In the not too distant past, a beverage entrepreneur drew guffaws and some buyers at trade shows with his children’s drink, packaged in bottles resembling licensed characters like Scooby Doo and bearing the tongue-in-cheek name Belly Wash.
Today, it would be difficult to find a retailer willing to stock such a product, let alone a mother willing to buy it for her child.
The beverage stars today play to healthy eating and drinking trends, with superstars like Starbuck’s Evolution Fresh juices generating buzz and big sales. What beverage company wouldn’t want to command the premium prices of such brands? The story for carbonated soft drinks, on the other hand, is grim to dire. Declines in per capita consumption that began in 1998 now are a cumulative 18 percent, and absolute case volume has fallen 10 consecutive years.
As a result, at many existing beverage facilities, the “intensive capital investments in products that have fallen out of favor” need to be rationalized, points out Doug Newman, a partner in Cincinnati-based Myrtle Consulting Group. Pockets of growth products exist, but today’s beverage manufacturing norm is more SKUs, frequent changeovers and packaging reassessment, as companies focus on filling production schedules for underutilized assets squeezed between rising costs and declining sales.
Improved manufacturing performance and operational excellence are Newman’s specialty, and his client list reads like a who’s who of North American beverage companies (Nestle, Cadbury, Molson Coors, Coca Cola, etc.). Reorienting production and marketing away from maximum throughput and toward cost control, labor savings and scheduling changes is a challenge and often results in “bidirectional frustration,” he adds. “Sales and marketing is an inexact science, while operations has a well-defined process orientation.” Getting the two sides in sync on issues as simple as cap color can be daunting. “Sometimes the cop color matters to the consumer, and sometimes it doesn’t,” reflects Newman. If it doesn’t, fewer changeovers are warranted.
At Pepsi bottling plants, flexibility is discussed in terms of size, flavors and substrates, according to Rich Beck, head of manufacturing at Pepsico Inc., Purchase, N.Y. For example, a level of standardization of the neck, cap and base sizes of various bottles can minimize downtime during product changeovers. Flavor formulations are managed at the filler, and “those changeovers are done one after another,” he says.
Substrates determine if filling involves carbonated drinks, noncarbonated beverages and whether they are filled hot or cold. “That’s where we need different platforms” and therefore multiple lines at a given location to avoid unproductive downtime.
Sugar-free is nice, but parents also demanded preservative-free from the makers of Aqua Ball, which prompted a switch to hot fill. Photo: True Drinks Inc.
Hot-filling replaces hexametaphosphate
While the contents of a Belly Wash bottle wouldn’t fly today, the licensed character on the bottle itself still is a viable hook for a children’s beverage. True Drinks Inc., Irvine, Calif., recognized that in 2012 when it inked licensing deals with Disney Consumer Products and Marvel Characters in preparation of the 2013 launch of AquaBall, a stevia-sweetened water fortified with vitamins and positioned as a better-for-them beverage for youngsters.
True Drinks pegs the children’s drink market at $1.2 billion, a business dominated by brands such as Capri Sun and Juicy Juice with anywhere from 8g to 33g of sugar. “A whole army of bloggers are sharing the positive impact of AquaBall” and the B3, B5, B6, B12 and C vitamins it contains, boasts CEO Lance Leonard.
Unfortunately, platoons of bloggers are criticizing the potassium sorbate, sodium hexametaphosphate and malic acid that stabilize and preserve it. “We always had a plan to remove those preservatives,” explains Leonard, but the cost of hot filling would have forced the firm to price the product too high.
Cold filling by copackers in California, Texas and New York enabled modest sales of 4 million cases last year, but True Drinks is anticipating 60 percent growth in 2016 when it switches to hot filling at the Dallas facility of Niagara Bottling, one of the nation’s leading private-label water bottlers.
“They are so incredibly efficient, they do everything in house,” Leonard says of Niagara. Blowmolding, label printing, sleeving and even caps are made on site. “Filling a package is much different than making a package in terms of complexity,” Newman observes, but the investment in equipment and expertise pays handsome returns. “If you’re buying caps instead of making them, they’re coming in a trailer that basically contains air and adds cost.”
