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Speed to Market: Becoming Lean Through Outsourcing

By: Dave Becker
Posted: June 3, 2010, from the June 2010 issue of GCI Magazine.

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Today’s consumers constantly expect more from beauty brands—more innovation, more creativity, more service, more value. In the same way, brand owners should expect more from their outsourcing suppliers. A successful business partnership requires planning, communication, added value and growth. A contract manufacturing relationship should be no different. Outsourcing is not simply a means to improve the bottom line and meet demands—it can be a vehicle to improve both the brand and the contract manufacturer. By learning from each other and adapting the supply chain accordingly, both companies can become leaner, more responsive and, ultimately, more profitable.

GDMI, Inc. develops formulas and contract manufacturing solutions for beauty brands. Throughout the years, it has learned to react to numerous challenges in the industry, and has grown to become more efficient and responsive. Immediate sampling of ingredients and speed-to-market incentives drive the company to constantly improve delivery to its customers. “The faster a formula is developed, the faster manufacturing may take place,” says Gina Ferrall, vice president and COO, GDMI. Through improving its own lean manufacturing, GDMI has been able to pass supply chain savings directly to its customers, making them more efficient and successful.

Ferrall has found more benefits from lean manufacturing. “Although lean operations have provided efficiency to us, they also push for improved service and quality. The lack of excess has helped to cultivate an atmosphere for doing things right the first time.” In an industry where quality issues can derail a launch or permanently damage a brand, a supplier that can deliver zero defects within shorter time frames is a definite asset. Some outsourcing partnerships even include full inspection and documentation, so final product arrives at the supplier with all quality checks in place, ready to integrate into the manufacturing process.

Expertise

Another time-saving benefit of outsourcing is the inclusion of experts in the manufacturing process. “When customers come to us, it’s usually because they don’t have the experience in manufacturing or complete supply chain management to bring their products to market efficiently,” explains Justin Ames, director of custom manufacturing, Neways Inc., a company that focuses on the R&D, manufacture and fulfillment of personal care products. Its expertise in the beauty market, combined with experience in continuous improvement and lean initiatives, provides brand owners with the necessary tools to improve production and speed to market.

After the initial research, one of the most difficult and time-intensive tasks in beauty product development is taking a product from trial to mass production. Unique skills and knowledge are required to make such a transition a success. Neways Inc. addresses this issue through a customized solution. “We’ve developed a very effective process for scaling up a product from the R&D stage to the production floor,” adds Ames. “This transition is a potential risk for waste in many organizations, and we’ve been able to save our customers time, money and material.”