Picking a manufacturer to make your health supplement might be the most important business decision you make. For obvious reasons.
I’m writing this article to aspiring entrepreneurs about the biggest misconception someone could have when beginning the process.
Many companies that advertise themselves as supplement manufacturers have an inconvenient secret:
They’re not supplement manufacturers!
Or any kind of manufacturer.
They’re just advertising/storage companies that outsource their manufacturing. And charge you a markup.
I learned this the hard way when I began my entrepreneurial journey. I was taking quotes for Incredible Greens and received three different offers that differed by about $10,000. I later found out they were all going to be made in the same place!
Yep. Same formula, same quoting department, and a 5 digit pricing difference for my first batch. Yowza. I only found out through a competitor who told me about the arrangement as an attempt to get me to switch manufacturers.
I still remember the next week meeting with a sales rep from one of the brokers after I knew their company was a broker and not a manufacturer. He made a remark about how young I was, and then made an elaborate presentation about how their manufacturing operations worked. He never made eye contact once throughout the conversation.
How To Separate the Wheat from the Chaff
Reputable manufacturers adhere to section 21 CFR 111 of GMP Regulations, as defined by the FDA. The FDA itself doesn’t contract with outside organizations to conduct its regulatory inspections. But there are two organizations that independently verify manufacturing facilities for adherence to GMP manufacturing standards. They’re the Natural Products Association and NSF. Their inspections mimic FDA guidelines and they offer their own certification programs so outsiders can tell if a manufacturer is legitimate or not.
You can read more about their programs here and here.
They also keep lists of the companies who are currently in good standing with their certification programs.
The NPA list is here. The NSF list is here.
Whenever you’re shopping for a supplement manufacturer double check to see if they’re listed on one of these two websites. If they are you’re in good shape. If not they’re either a broker, small-time, or possibly up to some sneaky stuff (like degrading their product with low grade stuff from China).
Different Types of Certifications
The NPA only offers one type of certification. NSF offers three. By perusing their website, it looks like the NPA GMP certification only pertains to companies that actually manufacture products. At least going by the wording on this page. However NSF offers three different types of GMP certifications:
- Packaging Certificate – This means the company bottles and labels products according to GMP standards.
- Storage/Distribution Certificate – They store products according to NSF/GMP standards. This usually means a temperature controlled facility.
- Manufacturing Certificate – They make products according to NSF/GMP standards.
When it comes to finding a manufacturer, the last one is the only one you care about. The other two are fluff. It’s also where you have to be careful. Some companies that advertise themselves as NSF certified supplement manufacturers are actually NSF certified distributors. If you are only looking to put your label on something then that’s fine. You can buy one of their stock products and put your label on it, and rest assured that when they buy their stuff it’s being stored in a safe place.
But you should not be using these guys for custom formulations. They’re just turning around and giving it to the quoting department of the company that actually makes it and charging you a markup.
Naturally their prices will always be on the high side. To their credit, these companies are quite good at explaining their increased costs. The manufacturing industry has large amounts of informational asymmetries. When confronted with uncertainty people routinely place increased emphasis on alarmist outcomes. When buying under uncertainty people take comfort in paying more because they feel like they’re being insulated from risks they cannot quantify.
Brokering/distributing companies emphasize the importance of GMP compliance and how much it costs, and insist their price is what it takes to ensure a high quality product. They’re correct that regulatory compliance has its costs but they fabricate reality. Most supplement manufacturers can make batches of powders and tablets starting at around 500 or 1000 bottles of tablets or powders and still make a profit. Liquids and packets are more.
The tricky part is that the primary business activity of a supplement broker is sales, so they’ll typically have more refined customer service skills than a pure manufacturer. So if you don’t know any better it’s easy to mistake the brokerage company as more reputable.
When They’re Appropriate
Brokers and distributors aren’t inherently bad, it’s just important to understand when that’s all they are. I’ve spoken with many companies that were transparent about their brokerage, and when I inquired about a formula/product they didn’t make we discussed the possibility of them buying it in large quantities (10,000+) and splitting the batch between several companies. That’s fine.
But many of them advertise themselves as something more than what they are (something all companies do I might add). I’ve found that most of them are quite adept at wording their sales copy and objections to technically be in the truth but still obfuscate their true nature.
How To Use This Advice
If you’re looking for a supplement manufacturer you should internalize this information as your first step in filtering potential manufacturers.
If you are looking to private label then brokers and distributors are a good first place to start since they’ll have lower order minimums on their stock products. This is a good idea if you’re an independent retailer or looking to test marketing approaches for a custom product.
If you’re looking to design a custom supplement then you should limit yourself to the organizations listed on the two links at the beginning of this article.
Health Kismet Blog 
You know I never really thought of it in that manner. I really need to check to see which companies/supplements are actually on the two lists listed above and make sure to do some more research on the supplements I currently take. Thanks for the heads up.
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Sid,
Thanks. Although you should be aware that the companies on the label of a package are rarely the same ones listed on those lists.
Often companies will contract themselves out with a manufacturer to make it while they handle marketing, customer service, etc. Often corporations will also have different sister companies, so even if they ARE a registered manufacturer the name they show to the world might not be the one that’s registered with NSF of NNFA.
Really, this advice is not so relevant to a retail supplement shopper, and very relevant to someone who’s looking to buy directly from a manufacturer for whatever reason.
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Well thats an eye opener, I am obviously far too trusting. I knew that supermarkets do this kind of think but rather assumed that anybody advertising themselves as a manufacturer was exactly that. An interesting article.
