Which is the best option for Start-up? Third Party Manufacturing or Loan License Manufacturing!!

Query:
I am planing to start a pharma marketing company , Please tell me which is the best option for a beginner? loan manufacturing or a third party manufacturing? Is there a huge difference in production margin?
My company is registered in karanataka and my marketing place and office will be in tamilnadu. In which state should I apply for drug licence and GST.

 

Response:
For beginners third party manufacturing is best option. Loan licensing is complex procedure and it may cost you more in begining with lot of documentation.

You should go with third party manufacturing. If we talk about production margin. This margin differ company to company. Third party rate is also depend at quantity, you are getting manufactured. You should get rates from three to four manufacturers and compare them. After considering all rates, you could have best idea of best third party manufacturing rates.For example, you want a brand ABD having CFG xomposition in it. And you want to get manufactured 500 box. Suppose you get rate of 500 boxes is 60/- per 100 tab. It will be 65/- for 300 boxes and could be 55/- for 1000 boxes.

Don’t just consider rates, you should also consider service, quality and delivery/dispatch time. You will have no benefits by purchasing five rupees less if manufacturer doesn’t give products at proper time. Even you may suffer loss in that case. Choosing good manufacturer is important aspect for marketing company.

There may be two case. One you want to sale product in Tamilnadu. Then apply for drug license number and GST of your company in Karanataka and appoint distributor or c&f in Tamilnadu. So anyone don’t consider your company as local.

Second you want to operate company from Tamilnadu with marketing office, then you should apply for wholesale drug license number and GST number in Tamilnadu for easy operation and administration. Read this article for complete information: What is Marketing Address ? Is it possible to have marketing address and operation from different places?

In other words, you should take drug license number and GST number at place from where you find it easy to receive and dispatch stock, maintaining stock register along with handling marketing/sales & administration. In case of drug and medicine, you can only store and place at area having drug license number. Drug`& Medicines and related products couldn’t be stock at any other premises.

Hope Above information is useful to you…

For any query and suggestion, mail us at pharmafranchiseehelp@gmail.com 

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Ajay Kamboj

Full Time Blogger, Part Time Entrepreneur and Partial Time Helper for New Start-UP's in Pharmaceutical, Ayurvedic and Nutraceutical Sector. Contact him at pharmafranchiseehelp@gmail.com

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