{"id":753,"date":"2021-07-23T06:02:00","date_gmt":"2021-07-22T22:02:00","guid":{"rendered":"https:\/\/slpkg.com\/?p=753"},"modified":"2021-07-23T17:23:00","modified_gmt":"2021-07-23T09:23:00","slug":"packaging-broker-vs-factory","status":"publish","type":"post","link":"https:\/\/slpkg.com\/?p=753","title":{"rendered":"Packaging Broker vs Factory, Which Company I Should Choose?"},"content":{"rendered":"\n<p>Back when I started my first business, a big challenge was to decide on the type of packaging for my products. I didn\u2019t know whether I should buy it from a broker or a factory. There were so many things to consider, and I was confused. However, after tons of research on this topic, I ended up knowing a lot about it. In this article, I will share with you everything you need to know when choosing your packaging supplier.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>What exactly is a broker, and how is it different from a factory?<\/strong><\/h2>\n\n\n\n<figure class=\"wp-block-image size-large\"><img fetchpriority=\"high\" decoding=\"async\" width=\"973\" height=\"669\" src=\"https:\/\/slpkg.com\/wp-content\/uploads\/2021\/07\/what.png\" alt=\"\" class=\"wp-image-760\" srcset=\"https:\/\/slpkg.com\/wp-content\/uploads\/2021\/07\/what.png 973w, https:\/\/slpkg.com\/wp-content\/uploads\/2021\/07\/what-300x206.png 300w, https:\/\/slpkg.com\/wp-content\/uploads\/2021\/07\/what-768x528.png 768w, https:\/\/slpkg.com\/wp-content\/uploads\/2021\/07\/what-600x413.png 600w\" sizes=\"(max-width: 973px) 100vw, 973px\" \/><\/figure>\n\n\n\n<p>Don&#8217;t feel embarrassed if you don&#8217;t know exactly what a broker is, it&#8217;s not something you encounter daily. Still, you&#8217;re not alone, and I&#8217;m here to explain.<\/p>\n\n\n\n<p>A broker is a person who arranges transactions between a buyer and a seller and gets a commission if they close a deal. So, he doesn&#8217;t actually own any assets, he may not even see the final products, but he still earns good amounts of money.<\/p>\n\n\n\n<p>He often has access to many factories and gets better prices, because of the amount of work he can offer.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Broker vs Factory: Pros and Cons<\/strong><\/h2>\n\n\n\n<p>Since there is no general answer, obviously both of the options have their advantages and disadvantages.<\/p>\n\n\n\n<p><strong>Pros and Cons for Brokers<\/strong><\/p>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td><strong>Pros<\/strong><\/td><td><strong>Cons<\/strong><\/td><\/tr><tr><td>Complex product solution<\/td><td>Not professional in single product<br>comparing matched factory, but familiar to<br>the whole chain<\/td><\/tr><tr><td>Budget-friendly solutions<\/td><td>&nbsp;<\/td><\/tr><tr><td>Quick delivery<\/td><td>&nbsp;<\/td><\/tr><tr><td>Consultancy<\/td><td>&nbsp;<\/td><\/tr><tr><td>Lower MOQ<\/td><td>&nbsp;<\/td><\/tr><tr><td>Design service<\/td><td>&nbsp;<\/td><\/tr><tr><td>Sourcing service<\/td><td>&nbsp;<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p><strong>Pros and Cons for Factories<\/strong><\/p>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td><strong>Pros<\/strong><\/td><td><strong>Cons<\/strong><\/td><\/tr><tr><td>Better price per unit<\/td><td>Less flexibility<\/td><\/tr><tr><td>More efficiency on simple projects<\/td><td>Larger minimum quantities<\/td><\/tr><tr><td>&nbsp;<\/td><td>Larger budget needed<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Which kind packaging company should I choose?<\/strong><\/h2>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" width=\"1024\" height=\"572\" src=\"https:\/\/slpkg.com\/wp-content\/uploads\/2021\/07\/Which-kind-packaging-company-should-I-choose-1024x572.jpg\" alt=\"\" class=\"wp-image-761\" srcset=\"https:\/\/slpkg.com\/wp-content\/uploads\/2021\/07\/Which-kind-packaging-company-should-I-choose-1024x572.jpg 1024w, https:\/\/slpkg.com\/wp-content\/uploads\/2021\/07\/Which-kind-packaging-company-should-I-choose-300x168.jpg 300w, https:\/\/slpkg.com\/wp-content\/uploads\/2021\/07\/Which-kind-packaging-company-should-I-choose-768x429.jpg 768w, https:\/\/slpkg.com\/wp-content\/uploads\/2021\/07\/Which-kind-packaging-company-should-I-choose-600x335.jpg 600w, https:\/\/slpkg.com\/wp-content\/uploads\/2021\/07\/Which-kind-packaging-company-should-I-choose.jpg 1192w\" sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<p><strong>You should choose to work with a factory if you plan to place a big order and you already have the exactly design you request. On the other hand, choose a broker if you want to place smaller orders or if you need consultancy on the development of the project.<\/strong><\/p>\n\n\n\n<p>However, there are more things to consider when taking such an important decision for your business. The good news is I will talk about each of them so you don&#8217;t lose money or time by trying everything available on the market.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>What exactly should you think of when choosing your packaging supplier?