Filled bottles of water make their way to casepacking at Nestle Waters North America’s plant in Lehigh County, Pa. Fill rates of 1,200-1,500 bottles per minute are almost sluggish compared to some water bottlers.
While bottled water is poised to supplant carbonated soft drinks (CSDs) as America’s favorite beverage, growth rates are slowing and capacity is catching up with demand. Firms like Niagara, which doubled its network to 24 plants in three years, are positioning themselves as the low-cost contract manufacturer that brand owners will turn to.
Each new blowmolding machine outperforms the prior unit, with only 7.6g of resin per 16-oz. bottle the latest standard, considerably less than water bottling’s norm. The newest lines output more than 1,800 bottles per minute. Distribution is optimized with nested cases that ship less air and squeeze 84 cases on a pallet, up from 78 (to prevent crushing, bottles are topped with nitrogen gas).
Continuous improvement goes beyond existing capabilities and systems and can result in consideration of new methodologies. Four CSD plants — two in Latin America, two in Asia — are piloting a “multi-chiller sequencing system” engineered by Frigel Firenze SpA, an Italian process cooling firm with U.S. offices in East Dundee, Ill. Instead of a single chiller that delivers water at the lowest required temperature, Frigel’s system relies on modules to chill product and materials at various set points, according to Al Fosco, global marketing manager.
Fans replace compressors in the Frigel system, which first gained acceptance in plastic injection molding and is an alternative to ammonia-based systems. “We’ve played in the beverage industry before but have never gotten down to what the process needs are” until the current pilots, Fosco says. A multi-chiller sequencing control is the focus of the tests. Capital costs are recouped by 25-30 percent electric savings, he adds.
Cold-pressed goldmine
Like CSD, mainstream juice consumption is on a downward spiral, with orange juice down 45 percent per capita since 1998. Juicing, on the other hand, is all the rage among the health conscious, with premium products fetching $4 or more a bottle. High pressure processing increasingly is the technology of choice, with Evolution leading the way with its move to of “cold pressed” processing enabling it to distribute a preservative-free refrigerated product nationally in 2010.
Texas Food Solutions LLC in Katy, Texas, exemplifies the wave of HPP tolling centers cropping up to serve this premium market. Backed by venture capitalists, TFS commissioned the first of four HPP presses in the fall, with a second machine scheduled for start-up in early 2016, according to president Jasmine Sutherland.
Sutherland also directs Perfect Fit Meals, a supplier of single-serve prepared meals that she converted from local home delivery to HPP and began selling to retailers as far north as St. Louis. Dissatisfied with the lack of transparency from the tollers she worked with, she conducted due diligence on uptime performance and repairs for machines in New Zealand, Australia, Germany and North America before ordering a press from Uhde High Pressure Technologies, a division of ThyssenKrupp that partners with Multivac for system integration.
“Fruit gravitates to HPP because it handles a lot of issues,” notably nutritional destruction from thermal treatment, one of the few options in achieving a 5 log reduction in bacteria and spoilage organisms, she points out. Her Houston area operation soon will add bottling and cup-filling capabilities.
Fairport, N.Y.-based LiDestri Food & Beverage is another processor jumping into the HPP tolling space. A copacker with 25 production lines in five facilities, LiDestri expects to commission a 525-liter Hiperbaric press in mid December in Rochester, N.Y., with a bottling line slated in late 2016.
“Heat is such a bad word when you talk about nutrients and flavor,” observes Frank Cavallaro, vice president-R&D. “People want fresher, preservative free food, and it’s hard to do that without HPP."
LiDestri’s HPP venture was encouraged by Wegmans, which chipped in with LiDestri on funding a HPP pilot plant at Cornell University’s New York State Agricultural Experimental Station in nearby Geneva, N.Y. (a state grant of $600,000 covered most of the cost). The pilot plant will conduct validation tests for small and midsized food companies that want to respond to retailer demands for clean labels but can’t capitalize their own HPP system.
