Contract packaging is the process of creating and assembling packaging for a product to get it ready for retail sales. A contract packaging organization (CPO) is an extension of a manufacturer, as it is responsible for making product packaging reliable and presentable.
CPOs exist because it is much easier and less costly for manufacturers to outsource this work to a specialized company. By using CPOs, manufacturers avoid significant infrastructure investments and having to expand their teams to do specialized packaging processes themselves.
Overview of the Contract Packaging Process
The scope and complexity of every packaging project depend on the product itself. This is why CPOs work closely with product managers and manufacturers to create packaging that is suitable for both the product and the brand.
Once the companies have consulted and agreed upon processes, the wheels are put in motion. This typically includes six phases:
Phase One: Design
Most CPOs have a design team. This allows them to create original packaging for clients and address any design-related problems with prototypes.
Phase Two: Inventory Management
As products are received (with or without packaging prototypes), each delivery must go through an audit and be properly stored.
Phase Three: Printing Components
In most cases, the products are received with accompanying artwork that must be printed on the packaging components.
Phase Four: Production of Packaging Elements
During this phase, the elements that make up the packaging are created. This can mean producing trays, blister packs, clamshells, and other elements.
Phase Five: Assembly
This is when a product is actually packed. It can be a complex process. Each product requires a specific packaging sequence to ensure quality and condition aren’t compromised. Any accompanying material — stickers, coupons, manuals, etc. — needs to be correctly fitted or affixed.
Phase Six: Storage
The final stage is to store the packed product to await transport to a retailer (or another storage location). Some products may require specific storage conditions, such as temperature and light. This is why some CPOs specialize in certain types of products, pharmaceuticals, for example.
Read more: What is Contract Packaging?