Top 3 Cost-Saving Ideas for Food Companies
When you own a food company, budgeting can be a challenge. When every step of the process of getting your product to market seems to require a significant amount of money, it may feel like your funds are going to run dry.
Luckily, there are many ways for food companies to save money when they are working to get a product on retail shelves. The unfortunate thing is that many first-time food manufacturers aren’t familiar enough with the industry to be aware of the ways they can conserve their financial resources. So today, we’re going to cover the top 3 cost-saving ideas for food companies. After all, I believe all food companies, big and small, should have the knowledge they need to be able to stick to their budgets and reduce stress about finances.
Cost-Saving Idea # 1: Work with a Co-Packer
Many food companies that are just starting out may not know about co-packers, but they can save you big bucks and a whole lot of time when it comes to packaging your product—and perhaps even producing it, too.
Essentially, co-packers will either package your finished product (after you make it in a commercial kitchen) or they will produce and package your product. Both options are convenient and cost-saving, but if you have your co-packer produce your product too, you can forget about having to lease a commercial kitchen space, renting food-grade equipment, and hiring and paying employees to make your product. Think of how much cash you’d save without all these expenses!
Most good co-packers offer incredible value, especially considering they are well-versed in FDA and USDA regulations. If you work with an experienced co-packer, you can rest assured that your product will be in perfect accordance with industry standards.
If you are worried that your product won’t be made in the way you want it to, just ensure that when you hand your recipe over to a co-packer, it is as detailed as possible. Also, sign a non-disclosure agreement (NDA) so you can be confident your secret recipe will remain a secret.
Cost-Saving Idea #2: Buy Your Barcodes From a Reputable Source
Distributors and retail establishments require products to have barcodes so they can easily keep track of sales and inventory. Needless to say, you’re going to need one or more if your product comes in more than one size of packaging or if you have more than one product.
The key to cutting costs when it comes to purchasing barcodes is making sure you are working with a reputable, legitimate barcode company. I’ve heard one too many stories about first-time food manufacturers being sold barcodes for big bucks only to have it be a dud or a duplicate of one that is already out there on another product.
To ensure you are getting a quality barcode for the best possible price, I recommend working with a company like Simply Barcodes. They will take care of all the work for you, and you’ll have your barcodes in your email inbox shortly after you purchase them (the turnaround time is typically about an hour).
The process for obtaining your barcode(s) from an online company like Simply Barcodes is easy. Once you place an order online, you will be assigned official UPC numbers issued by the GS1 (the governing body of barcodes). Using these numbers, the barcode company creates your barcode and emails it to you. From there, all you have to do is download and print.
Cost-Saving Idea #3: Use an Online Nutrition Analysis Software
If you intend to sell your product on retail shelves, you’re going to need a nutrition facts panel, ingredient list, and allergen statement in compliance with the FDA’s guidelines. While obtaining this information has the potential to cost a whole lot of cash, there are more cost-effective routes you can take. Using an online nutrition analysis software to create these necessary components of your food label is by far the most affordable option available.
Lab analysis, for example, can cost as much as $700 per recipe analysis, not to mention that it may take a month for your to get your results back. Independent consultants who analyze recipes for clients usually charge about $400 per recipe analysis. Online nutrition analysis software, however, costs as little as $225 per analysis, making it accessible even to those who are watching their budget.
What’s also great about online nutrition analysis is that you do the analysis yourself and it only takes a few minutes from start to finish—time is money in this industry, after all. With a user-friendly software, all you have to do is create your password-protected account, input your recipe and serving size, and watch as your nutrition facts panel instantly generates. From there, you can edit your ingredient list and allergen statements. Then, all you have to do is download and print your FDA-compliant nutrition facts panel.
Be Informed About Cost-Saving Ideas
As you can tell, being informed about the smart decisions you can make while navigating the process of bringing a product to market can help you stay on budget—or maybe even come in a bit under! If you are new to the industry, you may also want to consider speaking with an expert food labeling consultant for other ways to save cash. Not only can they help you save money, but they can also give you valuable guidance on how to attract customers and maximize profits—like how to use nutrient content claims or health claims on your product.
The most important thing is that you feel informed and empowered to make the best possible choices about your product. That way, when your product finally does come to market, you’ll have some cash left in the bank and a clear picture of what needs to be done for your next product.