Hot fill, cold fill and flash pasteurization with aseptic fill are other LiDestri capabilities. Clients are beginning to migrate from hot fill to aseptic, a process growing in favor with manufacturers who need extended ambient shelf life for their functional and nutrient rich beverages, Cavallaro says. The aseptic line can fill 600 bpms, compared to less than 100 bottles on the HPP line. But if taste, color and “retaining all the nutrients” are important, HPP is the process of choice, he concludes.
Power of light
UV light as a treatment for both process water and product water has a long track record—major breweries began applying it to kill any wild yeast in wort in the 1970s—and applications are expanding, in part because of the emergence of heat-resistant molds and other organisms and also because of validation standards incorporated in the Pasteurized Milk Ordinance (PMO) in recent years.
Municipal drinking water was the first sector required to validate the efficacy of UV treatment, and wastewater treated for re-use also must meet U.S. EPA standards. In both cases, post-UV treatment with chlorine is done, which is why only 95 percent of the water must meet specs. That could pose a problem for a beverage process, points out Phyllis Posy, vice president-regulatory affairs for Atlantium Technologies, an Israeli firm with offices in Santa Clarita, Calif.
The PMO standard’s key difference is that there must be a mechanism to divert any out-of-spec water and prevent it from being used in process, explains Jon McClean, president of Beaver Dam, Wis.’s Engineered Treatment Systems, a UV specialist acquired three years ago by Neptune Benson Inc. A monitoring camera linked to each UV lamp determines the light dosage necessary to achieve the desired log reduction. If the lamp can’t deliver it, the water won’t advance.
Machines usually are validated for 1-4 log reductions. “Five log is possible, but it gets much, much harder” to achieve and requires “very good water” entering the system, adds McClean. Fruit juices need to attain 5 log pasteurization, and he says processors are beginning to migrate to thin-film geometry with UV and supported by other interventions as an alternative to heat treatment.
Besides its cost advantage, UV pasteurization of process water reduces the fluid volume through a conventional pasteurizer, often a bottleneck in a dairy, McClean points out. Additionally, filamentous fungi have been found to survive heat pasteurization, resulting in haze in ready-to-drink teas and other beverages often produced in dairies, prompting processors to try alternative treatments.
Mold and microbial destruction on smooth surfaces is particularly effective with pulsed ultraviolet light, making it an emerging alternative for decontaminating caps and cups in both dairy and other packaged fluids, according to Christophe Riedel, CEO of Claranor SA, Avignon, France. Beer makers are evaluating pulsed light in conjunction with other package sterilization technologies as an alternative to post-fill pasteurization.
Powdered coconut water
One beverage category that has been hot lately is coconut water. The category has grown to $700 million at retail and is quickly climbing to $1 billion.
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Most coconut water is filled in cans or aseptic cartons, but high-temperature processing is not kind to the nutrients or flavor, maintains Arnold Thorstad, cofounder and president of Covico Coconut Water Solutions. Logistics is another issue: Coconuts are sourced from only a handful of regions worldwide, none of them close to North America. Covico’s solution is a proprietary freeze-drying system applied at its Mumbai, India, production facility.
“Instead of UHT at 220°F, the powder can be reconstituted and hot filled at 140°,” Thorstad suggested at Covico’s booth at November’s Private Label Manufacturers Assn. show, which draws retail buyers, copackers and other firms involved in private-label manufacturing. Adding some vinegar to keep the pH below 4.0 would keep the water safe on the shelf.
“Logistics is a big deal for companies,” understates Thorstad. Few if any food products can match the weight by volume of beverages. Water accounts for most of that weight, and water extraction can produce significant savings.
Before a brewhouse was built, Coors Brewing shipped Coors Light in refrigerated rail tanker cars from Golden, Colo., to Elkton, Va., where it was reconstituted and bottled. The concentrate had 7.5 percent alcohol by volume and was diluted to 4.2 percent when filled. Each rail car had enough concentrate to produce 18,600 cases.
Powdered gin and vodka sold as Palcohol would have extended the idea, but neo-Prohibitionists in 25 states banned the product last summer before it got onto liquor store shelves. No matter: As the partnerships between Pepsi and Soda Stream and Coca Cola and Keurig demonstrate, beverage processors are always looking for the next big thing to pick up the slack from products with declining sales.
