Beverage Industry March 2011

2011 BEER REPORT

PROBIOTICS & FIBER

CONVENIENCE & DRUG STORES

Variety helps category endure tumultuous times

Consumers seek aids to stay balanced

Beverages contribute to growth in on-the-go channels

Trends, technology & products shaping the marketplace

March 2011

‘One case at a time’ Del Papa Distributing Co. plans for another 100 years of brand building

www.bevindustry.com Larry Del Papa, president of Del Papa Distributing Co.

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March 2011

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Features 6 Beverage Beat 8 Industry Issues

42 Marketing 44 Packaging

12 Category Focus

Case packers and wrappers are improving on proven technologies.

Natural positioning is popular for children’s beverages.

50 Beverage R&D

16 New Products 20 Special Report

Probiotics and fiber keep people’s digestive systems balanced.

2011 Beer Report

55 Ingredient Spotlight

26 Cover Story

Herbs and botanicals offer healthy formulation options.

Del Papa Distributing Co., Galveston, Texas, plans for another 100 years of building brands and relationships.

32 Plant Focus Del Papa Distributing Co. will implement proven technologies and practices in its new distribution center.

36 Up Close With…

58 Distribution Trucks must now comply with new stopping distance regulations.

60 Operations Blend of processing automation equipment and technology achieves the right mix.

NextFoods

64 Supplier’s Marketplace

38 Channel Strategies

70 Classifieds

Beverages contribute to growth in convenience and drug store channels.

74 The Last Drop Cover, cover story and plant photos by Vito Palmisano.

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Beverage Beat

VOLUME 102, NUMBER 3 PUBLISHER Midwest/West Coast Sales

STEVE PINTARELLI [email protected] 203-267-3388

EDITORIAL

Healthy innovations for ‘maxed out’ moms I NEVER IMAGINED SOMETHING LIKE THIS WOULD happen to me. I’m the editor-in-chief of Beverage Industry and my own baby won’t take a bottle. Numerous bottles, formulas and multiple tricks have left me with a picky “consumer” and challenged me more than I ever imagined. I, like many moms, have found my time strapped in meeting my new daughter’s needs and balancing the rest of the tasks I need to accomplish in a day, including eating. During an IFT webinar presentation last month on the “Implications of the 2010 Dietary Guidelines for Americans,” presenter Darren Seifer, a food and beverage analyst from the NPD Group said that one of the challenges for increasing consumer demand for healthier foods is that “mom is maxed.” Since the 2005 guidelines, a significant change in consumption has not occurred. What has changed is that more women are in the workforce than in past decades and women are still responsible for the planning, shopping, preparing and cleaningup of meals prepared in the home, he said. “When you are talking about your innovation and your marketing tactics just remember that mom in a household is maxed out for time,” Seifer said. The overarching theme of the 2010 Dietary Guidelines is obesity among children and adults, explained Roger Clemens, chief scientific officer of E.T. Horn Co. and a member of the 2010 Dietary Guidelines Advisory Committee during the webinar. The problem is as simple and as difficult as “too much energy in and not enough energy out,” he said. It is not as simple as the food and beverage industry selling fewer calories though, said Richard Black, vice president of nutrition for Kraft Foods Global, during the webinar. A successful launch of a lower calorie food or beverage could result in more calories being sold, he explained. “If we consider the food industry as a whole, we might expect then to see an overall reduction in calories sold, as the calorie reduced items displace higher calorie items,” Black said. Working on calorie reduction is the Healthy Weight Commitment Foundation, the members of which have pledged to reduce 1.5 trillion calories out of their products by the end of 2015, a decrease member companies intend to sustain in subsequent years, he said. While Americans could be slow to change their diets and are strapped for time when making their choices, with the industry working together to reduce calories and replace products with healthier choices the hope is the growing obesity epidemic will shift direction. As I find my new stride with motherhood, food and beverage convenience definitely is a top priority and I’m looking for healthy innovations and reformulations from the food and beverage industry to help me out.

ELIZABETH FUHRMAN Editor-in-Chief

Editor-in-Chief

ELIZABETH FUHRMAN [email protected] Managing Editor

JENNIFER ZEGLER [email protected] Associate Editor

JESSICA JACOBSEN [email protected]

ART Art Director

DANA KNAPP [email protected]

CONTRIBUTORS

DAVID KOLMAN LORI SICHTERMANN MOLLY V. STRZELECKI JAMIE POPP ADVERTISING Associate Publisher Northeast/Canada Sales

BRUCE KLION [email protected] 516-944-5885 Director, Industry Development Mid-Atlantic/Southeast/Texas Sales

TOM BACHMANN [email protected] 941-473-7739 Senior Classified Sales Manager

CATHERINE WYNN [email protected] 847-405-4010 European Sales Representative

ERHARDT EISENACHER [email protected] 49-228-2499860 Advertising/Production Manager

COURTNEY WARNIMONT [email protected] Corporate Reprint Manager

JILL DEVRIES [email protected]

AUDIENCE DEVELOPMENT Audience Development Manager

PEGGY PEREZ Multimedia Manager

KATIE JABOUR Audience Audit Coordinator

CAROLYN M. ALEXANDER

LIST RENTAL POSTAL CONTACT: Rob Liska at 800-223-2194 x.726 [email protected] EMAIL CONTACT: Shawn Kingston at 800-409-4443 x.828 or [email protected] For subscription information or service, please contact Customer Service at: TEL.: (847) 763-9534 or FAX: (847) 763-9538 or E-MAIL: [email protected] www.bevindustry.com

CORPORATE DIRECTORS Publishing: TIMOTHY A. FAUSCH Publishing: JOHN R. SCHREI Corporate Strategy: RITA M. FOUMIA Production: VINCENT M. MICONI Finance: LISA L. PAULUS

Visit us online Go to BEVINDUSTRY.COM for archived articles, to conduct keyword searches, and print or download articles. For high quality reprints of articles or advertisements, contact JILL DEVRIES: TEL.: 248-244-1726 EMAIL: [email protected]

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Industry Issues PepsiCo shows volume, revenue growth

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epsiCo Inc., Purchase, N.Y., reported volume, revenue and profit growth for the fourth quarter and full year of 2010 driven by gains across its worldwide snack and beverage businesses, and from the acquisitions of its anchor bottlers earlier in the year. “We are pleased with PepsiCo’s performance in the fourth quarter and for the full year,” said PepsiCo Chairwoman and Chief Executive Officer Indra Nooyi, in a statement. “The underlying performance of our businesses remained solid despite a challenging macroeconomic environment. We posted broad-based worldwide gains in both snacks and beverages, our businesses deftly balanced a delicate pricevalue consumer equation, and we aggressively managed costs and productivity to deliver toptier financial results.” Nooyi said PepsiCo’s core global snack and beverage businesses benefited from strong brands, innovative and differentiated products and targeted investments. The company also acquired and integrated its two anchor bottlers, creating more efficient and effective beverage businesses in its North American market and in Europe. It also acquired Wimm-Bill-Dann,

Russia’s preeminent food and beverage company, providing PepsiCo with a strong foothold in the dairy category. PepsiCo also established a Global Nutrition Group to accelerate innovation and growth in its nutrition businesses. For PepsiCo Americas Beverages (PAB), North American volume (excluding the impact of incremental volume from the agreement with Dr Pepper Snapple Group) grew 1 percent in the quarter behind strong performance of the company’s non-carbonated beverage portfolio. The fourth quarter of 2010 marks the company’s fifth consecutive quarter of sequential improvement in organic volume performance in North America, it said. Volume, revenue and operating profit growth for the quarter and full year benefited from the impact of the anchor bottler acquisitions, the company said. In a statement, PepsiCo Chief Financial Officer Hugh Johnston said, “We delivered more than $150 million in synergies from the bottler acquisitions in 2010, above our target for the year. The strong pace of synergy realization and the identification of additional synergies have led us to increase our expectation for total synergies through 2012 to more than $550 million.” BI

Coca-Cola reports sparkling and still gains

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he Coca-Cola Co., Atlanta, reported strong fourth quarter 2010 operating results, with reported worldwide volume growth of 6 percent, cycling 5 percent growth in the prior year quarter. For the full year, the company reported worldwide volume grew 5 percent. Excluding the benefit of new cross-licensed brands in North America, primarily Dr Pepper brands, worldwide volume grew 5 percent in the quarter and 5 percent for the full year. Coca-Cola achieved broad-based volume growth in the quarter across each of its five geographic operating groups, with growth of 14 percent in Eurasia and Africa, 5 percent in Latin America, 2 percent in Europe, 1 percent in Pacific and 8 percent in North America (3 percent excluding the benefit of new crosslicensed brands), its third consecutive quarter of organic growth. In the quarter and for the full year, Coca-Cola gained global volume and value share in non-alcohol

ready-to-drink beverages, with share gains across most beverage categories. It continued to see strong growth in sparkling beverages, with worldwide brand Coca-Cola volume up 4 percent in the quarter driven by an array of global markets. Worldwide sparkling beverage volume increased 5 percent in the quarter (3 percent excluding the benefit of new crosslicensed brands in North America), with international sparkling beverage volume increasing 4 percent. Worldwide still beverage volume increased 9 percent in the quarter, led by growth across the portfolio, including juices and juice drinks, sports drinks, teas and water brands. Still beverage volume in the quarter increased 11 percent internationally and 7 percent in North America with continued strong global performance of sports drinks, driven by Powerade, which reported a 12 percent increase. CocaCola also grew Vitaminwater in the quarter, with double-digit growth internationally and 10 percent growth in North America. BI

The Coca-Cola Co., Atlanta, added Minute Maid Pulpy to its roster of brands that have achieved global retail sales of more than $1 billion, bringing the number of billion dollar brands in the company’s portfolio to 14. Minute Maid Pulpy is a juice drink with fruit juice and orange pulp. Orange is the core flavor but the product is available in a range of other flavors in different markets. Minute Maid Pulpy launched nationally in China in 2005, and is among the premier juice drink brands in 18 geographies across three continents, the company said. Heineken USA, White Plains, N.Y., announced that Dos Equis reached the milestone of 1 million “Likes” on Facebook. The brand experienced growth in the social media space during the past 16 months, particularly on Facebook, where Dos Equis added more than 800,000 fans in 2010, the company said. Dos Equis fans generate between 100 and 1,000 wall posts a day, most of which are linked directly to its “Most Interesting Man in the World” campaign, it said. Nor Cal Beverage Co. Inc., Anaheim, Calif., purchased 5.1 acres of developed light industrial land adjacent to its Anaheim co-packaging plant in plans for an expansion of its Southern California production, logistic and shipping operations. The adjacent parcel comes with 50,000 square feet of warehouse space, office space and a shop facility. Nor Cal’s Anaheim plant co-packages many of the company’s juice lines. The Dr Pepper Museum, Waco, Texas, received a $250,000 gift from the Dr Pepper Snapple Group (DPS), Plano, Texas, as the first part of a three year $1.5 million challenge issued by DPS to assist the museum in expanding its facilities and building its endowment. The Dr Pepper Museum raised $250,000 in donations during 2010 to meet DPS’s challenge and earn the $250,000 matching gift. The museum must raise another $250,000 in 2011 and again in 2012 to earn additional $250,000 matching gifts for each year. By successfully completing all three years of the challenge, the museum will earn $1.5 million. Constellation Brands Inc., Victor, N.Y., completed the sale of its Australian and U.K. business to CHAMP Private Equity of Sydney, Australia. Constellation retained an approximate 20 percent interest in the business and received cash proceeds of about $230 million, subject to closing adjustments. Constellation expects that net proceeds will be used to reduce borrowings.

Starbucks forms single-serve partnership

Wirtz Beverage Illinois, Chicago, became the exclusive distributor of Seagram’s Vodka from Infinium Spirits, a division of Wilson Daniels. It also became the exclusive distributor of Folio Fine Wine Partners’ portfolio.

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Reed’s Inc., Los Angeles, reached a distribution agreement with Spike Beverage LLC to distribute Reed’s and Virgil’s brands throughout Arizona.

tarbucks, Seattle, entered into an agreement with Courtesy Products, a provider of in-room coffee service to hotels, to provide Starbucks ground coffee for use in Courtesy’s CV1 in-room and on-demand brewed coffee system. The agreement with Courtesy Products is the first in Starbucks’ planned expansion into the premium single-serve category, said Jeff Hansberry, president of Starbucks Consumer Products Group. “The single-serve coffee category in the U.S., and much of the world for that matter, is in its beginning stages of development,” Hansberry said, in a statement. “At this very early stage, there are numerous

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contenders and no demonstrated, long-term winners related to either format or machines. Following our very successful introduction of Starbucks Via Ready Brew in the U.S. and into a growing number of international markets, Starbucks will continue to explore the many single-serve and on-the-go solutions and options available to us, and to participate in those where we can better and more conveniently serve our customers wherever they may be.” Starbucks plans to begin offering its coffee for the CV1 this fall. The CV1 system is available in approximately 500,000 luxury and premium hotel rooms in the U.S., the company said. BI

Zico Beverages LLC, Hermosa Beach, Calif., announced that Zico Pure Premium Coconut Water now is sold nationally in Target stores. New Belgium Brewing, Fort Collins, Colo., plans to expand its market territory to Virginia, Maryland and Washington, D.C., in September. The added territory will bring its products to 29 states.

