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Outsourcing: ‘The experience was too horrific’

Adam Zuchetti
Adam Zuchetti
17 December 2019 2 minute readShare
Manufacturing warehouse

An Australian foods maker has revealed their disastrous experience in outsourcing their manufacturing, admitting they ended up with only a third of the products being viable for sale.

Karen Lebsanft, who owns and operates savoury goods maker Kurrajong Kitchen — including their signature lavosh flatbread — with husband Ben, told My Business that they attempted to outsource their manufacturing within Australia to meet the rapidly surging demand for their products. But the experience saw them return to manufacturing in-house.

“We actually decided we would outsource the making of the lavosh, and we decided we would outsource it to a company across on the other side of the nation,” Ms Lebsanft recalled.

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“We were deciding that we would move into a site which was a smaller site, purpose-built now, in the local area. It was going to be our export site, so we would produce our export markets on this site and we would... outsource our manufacturing for them to make our products.”

The former restaurateur said that despite considerable training and development about their product, the quality by and large didn’t meet their standards, while the actual deliveries also proved challenging.

 

“Those pallets would come across to an unmanned warehouse in the local districts and a truck driver would ring you [to say], ‘I’ve got a pallet for you, or two. Come down, unload it, open it up.’ So, we were very active. I was running here, there, and everywhere on the go,” she said.

“[We would] open it up and what happened with the product that we outsourced is that they did a packet of lavosh and one piece would be burnt around the edges. One would be properly cooked. The next one might be burnt completely through.

“The quality within that single packet was just a risk. We couldn’t put our brand on it to actually send it out.”

Ms Lebsanft said they would be left with around a third of the product being suitable for sale.

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“Ben and I would sit there at the end of a day, we’d go down to this unmanned warehouse and back then we would literally unpack what was a pallet of products, repack it, and potentially end up with one-third of the product that we’d actually claim.

“We were prepared to lose that to back ourselves, to make sure that our brand and the quality within our brand was recognised.”

Such a situation was not commercially viable, she explained, forcing them to bring their manufacturing back in-house.

“Had we sent that packet to market as it was — and this wasn’t one packet, of course, this was from one pallet down to one-third of the pallet — we would never have a brand today,” Ms Lebsanft said.

“We decided not to outsource again, because the experience was too horrific.... We decided to only bring it back in-house and we haven’t moved from this space since.”

Ms Lebsanft urged other business owners to really back themselves and stay true to the standard of quality they expect from their products and services.

Outsourcing: ‘The experience was too horrific’
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Adam Zuchetti
Adam Zuchetti

Adam Zuchetti is the former editor of MyBusiness and a senior freelance media professional, specialising in the fields of business, personal finance and property. In 2020, he also embarked on his own business journey – inspired in part by the entrepreneurs and founders he had met through his journalistic work – with the launch of customised pet gifting and subscription service Paws N’ All.

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