Start-Up FMCG: Why Choosing the Right Manufacturer or Blender Is the Most Important Procurement Decision You Will Make

The founding mistake: choosing on price and availability

Most FMCG start-ups choose their first manufacturer the same way they choose a supplier for anything else — they ask around, get some quotes, and go with whoever was cheapest, fastest, or most willing to work with low minimum order quantities. This is understandable. Cash is tight, timelines are urgent, and the product needs to exist before anything else can happen.

The problem emerges at the point of retail scale. The manufacturer that was perfect for your first 500 units, your DTC website, and a few independent retailers is frequently not the manufacturer that can supply Tesco, Boots, or Holland & Barrett. The gap is rarely about the product itself — it is almost always about the manufacturing partner: their certifications, their systems, their capacity, their quality management, and their ability to withstand a retailer audit.

What major retailers actually require

Retailers like Tesco, Sainsbury's, Boots, Superdrug, and Waitrose have supplier manuals that run to dozens of pages. These are not guidelines — they are requirements. Failure to meet them results in delistings, fines for non-compliant deliveries, or refusal to list in the first place. Understanding these requirements before you choose a manufacturer is essential.

Most major UK retailers require that food and consumer goods manufacturers hold certification to a GFSI (Global Food Safety Initiative) recognised standard. The two most common in the UK are:

• BRC Global Standard for Food Safety (BRCGS) — the primary standard for food manufacturing in the UK. BRCGS Grade AA or A is typically required for own-label supply; brand suppliers are often accepted at Grade B or above depending on the retailer and category. Some retailers conduct their own audits in addition to BRCGS.
• SQF (Safe Quality Food) — more common in North American supply chains but increasingly accepted in the UK.
• FSSC 22000 — increasingly required, particularly for supplements and functional food categories where pharmaceutical-adjacent standards apply.

For cosmetics, personal care, and supplement products, ISO 22716 (Good Manufacturing Practice for Cosmetics) and GMP (pharmaceutical-grade manufacturing) are the relevant standards. Health and beauty retailers including Boots and Holland & Barrett will specify the manufacturing standard required as a condition of listing.

Major food retailers require full batch traceability from raw material to finished product. This means your manufacturer must be able to demonstrate, for any unit of product, exactly which batch of each ingredient was used, where that ingredient was sourced, and every processing step it underwent. This is not optional — it is a legal requirement under EU Food Law (retained in UK law) and a contractual requirement under all major retailer supplier agreements.

For ingredients with ethical or sustainability claims — Rainforest Alliance, Fairtrade, organic, free-from — the traceability requirement extends to the entire ingredient supply chain. A product claiming organic certification must be manufactured in a certified organic facility, using certified organic ingredients, under a documented organic management plan. A manufacturer that makes this claim without the underlying certification infrastructure is exposing your brand to trading standards enforcement and retailer delisting.

UK food labelling is governed by the Food Information to Consumers Regulation (FIC — retained from EU Regulation 1169/2011). Requirements include mandatory allergen declaration (14 allergens, emphasised in the ingredients list), accurate nutrition information in a specified format, origin labelling for certain categories, and — for products making health or nutrition claims — compliance with the GB nutrient profiles and the retained EU Register of authorised health claims.

Many start-up FMCG brands arrive at the retailer listing process with labelling that does not comply with FIC requirements. This is almost always a manufacturer problem in the first instance — a manufacturing partner with robust quality management will have an in-house or retained regulatory expert who reviews label artwork before printing. Choosing a manufacturer without this capability means carrying the label compliance risk yourself.

Beyond the regulatory baseline, each major retailer has its own additional requirements. Tesco's Supplier Guidance specifies requirements around ethical trading (Sedex SMETA audit), environmental standards (packaging recyclability, carbon reporting), and responsible sourcing (for specific commodities including palm oil, soy, and cocoa). Waitrose requires compliance with the John Lewis Partnership's responsible sourcing standards. Boots has its own product testing and quality assurance requirements for health and beauty products.

These requirements apply to the manufacturer as well as the brand. If your manufacturing partner is not already compliant with Sedex SMETA audit requirements, listing with Tesco will require them to become so — which takes time, costs money, and may reveal issues that delay or prevent the listing entirely.

What to look for in a manufacturing partner

The due diligence process for selecting a contract manufacturer or blender should go well beyond reviewing their sales deck. A site visit and a structured capability assessment — before you commit — is essential.

The contract — what must be in it

Manufacturing agreements for FMCG start-ups are frequently inadequate. The most common gaps are:

• IP ownership — who owns the formulation? If you have developed a product with your manufacturer, make sure the IP agreement is explicit. Manufacturers who develop their own formulations and supply them to multiple brands are a different risk profile from manufacturers producing to your proprietary recipe.
• Exclusivity provisions — are they manufacturing the same or similar products for your competitors? Is there any obligation to notify you? Do you have a right to audit this?
• Quality standards — the contract must specify the quality standard the product must meet, the certification the facility must maintain, and what happens if either lapses
• Recall provisions — what is the process and cost allocation if a product needs to be recalled? Who makes the decision? What notification obligations exist?
• Price change mechanisms — commodity price volatility makes fixed-price manufacturing agreements difficult to maintain. Understand the indexation mechanism and the notice period for price changes.
• Exit provisions — what is the notice period and process for terminating the relationship? What happens to raw material stock, work-in-progress, and tooling?