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Jenny,
Almost ALL retailers don’t actually manufacture their product, they just find a manufacturer to make it for them. So they control the formula, ingredients, design, distribution, and marketing, but the manufacturing plant handles the actual making of the product.
Very few of the brands you buy actually have their own plant.
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Thanks for these helpful points. I’m currently searching for a supplement manufacturer and will keep these in mind. I definitely would not work with a company whose manufacturing facility I have not visited and would recommend to all of your readers that they do the same. According to the recent FDA warning, private label distributors will be held responsible to ensure manufacturers follow cGMPs. See this link: http://www.nutraingredients-usa.com/Regulation/FDA-warning-letter-highlights-obligations-of-private-label-distributors
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Ian, this is very helpful, thank you. I’ve never read that before and it’s always nice when a reader brings something new to my attention.
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Hi Jonathan,
I have been reading your blog and what a great way to help people out! The information is incredibly useful thank you so much
I have a question in regards to Ian’s post about FDA warning letter about private labeling.
It says “know what and how manufacturing activities are performed”
Does this apply to everyone who would like to private label a formula that’s already out in the market or for a custom made formula”
What would you suggest to a new starter when buying dietary supplements and private labeling them?
How can we trust?
Thank you so much
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[…] on Site: Most supplement manufacturers will manufacture their product with a third party. I’ve written before how this can potentially lead to a lower quality product. However, The Synergy Company acts as both a supplier, manufacturer, and distributor for its […]
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I was shocked at how rude Solara (the CM company listed with the photo from this blog) was over the phone! People don’t seem to understand common decency in business now, and it’s embarrassing.
Regardless, good blog Jon!
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Thanks Fara! Sorry you had a bad experience with them 😦
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We deal with several supplement manufacturing companies. They all say that they are GMP certified. But I didn’t find them in both list. I asked to send the certificate and one of the company sent the doc signed by another company (not NSF, no NPA). What does it mean? Are they fraudsters? Or some other companies are also authorized to issue GMP certificates?
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Olga,
1). They might be owned by a parent corporation that is GMP certified, in which case the certificate is probably legitimate.
2). They might be a broker that collects leads for manufacturers and are passing off the certification of the manufacturer they outsource themselves to as their own.
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Jonathan
Thanks for answering.
As far as i could understand, if they were a child company or broker, they would send GMP certificate in the name of their parent company. But they sent the certificate in their the own name. This company is not in the list of NSF or NPA. So is their certificate legitimate? Can you advice? Thanks
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Ahh……sorry, I was confused about your
Was there a date on the certificate? There should be a specific date for when they passed their inspection. If not that’s very suspicious IMO.
In my experience neither the ratings agencies or the manufacturers are particularly good with keeping their lists up to date. This is particularly true w/ NSF, which seems to be pretty slow on the uptake with updating their page. But if there’s a discrepancy of more than 3-6 months then that should be a red flag.
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If the company is certified has the cGMP certification by NPA, does that mean NPA has tested their supplements to make that each supplement contains advertised dose in a specifc supplement and it does not contain more or less of the mineral or vitamin as the company claims?
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No, it means they’ve conducted an audit of their facilities to make sure their business practices comply with FDA guidelines.
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Johnathon, very interesting and accurate article. I am the sales manager for Enzyme Process. We passed our most recent NPA inspection July of last year. I am happy to send a copy of our cGMP certificate to potential customers. We are FDA registered and inspected. We passed our most recent FDA inspection November 2016. We are happy to sign an NDA. We will not use your formula for our benefit or sell it to anyone else.
Enzyme Process guarantees in writing that your product will meet or exceed the label claims. We provide a Certificate of Analysis showing each nutrient in your product meets the amount claimed on the label. We also provide the results from our microbiological test showing that your products is free from mold, yeast, E. coli, Salmonella and Staph Aureus. I can be reached at james@enzymeprocess.co or 1-800-521-8669 x2 8 am to 4:30 pm Monday to Friday PST.
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My question has a bit to do with manufacturers that don’t want to sign my nda. Soon as they find out its a custom formula that’s been tested and not trademarked yet they won’t sign. Are there any places not trying to screw you over anymore? Also how can I get around them not wanting to do all organic formulas. The one I thought I’d have a deal with at the end of talks insisted everything be done none organic to make a better profit. It’s been a year since I looked into having a manufacturer for my products and I’m hope there are decent recomendations. Will dive into the list posted earlier in the article tomorrow as well.
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I would use an electronic NDA to make the process easier, a lot of time it’s just inertia that stops NDA’s from getting signed.
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Hey there Will, have any luck finding a new manufacturer? As you mentioned, they all seem shady. Especially the ones who offer a low minimum. I’ve contacted every company (only manufacturers) on those lists and had such a hard time finding a decent one.
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Hello Will,
My name is James. I am the sales manager for Enzyme Process. We have been making dietary supplements since 1950. We will always sign an NDA. We have made products for hundreds of companies over the years. We want to make your product. We have no interest in stealing your product or research. Enzyme Process is FDA registered and inspected. We are certified cGMP by the UL/NPA. We will send you a copy of our current cGMP certificate. You can reach me a 800-521-8669 x2 Monday to Friday from 8 am to 4:30 pm PST. If you prefer email send you request for a quote to james@enzymeprocess.co.
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I work with lief labs. We’re a contract manufacturer. Nsf gmp. This is a great article . I’ve lost much business from these so called “manufacturers”
if anyone needs a legit, honest contract manufacturer. Please reach out to me personally for a tour and competitive pricing .
I’ve been in this industry for 12 years and the growing number of brokers and fake gmp certificates is getting out of hand.
Sam Biggs
Lieflabs.com
661-775-1430
Sr Executive sales..
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