Direct answer. Co-packing is the outsourcing of a product's packaging operation, assembly, multi-pack bundling, or creating a promotional bundle or gift set, to a specialized external provider, called a co-packer, rather than handling it in-house. It lets a brand or retailer offer special formats without investing in a dedicated packaging line.
Why and when to use co-packing
Co-packing meets a one-off or recurring need that the in-house production setup doesn't cover efficiently. The most common use cases are time-limited promotional operations (a "buy 2, get 1 free" bundle, a multi-pack shrink-wrapped together), the creation of seasonal gift sets, or adapting the same product to different packaging formats depending on the retail chain. Brands that lack a flexible in-house packaging line, or that want to avoid tying up their own production equipment on a temporary operation, turn to it rather than modifying their production line.
The co-packer generally comes in downstream of manufacturing: it receives the already-finished products and carries out the assembly, shrink-wrapping, special labeling and sometimes the kitting (bundling different SKUs together) requested by the brand. The service can include managing buffer stock, batch traceability and compliance with industry-specific regulatory requirements (food and beverage in particular, with the associated hygiene and best-before/use-by requirements).
Using co-packing also implies a temporary transfer of physical stock to the provider's warehouses, which requires good logistics coordination between the brand and the co-packer: dates products are made available, turnaround times for the finished packaging, and feeding information back to the brand's WMS to track stock available for sale in real time.
Using co-packing also makes it possible to absorb a seasonal activity peak (year-end holidays, back-to-school) without hiring or investing in-house, as the provider pools its packaging lines across several client brands.
FAQ
What's the difference between co-packing and kitting?
Kitting refers to assembling different SKUs into one functional set. Co-packing refers to outsourcing this packaging operation to an external provider rather than doing it in-house. A co-packer can therefore carry out kitting, but not all kitting is necessarily outsourced.
Who uses co-packing?
Mainly consumer-goods brands (food and beverage, cosmetics) for one-off promotional operations, as well as retailers who want to adapt a product's packaging to their own formats without depending on the manufacturer's production line, or investing in their own packaging equipment.
Related terms
Kitting · Packing · Case packing · Best-before / use-by date · SKU · Warehouse / logistics platform.
See also: logistics picking methods.
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