In the healthcare industry or any third-party manufacturing or contracting manufacturing, batch size plays an important role in determining overall production cost. For a smarter business run, you should know how the size of the batch affects pricing, whether you are a startup brand, a PCD pharma franchise owner, or having established healthcare company.
At Getwell Biocare, manufacturing one of the most important factors while quoting prices for contract manufacturing is batch size, because from raw material procurement to labour, machinery utilisation, packaging, and compliance cost directly or indirectly impact the size of the batch.
In this article, we will explore how batch size impacts costs in contract manufacturing and how businesses can choose the right batch size for maximum profitability.
Batch Size in Contract Manufacturing – Overview
Before we start with batch size, let’s start with contract manufacturing, in simple words, outsourcing production from a third-party firm, which allows companies to focus on functions like marketing and promotions, meanwhile third-party company will manufacture the product. Now batch size refers quantity you want to produce in a single manufacturing run. In pharmaceutical contract manufacturing, batch size may be defined as:
- Number of tablets
- Number of capsules
- Litres of Syrups
- Suspension
- Units of creams and ointments
When you choose a batch size, it will impact cost per unit production efficiency and pricing flexibility.
Why size of the batch matter in manufacturing cost?
The size of the batch directly affects the efficiency of the production and the quality of the product. Most of the contract manufacturing costs are fixed or semi-fixed, which means they remain almost the same whether you manufacture for a small or large batch. Even if production volume increases, the costs get distributed over more units, reducing the cost per unit. For balancing between affordability, quality, and compliance, the GetWell Biocare manufacturer is the best who wants to achieve the best result.
What are the impacts of small batch sizes on manufacturing cost?
For startups small batch size is preferred, or any company that is testing a new product, but it comes with certain cost implications. Like:
- Price will be higher per unit
- Margin will be less for distributors and retailers
- It results in higher raw material cost
- No discount on packaging due to limited batch
Who can use small batches?
Small batches can be useful for launching a new product or testing a new product for market demand, and always select a company that offers a flexible batch option and supports new entrants without compromising quality. For managing limited budgets or specialised formulation, the small batches can be used.
What is the impact of large batch sizes on manufacturing cost?
When it comes to improving cost efficiency, large batch sizes are preferred by established brands and PCD pharma companies because when the batch size increases:
- Manufacturing process will become more economical
- Fixed costs are spread across more units
- Pricing becomes competitive after completing.
Advantages of bulk batch size:
Bulk batch sizes allow manufacturers to purchase APIs, reduce packaging material costs, and optimise storage and logistics.
What are the factors that affect batch size?
Compliance and Regulatory
If your batch contains 10 lakhs units or 10,000 units, the regulatory compliance remains the same:
- GMP Compliance
- Stability testing
- Batch Documentation
- Quality checks
Packaging and Batch Size
Packaging is more important in contract manufacturing and is also an essential component of pharmaceutical manufacturing like for:
Small Batch
- No discount
- Higher setup charges for printing
- Higher printing cost per unit
Large Batch
- Reduce cost per label
- Branding
- Better supplier pricing
Logistics and Transportation
Cost of production is also affected by batch size because a small batch increases cost per unit due to partial loads on the other hand, larger batches reduce freight cost per unit. That’s why bulk shipments improve supply chain efficiency, and PCD networks are for PAN India distribution.
Inventory
If you plan inventory, it will reduce manufacturing costs in large batches. There are risks for rage batches like higher inventory holding costs, expiry of products if sales are slow, and capital tied up in stock, so always choose batch sizes based on market demand and sales projections.
How to choose the right batch size for contract manufacturing?
While deciding batch size, make sure to consider the following points:
- Budget and cash flow
- Distribution network
- Demand of the market
- Pricing
- Expansion plans
- Product shelf life
How does GetWell Biocare help manufacturing optimise batch size?
While clients of GetWell Biocare manufacturing receive:
- Breakdown of cost
- Recommodation of batch size
- Manufacturing option, whether small or large
- WHO-GMP certification production
- Scalable solutions for growing brands.
Conclusion
One of the most significant factors that impact contract manufacturing cost is batch size. When batch sizes are smaller, there is flexibility but at the expense of unit cost; however, with large batch sizes, efficiency increases and pricing reduces with enhanced profitability. For pharmaceutical companies and PCD firms, the trick lies in striking the proper balance between manufacturing volume, demand in the marketplace, and managing the expenses. Under the able guidance and malleable manufacturing systems, GetWell Biocare Manufacturing assists the companies in making the proper judgments in relation to the aforementioned aspects.
FAQs
Is there any risk of investing in bulk manufacturing?
Investing in bulk production will assist you by filling your inventory, but be aware that if sales decline, there may be a potential that the product could expire.
Does contract manufacturing offer cost balancing for both small and large batch sizes?
The size of the batch affects the production, and the quality of your product for affordable, quality, and compliance. GetWell Biocare is the top manufacturing company.
For startup business does GetWell Biocare provide small batch manufacturing?
Certainly, GetWell Biocare manufacturing supports small batches for new launches and market testing.
Is quality affected by batch size?
No, quality standards remain the same for small and large batches under WHO-GMP compliance.
