boss (Learn more on how your nutraceutical company can grow even in expensive market – CLICK HERE).
Because they are motivated and driven by acquiring MARGINS and ultimately higher earning prospects they logically think that buying land for factory plant setup will entitle them to higher profits and allow them to control the production side of their product as well and thereby efficiently extracting margins from their production plant, however this decision is mainly linked with having land as an asset as well in form of a factory, the owner ship of running your manufacturing unit in itself a great feeling for any self made person.
As a company owners who has spend most of their time in selling products, researching consumer feedback and competition and being able to devise good quality customer experience, they now start to allocate their TIME by venturing into manufacturing with a single goal in mind that margins are sweeter.
Also the feeling of being a Factory owner has a glitter success label among peers and professional society. There is nothing wrong in starting your own manufacturing unit, but there certainly is a better way, a more profound & productive way, surely less captial intensive, which is outsourcing manufacturing of your nutraceuticals by giving the manufacturing load to existing manufacturing setup.
Its not like the end consumer will see the name of manufacturing company and stop buying your brand, if anything you will buy time to sell more by researching on how to increase volumes and categories of your product, also majority of such manufacturing initiatives initially find themselves struggling to find orders, because this type of manufacturing setup is sprouted from a sales background and not formulation one hence there are bottlenecks within production operation that owners face and delay their break even point or head towards closure.
Hence the real deal is to collaborate intensively with manufacturing setups and work to see high growth in your business rather than competing with existing manufacturers, look at the example of Asian Paints and Parle who outsource manufacturing in their respective products which is known as Job Work.
Checking for quality is a tough task:
Many companies believe that if they were to outsource manufacturing of nutraceuticals then they would not be able to ensure the quality of the same, this is not true always, when consumers consume healthcare or nutritional products, they usually are not on a one time basis because they are required on a daily basis, a serious third party manufacturing company knows this very well and they would not compromise on quality of the product, rather they might not be able to meet the rates or the price of the said formulation instead.
Executive employees are costly & labour is always cheap:
One of the primary ways to limit loss in a company is to reduce on its expenses, majority of companies which are in manufacturing are based in Baddi or Poanta Sahib districts in India which are special economic zones and the subsidies by the government for manufacturing units are nothing but premium returned margins in the future.
Labour being cheap is nothing but less expense than desks job based positions, such as marketing, designing and accounting cost more and hence diversified departmental recruitment is not preferred, because of the perceived higher cost of desk job positions, this is in a way limits the company’s ability to expand its reach in terms of new location venture.
Some companies due to their owners making decisions to start their own manufacturing units directly limit their products reach to export markets or diversify their portfolio. In real sense outsourcing manufacturing of nutraceuticals or similar products will ensure adequate time on sales expansion and in a ways limit risk of intensive capital towards manufacturing units.
Outsourcing manufacturing will allow your to test and measure if the products that you have been selling in a different brand will it be feasible in your brand, then you do not need to setup up everything from scratch if you go for outsourcing your manufacturing requirements, there is always a low risk as there is easy in & easy out from the market for your new product.
Where does Rass Biosolution come in?
Rass Biosolution Private Limited focuses on providing outsource manufacturing solutions to existing Pharmaceutical and Nutraceutical companies both which are into manufacturing and who are primarily marketing companies.
Contact us on +91-8090113353 to fulfill third party manufacturing of any type of formulations within nutraceutical, pharmaceuticals, herbal extracts and more.
Ruchi Khanna
ruchi@rass-biosolution.com
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