Contract toll processing, also called contract manufacturing, custom materials processing or toll milling, refers to the production of a product or goods on behalf of another company. Processing and milling services are generally used when the reduction of particle size is required.  The two methods used in materials processing are dry milling and wet milling.  Dry milling is cost effective but cannot produce the fine particle sizes achieved in the wet milling process. Wet milling is a more complex and costly process than dry milling, with additional steps, expensive equipment and increased expenditures for labor and energy. Despite the increased costs involved in wet milling, the process produces better product quality with finer particle sizes as well as byproducts that can potentially generate additional income.

The customer supplies their formula and specifications for the production of a product.  In most cases, there is usually a nondisclosure or confidentiality agreement in place to protect the intellectual property of the customer.  Once terms are settled between the two parties, the contract manufacturer provides custom processing, milling, mixing and blending services for the provision of the customer’s product.

Contract Toll Processing vs. Toll Milling

Toll milling describes the services performed on a customer’s product.  The customer pays the processor a fee or “toll” for services rendered.  This can be utilized for the processing or manufacture of goods at any stage of the production process.  Tolling is often incorporated into intermediate steps in the production process that require customized milling, blending, mixing, compounding, or other processing/manufacturing services, requiring specialized equipment or engineering capabilities to produce a semi-finished product.

Toll processors can also provide complete production of a customer’s product or supplement production demands that are unable to be fulfilled in-house.  Instead of simply providing an intermediary step in the process or production on a short-term basis, a contract is implemented, establishing a long-term relationship between the toller and customer.  In this case, the processor is responsible for the complete manufacture of a customer’s product from the acquisition of raw materials to delivery of the finished product to the end user. Production, packaging, storage of raw materials and finished products and additional processing/manufacturing services are provided at a volume-based rate.

Processors have established relationships with suppliers to obtain necessary raw materials at a discounted rate on behalf of a customer.  Investments in additional equipment and engineering are often made by both parties for ongoing development and improved product quality.  The custom materials processing provider is required to produce the fabricated merchandise with the same quality as the original manufacturer. A common practice with various industries, the outsourcing of materials processing by way of contract manufacturing offers a variety of benefits over in-house production including:

  • Processing expertise involving difficult or hazardous chemistries
  • Compliance with mandated regulatory permits
  • Reduced production costs
  • Short product development cycle
  • Flexibility to adjust production requirements based on demand
  • Particle size reduction and feasibility analysis
  • Laboratory and technical support for research and process development
  • No unscheduled downtime or production interruptions due to emergency maintenance of equipment
  • Complete documentation of processes
  • Reduce time-to-market for the introduction of new products

Choosing the right contract manufacturer is essential.  While cost may be a deciding factor, be sure to also consider a company’s expertise, equipment and reputation when making your selection. As a manufacturer of processing equipment, Custom Milling & Consulting, Inc. is an expert in particle size reduction processes.  The company offers horizontal media mills, basket mills, dispersers and other processing equipment for various wet milling, mixing and blending applications.  Equipment can be reconfigured to accommodate specific requirements for various industries.  Our expertise in process engineering coupled with a superior line of specialized equipment makes CMC the perfect partner to fulfill even the most stringent particle size reduction and contract manufacturing needs.