<\/strong><\/h2>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" width=\"1024\" height=\"469\" src=\"https:\/\/slpkg.com\/wp-content\/uploads\/2021\/07\/What-exactly-should-you-think-of-when-choosing-your-packaging-supplier-1024x469.jpg\" alt=\"\" class=\"wp-image-759\" srcset=\"https:\/\/slpkg.com\/wp-content\/uploads\/2021\/07\/What-exactly-should-you-think-of-when-choosing-your-packaging-supplier-1024x469.jpg 1024w, https:\/\/slpkg.com\/wp-content\/uploads\/2021\/07\/What-exactly-should-you-think-of-when-choosing-your-packaging-supplier-300x137.jpg 300w, https:\/\/slpkg.com\/wp-content\/uploads\/2021\/07\/What-exactly-should-you-think-of-when-choosing-your-packaging-supplier-768x352.jpg 768w, https:\/\/slpkg.com\/wp-content\/uploads\/2021\/07\/What-exactly-should-you-think-of-when-choosing-your-packaging-supplier-600x275.jpg 600w, https:\/\/slpkg.com\/wp-content\/uploads\/2021\/07\/What-exactly-should-you-think-of-when-choosing-your-packaging-supplier.jpg 1243w\" sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<p>Nobody could say that a broker is better than a factory or the other way around. And sadly, reading minds is not that possible, for the moment.<\/p>\n\n\n\n<p>So\u2026 Just concentrate on what you need and write down the main aspects of that desire. This will get you a step closer to the final answer.<\/p>\n\n\n\n<p>To help you with that process, I will give you a list of things you should analyze before making a decision on <a href=\"https:\/\/slpkg.com\/characteristics-of-good-packaging\/\">good packaging<\/a> solution:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Quantity requested<\/strong><\/li><li><strong>Complexity of the project<\/strong><\/li><li><strong>Stage of the project<\/strong><\/li><li><strong>Budget<\/strong><\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>The quantity requested<\/strong><\/h3>\n\n\n\n<p>You need to think about the quantity of the orders you want to place and how frequent they will be.<\/p>\n\n\n\n<p>If you plan to order larger quantities and less frequently, choose a factory. Usually, they will offer you a better price per unit.<\/p>\n\n\n\n<p>If you need smaller quantities, more frequently, a broker is your better option. Since they act as middlemen, they will also work with smaller quantities, but typically for a higher price per unit. Overall, you will spend less money, more efficient.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>The complexity of the project<\/strong><\/h3>\n\n\n\n<p>In my experience, most of the times, if you consider your solution to be complex, you should probably choose to work with a broker.<\/p>\n\n\n\n<p>As you advance in the design project, the product can suffer many changes. This can sometimes be too much for a factory, because of limited equipment and expertise.<\/p>\n\n\n\n<p>A broker has the advantage to work with many factories, with various experts and machinery. They can offer you multiple solutions for your needs.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Stage of the project<\/strong><\/h3>\n\n\n\n<p>You should also consider which stage are you in with the development of your project.<\/p>\n\n\n\n<p>If you are at the beginning of the process and need consultancy, the best option would be a broker. They often offer you advice and newer solutions for what you would like your packaging to look like.<\/p>\n\n\n\n<p>A factory normally requests a final prototype that they can start to produce quickly. They won\u2019t take the time to discuss with you too many options and will offer less flexibility.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Budget<\/strong><\/h3>\n\n\n\n<p>The budget you have for this specific area plays a very important role in the decision.<\/p>\n\n\n\n<p>In general, working with a factory requires a bigger budget. You need to invest in developing the prototype and also in a bigger quantity ordered, and this will drive your costs up.<\/p>\n\n\n\n<p>If you can\u2019t afford to invest a lot of money in the packaging, a broker is your answer. They can also offer you products that they have in stock, so you don\u2019t need to invest in a design process of your own. The smaller quantities they agree to work with are also more budget-friendly.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Which factors influence my decision?<\/strong><\/h2>\n\n\n\n<p>Here we talked 2 factors that influence the decision most.<\/p>\n\n\n\n<ol class=\"wp-block-list\"><li><strong>Company type<\/strong>, depending on the type of the company and the project, there is some basic advice.<\/li><li><strong>Company size<\/strong><\/li><\/ol>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"729\" src=\"https:\/\/slpkg.com\/wp-content\/uploads\/2021\/07\/how-1024x729.png\" alt=\"\" class=\"wp-image-758\" srcset=\"https:\/\/slpkg.com\/wp-content\/uploads\/2021\/07\/how-1024x729.png 1024w, https:\/\/slpkg.com\/wp-content\/uploads\/2021\/07\/how-300x214.png 300w, https:\/\/slpkg.com\/wp-content\/uploads\/2021\/07\/how-768x547.png 768w, https:\/\/slpkg.com\/wp-content\/uploads\/2021\/07\/how-600x427.png 600w, https:\/\/slpkg.com\/wp-content\/uploads\/2021\/07\/how.png 1311w\" sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<h3 class=\"wp-block-heading\">How company type influence decision?<\/h3>\n\n\n\n<p><span class=\"has-inline-color has-black-color\">Business models are different for each company. The resources available for developing a packaging solution are variable. So, the type of your company should certainly influence your decision.<\/span><\/p>\n\n\n\n<p>We did some research and we discovered some typical solutions chosen by companies from different industries. Here are the results:<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><strong>Co-packaging original equipment manufacturers<\/strong><\/h4>\n\n\n\n<p>Generally speaking, they choose brokers for more complex packaging kits and factories for simpler ones.