How to compare two quotations properly, normalise before you choose

We have written about how to read a single manufacturer’s quotation. This is the harder problem: you have two, they differ by a meaningful margin, and you have to choose.

And the mistake almost every new brand makes is to compare the two numbers at the bottom.

Because two quotations for “60 capsules of ashwagandha” are, nine times out of ten, quotations for two different products.

Different extract, different standardisation, different fill weight, different capsule shell, different packaging, and different things included and excluded.

So the work is normalisation: reducing both quotes to the same basis before you let yourself look at the price.

And once you do that, the cheaper quote is sometimes genuinely better value, which is the point of doing it rather than assuming.

This is orientation, not legal, regulatory or financial advice. Costs, tax treatment and testing obligations change. Check the current position with a competent consultant before committing.

Step 1: get both quotes onto a per-unit composition sheet

You cannot normalise what you cannot see.

So before anything else: ask both manufacturers for a per-unit composition sheet with quantities. Not a formula description. Milligrams per capsule, for every ingredient including excipients.

If one refuses, you have your answer about that one, and the comparison is over.

And if a quote lists “proprietary blend 500 mg”, it cannot be compared with anything, we have written separately about why that phrase is doing work.

Step 2: convert everything to the active, not the ingredient

This is where most of the difference hides, and it is the single highest-value step.

Take a worked example with the arithmetic shown.

Quote A: “Ashwagandha extract 500 mg” at ₹X per bottle.

Quote B: “Ashwagandha extract 300 mg (standardised to 5% withanolides)” at ₹1.3X per bottle.

B looks 30% more expensive for 40% less ashwagandha. A appears to win twice.

Now ask A for the standardisation, and suppose the answer is 1.5% withanolides, or, as happens, that there is no standardisation because it is root powder, not extract.

Then:

A delivers 500 mg × 1.5% = 7.5 mg withanolides.

B delivers 300 mg × 5% = 15 mg withanolides.

B delivers twice the active for 1.3 times the price.

And on cost per milligram of active, B is roughly 35% cheaper than A.

That reversal is the normal outcome of this exercise, not an unusual one. It is why “compare the composition sheets first” is the only useful instruction in this area.

And the same arithmetic applies across ingredients, with the figures that matter being specific to each: withanolides for ashwagandha; curcuminoids, not “turmeric extract”, for curcumin; AKBA as well as total boswellic acids for boswellia; bacosides for brahmi; fulvic acid with the test method for shilajit; elemental calcium rather than the salt weight; protodioscin for gokshura.

We have written about each of those separately, and the pattern is identical every time: there is a number that determines potency and a bigger, friendlier number that does not.

Step 3: check what is included

Quotations differ in scope more than brands expect, and these items are routinely outside the headline figure:

Packaging, bottle, cap, induction seal, label, carton, shipper. Ask which are in and at what specification.

Artwork and plates. Plate or cylinder cost is usually a one-off per design, and it belongs in the first-order economics, not the per-unit price.

Testing. Which tests, how many batches, and in-house or NABL-accredited third party. A quote that excludes third-party heavy metal testing is cheaper for a reason.

Freight and insurance, and from where to where.

Taxes. Confirm whether figures are inclusive or exclusive, and at what rate, and note that classification can differ between a food supplement and an Ayurvedic medicine, which changes the rate. Check the current position; this moves.

Shelf-life documentation and stability study, if you need it, and you will for export registration.

Overs and unders. Most manufacturers deliver within a tolerance band of the ordered quantity and invoice what is delivered. Ask the band. A ±10% tolerance on a small order is a material difference in your landed cost.

And wastage on labels and cartons, printed material is ordered with spoilage allowance, and who pays for the unused balance should be stated.

Step 4: normalise the unit

Obvious and routinely missed.

Per bottle, or per capsule? 60-count and 90-count bottles are both standard, and a per-bottle comparison across different counts is meaningless.

Fill weight for powders. 200 g and 250 g tubs look similar on a shelf and differ by 25%.

And for liquids, declared volume and the actual fill.

Reduce everything to a per-dose cost, where “dose” is the serving on the label. That is the number your pricing and your margin actually sit on.

Step 5: separate one-off from recurring

A quote often blends the two, which flatters whichever manufacturer front-loads less.

One-off: plates and cylinders, artwork, formulation development, stability study, first-time registration support, mould or tooling for a custom bottle.

Recurring: materials, manufacturing, packaging, per-batch testing, freight.

And then run the comparison twice:

First order, where one-off costs dominate and the higher-quality manufacturer often looks worse.

And steady state, over your expected annual volume, which is the comparison that actually matters if the brand survives.

Those two comparisons can favour different manufacturers, and knowing that is useful rather than confusing: it tells you what you are paying for the privilege of starting cheaply.

Step 6: price the things that are not on either quote

And these are real costs that a quotation cannot show you.