DPS reports net sales up in fourth quarter

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r Pepper Snapple Group Inc. (DPS), Plano, Texas, reported fourth quarter 2010 net sales increased 4 percent reflecting sales volume growth, positive pricing and deferred revenue recognized under the PepsiCo Inc. and The CocaCola Co. licensing agreements. Reported segment operating profit increased 3 percent, reflecting net sales growth and supply chain productivity benefits partially offset by a $19 million increase in marketing, higher packaging, ingredient and transportation costs and higher last in, first out-related inventory provisions. Reported income from operations for the quarter was $268 million compared to $251 million in the prior year period. In a statement, DPS President and Chief Executive Officer Larry Young said, “As we look ahead, I’m encouraged by some of the improving trends we’re seeing in consumer spending and in the economy generally and by the momentum of our brands and business. We accomplished a lot in 2010, from the opening of our regional center in Victorville, Calif., to the new licensing agreements with PepsiCo and Coca-Cola, to increased availability of our products in take-home, immediate consumption and fountain. With key foundational investments now behind us, we are focused on building our people capabilities and delivering even greater customer value through our developing Rapid Continuous Improvement

initiative. This, combined with strong innovation, the national launch of Sun Drop and continued marketplace investments, gives me great confidence in our ability to grow and enhance the returns of this business in 2011 and beyond.” For the quarter, bottler case sales volume increased 4 percent with CSDs growing 4 percent and non-carbonated beverages growing 3 percent. In carbonated soft drinks, Dr Pepper volume was up 4 percent. 7UP, Canada Dry and A&W were each down less than 1 percent and Sunkist declined in the high single-digits. Expanded third-party bottler distribution added 11 million cases to Crush, more than doubling this business. In non-carbonated beverages, Hawaiian Punch volume increased 18 percent on continued strong promotional activities. Pressure on the company’s premium products continued with volume down 12 percent, the company said. Snapple declined 15 percent, but improved sequentially after its restage and strong media support. Mott’s juices and sauces increased 8 percent due to promotional activity. By geography, U.S. and Canada volume increased 4 percent, and in Mexico and the Caribbean, volume declined 1 percent. For the quarter, sales volume increased 3 percent and was 1 percentage point below bottler case sales volume. Year-to-date sales volume and bottler case sales volume increased 4 percent each. BI

PEOPLE IN THE NEWS… Buffalo Rock Co., Birmingham, Ala., named Matthew Dent president and chief operating officer and Bruce Parsons executive vice president. United States Beverage, Stamford, Conn., promoted Fred Gambke to chief operating officer, Andy Loy to national sales director, Philip Stobaugh to director of sales – Southeast region and Kevin Immen to director of national draft sales. Heineken USA, White Plains, N.Y., selected Lesya Lysyj as its chief marketing officer. Bacardi Limited, Hamilton, Bermuda, appointed Jon Grey regional president of the newly created Middle East & Africa region. Pernod Ricard USA, New York, appointed Ed Merklen general manager – East division sales.

bevindustry.com | MARCH 2011 | Beverage Industry |

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Industry Issues PEOPLE IN THE NEWS… The Coca-Cola Co., Atlanta, elected Guy Wollaert, chief technical officer, as senior vice president of the company. Republic National Distributing Co., Dallas, named Mike Young vice president of marketing. Revolution Tea, Phoenix, named David Enser chief executive officer. Beam Global Spirits & Wine Inc., Deerfield, Ill., named Albert Baladi president of Europe/ Middle East/Africa region. Zico Beverages LLC, Hermosa Beach, Calif., selected Matt Merson as director of national accounts. Honest Tea, Bethesda, Md., appointed Peter Kaye vice president of marketing.

Front of pack calorie labels now in stores

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onsumers across America are seeing new calorie labels on the front of beverages, as leading non-alcohol beverage companies bring the American Beverage Association’s (ABA) Clear on Calories initiative to stores. The beverage industry’s voluntary commitment to make calories more visible to consumers supports First Lady Michelle Obama’s efforts to help families make informed choices as part of active, healthy lifestyles. Beverage companies are adding the new calorie labels to the front of cans, bottles and packs that they produce and displaying the total calories in each container on all beverages 20 ounces or smaller. The labels began appearing on some beverages last fall and are now in stores nationwide. The companies expect to have the calorie labels on the front of all of their major brands and more than half of their product volume by June and on all brands and packages by early 2012 as committed. The Clear on Calories initiative has required a significant manufacturing, distribution and resource commitment by the participating companies, the ABA said. The calorie label was developed last year and tested with consumers to make sure it provided clear and easy-to-use information they could use to make informed choices when buying a beverage, the ABA said. The industry worked with the White House and

its agencies throughout the label development process and remains in contact with the administration throughout implementation of the initiative. Under the labeling commitment, the companies agreed to display calories more prominently on the following: Q Product labels: Total calories will be displayed on the front of all containers up to and including 20 ounces. A 12-ounce serving will be used in displaying calories for multi-serve beverage packages, such as 2-liter bottles. One hundred percent juices and juice drinks, at the U.S. Food and Drug Administration’s request, will continue to use an 8-ounce serving size. Q Company-controlled vending machines: Total calories in each container will be displayed on selection buttons on company-controlled vending machines, or when infeasible, in close proximity to the specific selection. Q Company-controlled fountain equipment: Calories will be displayed prominently. With regard to vending machines and fountain equipment, new federal regulations were proposed under health care reform after the beverage industry’s commitment was announced. To ensure regulatory compliance, the association is now working within the regulatory process on how vending machines and fountain equipment will be labeled. BI

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2011 Food Safety Summit offers safety solutions for today and tomorrow

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he 13th annual Food Safety Summit will take place April 19 to 21 at the Walter E. Washington Convention Center in Washington, D.C. David Gregory, host of NBC’s “Meet the Press,” will deliver the keynote address to participants of the Food Safety Summit at 9:30 a.m. on April 20. More than 1,400 food manufacturing, retail, foodservice, academic, military and government professionals will attend the summit to share their knowledge and experience in interactive workshops, general sessions and on the exhibit floor where more than 150 companies will display products and services and the latest information in fighting contamination. New this year, the expo hall will be open April 19 from 5 p.m. to 8 p.m. and on April 20 from 10:30 a.m. to 2:30 p.m. April 21 will be “Casual Thursday” where the conference sessions will be held from 8:30 a.m. to 11:45 a.m. followed by lunch. Attendees can either stay and network or have lunch to go. In addition to Gregory’s keynote session, The Food Safety Summit offers a broad educational program, which begins on April 19 with three half-day workshops. Speakers will provide in-

depth analysis and give attendees the opportunity to discover how issues including “Training For Results,” “Effective Risk Communication In Order To Secure Food Safety Resources,” and the “Three Pillars Of Successful Food Liability Program: Prevention, Response and Resolution” are implemented at other organizations. Other conference sessions on April 20 and April 21 will feature important government issues including the following: “Food Regulations: What New Mandates Face the Food Industry in 2011 and Beyond” and “The FDA Food Code: Content, Adoption and Implementation” to manufacturing issues such as “Traceability, Managing Allergens and Food Defense” to issues including “Food Safety Media Training” and “Working with Public Health Officials.” In addition, several companies including Ecolab, IFS Food, Siemens Industry, Bureau Veritas Certification NA Inc., Romer Labels, Alchemy Systems, New Leaf Food Safety Solutions, Eurofins Scientific, Ingersoll Rand, DeltaTrak and Lubriplate Lubricants will offer education sessions in the vendor theaters. For more information or to register, call 847/405-4000 or visit foodsafetysummit.com. BI

Wherever you find business, you’ll find us.

Category Focus

Health positions dominate kids’ market REDUCING CALORIE CONSUMPTION IS AMONG THE RECOMMENDATIONS IN THE 2010 Dietary Guidelines for Americans that were released in late January. A release from the U.S. Department of Agriculture states that the guidelines align with the fact that more than one-third of children and more than two-thirds of adults in the United States are overweight or obese.

For 2010, of the new children’s beverages launched in the United States that marketed a health position for the product, only 11.6 percent were positioned as low calorie, according Innova Market Insights, The Netherlands. Andy Schamisso, founder and president of Inko’s LLC, New York, says that the market does not seem to offer too many new kids’ beverages that are all natural or low calorie. One reason might be that many beverage companies haven’t figured out how to sell products to kids “that aren’t basically sugar water,” he says. In 2010, Inko’s launched two new Standardized for Strength, flavors of white teas, Stabilized for Safety, Inko’s Poppin’ Punch and Validated for Quality. and Bumpin’ Berry, ColorMaker develops natural color blends compatible with a which both contain customer’s product, process, and packaging requirements to improve 25 calories in each the allure of foods and beverages through visual appeal. 8-ounce serving and are marketed to kids. We are a local natural color supplier with “The fact of the matter a global footprint, thanks to our strategic is calories are probably partnership with the most influential D.D. Williamson. driver in parents buying for kids and kids Call us. Juices and buying for themselves,” jelly beans, royal icings Schamisso says. and butter creams, soups He says that when and sauces, coffees and colas, Inko’s decided to pastas and peanut butters develop products we bring captivating visual for the kids’ specific appeal to your food market, the company or beverage. put emphasis on flavor and package design, but it also took the drinks to the New York 3309 East Miraloma Ave., Suite 105, Anaheim, CA 92806 City Department of (714) 572-0444 phone • (714) 572-0999 fax [email protected] • www.colormaker.com Education for approval of sale. The New York

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Natural positioning is popular for children’s beverages

Inko’s launched two new flavors of white teas designed for kids with Poppin’ Punch and Bumpin’ Berry varieties, which align with the New York City Department of Education’s wellness policy.

City Department of Education revised its Wellness Policies on Physical Activity and Nutrition in 2010 to align with the goal of ending the childhood obesity epidemic, according to its June 2010 Wellness Policy. Last year, the American Beverage Association (ABA), Washington, D.C., announced that America’s leading beverage companies had delivered on a threeyear commitment to remove full-calorie soft drinks from schools across the country and replace them with lower-calorie, smaller-portion beverages. The commitment resulted in an 88 percent reduction in calories from beverages shipped to schools since 2004, the ABA says. ABA has School Beverage Guidelines for elementary, middle and high schools. All schools can sell bottled water, while elementary schools can sell up to 8 ounces of milk and 100 percent juice with no added sweeteners and up to 120 calories. Fat-free or low-fat regular milk and nutritionally equivalent milk alternatives with up to 150 calories in an 8-ounce serving can be sold as well. Middle schools use the same guidelines as elementary schools, except juice and milk may be sold in 10-ounce servings. High schools may have 12-ounce servings of milk, 100 percent juice with no added sweeteners and certain other drinks, as well as no- or low-calorie beverages with up to 10 calories in an 8-ounce serving. Other drinks can be sold with no more than 66 calories in an continued on page 14

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BY JESSICA JACOBSEN

The power of CHILDREN’S DRINKS LOOK TO FUNCTION Global Industry Analysts Inc. projects that the global kids’ food and beverages market will reach about $89.3 billion by the year 2015, based on the July 2010 report “Kids’ Food and Beverages: A Global Strategic Business Report.” “Growing health awareness and time constraints and the ensuing demand for functional and convenience foods has and will continue to drive growth and development of the kids’ food and beverage market,” the San Jose, Calif.-based company says. The report says that focus has been shifted to better-for-you products due to imbalanced diets, a higher prevalence of childhood obesity, vitamin deficiencies and insufficient dietary intake of nutrition foods, including iron and fiber. “Rising, and uncompromising emphasis on child health and wellness, coupled with growing awareness and benefits of the right dietary habits, are helping consumers spend more on products that offer greater value,” the report says. “Continuous product innovations will additionally help keep consumers interests sufficiently kindled.” This past year of the valuepriced offerings included private label products as Fresh & Easy Neighborhood Market, El Segundo, Calif., began offering its own brand of children’s drinks with Goodness Fruit & Veggie Juice Blend in a Strawberry & Banana variety. The juice is a blend of 10 vegetable and fruit juices from concentrate, and each serving contains half a cup of vegetables and half a cup of fruits. The

reconstituted vegetable juice blend includes concentrated sweet potato, carrot, tomato and beet juice, while the reconstituted fruit blend contains white grape, orange, apple, strawberry and clarified banana juice. Lifeway Foods Inc., Morton Grove, Ill., also sees the need to address the “extremely valuable” children’s beverage segment, a company spokesperson says. “Popular opinion and consumer behavior are trending toward healthier choices,” the Lifeway spokesperson says. “This has led to increased regulatory focus, such as Nutrition Keys initiative and the proposed taxes on sugary drinks.” The company will continue to follow the latest nutrition research as well as experiment with innovative ingredients and production operations, the spokesperson says, and the company is conducting specific research on probiotic strains that are beneficial for kids. Ron Berkowitz, chief operating officer of KIDStrong Enterprises, Fairhaven, N.J., foresees the children’s beverage category growing as consumers shift toward natural products, simpler ingredient statements and functional drinks. “Whether children are pushing their bike pedals or computer keys, essential nutrition is essential for them to be at their personal best,” he says. As KIDStrong develops new products, Berkowitz says that the company will focus on health with vitamins and functional ingredients, as well as a taste that is balanced in nutrition that appeals to parents and kids. Berkowitz adds that KIDStrong is close to debuting Watermelon and Lemon-Lime varieties to its product lineup and that the company plans to have 10 KIDStrong varieties by 2012. “Consumers’ growing health awareness, time constraints and the ensuing demand for functional and convenience foods has and will continue to drive growth and development of the kids’ food and beverage market,” he says. BI

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FULL potential Are your functional beverages reaching their FULL potential? Recent studies demonstrate that beverages formulated with Fibersol®-2 digestion resistant maltodextrin can provide an increased feeling of satiety so consumers felt fuller for longer periods of time. Fibersol®-2 is also completely souble and transparent in solution so beverages will have a great taste with no added flavor, odor or continued from page 12

8-ounce serving, and at least 50 percent of non-milk beverages must be water and no- or low-calorie options.

