Model total production cost at a contract manufacturer — CM charges, packaging materials, MOQ economics, and a full per-unit COGS breakdown.
| Cost Component | Per Batch | Per Unit | % of COGS |
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This calculator models the complete per-unit cost structure of producing a packaged food product at a third-party contract manufacturer (co-packer or CM). It breaks your total COGS into its constituent components — ingredient cost, packaging material, CM conversion fee, QC and testing charges, packing labour, inbound and outbound freight, and your own overhead allocation — and expresses each as both a per-batch figure and a per-unit figure, along with its percentage contribution to total COGS.
Understanding this cost structure is essential before you set a selling price, approach a distributor, or commit to a production run. Many first-time FMCG founders underestimate total COGS by 20–35% because they only model ingredient cost and packaging, missing the CM conversion fee, QC charges, freight, and overhead components that can collectively add ₹8–25 per unit depending on product type and volume.
The conversion fee (also called a tolling charge or CM charge) is what the contract manufacturer charges for their time, equipment, energy, and facility use. It is typically quoted per kilogram of finished product output (not input), and ranges from ₹20–30/kg for simple dry blending and packing operations, to ₹80–150/kg for complex processing involving cooking, extrusion, or specialised equipment. For roasted snack products like makhana, typical CM conversion fees in Tier-2 cities range from ₹35–60/kg.
Process yield is the percentage of your input raw material weight that ends up in finished, sellable product. A 50kg batch at 95% yield produces 47.5kg of finished product — the remaining 2.5kg is lost to moisture evaporation during roasting, coating adhesion on equipment, product rejected during QC, and trim losses during packing. A 5% yield improvement on a ₹5,000 batch reduces your per-unit ingredient cost by approximately 5%. This is why experienced co-packers command higher fees — their yield is typically 2–5% better than newer facilities.
Most FMCG co-packers in India require a minimum batch of 25–100kg per run for dry snack products. Below this, fixed setup costs (line changeover, QC testing, documentation) make the economics unviable for the CM. If your current volumes are below 25kg/run, consider a shared production facility or a home-food-processing unit until you validate demand.
For brands under ₹2 crore annual revenue, co-packing is almost always the right choice — capital stays in working capital and marketing rather than depreciating equipment. Above ₹5 crore, the calculus changes and a hybrid model (own some equipment, co-pack others) often makes sense. This calculator helps you understand your co-packing cost baseline before making that decision.
Yes — you as the brand owner need FSSAI registration, and your co-packer needs a separate FSSAI licence for their facility. The product is manufactured under the CM's licence but sold under your brand's registration. Both entities' FSSAI numbers must appear on the product label as "Manufactured by" and "Marketed by" respectively.
Sign a Non-Disclosure Agreement (NDA) and a Contract Manufacturing Agreement (CMA) before sharing any formulation. The CMA should specify ownership of the recipe (you), exclusivity terms, minimum order commitments, quality standards, and IP clauses. Splitting the supply chain — buying and supplying your own ingredients rather than having the CM source them — also provides recipe protection since the CM only sees process steps, not full formulation.
Disclaimer: Cost estimates are for planning purposes only. Actual co-packer charges vary by location, product type, volume, and negotiated terms. Always obtain formal quotations from at least 3 co-packers before making production commitments.