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><strong>Design companies<\/strong><\/h4>\n\n\n\n<p>Choose a factory if you think you can handle the design part of the project, as it will save you a ton of money. Otherwise, go for a broker for a smaller initial investment.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><strong>Wholesale companies<\/strong><\/h4>\n\n\n\n<p>It seems like your only option would be working with a broker. Your business model requires this kind of partnerships in order to produce more profit.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><strong>Sourcing agent<\/strong><\/h4>\n\n\n\n<p>As a sourcing agent, if you have the time and the willingness to give for probably one of the most exhausting tasks of your life, go for a factory. Otherwise, just choose a broker, it\u2019s simpler.<\/p>\n\n\n\n<p>Developing a prototype and then ensuring that everything works smoothly is really time-consuming. There are way too many parties involved in the process. You need to be tough to do it all!<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>How company size influence my decision?<\/strong><\/h3>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"623\" src=\"https:\/\/slpkg.com\/wp-content\/uploads\/2021\/07\/company-size-1024x623.jpg\" alt=\"\" class=\"wp-image-763\" srcset=\"https:\/\/slpkg.com\/wp-content\/uploads\/2021\/07\/company-size-1024x623.jpg 1024w, https:\/\/slpkg.com\/wp-content\/uploads\/2021\/07\/company-size-300x183.jpg 300w, https:\/\/slpkg.com\/wp-content\/uploads\/2021\/07\/company-size-768x467.jpg 768w, https:\/\/slpkg.com\/wp-content\/uploads\/2021\/07\/company-size-600x365.jpg 600w, https:\/\/slpkg.com\/wp-content\/uploads\/2021\/07\/company-size.jpg 1328w\" sizes=\"(max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<p>Sometimes, a small companies annual revenue is equal to a bigger companies budget for developing some new packaging options. Although that&#8217;s pretty sad for the first ones, only by taking the right decisions they could increase their budget.<\/p>\n\n\n\n<p>So, here are some basic instructions depending on the size of your business.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><strong>If you represent a larger company, such as a corporation&#8230;<\/strong><\/h4>\n\n\n\n<p>You often have a substantial budget to spend on packaging. Then, the decision is made based on the complexity of the products and the quantity needed.<\/p>\n\n\n\n<p>If your product is complex, then your only viable option is usually a broker. However, if it&#8217;s a simple project, a factory could offer a better price, especially if the quantity needed is big enough.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><strong>If you own a small business\u2026<\/strong><\/h4>\n\n\n\n<p>Most of the time, a broker is the best choice. They can offer smaller quantities so you can test if your products are selling well, and you could increase the number with each order.<\/p>\n\n\n\n<p>They will also help you to develop the right product for your needs.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Concluding\u2026<\/strong><\/h2>\n\n\n\n<p>As you probably found out, there is no such thing as the best option for everyone. It gets a little complicated, but it is what it is. With some effort, you hopefully found out what you should do.<\/p>\n\n\n\n<p>At the end of the day, finding a business partner that can help your business grow healthy is the only thing that matters.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Back when I started my first business, a big challenge was to decide on the type of packaging for my products. I didn\u2019t know whether I should buy it from a broker or a factory. There were so many things to consider, and I was confused. However, after tons of research on this topic, I [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":755,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[115,116],"class_list":["post-753","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","tag-packaging-broker","tag-packaging-factory"],"_links":{"self":[{"href":"https:\/\/slpkg.com\/index.php?rest_route=\/wp\/v2\/posts\/753","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/slpkg.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/slpkg.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/slpkg.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/slpkg.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=753"}],"version-history":[{"count":6,"href":"https:\/\/slpkg.com\/index.php?rest_route=\/wp\/v2\/posts\/753\/revisions"}],"predecessor-version":[{"id":765,"href":"https:\/\/slpkg.com\/index.php?rest_route=\/wp\/v2\/posts\/753\/revisions\/765"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/slpkg.com\/index.php?rest_route=\/wp\/v2\/media\/755"}],"wp:attachment":[{"href":"https:\/\/slpkg.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=753"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/slpkg.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=753"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/slpkg.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=753"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}