NATURAL POSITIONING

unwanted texture. And with the other functional benefits of increasing fiber, reducing calories and improving digestive health, Fibersol®-2 digestion resistant maltodextrin is the fiber you want

When beverage companies released to be sure your consumers and your new children’s beverages in 2010, the top product claim was no additives and preservatives at 30.2 percent, Innova reports. products reach their FULL potential! KIDStrong Enterprises LLC, Fairhaven, N.J., is one company that wanted to provide “healthy beverages that are convenient, all-natural, nutritional, low in sugar and taste great” to children, says Ron Berkowitz, the company’s chief operating officer. “We are committed to offering 100 percent all-natural products that parents approve of and kids love to drink,” he says. KIDStrong Enterprises offers KIDStrong Proactive Hydration drinks, a flavored water comprised of KIDStrong’s four stage complex carbohydrate blend of crystalline fructose, evaporated cane juice, trehelose and vegetable glycerin. The drink is available in Clearly Fruit Punch, Clearly Grape and Clearly Orange varieties. Berkowitz adds that KIDStrong drinks also offer 20 vitamins and minerals in each 12-ounce bottle. “Consumers are looking for healthful and nutritious drinks that their kids will like to drink,” he says. In Zone Brands Inc., Smyrna, Ga., released in 2010 TummyTickler Tots, a reduced-sugar apple juice for toddlers aged 1 to 3 years old. The juices are formulated with 40 percent less sugar and contain no artificial flavors, colors and sweeteners. Juices are available in 4-ounce bottles and 125-ml. juice boxes. Innova research also found that 27.9 percent of new beverages for kids were positioned as organic. B.R.A.T. Diet LLC, San Luis Obispo, Calif., last year introduced a line of organic beverages designed to help soothe children’s upset stomachs. Organic B.R.A.T. varieties are a U.S. Department of Agriculture certified organic non-dairy drink that is fortified with vitamins and calcium and is made from a blend of organic brown rice milk as well as banana and apple purees. Organic B.R.A.T. is categorized as a dairy alternative drink by Innova, which accounted for 4.6 percent of children’s beverage categories in 2010 compared to 1 percent in 2009. B.R.A.T. Diet LLC last year introduced In addition to dairy alternative drinks, flavored and unflavored bottled a line of organic beverages designed to waters saw an increase in product launches directed at the children’s help soothe children’s upset stomachs.

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Only 1.6 Calories per gram!

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| Beverage Industry | MARCH 2011 | bevindustry.com

market. The top category tracked for kids’ beverages in the United States remained juice and juice drinks in 2010 at 15.2 percent, but this was a decrease from the 20.8 percent in 2009, according to Innova data. Lifeway Foods Inc., Morton Grove, Ill., which offers its ProBugs Organic Whole Milk Kefir for kids, entered the juice market for children when it acquired the assets of First Juice Inc. in October. First Juice products include a line of juice flavors that are made from organic produce. “The market for healthy children’s beverages and other foods that promote healthy children’s eating habits is clearly growing,” said Julie Smolyansky, chief executive officer of Lifeway Foods, in a statement. “We’ve seen it with our ProBugs Kefir products, as well as in the calls to improve children’s nutrition everywhere from the media to the White House.”

satiety lower calorie

sugar-free digestive health

No added sugar was another of the top health positions for children’s beverages in the United States for 2010, Innova states. The positioning category made up 19.8 percent of the health-related claims, according to the product development tracking firm. Tropicana Products Inc., a division of PepsiCo, Purchase, N.Y., announced in December that it is testing a new portable snack called Tropicana Tropolis, which is a blend of real squeezable fruit designed for kids. The company said it worked with moms, kids and health experts, including dietitians and pediatricians, to develop the healthy snack. The product is a good source of fiber and offers 100 percent of the recommended daily value of vitamin C, the company says. The Tropicana Tropolis introduction is the latest addition to the expanding “Good for You” product portfolio from PepsiCo, it says. O.N.E. – One Natural Experience, Los Angeles, makers of coconut water, introduced a variety for children with O.N.E. Kids Coconut Water in 2010. The flavored coconut water has no added sugar and contains less sugar than typical fruit juices, the company says. O.N.E. Kids is packaged in 6.75-ounce aseptic cartons that contain 60 calories. The kids’ beverage also offers five electrolytes and provides natural hydration benefits to prevent dehydration, the company says. BI

it’s the fiber you want soluble low glycemic response clean taste

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>>

ADDRESSING SUGAR

O.N.E. Kids Coconut Water has no added sugar and contains less sugar than typical fruit juices, the company says.

CHOPIN RYE VODKA Chopin Imports, Manhasset, N.Y. Internet: chopinvodka.com Distribution: National

RYE RELEASE Chopin Vodka, which is imported to the United States by Chopin Imports, expanded its line of Polish made vodka with the U.S. debut of Chopin Rye. The vodka, which is named for Polish composer Frederic Chopin, is made from golden rye grown in the Podlasie countryside in eastern Poland. The grain is then placed in a traditional copper still and distilled four times. Chopin Rye is silky with a rich, balanced finish and hint of spice, the company says. The vodka variety has been available in Poland and is available beginning this month in 750-ml. bottles for $31.99 in select U.S. retailers.

NAWGAN TAROCCO ORANGE Nawgan Products LLC, St. Louis Telephone: 888/269-9411 Internet: nawgan.com Distribution: Select markets Ingredients: Filtered water, cane sugar, citric acid, citicoline, malic acid, natural flavors, sodium citrate, alpha-glyceryl phosphoryl choline, lycopene, caffeine, D-alpha tocopheryl acetate, reb A and soy lecithin.

BRAIN HEALTH FORMULA Nawgan Products LLC added a Tarocco Orange flavor to its line of Nawgan functional beverages made with ingredients for “brain fitness,” the company says. The company describes the Taroccco Orange flavor as having a crisp, mildly sweet and lightly tart overtone of an Italian blood orange. Like Nawgan’s previous varieties, Tarocco Orange contains lycopene, vitamin E, alphaglyceryl phosphoryl choline and cicitoline for brain health benefits, the company says. In addition, the flavor contains caffeine and has 30 calories in each serving. Nawgan, which was recently re-classified from a dietary supplement to a beverage by the U.S. Food and Drug Administration, is available for $2.29 in an 8-ounce can in St. Louis, Missouri, Illinois and Phoenix.

TEAS’ TEA LIGHTLY SWEETENED AND CLASSIC TEAS Ito En North America Inc., Brooklyn, N.Y. Telephone: 718/250-4000 Internet: teastea.com Distribution: National Ingredients: Lightly Sweetened Mango Oolong: Purified water, cane sugar, natural flavor, oolong tea, citric acid and ascorbic acid.

TIERED TEA SYSTEM Ito En North America Inc. relaunched its Teas’ Tea line with a three-tier approach that includes its new Lightly Sweetened and Classic varieties along with the company’s existing Unsweetened flavors. The Lightly Sweetened segment includes new low-calorie Teas’ Tea Blueberry Green, Lemon Black and Mango Oolong flavors. The reduced calorie flavors contain between 8 to 9 grams of natural cane sugar and 40 calories in each serving. The Teas’ Tea Classic varieties have 70 calories in each serving and are available in Crispy Apple and Country Peach flavors. The Lightly Sweetened and Classic varieties are packaged in 16.9-ounce recyclable PETE 1 bottles. In addition, the company also introduced a new lighter bottle for its Teas’ Tea Unsweetened line, which is packaged in rectangular 16.9-ounce PETE 1 bottles.

R.W. KNUDSEN FAMILY LIGHT! JUICES R.W. Knudsen Family, Chico, Calif. Telephone: 888/569-6993 Internet: knudsenjuices.com Distribution: National Ingredients: Blueberry: Filtered water, apple and blueberry juice concentrates, blueberry puree, lemon juice concentrate and rebiana.

CORDINA STRAWBERRY DAIQ-GO-RI Big Easy Blends, Kenner, La. Telephone: 504/338-3800 Internet: bigeasyblends.com Distribution: Select markets

READY-TO-DRINK COCKTAIL Big Easy Blends added Strawberry Daiq-Go-ri to its line of ready-to-drink cocktails packaged in 12.7-ounce flexible pouches. Cordina Strawberry Daiq-Go-ri is made with orange wine and natural flavors. Similar to its Mar-Go-rita product, the pre-mixed Daiq-Go-ri cocktail can be served on the rocks, chilled out of the pouch or served frozen and squeezed out of the package. In addition, the product’s cap can be re-sealed if the pouch is not fully consumed. Strawberry Daiq-Go-ri is available in a four-pack of 12.7-ounce pouches in select markets.

FOR MORE INFORMATION ON NEW BEVERAGE PRODUCTS, VISIT BEVINDUSTRY.COM. 16

| Beverage Industry | MARCH 2011 | bevindustry.com

LOW CALORIE JUICES R.W. Knudsen Family launched Light! Juices that are sweetened with Truvia, an all-natural sweetener made from the stevia plant. Available in Cranberry, Blueberry and Pomegranate, the juices contain 45 percent fewer calories than other superfruit blends, the company says. The juices are available at natural and traditional supermarkets nationwide in 32-ounce bottles for $2.99.

SPONSORED BY:

BRINGING NATURAL FLAVORS INTO FOCUS [email protected]

SKYY INFUSIONS DRAGON FRUIT AND BLOOD ORANGE VODKAS Skyy Spirits LLC, San Francisco Telephone: 415/315-8000 Internet: camparigroup.com Distribution: National

EARLY TIMES 354 BOURBON Brown-Forman, Louisville, Ky. Telephone: 502/585-1100 Internet: earlytimes.com Distribution: Select markets

EXOTIC FRUIT FLAVORS Skyy Spirits LLC, a division of Gruppo Campari, introduced Skyy Infusions Dragon Fruit and Blood Orange varieties to its line of flavored spirits. Skyy Infusions Dragon Fruit contains the rainforest-grown superfruit and has a bold, sweet taste with the aroma of candied tropical berries along with a wave of exotic fruits and a complex blend of savory spice and zest, the company says. The company also added Skyy Infusions Blood Orange, which is made with real blood orange and has an aroma of sweet orange zest along with hints of spice and caramel, the company says. The new Skyy Infusions flavors are available nationwide in 50-ml. bottles for $1.99, 750-ml. packages for $18.49 and 1-liter bottles for $26.49.

RAINFOREST COLA Rainforest Beverages LLC, Fort Lauderdale, Fla. Telephone: 954/332-2408 Internet: rainbev.com Distribution: Select markets Ingredients: Triple filtered carbonated water, pure cane sugar, clarified acai juice, caramel color, natural flavor, malic acid, tartaric acid, green tea extract, stevia leaf extract and kola nut extractive.

XENERGY XTREME FRUIT PUNCH Xyience, Las Vegas Telephone: 702/430-5400 Internet: xyience.com Distribution: National

ENERGY ADDITION Xyience expanded its Xenergy Xtreme lineup of energy drinks with the introduction of a Fruit Punch flavor. The Fruit Punch Xenergy Xtreme beverage is made with a blend of flavors from natural sources, including cherry, orange and tangerine, and does not contain calories. The flavor is packaged in a 16-ounce limitededition can featuring British mixed martial arts fighter Dan Hardy, an Ultimate Fighting Championship welterweight and Xyience team athlete. Fruit Punch Xenergy Xtreme is available for $2.29 to $2.79.

TRADITIONAL BOURBON Brown-Forman added Early Times 354 Bourbon to its line of bourbon of the same name. The variety is made with a traditional recipe of water, select grains and proprietary yeast and is distilled and matured in select oak barrels. The product, which takes its name from the Early Times Distillery’s permit No. 354, is packaged with a retro-classic design inspired by the 1930’s brand packaging in 750-ml. bottles that are available for $15.99. The bourbon will be sold in 17 U.S. markets initially, the company says.

ANTIOXIDANT SODA Rainforest Beverages LLC created Rainforest Cola, an all-natural soft drink containing antioxidants. The soft drink is formulated with ginseng and acai berry and is sweetened with stevia. Packaged in tall and slim 12-ounce cans, a serving of Rainforest Cola contains 30 calories and 7 grams of sugar, the company says. The beverage currently is available in select markets in Georgia, Kentucky, Massachusetts, New York, North Carolina, Tennessee and Wisconsin.

LIFEWAY BIRTHDAY CAKE KEFIR Lifeway Foods Inc., Morton Grove, Ill. Telephone: 877/281-3874 Internet: lifeway.net Distribution: National Ingredients: Pasteurized cultured low-fat milk, non-fat milk, organic cane juice, natural flavors, vitamin A palmitate and vitamin D3.

