Field note
What does it
actually cost to
co-pack an RTD?
The number on the quote is not the number you will pay. Here is what sits inside a co-packing cost, what routinely gets left out, and which line items decide whether your margin survives first production.
The short answer
There isn't a single number, and anyone who gives you one without asking about your format, your MOQ and your process is guessing. What there is is a predictable structure. Once you know the structure you can price your own project within a usable range, and you can tell the difference between a quote that is complete and a quote that will grow by a third between signature and first pallet.
The mistake that costs the most
Most founders price the run. The run is rarely what breaks the model. What breaks it is the gap between the quoted tolling fee and the fully loaded cost per case — yield loss, freight, testing, storage and changeover — landing on a margin that was only ever calculated against the quote.
What's in the quote
Usually quoted
- Tolling / run fee — per case or per hour of line time
- Minimum order quantity — the real constraint, not the price
- Changeover and sanitation — sometimes bundled, sometimes not
- Basic QA — in-line checks during the run
Often not quoted
- Yield loss — liquid and packaging lost to startup, shutdown and rejects
- Freight in and out — ingredients, cans, ends, finished pallets
- Lab and shelf-life testing — and the time it adds before you can ship
- Storage — per-pallet, per-week, from the day the run ends
- Label application — if you aren't running pre-printed cans
- Process authority work — required before anyone runs your liquid
The five numbers that decide your margin
- MOQ against your cash. A good per-case rate at a minimum you can't sell through is worse than a mediocre rate at a run you can move. The cheapest quote is frequently the most expensive engagement.
- Packaging as a share of COGS. For most canned RTDs the container, not the liquid, is the dominant input. Formulation savings rarely move the model as much as a packaging decision does.
- Yield assumption. Ask what yield the quote assumes and what happens if you miss it. The answer tells you how experienced the co-packer is with your format.
- Freight lanes. Geography between your ingredient suppliers, your co-packer and your 3PL can quietly exceed your tolling fee.
- Cash cycle. You pay for ingredients, packaging and the run long before a distributor pays you. Many brands die solvent on paper.
How to get a quote you can actually model
Give the co-packer enough to stop hedging: finished formula or a clear direction, target format and fill volume, annual volume forecast with a realistic first run, packaging decisions you've already made, and your required shelf life. A vague brief gets a padded quote, and the padding is invisible until you're committed.
Then ask three questions that separate a real quote from a brochure: what is your assumed yield, what is not included in this number, and what has to be true before you can schedule me?
Where this comes from
This is the question I get asked more than any other, by founders and by the suppliers who have to qualify them. It's also territory I cover regularly on DrinkUp Live, the beverage operations podcast I co-host — often with the co-packers and buyers who sit on the other side of these quotes.
Want your numbers, not the general case?
The Alias Pilot is a fixed-scope engagement that produces a real COGS and margin range for your SKUs, a feasibility read, and a go/no-go you can take to a board or a bank.
Written by Adam Smith, beverage operations consultant and founder of Alias Advising.