Helping You Choose the Right Path With Paragon
Deciding on a manufacturing service model is one of the first steps in bringing a new product to market. There are many ways to approach the decision, but the key question to ask is this: Just how much of the product production should your brand handle?
The context in which a company launches supplements and nutraceuticals can vary greatly from one product to the next. Examples include:
- A small startup launching its first product.
- Adding a product to your established supplement brand.
- Branching into supplements as a departure from your food or pharma products.
- Developing a highly specialized supplement from a proprietary formulation or ingredients.
- Switching partners when your current supplement manufacturing process isn’t working.
- Adding a limited edition, short-run, or seasonal product.
For any of the above situations, there are two primary service models to choose between:
- Turnkey manufacturing.
- Toll manufacturing, or tolling.
Here, we’ll look at how these two supplement contract manufacturer options differ, how they play out during production, and some considerations for choosing what’s best for your company.
Turnkey Supplement Manufacturing Explained
In this end-to-end production model, the manufacturer you choose is responsible for sourcing, testing, manufacturing, packaging, and delivering your finished supplement product. Your company will have less direct involvement in the process, and you are generally invoiced for the entire project when the order is ready to deliver.
The Benefits of Turnkey Supplement Manufacturing
- Faster production and time to market.
- Continuity of the organization, facility, and QC process.
- Less work for your company than coordinating and vetting multiple vendors.
- Saves your company the cost of investing in equipment and staff for producing in-house.
- Testing (dependent on claims) and compliance are included.
- Lower risk of variation between orders.
This model is often best for startups, companies with multiple existing product lines, and those who are scaling up production and lack the equipment, facilities, or on-staff expertise to manage an entire supplement project. Also some companies who have in-house production capabilities may outsource due to overflow manufacturing or even specific manufacturing expertise that a contract manufacturer may have. One noteworthy benefit is that it allows your team to focus resources on marketing, branding, and customer services instead of sourcing and qualifying ingredients and components suppliers.
Toll Supplement Manufacturing Explained
In this model, your company will have a much larger and more active role in the entire process, requiring more resources – personnel, expertise, and time. In tolling, your company supplies all of the raw ingredients, components like capsules or pouches, and packaging materials, and the manufacturer does the blending, tableting or capsule filling, and packaging only. The terms toll manufacturing and tolling refer to the fee you pay to use the company’s equipment, personnel, and facility during production. Your company will be responsible for sourcing and qualifying all ingredients, testing, label creating and proofing, and compliance tasks.
The Benefits of Toll Manufacturing Supplements
- Saves the expense of paying the manufacturer for sourcing, testing, etc.
- Gives you more control over ingredients and relationships with ingredient suppliers.
- Gives you more visibility into the whole manufacturing process.
This model gives you more freedom over sourcing, which may be helpful if your active ingredients are hard to find or if you require a type of capsule the manufacturer doesn’t carry. However, there are downsides to this model, too. By sourcing ingredients yourself, you carry a greater risk of not finding them or paying more. It can also be more cumbersome to identify reliable alternative sources during supply chain disruptions. You also need to find a reputable lab for testing, or invest in your own setup. Finally, your chosen manufacturer may have a very high minimum order. For example, Paragon requires a 1 million capsule or tablet minimum order for tolling services.
Why Paragon Prefers Turnkey Supplement Manufacturing (and You Might Too)
At Paragon, we want your product to succeed! Because we have the experience and knowledge to see even complex or unique products through the whole manufacturing process, we think turnkey is the best option for most of our customers. Consider these benefits to turnkey supplement manufacturing with Paragon:
- You get a single, accountable partner that you can rely on from end to end. This makes your job easier and saves frustration over delays or unforeseen obstacles to production.
- Partnering with us frees your company up to focus on core capabilities, growth, product ideation and research, product promotion, and engaging with your customer base.
- Paragon handles the “grunt” work, including sourcing, compliance, and ingredient and component logistics.
- Because we are an established and trusted supplement manufacturer, we have access to a range of sources and economies of scale purchasing power. This makes the turnkey model cost-effective.
- We also offer many coating and capsule options, as well as decades’ worth of experience with many types of ingredients, techniques, and potential pitfalls.
What’s Best for Your Company? Questions to Ask.
Each supplement or nutraceutical project is unique, and it’s critical to examine the specifics of your situation and product. Often though, the choice between turnkey vs. toll supplements comes down to these questions:
- Do you want control of ingredient sourcing? Or do you need hassle-free production?
- Do you have compliance and/or testing expertise and lab equipment in-house already?
- Is your order large enough to justify the tolling option?
Partner with Paragon – Get Your Free Quote Today
When you work with us, you’ll get a great product that meets your needs, whether you choose turnkey or toll supplement manufacturing. If you’re still not sure which option is right for your company, or if you have questions about our proven turnkey process, schedule a consultation to find your best-fit model, or request a free quote.