ANNIVERSARY RELEASE In honor of the company’s 25th anniversary, Lifeway Foods released a low-fat Birthday Cake Kefir variety. The cultured dairy smoothie has a yellow cake batter flavor and also contains Lifeway’s blend of 10 live and active probiotic cultures along with ProBoost, the company’s exclusive pair of probiotics that are clinically proven to support immunity and aid digestion, the company says.

bevindustry.com | MARCH 2011 | Beverage Industry |

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SPONSORED BY:

BRINGING NATURAL FLAVORS INTO FOCUS

COLBY RED WINE Foster’s Group Ltd., Napa, Calif. Telephone: 707/259-4500 Internet: colbyred.com Distribution: National

[email protected]

CHARITABLE WINE In partnership with Treasury Wine Estates, a division of Foster’s Group Ltd., Australian winemaker Daryl Groom introduced Colby Red wine in Walgreens drug stores. The release is a blend of 2009 Cabernet Sauvignon, Zinfandel, Shiraz, Merlot and Petite Sirah from select Treasury Wine Estates vineyards. Colby Red is a table wine blend that is dedicated to raising awareness for heart disease through the Groom family’s support of the American Heart Association and St. Jude Medical Foundation. Treasury Wine Estates will match the contributions of the Groom family with a planned combined donation of $100,000 to the American Heart Association. The 2009 Colby Red is available at more than 4,500 Walgreens locations for $12.99.

BURNETT’S LIMEADE AND ORANGE CREAM VODKAS Heaven Hill Distillery, Bardstown, Ky. Telephone: 502/348-3921 Internet: burnettsvodka.com Distribution: Select markets

SWEET CITRUS SPIRITS Heaven Hill Distillery added two new flavors to its Burnett’s flavored vodka portfolio: Limeade and Orange Cream. The flavors bring Burnett’s portfolio to 23 varieties and were designed for quality, utility and taste, the company says. Burnett’s Limeade and Orange Cream flavored vodkas are available in 750-ml. bottles for $9.99 as well as in 50-ml., 1-liter and 1.75-liter sizes.

DESSERT-INSPIRED TEAS

CUPPA CHOCOLATE TEAS The Republic of Tea, Novato, Calif. Telephone: 800/298-4832 Internet: republicoftea.com Distribution: National Ingredients: Red Velvet Chocolate: Rooibos, beetroot bits, sweet blackberry leaves, chocolate and vanilla flavoring.

PROTEIN PLUS PARFAIT SMOOTHIE Bolthouse Farms, Bakersfield, Calif. Telephone: 800/467-4683 Internet: bolthouse.com Distribution: National Ingredients: Water, apple juice from concentrate (water, apple juice concentrate), yogurt (cultured milk, pectin, carrageenan), strawberry puree, whey protein concentrate, soy protein isolate, cane sugar, brown sugar, dextrin, whole grain brown rice flour, whole grain oat flour, pectin, natural flavor, citric acid, red beet concentrate and stevia leaf extract.

PROTEIN-PACKED PARFAIT Bolthouse Farms introduced a new variety to its Protein Plus beverage line, the Parfait Smoothie. The variety contains strawberries, yogurt and granola and Bolthouse’s proprietary whey and soy protein blend. The smoothie contains 180 calories, 3 grams of fiber and 25 grams of protein in each 15.2-ounce bottle. The Parfait Smoothie is the third Bolthouse Protein Plus flavor, along with Chocolate and Mango, and is available nationwide for $3.19 in a 15.2-ounce bottle.

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| Beverage Industry | MARCH 2011 | bevindustry.com

The Republic of Tea introduced its Cuppa Chocolate Tea collection in four varieties of herbal teas inspired by chocolate treats. The varieties are Red Velvet Chocolate, Peppermint Chocolate, Coconut Cocoa and Strawberry Chocolate. The teas each contain South African rooibos that is blended with all-natural cocoa powder, chocolate, fruit, herbs and spices. The Strawberry Chocolate variety, which is made with strawberries and bourbon vanilla beans, is a limited-edition release scheduled through May, the company says. The flavors are available nationwide in a tin of 36 tea bags for a suggested retail price of $9.50.

NUTRICCINO AND VITAMIN COFFEE Health is Wealth Foods, Williamstown, N.J. Telephone: 856/728-1998 Internet: healthiswealthfoods.com Distribution: Select markets Ingredients: Nutriccino Mocha Latte: South American coffee blend (water, coffee), evaporated cane juice, skim milk, cream, maltodextrin, pectin, cocoa powder, natural flavors, ascorbic acid, Dl-alpha tocopheryl acetate, biotin, niacinamide, retinyl palmitate, D-calcium pantothenate, natural caffeine, cholecalciferol and pyridoxine hydrochloride, thiamin hydrochloride, riboflavin, cyanocobalamin and folic acid.

ENHANCED COFFEES Health is Wealth Foods introduced Nutriccino and Vitamin Coffee iced coffee drinks that are enhanced with vitamins and minerals. Nutriccino is available in low-fat Mocha and Vanilla Latte flavors. Each 9.5-ounce bottle of Nutriccino contains 190 calories, 3 grams of fat and the daily recommended values of vitamins A, C and D as well as B vitamins and also contains niacin, folic acid and biotin, the company says. Also available in Vanilla Latte and Mocha flavors, Vitamin Coffee is infused with the same daily vitamins as Nutriccino as well as calcium, vitamin E, guarana, ginseng and double the caffeine of Nutriccino, the company says. The enhanced coffee beverages are available in select natural foods stores for $1.99.

y a W t s e t s a The F ! a t s e i to F AMERICA’S FAVORITE COCKTAIL 1.8 billion Margarita’s are consumed in the US every year!*

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Special Report

Another year of trading places in beer Variety helps category endure tumultuous times

AFTER THE PREVIOUS YEAR’S TREND OF TRADING DOWN TO BELOW-PREMIUM brands, in 2010 brewers narrowed the price gap between below-premium and premium brands. The resetting of prices allowed more consumers to return to premium selections, says Nick Lake, vice president and group client director for The Nielsen Co., Schaumburg, Ill.

>>

“In the beer industry, the story was about brand equity and building price points,” Lake says. “In fact, the beer industry overall saw about a 2 percent increase in prices, which is pretty amazing in the economic times that we’ve been facing.” The overall beer category remained relatively Áat with 0.6 percent change vs. the previous year in dollar sales with a total of $24.6 billion in sales across all beer categories in U.S. supermarket, drug, gas, convenience and mass merchandise outlets, excluding Wal-Mart, club and liquor stores, for the 52 weeks ending Jan. 23, according to SymphonyIRI Group, Chicago. Despite Áat performance in dollar sales, case sales experienced a decline of 1.7 percent during the measured time period, SymphonyIRI data shows. In comparison, wine volume grew 2.6 percent and spirits’ Coors Light, which reported single-digit volume increased 3 percent in U.S. supermarkets dollar and case volume growth according to through Jan. 2, according to SymphonyIRI data SymphonyIRI, introduced a 16-ounce Silver Bullet presented during The Brewers Association’s Aluminum Pint bottle in August. Power Hour teleconference series’ “2010 Beer Category (individual brands) Overview and Craft Segment % CHANGE VS. % CHANGE VS. DOLLAR SALES CASE SALES Review.” PRIOR YEAR PRIOR YEAR “2010 will go Bud Light $5,280,398,000 0.1 267,895,200 -1.4 down as a very Budweiser $2,111,012,000 -5.7 107,158,600 -6.9 challenging Coors Light $1,891,150,000 2.6 97,725,430 1.7 year for the beer category and Miller Lite $1,686,577,000 -1.7 87,076,900 -3.0 certainly one that Natural Light $1,120,376,000 0.0 77,478,940 -3.7 is not going to be Busch Light $735,476,000 2.2 51,655,970 -1.6 reÁected proudly Busch $673,678,300 -2.6 46,292,390 -6.1 upon,” says Dan Wandel, senior Miller High Life $502,542,200 -1.4 33,945,890 -3.9 vice president Keystone Light $491,031,900 5.4 35,292,240 1.3 of beverage Natural Ice $350,012,800 2.4 25,083,690 -1.6 alcohol client Total Domestic solutions for $18,539,830,000 -0.7 1,023,690,000 -2.7 Category* SymphonyIRI. Craft beer, Source: SymphonyIRI Group, Chicago. Total U.S. supermarkets, drug stores, gas/convenience stores and mass Á avored malt merchandise outlets (excluding Wal-Mart, club and liquor stores) for the 52 weeks ending Jan. 23, 2011. beverages Individual brand listings — sales do not represent brand totals. *Category totals include brands not listed. (FMB) and

Top domestic beers

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| Beverage Industry | MARCH 2011 | bevindustry.com

cider dominated the good news in the category, each with double-digit growth in 2010. With approximately $1.1 billion in sales, craft beer continued to grow in SymphonyIRI’s measured channels. The category posted a 14.6 percent increase in dollar sales and 13.1 percent rise in case sales for the 52 weeks ending Jan. 23. Consumers’ continued embrace of craft beer represents a tangential trend of “trading away,” says Ty Law, U.S. research analyst, Euromonitor International, Chicago. In the “trading away” trend, consumers treat each purchase as a reward and are choosing premium beer instead of standard beer brands such as Bud Light and Miller Lite, Law says.

EFFECTS OF PRICING The beer market rebounded slightly last year by experiencing fewer declines in 2010 than in the previous year. In 2009, many consumers chose sub-premium brands and large volume package sizes. Heavy beer buyers, who are classiÀed as those who purchase 24 or more cases a year, continued to favor domestic sub-premium brands, according to SymphonyIRI Group data presented during the Brewers Association Power Hour teleconference. Domestic sub-premium brands, such as Natural Light, Busch Light and Keystone Light makeup 49 percent of the volume purchased by heavy beer drinkers, the research Àrm said. The second largest segment is domestic premium brands, including Bud Light, Budweiser, Coors Light and Miller Lite, which attracted 36 percent of heavy beer consumers’ purchases. According to SymphonyIRI data in measured channels through Jan. 23, domestic sub-premium brands had an average increase in price of $0.51 a case with an average case price of $14.31. The average domestic premium case value is $19.52, which reÁects an average price increase of $0.27 cents each case, according to SymphonyIRI. In dollar sales, SymphonyIRI’s list of Top 10 overall beer brands shows that Bud Light, Coors Light, Natural Light and Busch Light reported slightly positive performance in measured channels through Jan. 23. The remaining brands reported declines in dollar sales, including a 3.1 percent loss in dollar sales for Corona Extra and Heineken’s 3.3 percent dollar sales decline.

BY JENNIFER ZEGLER

Less optimistic results were shown in case sales as only one of the Top 10 overall beer brands — Coors Light — reported case volume increases in measured channels through Jan. 23, according to SymphonyIRI data. The remaining nine reported losses, which ranged from a 1.4 percent decline in case sales for No. 1 brand Bud Light to 6.9 percent drop in No. 2 seller Budweiser. Coors Light reported the largest increase in the beer category with an additional 1.3 million cases sold vs. the previous year through Jan. 2, according to SymphonyIRI data presented during the Brewers Association’s Power Hour teleconference. Keystone Light followed with a little more than 793,500 additional cases sold during the time period.

White Plains, N.Y., and Diageo Guinness USA, Stamford, Conn., both reported single-digit decreases in dollar and case sales. Heineken USA experienced a 2.1 percent drop in

case sales and 2.8 percent decrease in dollar sales in the measured channels for $1.1 billion in sales through Jan. 23, SymphonyIRI said. Diageo Guinness reported $403.7 million in

dollar sales and fell 1.4 percent in case sales and 1.3 percent in dollar sales in the same period. The remaining top 10 beer vendors, each reported increases in dollar sales continued on page 22

BREWER PERFORMANCE Price increases drive shareholder value, but affect top-line industry growth, according to a “State of the U.S. Beverage Alcohol Industry 2010” report from Bump Williams Consulting, Stratford, Conn. In 2010, MillerCoors’ underlying net income increased nearly 22 percent to almost $1.1 billion, according to the Chicago-based brewers’ full-year report released last month. The brewer attributed the increase to positive pricing, favorable brand mix and continued strong cost management. However, MillerCoors’ domestic sales to retailers declined 3.2 percent and domestic sales to wholesalers decreased 3 percent for the full-year 2010, the company reported. According to SymphonyIRI data, Anheuser-Busch InBev, St. Louis, and MillerCoors, Chicago, reported declines in both dollar and case sales through Jan. 23. Anheuser-Busch InBev reported case sale decreases of 3.1 percent and a total of $12.5 billion in sales, which represented a 1.1 percent decline from the previous year, SymphonyIRI data show. MillerCoors also reported a 3.2 percent drop in case sales and a 1.3 percent decrease in dollar sales, which totaled $6.5 billion in measured channels for the 52 weeks through Jan. 23. Of the import producers only Crown Imports, Chicago, reported positive numbers for the year ending Jan. 23 with a 1.8 percent increase in case sales and dollar sales remaining relatively Áat, SymphonyIRI reports. Its counterparts Heineken USA,

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bevindustry.com | MARCH 2011 | Beverage Industry |

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Special Report continued from page 21

with The Boston Beer Co., Boston; North American Breweries, Rochester, N.Y.; and Mark Anthony Brands, Vancouver, reporting double-digit dollar sales growth vs. a year ago, according to SymphonyIRI. Pabst Brewing Co., Woodridge, Ill., ranked sixth with a 4 percent rise in dollar sales to $393 million, but reported a 0.8 percent decrease in case sales. Not far behind the double-digit growers, D.G. Yuengling & Son, Pottsville, Pa., grew 9.4 percent in dollar sales for a total of $177 million and case sales increase of 8.5 percent.

