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A copacker manufactures, packages and labels products for other companies, often in the food, pharmaceutical and cosmetics industries. This is cost-effective and helps companies comply with complex regulations. However, issues can arise, such as contamination, when products from different industries are manufactured in the same facility.
A copacker is a company that manufactures, packages and labels products based on contracts for other companies. Typically, copackers have multiple manufacturing agreements with a variety of different companies in the same industry. A good example of this is copackers in the food industry who can manufacture food products for national or international food distributors, even local businesses based in home kitchens.
Contract manufacturing has become commonplace in factory settings. This is usually due to the need to comply with complex manufacturing regulations imposed by the government. Official production, labeling and packaging regulations can be difficult for individual companies to decipher and continually comply with, so they “hand off” the manufacturing process to a copacker who has a wealth of industry standards experience in a variety of related products.
Producing and manufacturing a copacker is also often more cost-effective, as they have the ability to produce large quantities of a product in many regional locations, with consistent quality and a lower cost per unit than an individual company can do in its own home. company. own. These economies of scale make copacker deals ideal for start-ups that cannot compete with large competitors that are already in the market. Various industries such as food products, pharmaceuticals and cosmetics also naturally lend themselves to copacker deals. The creators of intellectual property in these industries are generally not directly in the manufacturing business, but are focused on refining legacy products and researching and developing new ones.
The merging of production and manufacturing through the use of copackers is being taken to another level, with copacker companies themselves joining large conglomerates. Several regional pharmaceutical copackers in the United States merged into one parent company in 2011 as an example of this. This allows pharmaceutical companies to handle just one copacker for a variety of drugs they license, in a variety of forms and dosages.
Problems with copackers can also arise when products in different related industries are manufactured in the same facility, as was the case in 2011 in Germany. A copacker in Schleswig Holstein started a chain of events that contaminated food intended for human consumption with the carcinogenic chemical dioxin. The copacker factory manufactures oils intended for use as biofuels, but they have been added to animal feed for chickens, pigs and possibly cows on 4,700 farms in Germany. The extent of the problem was only discovered after at least 3,000 metric tons (3 million kg) of feed resulted in chicken meat and eggs, pork and possibly cow’s milk contamination in Germany, as well as on exports to the UK and Netherlands. The cause of this accident was attributed to greed, with the copacker marketing its product to farmers when it was only legally allowed to sell it as biofuel.
Asset Smart.
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