March 01, 2024

Is co-packing coffee capsules profitable for roasters?

Co-packing coffee capsules refers to when one company – often a roaster – outsources the filling and packaging of coffee capsules to a manufacturer. This allows the roaster to sell their own brand of coffee capsules without the need to invest in infrastructure, equipment, or training.

Co-packing can help roasters enter a growing market quickly, without the long lead-time, operational expenses or capital expenses associated with setting up their capsule production line. The roaster need only supply the coffee; the co-packer handles the rest.

But how does co-packing coffee capsules work? And is it profitable for coffee roasters? Read on to find out.  

Co-packing coffee capsules using a filling machine.

What is co-packing?

Co-packing is where you work with a 3rd party partner to produce and package a product instead of doing so in-house. Co-packing is common in many industries, but especially common in the food and beverage sector. 

Working with a co-packer eliminates the need to set up a dedicated packaging facility. As a result, brands can access new markets without financing new equipment, bringing on new team members or training existing staff. 

For roasters looking to enter the lucrative coffee capsule market, co-packing is a direct route to market which requires no major investment in your own filling line. Ultimately, by working with a co-packer – like Metropolis – you can get your branded coffee capsules to market quickly and efficiently. 

How does the process of co-packing work?

Every co-packer has their own process. At Metropolis, our first step is to get a clear idea of your needs and target market. We'll ask about the channels you plan to sell into and the coffee you want to pack into each capsule.

After this, we'll ask you to sign a non-disclosure agreement (NDA), allowing us to share proprietary information about our processes and pricing.

From here, we enter the product development stage. This is where we work with you to develop a sample capsule and its packaging. Once you're happy with it, we can start full production with minimal lead times and low MOQs. 

This means grinding with an industrial roller mill, precisely dosing each capsule, and hermetically sealing the shells after nitro-flushing them for maximum freshness. We also test the capsule for quality at every step of the production process.

So, once all this is done – is co-packing profitable?

A factory worker manufactures co-packing coffee capsules at a factory.

So, is co-packing coffee capsules profitable?

It will depend on the price you set for your capsules, but yes – co-packing coffee capsules is profitable. 

It removes the need for a significant upfront investment in a packing line. This means it's likely to turn a profit far earlier than manufacturing your own espresso capsules. 

Altogether, this makes co-packing a cost-effective way to access the rapidly growing US capsule market. More people than ever are brewing capsules at home, and working with a co-packer helps brands tap into this growth. 

Furthermore, by packing your coffee into capsules – rather than stocking other brands' capsules wholesale – you guarantee that customers have to return to you for more.

Leveraging your co-packer’s expertise has other benefits

As well as removing barriers to entry, working with a co-packer allows you to adapt your capsule operations based on demand.

For example, if your capsule sales suddenly skyrocket, a co-packer is likely to have the capacity to accommodate that. Conversely, adjusting your own facility to deal with such an increase could take months or even years.

At Metropolis, our partners benefit from our state-of-the-art filling line. We've invested more than a million dollars in it, so you don't have to. We can prepare up to 14,000 capsules per hour, which means we can get your product to market quickly and scale up as needed.

Moreover, our facility is certified SQF Level 2, meaning we hold the certifications required to sell into the nation’s largest retailers and hospitality brands.

Working with a co-packer like Metropolis, you don't need to dedicate staff time to training, set up a space for capsule production, or certify your facility to meet regulatory requirements – all of which cost considerable time and money.

So, now that we've outlined the benefits of co-packing coffee capsules, all that's left is to choose a partner.

Brewing espresso-style coffee using Metropolis coffee capsules.

Metropolis co-packing coffee capsules & other options

Ultimately, with the demand for capsules growing, it is a fantastic time for roasters to enter the market. As we’ve outlined, co-packing is a quick, cost-effective, and straightforward route to market. 

When it comes to choosing a co-packer for capsules, Metropolis is the obvious choice. With our decades of accoladed experience in specialty coffee, we do it like you’d do it. Moreover, we’ve put years and considerable dollars into coffee capsule R&D because if we put our name behind it, it has to be the best. 

Finally, for brands who already have a Metropolis espresso capsule in mind, we offer our retail range on a wholesale basis:

Interested in learning more? Check out our wholesale, co-packing, and private label espresso capsule solutions today.

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