CHANNEL CHALLENGES

>>

Across retail channels, beer continued to struggle as retailers saw shopper loyalty and foot trafÀc decline, according to Bump Williams Consulting. Grocery share of spending remained unchanged between 2009 and 2010, but competition for share of food and beverage is intensifying, according to SymphonyIRI data presented during The Brewers Association’s Power Hour conference series “2010 Beer Category Overview and Craft Segment Review.” The research Àrm reported that supermarkets make up 49.4 percent of channel share and Wal-Mart an estimated 20 percent. Despite channel leadership, supermarkets endured the continued ups and downs of the beer market during the past few years, SymphonyIRI’s Wandel says. “In the supermarket channel, which up until last year has Several retailers added private label beer options to their lineups, including supermarket chain Supervalu that released Buck Range Light fared OK, we actually did see early this year. the category struggle, and it did not grow,” he says. “It shrunk from a volume (individual brands) perspective by 1.7 percent vs. the previous year, % CHANGE VS. % CHANGE VS. DOLLAR SALES CASE SALES PRIOR YEAR PRIOR YEAR which was kind of the headline Corona Extra $917,681,300 -3.1 31,498,890 -2.2 there.” Heineken $569,622,200 -3.3 18,902,740 -2.1 CostModelo Especial $281,495,100 15.5 11,122,020 19.2 consciousness Corona Light $167,764,700 -2.1 5,912,066 -1.5 continues to be a consumer Tecate $166,310,900 -9.7 8,719,764 -8.2 trend and several Labatt Blue $118,566,900 0.7 6,046,851 -0.8 retailers debuted Labatt $104,527,900 9.1 5,445,646 6.6 private label beer Blue Light brands this year. Dos Equis XX In spring 2010, $101,590,600 23.4 3,566,670 23.4 Lager Especial convenience Stella Artois chain 7-Eleven $88,110,170 15.8 2,499,471 15.4 Lager introduced Game Heineken Premium Day Beer. Since $82,248,500 -13.8 2,789,290 -12.8 Light Lager then, Walgreens Total Import has joined the $3,395,158,000 0.0 124,911,600 0.7 Category* fray with the addition of Source: SymphonyIRI Group, Chicago. Total U.S. supermarkets, drug stores, gas/convenience stores and mass Big Flats 1901 merchandise outlets (excluding Wal-Mart, club and liquor stores) for the 52 weeks ending Jan. 23, 2011. premium lager, Individual brand listings — sales do not represent brand totals. *Category totals include brands not listed. which is sold

Top imported beers

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for $2.99 each six-pack. Big Flats also is available in 24-packs for $11.49 at Walgreens stores. Last month, supermarket chain Supervalu added Buck Range Light beer to its line of private beer brands. Buck Range Light is characterized as an American lager and is sold in 12-packs for $5.99 in most of the retailer’s markets. Supervalu also offers two craft brands, RJ King Wingwalker and Metolius, as well as import brands Gouden Haven and San Lucas. “Private label beer is an interesting phenomenon,” Nielsen’s Lake says. “Retailers have been trying private label beers on and off for quite a while, and for the most part, they typically don’t gain a lot of traction. The reason that they don’t gain a lot of traction is because the industry, in particular, the likes of Anheuser-Busch and MillerCoors and certainly the big import players, Corona and Heineken, have all built a business around brands and brand equity. “And as you look at the beer industry, there are so many segments within it that there’s really a price point for every consumer,” he continues. “Historically, they haven’t had a lot of success and I’m not convinced they are going to have a lot of success today, but it could happen.“ Convenience stores did beneÀt from the rise in Áavored malt beverages, SymphonyIRI’s Wandel says. The FMB segment increased 25 percent in volume and dollars in convenience stores, he says. The category also experienced an increase in competition as the drug store channel expanded with 3,400 new outlets that added beer in 2010, Lake says. The addition of new outlets makes up part of the 8.5 percent increase in sales in drug stores in 2010, he says. According to SymphonyIRI data presented during the Brewers Association Power Hour Teleconference, the drug channel reported the highest increase in retail with 1.1 percent growth since 2009, and it made up 11 percent of the market for the year ending Jan. 2.

INCORPORATING IMPORTS Coming back from a nearly 4 percent decline in 2009, imports remained Áat in dollar sales and reported a near 1 percent rise in case sales in measured channels for the 52 weeks ending Jan. 23, SymphonyIRI reports. “In the import category, there was some re-setting of pricing in promotional activity,” Nielsen’s Lake says. “[It] certainly ramped up pricing, ramped up promotion. It was really about making sure that the price gap between premium and imports was at a level that consumers saw the value of trading up. So that was achieved and interestingly enough they started taking back share again.” SymphonyIRI data show an overall $0.19 decrease in average price per import case in measured channels through Jan. 23. The average price per case of import beer during the time period was $27.18 compared to an $18.11 average price per case for domestic brands, according to SymphonyIRI data. Despite the price discounts, Lake notes that an average $8 price gap exists between the average import beer and average premium beer. In addition, several brands have struggled as many people in their key demographics were affected by unemployment, SymphonyIRI’s Wandel says. SymphonyIRI data show that Corona Extra maintained its top spot among imports with more than $917 million

Labatt Blue Light Lime Lager, which ranked seventh on SymphonyIRI’s list of Top 10 new brands in supermarkets in 2010, Wandel says. Stella Artois ranked ninth in the Top 10 import brands in measured channels for the year ending Jan. 23, according to SymphonyIRI. Stella Artois reported $88 million in sales, which represents a 15.8 percent increase in dollar sales and 15.4 percent rise in case sales.

KEEPING UP WITH CRAFT Stella Artois is part of Anheuser-Busch InBev’s growing upscale portfolio, which Nielsen’s Lake says is a portion of a lineup that larger brewers are leveraging to stay in step with the rise in craft beer. “It is raising the game with the big brewers,” Lake says. “Certainly, Anheuser-Busch and MillerCoors have renewed focus on the high-end of their portfolio. MillerCoors has launched Tenth & Blake [Beer Co.] and moved their Blue Moon, Leinenkugel and some of their imports under that umbrella and changed the way they’re going to market. On top of that, A-B has come out. They’ve got a very strong upscale portfolio with the likes of Stella Artois, Bass and Shock Top.” The craft beer category overall reported 14.6 percent increase in dollar sales and 13.1 percent increase in case sales. Within SymphonyIRI’s top 10 craft beer brands, only two – Widmer Hefeweizen and Samuel Adam’s Light – reported decreases in dollar sales. The continued on page 24

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in sales, but experienced a 3.1 percent decline in dollar sales and 2.2 percent drop in case sales in measured channels for the year ending Jan. 23. However, the brand began to see a turnaround at the end of last year, he says. Crown’s Modelo Especial brand was one of three double-digit gainers in the import category. Modelo Especial reported 15.5 percent increase in dollar sales and 19.2 percent in case sales in the measured channels during the time period. Heineken retained its No. 2 spot among import beer brands, exceeding $569 million in sales. However, the brand experienced a 3.3 percent decline in dollar sales and 2.1 percent drop in case sales for the 52 weeks ending Jan. 23 in measured channels, SymphonyIRI reports. Tecate, a brand of Heineken, ranks Àfth with $166 million, but reported a 9.6 percent decline in dollar sales and 8.2 percent drop in case sales during the time period, according to Symphony IRI. On the other hand, Heineken experienced growth with its No. 8-ranked Dos Equis Lager Especial, which grew 23.4 percent in dollar sales and case sales, SymphonyIRI reported. The increases partly can be attributed to Dos Equis’ marketing campaign starring “The Most Interesting Man in the World,” who recently earned 1 million “likes” for the brand on Facebook. Labatt Blue and Labatt Blue Light also presented positive numbers in dollar share, with 0.7 percent and 9.1 percent increases, respectively. The North American Brewery-owned brand also introduced

Heineken-owned Dos Equis Lager Especial increased dollar and case sales by 23 percent, SymphonyIRI reports.

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Special Report continued from page 23

remaining eight brands each reported positive dollar sale performance ranging from 3.6 percent for Samuel Adams Boston Lager to a 141.2 percent rise in Sierra Nevada Torpedo Extra IPA for the year ending Jan. 23. Consumers are continuing to embrace craft brands, says Julia Herz, craft beer program director for the Brewers Association, Boulder, Colo. “There’s a lot of trade-up going on from subpremium to premium beers to the craft level because price point difference is not that big of a jump compared to, say, wine,” she says. “Wine, you’re talking $10, $20, $30 difference, when going to one category to the next to the next. Then you’ve also got trade across from wine and spirits.” Also making an impact is the increasing availability of craft brands in cans. SymphonyIRI reported 30 craft vendors offered 65 SKUs in cans in supermarkets for the year ending Jan. 2. The Àgure is an increase from 2007 when 17 vendors offered 28 SKUs in cans. The packaging also is available in a variety of sizes, including 16-ounce cans in four-packs and 12-ounce cans in four-, six- and 12-packs. Total craft can sales ranked $5.8 million through Jan. 2 in supermarkets, SymphonyIRI reported. Sierra Nevada Pale Ale continues to occupy the top spot among craft beer with $85.5 million in sales and nearly 8 percent of the dollar share of the total craft category. The variety tops SymphonyIRI’s top craft pale ale brands. The brewery’s Torpedo Extra IPA ranks Àrst on the list of craft IPAs with $12.9 million in dollar sales in food, drug and convenience stores for the year ending Jan. 2, SymphonyIRI reports. Sierra Nevada Brewing Co. is one of the category leaders, along with The Boston Beer Co., Craft Brewers Alliance and New Belgium Brewing, (individual brands) SymphonyIRI’s Wandel says. “Those four % CHANGE VS. % CHANGE VS. DOLLAR SALES CASE SALES PRIOR YEAR PRIOR YEAR are continuing to Sierra Nevada grow,” he says. $85,487,170 4.8 2,676,120 3.9 Pale Ale “Their Áagship Samuel Adams brands as well as $84,622,340 28.1 2,760,718 27.0 Seasonal their second and Samuel Adams third support $74,024,720 3.6 2,445,495 3.6 Boston Lager brands in their New Belgium Fat portfolios are $56,821,140 9.5 1,739,844 10.4 Tire Amber Ale doing well. But Shiner Bock $45,918,900 6.1 1,586,440 2.6 we’re absolutely seeing a lot of Samuel Adams $28,823,100 41.1 1,020,384 42.7 Variety Pack regional pockets of success Widmer $22,389,720 -2.8 764,203 -1.7 Hefeweizen around the country, and Sierra Nevada $20,976,690 22.5 672,832 21.4 Seasonal we’re seeing a lot of smaller guys Samuel Adams $15,073,390 -17.5 508,548 -17.4 Light really starting to develop in the Sierra Nevada $13,488,710 141.2 405,419 142.0 Torpedo Extra IPA channels that we track.” Total Craft $1,078,501,000 14.6 33,974,780 13.1 Category* New Belgium’s Source: SymphonyIRI Group, Chicago. Total U.S. supermarkets, drug stores, gas/convenience stores and mass Ranger IPA was merchandise outlets (excluding Wal-Mart, club and liquor stores) for the 52 weeks ending Jan. 23, 2011. one of four nonIndividual brand listings — sales do not represent brand totals. *Category totals include brands not listed. FMB brands that

Top craft beers

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| Beverage Industry | MARCH 2011 | bevindustry.com

ranked on SymphonyIRI’s list of Top 10 new brands in dollar sales in U.S. supermarkets, according to data presented during the Power Hour Teleconference. Ranger IPA ranked fourth with approximately $5.5 million in sales in its Àrst year on the market, the research Àrm said. IPAs are prominent on SymphonyIRI’s list of Top 10 new craft beer brands in U.S. supermarkets. Samuel Adams’ Latitude 48 IPA ranks second with $1 million in sales and is followed by Widmer Deadlift Imperial IPA and Flying Dog Raging Bitch IPA. As new players continue to enter the category, Wandel says, the leaders are losing share within the segment. Six of the top 10 craft beer brands lost share during the year, SymphonyIRI reported. “What that tells you is that there is a tremendous amount of competition in the segment below those guys that are starting to gain traction in sales,” he says. During the Brewers Association’s Power Hour teleconference, SymphonyIRI reported that the all other craft brands segment includes 346 vendors, occupies 28.2 percent of the dollar share of the craft beer market and increased 1.5 percent for the 52 weeks ending Jan. 2. “On top of the 1,600-plus breweries that we have on the books, both large and small, we have over 500 on record for breweries in planning, and that’s extremely signiÀcant,” Herz says. “Right now, we’re at the largest number of breweries since Prohibition occurred in this country.” The association forecasts a continued upward trajectory for the market and recently revised its deÀnition of a craft brewer. The new deÀnition increases the maximum barrelage from 2 million to 6 million barrels and keeps up with the category growth, Herz says. “If we hadn’t changed that deÀnition, we likely would have lost some of the regional craft brewers, most immediately Boston Beer, but eventually maybe others,” she says. “When you lose the growth in the marketplace and the success in the marketplace from your most successful members, that’s going to take away from the overall statistics that you’re publishing and with that that would have inaccurately reÁected the actual success that the overall segment is having.”