Minimum order quantity, and the working capital it ties up. A lower per-unit price at triple the MOQ can be the more expensive option for a brand with limited cash, because the money is in a warehouse rather than in marketing.

Lead time, against your season. We have written about seasonal planning; a cheaper quote that lands after the demand window has a cost that does not appear anywhere on it.

Reprint risk. A manufacturer who does not review artwork for claims is handing you the possibility of destroying printed stock, or worse. That is a contingent cost and it belongs in the comparison.

Failure handling. What happens if a batch fails release after you have paid? If one quote comes with a written process and the other does not, they are priced differently and only one of them shows it.

And switching cost. If the formulation ownership is unclear, the cheap quote has a lock-in attached.

Step 7: then look at the price

And by this point the question has usually answered itself.

In our experience of clients running this exercise, three outcomes recur:

The cheaper quote is cheaper because it contains less active. The commonest case. Not a saving, a different product.

The cheaper quote is cheaper because it excludes testing, packaging or freight. Add them back and the gap closes or inverts.

And occasionally the cheaper quote is genuinely cheaper at the same specification, because of scale, location, or because the other manufacturer is simply expensive. This happens, and the exercise is how you find out, rather than assuming either way.

A normalisation checklist

Run both quotes through this and write the answers side by side:

Per-unit composition sheet, with quantities, obtained for both. Standardisation percentage for every standardised ingredient, with the test method. Cost per milligram of the active that matters, calculated. Capsule shell type, gelatin or HPMC, and whether that matches your market. Excipient load, and what the excipients are. Count per pack and fill weight, normalised. Cost per label serving, calculated. Packaging items included, and at what specification. Plate, artwork and development costs, separated as one-off. Testing scope: which tests, which batches, in-house or accredited third party. Stability data: available, or to be generated, and at whose cost. Freight, insurance and taxes, and whether figures are inclusive. MOQ and the working capital it implies. Lead time against your sell-through window. Overs-and-unders tolerance. Written process for a failed batch. Formulation ownership. And whether they will review your artwork for claims.

If one manufacturer cannot or will not fill in half of that, the comparison is already decided, and not on price.

And the thing to resist

The pressure in this process is always toward the lower number, because the lower number is certain and everything else is a judgement.

And the specific failure it produces is well established in this industry: a brand launches on a thin-extract product, sells through once on marketing, gets poor repeat purchase, and concludes the category does not work.

The category worked. The product was 7.5 mg where it needed to be 15.

We are a manufacturer and we lose quotes on price. So read that paragraph with the appropriate suspicion, and then do the arithmetic yourself, which is the only part of this article that settles anything.

The short version

1. Two quotes for the same product are rarely for the same product
2. Comparing the bottom-line numbers is the standard mistake
3. Normalise first, then look at price
4. Start by obtaining a per-unit composition sheet with quantities from both
5. A refusal ends the comparison, informatively
6. “Proprietary blend 500 mg” cannot be compared with anything
7. Convert everything to the active, not the ingredient
8. 500 mg at 1.5% withanolides delivers 7.5 mg
9. 300 mg at 5% withanolides delivers 15 mg
10. So the dearer-looking quote can be 35% cheaper per mg of active
11. That reversal is the normal outcome, not an unusual one
12. The number that matters differs by ingredient
13. Withanolides, curcuminoids, AKBA, bacosides, fulvic acid with method, elemental calcium, protodioscin
14. Every time, there is a potency number and a bigger friendlier number
15. Check what is included: packaging, plates, testing, freight, taxes
16. Confirm tax treatment, which differs between food and Ayurvedic classification
17. Ask the overs-and-unders tolerance, ±10% is material on a small order
18. Ask who pays for unused printed material
19. Normalise the unit: 60 vs 90 count, 200 g vs 250 g
20. Reduce to cost per label serving, the number your margin sits on
21. Separate one-off from recurring costs
22. Then run the comparison twice: first order, and steady state
23. The two can favour different manufacturers, which is useful to know
24. Price what is not on the quote: MOQ and working capital
25. A lower unit price at triple the MOQ can cost more in practice
26. Lead time against your season is a cost that appears nowhere
27. Reprint risk from unchecked artwork is a contingent cost
28. A written failed-batch process is part of the price
29. Unclear formulation ownership is a lock-in
30. Three recurring outcomes: less active, excluded scope, or genuinely cheaper
31. The third one does happen, and the exercise is how you find out
32. If one manufacturer cannot fill half the checklist, it is decided already
33. The failure mode: launching on a thin product and blaming the category
34. The category worked; the product was 7.5 mg where it needed 15

Related guides: supplement costing and margins, how to choose a contract manufacturer, private label vs custom formulation. Related reading: how to read a manufacturer’s quotation, questions to ask a contract manufacturer, why your repeat quotation went up, extract ratios and standardisation decoded, and minimum order quantity, why it exists.