How to start Third Party Manufacturing in detail

Summary

The video script is a comprehensive guide for starting a third-party manufacturing business in the medical device industry. It emphasizes the importance of third-party verification and the need for a long-term business setup. The speaker, Amit, offers insights on market research, product selection, and the necessity of understanding the local market and doctor preferences. He discusses strategies for becoming a medical representative, managing inventory, and building a sales team. The script also covers marketing tactics, distributor management, and the importance of maintaining a consistent sales force for business growth. Amit advises on product combinations, pricing, and the potential challenges of inventory management, encouraging viewers to start their express domain business with experience and strategic planning.

Takeaways

• 🛠️ Third-party verification is essential in the manufacturing business to ensure product quality and reliability. It involves producing a product through another company's manufacturing process but marketing it under your own brand.
• 📦 Proper inventory management is crucial. Maintain a minimum stock level to prevent shortages and fulfill orders promptly. Monitor inventory regularly to adjust orders based on demand.
• 🌐 Building a strong marketing and distribution network is necessary. Hire experienced personnel with at least 5-6 years of experience in the field to effectively promote and manage the brand.
• 🏥 Conduct thorough market research by surveying doctors and retailers to understand the demand for specific products and their prescriptions in different areas.
• 🧪 Focus on manufacturing common and high-demand pharmaceuticals such as painkillers (paracetamol), antibiotics, anti-diabetics, and anti-hypertensive medications to ensure steady business growth.
• 👨‍⚕️ Build strong relationships with doctors by offering promotional materials, celebrating occasions, and maintaining consistent communication. This helps in improving product visibility and loyalty.
• 💼 For successful third-party manufacturing, selecting the right manufacturing partners and molecules (products) is critical. Ensure the chosen products align with market needs and company goals.
• 📊 Appoint area managers and regional managers to oversee the performance of medical representatives and ensure efficient market coverage.
• 🔄 Regularly hold meetings to discuss marketing strategies, sales performance, and stock management to ensure all teams are aligned and working towards common goals.
• 🌍 Expansion can be gradual, starting from local to district, then state-level, and eventually national and international markets. Focus on building a strong foundation before scaling up.

Q & A

What is the importance of third-party verification in the manufacturing industry as mentioned in the script?

Third-party verification is crucial as it ensures the products manufactured by one company and marketed under another's brand meet the necessary quality standards and regulatory requirements.

What does the term 'express lane' refer to in the context of the script?

The 'express lane' likely refers to a fast-track process for certain products or services, indicating a quicker route to market or a more efficient way of doing business.

Why is it necessary to have a minimum order quantity when dealing with manufacturers as per the script?

A minimum order quantity is necessary to ensure cost-effective production runs and to maintain the financial viability of the manufacturing process for both the manufacturer and the business placing the order.

What are some of the challenges mentioned in the script when starting a business in the manufacturing sector?

Challenges include obtaining third-party verification, dealing with the complexities of manufacturing, managing inventory, and establishing a strong marketing and distribution network.

How does the script suggest one should approach the selection of products to manufacture?

The script suggests selecting products that are designed by the company itself and are in demand within the company's target area, emphasizing the importance of understanding the local market.

What role do medical representatives play in the business model discussed in the script?

Medical representatives are crucial as they interact with doctors and retailers, gather information about product preferences, and help in promoting and selling the products to the medical community.

Why is it important to maintain a good relationship with doctors according to the script?

Maintaining a good relationship with doctors is important because they can influence the choice of products used and prescribed, which can significantly impact the sales and success of a medical product business.

What marketing strategies are suggested in the script for promoting a new medical product?

The script suggests hiring an experienced marketing team, investing in market research, and creating promotional materials to effectively promote the products to the target audience.

How does the script advise managing inventory for a manufacturing business?

The script advises monitoring inventory levels closely, placing orders well in advance, and maintaining a minimum stock to avoid stockouts and to ensure a steady supply of products.

What is the significance of having a regional manager or area manager for a medical product business as mentioned in the script?

Having a regional or area manager is significant as they oversee the operations within their region, manage the local team, and ensure that the company's strategies are effectively implemented at the local level.

What is the advice given in the script regarding the selection of distributors for a medical product business?

The script advises selecting distributors who have a good track record and can provide terms that align with the company's needs, such as payment terms and promotional support.