Third Party Manufacturing In India

Third Party Manufacturing

Today’s we discuss on Third party manufacturing, is referred to the outsourcing of pharma products and to get products manufactured from others manufacturing units your own brand names. Third party manufacturing services gives quality products within your budget. If you want to gets best third party manufacturing services within lowest rate then click here….


  • Third party manufacturing of pharmaceutical business has been a mostly used, popular business model from quite some time. It is also referred to as contract manufacturing.
  • You will be surprised to know that among the pharmaceutical products, medicines, capsules, syrups and many more products sold today, the majority are third-party products.
  • The fundamental concept of this third party manufacturing is to the production of drugs by a pharmaceutical company under the name or brand of another company.
  • The third party manufacturing company which outsources the production work keeps the responsibility of publicizing and promoting the company products and brand.
  • Third party manufacturing became famous because it gives an excellent business opportunity to both parties.

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  • Some important factor into product manufacturing cost

 There are many factors that go into determining the cost of making your product. This is why in early conversations with your manufacturer it usually isn’t possible to give you an impromptu, off-the-top-of-the-head estimate to how much it will cost to make your product.

  • Of course, it’s a valuable and necessary piece of information to know before going forth with manufacturing, but an accurate quote needs to be based off of something — mostly the details relating directly to your product and design.
  • If you are serious about getting a quote, there is some information your contract manufacturer will need from you first. This will include any drawings (both 2-D and 3-D if possible), designs, blue prints, prototype, etc.
  • In some cases you may not be far enough along to properly quote, in which case there would need to be design completion first. All of this information needs to be reviewed before a reliable quote can be shared.
  • So, what are some of the main factors that end up determining the cost of manufacturing your product?

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Specific raw material, hardware, electronics, and more must be determined. There are countless types of each, so pricing depends on which meet your criteria. For example, if your product will be plastic, which type? What grade? What kind of durability? Does it need to bend? Should it be stiff? How much is needed? Does country of origin matter?

Answering questions like these will help guide you to the right type of plastic, which will be used to determine price for that component. The complete list of the raw materials, assemblies and components needed to manufacture an end product is referred to as your bill of materials (BOM).


Tooling is a necessary item in custom manufacturing, but it is also often one of the most expensive items. Determined by the material it is made from, tooling has a lifespan and won’t last forever, even with proper maintenance.

The cost of your tooling will vary by your design and the type and volume of production you plan to use it for. Tooling can be injection molds, stamping molds or casting molds. It may also refer to production line gauges and fixtures that are meant to assure maneuverability, efficiency, and quality.


There is a wide range of options for packaging. It can either be very basic and cheap or it can have a wow factor that comes with a high price tag. You may desire your product to be individually wrapped, in a blister pack, a fancy box, or shipped in bulk, but each of these types of packaging will correlate to its own cost structure. It just depends what makes the most sense for your product, your brand and your budget.

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Each transaction needs to be a win-win for customer and supplier/manufacturer, which is part of the reason volume discounts exist. It’s common to receive a discount if you order in larger quantities. This is because there is still the same overhead, operational and setup costs, known as non-reoccurring engineering costs (NRE cost), whether you produce 200 or 20,000 units.

If product volume goes up then cost per unit goes down, because minimum order quantity (MOQ) affects your cost. Materials are typically sold in specific amounts, so your manufacturer may either have to find another use for any extra or account for it in price.


The workers that are putting their efforts towards creating your product are, of course, not doing it for free. Labor cost also a part of your product cost because labor cost is most important to make a product. Labor cost depends upon how many labor works for your product and where your labor is coming from.

Reduced labor costs are one of the most commonly-known reasons why many choose to manufacture overseas. Of course, skill level is another factor which can potentially double the cost of labor.

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Overhead and margin

In order to make a manufacturing business work, capital investment is necessary. It wouldn’t be possible without the land, buildings, equipment and more that the manufacturer has to fund, plus a little extra for reinvestment. None of this can be attributed to your particular product. Nonetheless, it is an expense that is necessary.

Quality control and testing

For a quality product, don’t forget to budget for the cost of quality and reliability testing. You want your product to come out right each time, and the best way to be assured of that is to test it before it leaves the factory.


This won’t necessarily apply to all products, but you should be aware if your product needs approval from a third party such as UL, ETL or FDA. Third-party compliance testing can turn out to be a decent chunk of money and time as well, so talk to your manufacturer about this in the beginning.

Shipping, tax, and insurance

According to government rules will have their VAT, import & export duties, handling fees, shipping fees, insurance fees and many more charges. If your manufacturing partner is handling your logistics for you, you can count these associated costs into the cost of your product.

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