FLUCTUATING TOWARD FLAVORS Nielsen’s Lake sees a consumer movement toward Áavors, which is embodied in the rise of FMBs and ciders. “What I think the real surprise for the beer industry last year was the resurgence of Áavored malt beverages,” Nielsen’s Lake says. Coming back from a 4 percent drop in the category in 2009, the FMB segment expanded by 18.5 percent in dollar sales for a total of $952 million in sales in measured channels for the year ending Jan. 23, SymphonyIRI reports. The growth was led by Mike’s Hard Lemonade and Chicago-based Phusion Projects’ Four Loko brand. Diageo’s Smirnoff Ice product maintained its No. 1 spot in the FMB category with $102 million in sales for the 52 weeks ending Jan. 23 despite recording 5.5 percent drop in dollar sales and 5.7 percent decline in case sales. The company was active in launching new varieties with four new Áavors appearing on

channels for the 52 weeks ending Jan. 23. Anheuser-Busch also offers a caffeine-free FMB. Its Tilt brand was introduced in April 2010 and is organized by color, including Tilt Red, a fruit Áavor; Tilt Blue, blue raspberry Áavor, and Tilt Green, a lemon-lime citrus Áavor. SymphonyIRI’s Wandel predicts the FMB category might not continue its current growth trajectory. “It’s dependent upon innovation, primarily, but with the change in the caffeinated products, I’ve got to believe that there is going to be a bit of a let-down in the [FMB] segment,” he says. Analysts also are monitoring the cider category, which recorded nearly $42 million in sales in measured channels for the year ending Jan. 23, according to SymphonyIRI. The category’s growth is mirroring that of craft beer, Wandel says. Cider increased 17 percent in volume and 23 percent in dollars in measured channels for the 52 weeks ending Jan. 23. The beer category is projected to attain a certain amount of stability in 2011. “My prediction is that the category will probably grow, maybe half a percent to a percent,” Nielsen’s Lake says. “I think you’ll continue to see growth in the craft segment. I think you’ll see what I would call upscale beer, to include both craft and imports, I think you’re going to see that segment grow this year as the economy gets better and more and more consumers use beer as an indulgent reward.” BI

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SymphonyIRI’s Top 15 New Brands in dollar sales in U.S. supermarkets. Mike’s Hard Lemonade reported growth across its portfolio with double-digit growth in dollar and case sales in its Hard Lemonade, Cranberry Lemonade, Variety Pack and Seasonal offerings through Jan. 23 in measured channels. The company also reported 87.7 percent growth for Mike’s Harder Cranberry Lemonade and 94.7 percent increase in Mike’s Harder Lemonade. The product was designed to compete in the convenience store channel and is sold in 16-ounce cans and is available in a range of Áavored lemonades and a Limeade variety. Another company innovation, Mike’s Classic Margarita varieties occupied three spots on SymphonyIRI’s Top 15 New Brands in dollar sales in U.S. supermarkets. Fueling growth in the category, Phusion Projects Ànished just shy of the Top 10 beer vendor list and reported 253 percent growth in both dollar and case sales for the 52 weeks ending Jan. 23, according to SymphonyIRI. The company’s Four Loko brand experienced triple-digit growth for its Fruit Punch, Watermelon, Grape and Blue Raspberry Áavors. The brand attracted attention for its caffeine content and has created reformulated varieties, which are still doing quite well, Nielsen’s Lake says. However, MillerCoors reformulated its Sparks and Sparks Plus products to remove the caffeine and showed declines of approximately 48 percent in both dollar and case sales in the measured

Part of the growth in the flavored malt beverage segment in 2010 included Mike’s Harder Lemonade varieties, which were designed to compete in convenience stores.

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Cover Story

‘One case at a time’ Beer wholesaler plans for another 100 years of building brands

LAST YEAR, DEL PAPA DISTRIBUTING CO., GALVESTON, TEXAS, MARKED THE company’s 100th anniversary. To honor its centennial, the company organized a year-long celebration that highlighted the history of the Anheuser-Busch InBev distributor and the role it has played in the 17 counties in which it distributes in Southeastern Texas. Throughout its history, two things have remained the same: the company’s family ownership and its commitment to Del Papa Distributing’s motto, “Quality people building brands and friendships… one case at a time.” Del Papa Distributing was founded by Italian immigrant Omero Del Papa, who converted his retail grocery business in Galveston into a wholesale establishment in 1910. “The story of this company is really the story of what I would call the quintessential American dream,” says Mike McAfee, Del Papa Distributing’s vice president of marketing. “An immigrant comes to the United States

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with probably not much jingle in his pocket, but he had a dream of what he wanted to do, and this was the place that he thought he could do it.” The business grew throughout the years and in 1930 Del Papa Distributing formed an agreement with Anheuser-Busch to be a distributor of malt, syrup, baker’s yeast, soft drinks and a “near-beer” product called Bevo. Three years later, when Prohibition was repealed, Del Papa Distributing began carrying Anheuser-Busch’s beers. The company’s family ownership and its AnheuserBusch franchise relationship have endured throughout the years. Omero’s son, Lawrence Del Papa, serves as

BY JENNIFER ZEGLER

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Larry Del Papa, president of Del Papa Distributing Co., an Anheuser-Busch InBev wholesaler that serves 17 counties in Southeastern Texas.

chairman of the board, and Lawrence’s son, Larry Del Papa, has been company president since 1988. Del Papa Distributing also continues to maintain a strong relationship with Anheuser-Busch InBev, which remains its primary supplier. Anheuser-Busch InBev products make up 95 percent of the company’s business, Del Papa estimates. Del Papa Distributing has 350 employees and operates three distribution facilities along the Southeastern Texas coast. The company’s territory is a growing area with a population of 1.3 million, says Alex Guidroz, executive vice president of sales and marketing. Its location along the Gulf Coast also expands during the year as the area attracts tourists and vacationers from March through October. The area’s growth combined with the company’s business strategies have helped the business expand in recent years. “We came through 2010, a year in which our industry was down, and in our markets we gained market share,” McAfee says. “Now to do that, that means you have to take it away from competition because there’s no incremental growth. Now if you’re doing that, and at the same time you’re gaining these operational efficiencies, you’re maintaining profitability, which is obviously the ultimate goal.” In 2010, Del Papa Distributing reported a case equivalency volume of 9.5 millon cases, which represents a 22.1 percent increase in volume during the past 10 years, the company says. Its market share also has grown 19 percent in the past decade, and the company finished 2010 with a 57.9 percent market share in its territory, it reports.

MARKET SNAPSHOT The company’s portfolio includes many of the industry’s top brands, including Bud Light, Busch and Natural Light. Due to state franchise laws, Del Papa Distributing holds the rights to No. 1 import brand

Corona in a portion of its territory. The company also has rights to Anheuser-Busch InBev’s Stella Artois in limited areas. The company has experienced incremental growth from several emerging Anheuser-Busch brands. “In our business, it’s really rare that something will come out and really do gangbusters; it’s slow, steady growth over time,” Guidroz says. “We have a lot of those brands in our portfolio. Most of them are with Anheuser-Busch, brands like Land Shark, Ziegenbock, a brand that’s unique to Texas, and ShockTop, which is a national brand that does well and competes with Blue Moon.” Del Papa Distributing maintains distribution facilities in Beaumont, Galveston and Victoria to serve its market. Its accounts are made up of 60 percent chain and independently owned convenience stores, 20 to 25 percent supermarkets and mass merchandisers, and the remainder includes on-premise accounts, Del Papa says. The company serves approximately 1,500 accounts off-premise and 1,300 on-premise accounts throughout its territory, Guidroz says. Through the years, the company has seen the volume of its on-premise accounts shrink, but recently experienced a rebound in its draft business, McAfee says. “For years the draft business was down annually,” he says. “But for the last three to five years, draft is starting to come back. A lot of that is due to craft beers. We’ve done a really good job of promoting these beers on premise with a lot of sampling and on-premise promotions. The InBev brands that we’ve taken over, like Stella Artois, have enhanced our draft business, too.” The draft business also has benefited due to the sixth barrel keg, which is taller and skinnier than a traditional keg and can double or triple the number of tap handles at an on-premise account. The company’s market covers a wide area with a diverse population. In the north, Del Papa Distributing’s Beaumont facility serves eight continued on page 28

Del Papa Distributing Co. is heavily involved in special events and community outreach in the 17 counties that it serves in Southeastern Texas. The company sponsors at least 45 events across its territory and contributes gifts and donations to at least another thousand, says Mike McAfee, Del Papa Distributing’s vice president of marketing. With so much experience in events in the local area, when it came time to celebrate its own 100th anniversary Del Papa Distributing set-up a committee that spent two years researching the company’s history, planning special events, creating a marketing campaign and community outreach programs, McAfee says. It also set up a $220,000 endowment to benefit 13 colleges and universities located in its territory. “I think it brought awareness to our communities about the company that was

not appreciated prior,” says Larry Del Papa, the company’s president. “We only plant buildings in so many locations, and we cover a pretty broad territory. The word really got out, and it was a proud moment for us and our employees and a lot of our retailers appreciated it.” Its primary supplier, Anheuser-Busch InBev was instrumental in supporting its centennial anniversary celebrations. Del Papa Distributing hosted galas in Beaumont, Victoria and Galveston, which each included a special appearance by the AnheuserBusch Clydesdales. The brewer also created an anniversary label for Budweiser bottles that were handed out as favors along with a commemorative beer stein highlighting family members and a model of a 1930-era delivery truck that the company refurbished for the occasion.

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CENTENNIAL CELEBRATION

As part of its 100th anniversary celebration, Del Papa Distributing refurbished a 1930 Model A Ford delivery truck, which was featured at special events.

Anheuser-Busch’s media department also supported Del Papa Distributing’s radio campaign that promoted historical and local events that happened in its territories during the company’s 100 years in business. The anniversary celebration will culminate this year with the release of a 150-page book as well as a video that document the history of the company, McAfee says. BI

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Cover Story continued from page 27

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counties near the Louisiana border. The northern portion of its territory is a rural marketplace with many blue collar workers and a sizeable AfricanAmerican population, Del Papa says. In this market, value-priced brands tend to perform well, he says. The center of Del Papa Distributing’s area is served by its Galveston facility and spans two counties that include the island of Galveston as well as high-growth Houston suburbs. Consumers in the central area favor Bud Light along with some of the company’s higher end and craft beer brands, Del Papa says. The southern portion of Del Papa Distributing’s territory serves seven counties from its Victoria warehouse. This portion of the market has a heavily Hispanic During Beverage Industry’s interview, three team members from the company’s population with whom Beaumont office joined the interview in Galveston via video conference. Del Papa Distributing does not operate from one defined corporate office, instead, executive Bud Light is a favorite, Del Papa says. leadership operates out of each of the company’s three locations.

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BUSINESS ADAPTATION Del Papa Distributing saw the economic downturn as an opportunity to analyze its business and identify opportunities for the wholesaler, Del Papa says. “We have been through a few of these cycles, all of us together, and so we know we’re going to come out of it,” he says. “We look at these as opportunities to reorganize, reinvest and we’re always talking about what the next structure looks like.” Last year, the company converted its organization into a regional structure. Previously, employees were grouped according to their central office location, but in the regional structure, employees are organized around the marketplace, Del Papa says. The new structure provides balance in the workload between locations, Guidroz says. Prior to the reorganization, a sales manager in one location might have twice as many people, accounts and volume than a co-worker at another location, he says. In addition to internal changes, Del Papa Distributing continues to monitor the industry for new trends. Although Del Papa Distributing’s business is made up of 95 percent Anheuser-Busch brands, the company monitors the potential for new suppliers and brands to its portfolio. “We bring on additional suppliers to enhance our overall market share,” Del Papa says. “We don’t want to swap one case for another. I always say, ‘It’s plusplus. It’s not either/or.’ We don’t want to replace this

| Beverage Industry | MARCH 2011 | bevindustry.com

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brand or that brand. We want this brand plus that brand.” The company carries a selection of craft beers, including products from Sierra Nevada Brewing Co., New Belgium Brewing Co. and Craft Brewers Alliance. In addition, the company has had success with selections from Houston’s Saint Arnold Brewery, Guidroz says. The craft beer trend has yet to hit its peak in Del Papa Distributing’s territory, which allows the company to work out the best route to market for its craft brands, Del Papa explains. “We’re excited because we’ve got a great portfolio of good craft brands,” he says. “Even though they don’t contribute a lot of volume, yet, because in our marketplace craft beer is not really as established, so we’re not really playing catch-up. We have a portfolio to drive the business forward as the consumers and the demographics catch up.” The company also is careful to maintain a manageable amount of brands, Guidroz says. “We’ve found that you can probably have too many suppliers,” he says. “There is a right number in terms of accounts that are manageable. That’s important to us, too, to make sure that it’s the right partnership and from logistics that we can get the supply. Because they’re smaller quantities, we are not going to buy a full truck of every craft beer or import that we pick up.” In addition, to ensure that the company does not lose focus on its core Anheuser-Busch InBev brands, Del Papa Distributing has three brand managers who each manage a defined portfolio. The brand managers write sales plans, work with the marketing department on promotions and with field staff for implementation, Guidroz says. The company’s personnel organization also includes high-level sales representatives who are known as account development managers. Instead of going into the market writing orders, rotating beer and placing signage, account development managers visit higher volume and prestige accounts to sell programs, such as displays, themes, new packaging and price points, Guidroz says.

