Cost Savings

Situation

A nutritional and dietary supplement company was selling a liquid multi-vitamin product to Korea.  Product was physically and chemically unstable.  Furthermore, competitive pressure made it necessary that the cost of goods has to be reduced by at least 10 percent.

Solution

Seet & Associates was hired to address the above opportunities.  The existing formula was evaluated and potential solutions were quickly identified.  One gum was replaced with a cheaper alternative that also provided additional physical stability and the fiber source was replaced with a generic brand as no claims was being made for the proprietary fiber sauce.   The vitamin loss data was statistically analyzed and appropriate overages were instituted.  Seet & Associates also recommended that the company buy a vitamin premix from a reputable compounder instead of buying individual vitamins from different suppliers.  With all these changes, the cost reduction needed was exceeded and the product was more stable than the preceding product.

Benefits

The company has a cost competitive product that is more stable physically.  Individual vitamin quantity, at the end of shelf-life, meets label claims because of the overage adjustments.  Purchasing is simplified as only one vitamin premix is being purchased instead of buying ten different vitamins from different suppliers.   Furthermore, fewer mistakes are made in Production as they do not have to weigh individual vitamins and blending one premix with the other ingredients has resulted in a more homogenous mix.

For more information, contact Swee Seet, Ph.D., (626) 689-9523, seet@sbcglobal.net.