“I’ve been in the business all my life, and as long as I can remember even before we had the scale and the leverage, we always seemed to have the best people,” Del Papa says. “What

that tells me is that the retailers are saying we take care of them. It’s been instilled probably from my grandfather that the customer truly is king. It’s not something we say; it’s something that

according to our retailers, we do.” Most of the members of Del Papa Distributing’s senior leadership team have grown from entry-level jobs in the industry, which has given the continued on page 30

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bevindustry.com | MARCH 2011 | Beverage Industry |

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Cover Story continued from page 29

leadership gets out one day a month and gets out on the street and tries to understand the competitive landscape, the changes that are going on and talk to retailers. What our retailers always

executives perspective, Del Papa says. “We’ve all started at low-level positions, so we recognize what’s important,” he says. “We try to get out as much as possible. Every one of us in

reflect back to us is that we have the best people.” In addition to its personnel, Del Papa Distributing also constantly invests in tactics and technology to advance its

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operations, says Peter Williamson, vice president of performance systems. “We were first to market with pre-sell in our marketplace that was back in the late ‘80s,” Williamson says. “With Mike [McAfee]’s help, we were first to the market with bulk delivery in our territories back in the mid-‘90s. We invest not only in people, but we also invest in equipment and technology.” The company also was one of the first to implement a warehouse management system in its three locations, says Bill Falkenhagen, executive vice president and chief financial officer. Earlier this year, the wholesaler announced an $18 million project to build a new multi-million dollar Coastal Distribution Center in Texas City (see Plant Focus article for more). Del Papa Distributing is researching additional advancements to be implemented in the new facility to make it as efficient as possible, Falkenhagen says. As the company looks forward to its next 100 years, Del Papa wanted to give back to the beer wholesaler industry and is acting chairman of the board of the National Beer Wholesalers Association for the 2010-2011 term. As chairman, Del Papa plans to continue advocacy on behalf of the industry, he says. “There is an effort in this country to de-regulate alcohol,” he says. “From my view, and I think the view of many, I think that would be a disaster. I’m going to do everything I can to try to give back to an industry that’s been very good to me, my family, my employees and my retailers and do the best that one man can while I’m there serving my term.” Del Papa also wants to preserve the forward momentum of his family’s company. “Opportunities will present themselves, and we need to be mentally and financially ready when those opportunities come and make sure that we have enough foresight to continue to make good investments in our future,” the company president says. “I don’t tend to worry about those things, but at the same time we’ve got to change and we have to keep pushing for the right kind of change. We can’t just sit back and neglect the future and think everything’s going to work out for you. We work for our future very hard, but it starts with the people we hire. If we make the right investments, they’ll give us a reasonable return and that’s what you can expect in business.” BI

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Plant Focus

An investment in tomorrow Del Papa Distributing will implement proven strategies in new distribution center

IN 1930, DEL PAPA DISTRIBUTING CO., GALVESTON, TEXAS, ENTERED INTO A relationship with what remains to be its primary supplier, Anheuser-Busch. Through the years, Del Papa Distributing has grown to supply 17 counties in Southeastern Texas with a portfolio that now includes 95 percent Anheuser-Busch InBev products. The wholesaler operates distribution centers in Beaumont, Galveston and Victoria that companywide supplied 9.5 million cases of beer in 2010. Its three distribution centers are centrally located to serve the company’s 1,500 off-premise and 1,300 onpremise accounts. The area Del Papa Distributing covers is vast and the company’s distribution team drives approximately 2.5 million miles each year, says Peter Williamson, Del Papa Distributing’s vice president of performance systems. To help the company better serve its customers, Del Papa Distributing announced an $18 million investment in a new Coastal Distribution Center to be built in Texas City. The new facility will include a new distribution center and offices and will replace the company’s Galveston facility, which is located

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| Beverage Industry | MARCH 2011 | bevindustry.com

on an island about 50 miles southeast of Houston. “The island used to be where our business was, and it’s evolved over 100 years,” says Larry Del Papa, the company’s president. “Fortunately, we’ve grown and the outer territory has grown, and we’ve picked up territory. It’s going to be a big deal for our future.”

ADVANTAGES OF FORECASTING Customer service is a top priority for the wholesaler and shapes the way it goes to market, says Alex Guidroz, Del Papa Distributing’s executive vice president of sales and marketing. “We take it one consumer at a time, one case at a time and one can or bottle of beer at a time,” Guidroz says. “We don’t really go out and make a huge sale.

BY JENNIFER ZEGLER

>>

Del Papa Distributing’s Galveston facility implemented a warehouse management system that gives voice instructions to order pickers who locate products by barcode and select the necessary amount.

It’s a combination of a lot of little sales throughout the day, throughout the month, throughout the year that will make us or break us.” In addition to sales, relationships also are forged by the distribution team, whose routes generally visit the same accounts weekly, says Eric Joseph, the company’s vice president of logistics. Del Papa Distributing operates on a pre-sell system with more than half of its orders forecasted at least 48-hours in advance of delivery, Guidroz says. Merchandisers might visit accounts throughout the week, he says. The company delivers approximately 90 percent of its volume in bulk shipments, it says. Delivery is offered Monday through Saturday and during peak weeks the company is able to run deliveries twice a day. Due to Del Papa Distributing’s location along the Gulf Coast, the market experiences an influx of tourists several months of the year. During these peak times, the company adds seasonal workers and also uses a layer picker for volume orders. The layer picker can move as much as 30 percent of its volume, Guidroz says. In addition, the presell system helps the company to schedule its warehouse staff, Del Papa says. “The 48-hour and 72-hour advance sales helps us schedule our workers so people aren’t standing around waiting for orders,” Del Papa says. “That’s what used to happen in the peak season; the orders would come in at the end of the day and people would have been waiting on orders. Now when they get here first thing in the morning, they’ve got orders from two days ago.”

DISTRIBUTION PRACTICES The company maintains three controlled environment warehouses to serve its vast territory. The Beaumont warehouse spans 41,000 square feet with capacity for 275,000 cases. Its Victoria warehouse is 19,000 square feet and has space for 150,000 cases. In Galveston, the company has a main warehouse that is 45,000 square feet and an annex warehouse located down the street from the

main location with 8,650 square feet of space for extra products. The combined capacity of the two Galveston warehouses is 300,000 cases, the company says.

The recent economic downturn spurred the company to examine options for more efficient processes, says Bill Falkenhagen, Del Papa’s executive vice president and chief

financial officer. In an effort to reduce the number of times employees handle products, Del Papa installed warehouse management systems in each of its three locations. continued on page 34

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Plant Focus continued from page 33

Its warehouse management system receives a forecasted order from an account manager, which is given to an order builder in the warehouse who is equipped with a head-set. The voice-directed warehouse management system leads the order picker to specific product locations in the warehouse, which are marked by overhead barcodes, and provides instructions on the amount of cases to pick. Completed orders are shrinkwrapped and placed in rows organized by route numbers. Before being loaded onto trucks, the orders are verified by an employee. In 2010, the system helped Del Papa Distributing achieve 99.2 percent accuracy in its orders, Joseph says. With an aim of 100 percent accuracy, the company is investigating technology, such as weighing or scanning orders to streamline the verification process. In addition to order accuracy, the warehouse management system offers more visibility into location and code dates of products in the warehouse as well as advance shipment notices from suppliers, including the Anheuser-Busch InBev brewery in Houston. It also monitors employee activity and in the fourth quarter, the company saw a nearly 19 percent increase in the number of cases moved each hour across its three facilities, Williamson says. Del Papa Distributing’s fleet maintains 38 trucks across its three locations. In addition to 28 bulk delivery trucks, the company also uses 10 eightbay trucks, which are smaller trucks with four bays on each side that deliver bulk orders to smaller accounts. The eight-bay trucks are smaller and easier to maneuver in high-traffic areas than a standard semi-truck, the company says. “If we are pre-selling to the on-premise trade and the smaller accounts, the eight-bay truck can carry as much as we were selling off a 20-bay when we were pedal selling,” Del Papa says. “But the investment in the equipment is much less, and the efficiency in operating the equipment is better.” The models do not require a driver who has a commercial driver’s license, which provides for an entry-level employment opportunity, Del Papa adds.

PLANNING FOR PROGRESS

>>

The company’s current Galveston location tends to be the company’s hub and in four buildings houses 160 employees spanning the company’s sales, delivery, graphic design, human resources, fleet maintenance and financial services divisions, Del Papa says. The company’s plans for a new Coastal Distribution

Picked orders are tagged with a printed product list, which is manually verified by an employee before it is loaded onto the trucks.

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| Beverage Industry | MARCH 2011 | bevindustry.com

CREATING TOMORROW’S SOLUTIONS

>>

WHAT DO YOU WANT TO MASK?

Once the orders are verified, the shrinkwrapped orders are moved by route onto delivery trucks.

Center in Texas City will help centralize the divisions currently housed in Galveston. “This is a 31-year-old campus,” Del Papa says. “It’s been expanded to the point of inefficiency. It’s a very nice facility and it works well, but if we’re looking at the next 25 to 30 years, it’s obvious that putting more investment in a location that’s not as efficient and properly located as it could be, is not wise.” In its plans for the new facility, Del Papa Distributing is taking the best practices that are currently in use by the company, such as its warehouse management system, and combining them with state of the art features, such as video conferencing, on-site generators and environmentally friendly design features, Williamson says. In addition, the new Coastal Distribution Center will feature improvements on Galveston’s current design. “From a campus that is 31 years of age, we are going to be able to be much more efficient in our product layout,” Williamson says. “The number of cases that we are able to stack in certain areas of our warehouse will not be a problem going forward. We will be much more efficient there.

“In our loading bays, it’s going to be like a cross-dock,” he continues. “We’re going to bring product in on one side of the building and it will go out on the other side. So the congestion that we have today with receiving and sometimes shipping products will be eliminated.” The Texas City facility also will be the central location for the company’s lower volume products, Del Papa says. “About 50 of our packages do about 90 percent of our business, yet we have all packages at all locations,” he says. “What we’re going to be able to do is isolate the majority of our packages in our Coastal Distribution Center and pull them out of our Northeast and South distribution centers. Thereby increasing the capacity of those operations long term, and also increasing the productivity of how we handle these small packages.” The company envisions that when used in combination with its pre-sell forecasting system, smaller volume products can be picked at the Coastal Distribution Center and sent to Beaumont and Victoria to continue their journey with high volume products picked at the local warehouses, Del Papa says. BI

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bevindustry.com | MARCH 2011 | Beverage Industry |

35

Up Close With...

BY LORI SICHTERMANN

NextFoods: A drink with guts Probiotic beverages offer a healthful digestion solution

THE AMERICAN COLLEGE OF GASTROENTEROLOGY REPORTS THAT 95 MILLION people in the United States suffer from at least one type of digestive problem — that’s nearly one-third of the total population. In 2007, health food aficionados Steve Demos and Todd Beckman gathered industry insiders, medical professionals and lifestyle-trend watchers to discuss and develop a product rooted in healthful digestion. The result of this gastrointestinal gathering was the development of NextFoods. The company was quick to create a new category of food that helps support good health through the marriage of science and organics. The cornerstone of NextFoods’ good-for-you product line is its offering of probiotic drinks available under the GoodBelly brand. According to Wendy Goldner, director of marketing for NextFoods, the drinks offer distressed digesters an efficacious beverage that marries great taste with scientifically substantiated benefits. “Poor digestion results in diminished access to nutrients and energy, both of which are necessary to maintain good health and heal from illness or injury,” she explains. “Dysfunction of the gut can have far-reaching and long-standing consequences. Therefore, NextFoods was founded with the intent to ‘fix the gut.’”

PROS OF PROBIOTICS NextFoods found that the quickest and most effective path to a good gut is through probiotics. These healthful bacteria survive passage through the digestive tract, adhere to the walls of the intestinal system and deliver a benefit to the host, the company says. Years of research has found that the probiotic lactobacillus plantarum 299v (Lp299v) is one of the most powerful probiotics on the market. “With more than 17 research trials and 15 years of demonstrated safe and effective use of [Lp299v] in Europe, we launched the GoodBelly brand of fruit juices, which contains Lp299v,” Goldner says. According to Goldner, all GoodBelly products contain a dose of between 10 billion and 80 billion colony forming units (CFUs) at the time of manufacture. Packed full of Lp299v, NextFoods’ GoodBelly Plus line of enhanced fruit drinks was one of the first probiotic-enhanced juice drink lines to hit the U.S. market, the company says. The 2.7-ounce shot was introduced in 2008, and contains 20 billion probiotic CFUs at the time of manufacture.

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| Beverage Industry | MARCH 2011 | bevindustry.com

NextFoods followed this launch with the introduction of GoodBelly Quart probiotic juice drinks – a family-friendly, 32-ounce size that contains 20 billion CFUs in each serving. The line also includes GoodBelly Kids (10 billion CFUs in each 2.7-ounce serving) and GoodBelly Splash (20 billion CFUs in each serving) in 10-ounce grab-and-go bottles. GoodBelly probiotic juices come in an assortment of flavors, such as Pomegranate Blackberry, Cranberry Watermelon, Mango, Blueberry Acai, Strawberry, Lemon Ginger and Vanilla Chamomile. For those who are in need of a powerhouse dose of probiotics, NextFoods offers the GoodBelly BigShot, which contains 50 billion probiotic CFUs in each 2.7-ounce serving. This product is a lightly sweetened oat-based drink, which many find to be particularly soothing when they’re feeling off-kilter, the company says. “GoodBelly products have a 65- to 75-day shelf life from manufacture, and are dairy-free and soy-free,” Goldner says. “This makes them a perfect source of probiotics for any of the 30 percent of the U.S. population who say they can’t stomach yogurt or dairy on a daily basis. What’s more, GoodBelly uses all-natural and organic ingredients. We’re also 100 percent vegan.”

WHAT’S NEXT? NextFoods has garnered success from the GoodBelly line of products, and it shows no sign of slowing down. According to Goldner, a number of new GoodBelly juice varieties are in the pipeline. “NextFoods continues to innovate new flavors and delivery vehicles for Lp299v,” she says. “The company will be launching several new products in 2011, including a new Super Green flavor for the GoodBelly Quart and GoodBelly Plus probiotic juice drink line.” What’s more, NextFoods plans to make additions to its GoodBelly offerings by extending its product line in a number of directions. For example, a coconut water probiotic drink is being added to the lighter GoodBelly Splash grab-andgo line as well as a new value product called GoodBelly Straight Shot. “The GoodBelly Straight Shot is an all-natural, lightly flavored 2.7-ounce shot,” Goldner says. “This entry-level product contains no fruit juice and 50 percent of the calories of our shot line, while still delivering 20 billion CFUs per serving.” BI

Channel Strategies

Convenience, drug stores fare well in economy

>>

On-the-go channels experience growth from beverage sales

Walgreens drug stores began selling the private label beer Big Flats 1901 Premium Lager earlier this year.

38

CONVENIENCE STORES SAW A SALES GROWTH OF 2.6 PERCENT IN 2010, according to data from Euromonitor International, Chicago, which was a more robust increase than the grocery market overall during the same time period. Drug stores also performed well in 2010 with a 5.4 percent sales growth, according to the market intelligence firm. Beverage sales contributed to this growth, as Euromonitor data shows that soft drink volume grew by nearly 8 percent in 2010 in the convenience store channel. “This pace of growth meant that convenience stores gained share of total soft drink sales from other channels,” says Jon Wright, Euromonitor’s head of global retailing research. Wright adds that the drug store channel performance can be linked to retailers operating in prime locations, improving store layouts and expanding product mix. “The rising levels of footfall within these stores have aided the growth of types of beverages as consumers enjoy them as convenient products to grab on the go,” Wright says. The National Association of Convenience Stores (NACS) will release its State of the Industry Report with 2010 data in April, and “indications are it’s a good year,” says Jeff Lenard, NACS’ vice president of communications. Lenard says that the channel has reported flat to slight growth for some years. “The good thing we’ve found the last few years, in the recession, is when somebody’s thirsty they get something to drink,” he says. “And if you make it easy for them, they’ll do it. And convenience stores make it easier for them. So we hope that consumers will continue to embrace convenience stores for beverage purchases.” Euromonitor’s Wright also foresees a positive upcoming year for convenience and drug stores based on a number of factors, including addressing an aging population. Small stores appeal to consumers who don’t want to travel far or are unable to walk around large store formats, he says. The younger demographic also could increase footfall as the population urbanizes and their lives get busier, Wright adds. “For beverages, this should be seen as a positive as footfall at such stores will grow and, as a result, the grab on-the-go convenience of the products should enable them to see increased sales,” he says.

| Beverage Industry | MARCH 2011 | bevindustry.com

STRONG PERFORMANCE According to Chicago-based SymphonyIRI Group’s February edition of Times & Trends “CPG Year in Review: Out of Turmoil Rises Opportunity,” beverage categories have performed well. “Across CPG outlets, the three most rapidly growing categories during the past year are beverage categories,” SymphonyIRI states. Those categories are ready-to-drink (RTD) coffee and tea, sports drinks and energy drinks. When RTD coffee and tea as well as energy drinks were looked at in regard to the convenience channel, they showed recognizable growth, SymphonyIRI says. Sports drink unit sales increased 11 percent in convenience stores, but showed slower growth compared to grocery channels that had unit sales increase nearly 20 percent, SymphonyIRI’s Times & Trends states. However, the beer category saw a slight decline at convenience stores, finishing down 2.4 percent in cases and was nearly flat in dollars, being down twotenths of a percent, according to Dan Wandel, senior vice president of beverage alcohol client solutions for SymphonyIRI. The craft beer segment increased by double-digits in convenience stores, he says. “When I look at convenience stores, though, the story of the year, aside from the domestic products being down, would be the progressive adult beverage segment,” he says. Wandel said that strong performance by products such as Four Loko, Joose, Boston Beer Co.’s Twisted Tea, Mike’s Hard Lemonade and Diageo’s Smirnoff Ice varieties contributed to the growth of the flavored malt beverages (FMB) segment, which grew 25 percent in volume and slightly below 25 percent in dollars in the convenience channel. Drug stores also have seen outlets strengthen their focus on expansion of food and beverage products. Times & Trends cites examples of this, such as Walgreens’ announcement to expand those offerings in all stores, as well as CVS/Pharmacy redesigning 200 of its urban locations to increase its assortment.

BY JESSICA JACOBSEN

The publication adds that CVS is expected to continue renovations for more than 1,000 of its stores. The drug store channel saw strong growth in the coffee and tea categories as well as non-fruit drinks, says Susan Viamari, editor of Times & Trends. Each category experienced double-digit dollar sales growth in three of the past four quarters, she adds. Bottled water and juices also saw an increase in sales in the past year in the drug store channel; however, carbonated beverages and drink mix dollars decreased for the three of the past four quarters, Viamari says. Another category that fared well at drug stores was beer. Nick Lake, vice president and group client director for The Nielsen Co., Schaumburg, Ill., said that the drug store channel was up about 8.5 percent. “It’s driven a lot by new stores or

more retailers carrying beer,” he says. “In fact, we saw about 3,400 new drug stores stock beer.” Lake notes that the channel had seen notable growth in the craft beer market, but that is underdeveloped compared to the general market. Walgreens also expanded its beer offerings with the release of private label beer Big Flats 1901 Premium Lager. The release is nationwide, except for California, which will launch later this year, according to Winery Exchange, the company that launched the new beer.

PRIVATE OFFERINGS In the June 2010 edition of SymphonyIRI’s Times & Trends “Store Brands: More Than Just a Safe Harbor in Turbulent Times,” it states that convenience stores continue to increase store brand shares and that is being led by 7-Eleven. continued on page 40

TECHNOLOGICAL AVENUES Convenience stores are finding other ways to stay competitive and one way is turning to technology. Investments in technology at convenience stores and other small volume retailers have been at a slower pace compared to large volume stores, but convenience stores are turning more toward technology, says Paul Weitzel, managing partner with Willard Bishop LLC, Barrington, Ill. The use of “smart” hand-helds that provide data to store operators is one opportunity. “They provide intelligence that improve store re-ordering like order histories, promotion data, out-ofstock data, etc.,” Weitzel says. “Often, the wholesale partner is providing these units to the store for free or a small fee.” In addition to back office technology, Jeff Lenard, the National Association of Convenience Stores’ vice president of communications says he has seen stores implement up-selling technology such as the Lift Station platform. The Lift Station is connected to the point-of-sale (POS) cash register system, and when an item is scanned the system identifies an up-sell offer digital ad to the consumer and a selling script to the cashier. “It’s a little more robust and it allows somebody to sell two of

an item or something along those lines, depending on what you want to achieve,” Lenard says. Convenience stores also are finding ways to communicate with consumers throughout the store in order to “get the product to the customer instead of trying to get the customer to the product,” Lenard says. Touch screens also are an example of suggestive selling technology. When a consumer orders a sandwich the technology can be used to incent people to purchase a beverage as well, he says. Lenard also says that talking to people by running ads on gas pumps as a person is filling their gas tank or finding ways to get the product to the pump could be part of the future. Weitzel expects more technologies to emerge in convenience outlets, such as using technology that detects Blue Tooth signals on cell phones that knows when a shopper is at the gas pump. Store operators can then send promotions to entice consumers into the store. “Think of what that can do to increase in-store traffic,” he says. “The one thing that is holding us up is having a more sophisticated POS system to accept different discounts by shopper. I think this is the next big idea, and it’s just around the corner.” BI

Channel Strategies continued from page 39

broadening, opening the door to new purchase opportunities.” To appeal to legal-age millennials, 7-Eleven added to its proprietary wine line-up in November with Cherrywood

Cellars in three varietals: Chardonnay, Cabernet Sauvignon and Merlot. “We are targeting millennials because they like convenience and want to try new products, especially if we offer

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40

| Beverage Industry | MARCH 2011 | bevindustry.com

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>>

“Store brand share growth is strongest in the dollar store and convenience channels,” SymphonyIRI says. “In each of these channels, store brand assortment is quickly

Convenience retailer 7-Eleven added mid-tier priced Cherrywood Cellars to its wine lineup.

them a quality product at a great price,” said Jesus Delgado-Jenkins, 7-Eleven senior vice president of merchandising and logistics, in a statement. Cherrywood Cellars is a midtier-price wine priced $7.99 to $8.99 compared to the company’s first wine Yosemite Road, which is $3.99. The retailer also offers Sonoma Crest, a premium wine that is value priced. NACS’ Lenard says that private label offers retailers multiple outlets, such as being a better profit driver for the bottom line and as being a way to extend your brand beyond the store. “You don’t have to be a multi-store operator to take advantage of private label,” he says. Lenard says he has seen outlets use private label bottled water at various community events, allowing the store operator to receive the recognition compared to when they use someone else’s brand. He also has seen private label water used to fund charities that, for example, will give $0.25 of each bottle purchased toward a charity. However, some strategists caution about the effect that private label can have in these channels. “Private brands generally don’t succeed in a convenience shopping environment,” says Paul Weitzel, managing partner with Willard Bishop, Barrington, Ill. “Shoppers are making a quick purchase and are looking for the national brands and core items that they have developed equity with over the years. They want to get in and get out and don’t have time to analyze a purchase decision.” Weitzel has seen retailers turn to private brands as a way to increase their margin, because it can allow retailers to grow their margins by 10 to 15 percentage points, he says. “If done right, private brands can add value,” Weitzel says. “If not, I think it can definitely affect store loyalty. Retailers do need to be careful with private brands.” BI

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Marketing << ‘On the rocks’ bar

Diageo’s Captain Morgan rum brand opened a Captain Morgan on the Rocks Island Bar on Holland America Line’s 2,400-acre private island in the Bahamas. The bar is designed as a 101-foot long, twin-decked, three-masted schooner “washed up” on the beach on Half Moon Cay. With seating for 326 guests, Captain Morgan on the Rocks Island Bar pays tribute to the heritage of Captain Henry Morgan with natural artifacts and historic references to the pirate’s exploits, which took place in the area more than 350 years ago, the company says. The ship’s cannons release gentle mists of water to keep guests cool on the open-air upper deck. The lower deck features rum casks for seats and a stage for the ship’s band, the HAL Cats, to perform.

2012 sponsorship Heineken, Amsterdam, announced that it will be the official lager supplier and sponsor for the London 2012 Olympic and Paralympic Games. As part of the three-tier sponsorship, Heineken will be the branded lager served at the London 2012 games and Heineken UK will have exclusive pouring rights for its portfolio of beer and cider brands at all venues where alcohol is served. The company also is able to use exclusive hospitality and marketing opportunities associated with the event because of its position as an official supplier and sponsor. Heineken UK also will have the sponsorship and venue supply rights associated with the British Olympic Association; Team GB, the Great Britain and Northern Ireland Olympic team; the British Paralympic Association; and the Paralympics GB team.

<< Soccer plaza

To complement the U.S. tour of soccer’s Mexican National Team, The Coca-Cola Co., Atlanta, designed Plaza Coca-Cola, a gathering place for Hispanic soccer fans in the United States. Plaza Coca-Cola will follow the Mexican National Team as part of its five-city tour in the United States, which lasts through June. The canvas plaza provides a setting that embodies places, symbols, activities and music that convey happiness and is a place where fans can celebrate and pay tribute to their favorite teams, the company says. Plaza Coca-Cola features a 25-foot replica of one of Mexico City’s most recognizable landmarks, the victory column known as Angel de la Independencia. The replica was unveiled in Atlanta in February at an event hosted by Fernando Fiore, host of “Republica Deportiva” on the Spanish language network Univision, at the Mexican National Team’s first U.S. game. At each game, the plaza will be part of Futbol Fiesta, an interactive zone that spans more than 120,000 square feet and includes live music, games, celebrity appearances and giveaways.

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<< ‘Refresh’ re-boot PepsiCo, Purchase, N.Y., announced that it will build on the success of its 2010 Pepsi Refresh Project and fund twice as many ideas this year. Pepsi will give away 60 grants each month in four tiers that range from $5,000 to $50,000 for a monthly total of more than $1 million in grants. In April, the Pepsi Refresh Project will add a rotating category called the Pepsi Challenge that will pose a question and invite answers in the form of ideas that will refresh communities in new and exciting ways, the company says. Pepsi also amended the submission process by accepting entries during a five-day period and randomly selecting 1,500 ideas for public voting that starts in May. Also new this year, Pepsi Refresh complements its online voting with Facebook, Twitter, the Pepsi Refresh Project mobile app and a text2vote program that can be used to promote and vote for the ideas. Changes are based on feedback solicited from the Refresh Everything community, including focus groups on Facebook and interviews with grant recipients.

Leisure bus giveaway Salisbury, N.C.-based Carolina Beverage Corp.’s Cheerwine brand gave away its “Leisure Bus” to Cheerwine fan Chris Rizzie of White House, Tenn. The “Leisure Bus” is Cheerwine’s Volkswagon bus that features a refrigerator stocked with Cheerwine, a flatscreen TV, an X-Box video game system and a surfboard. The bus completed Cheerwine’s “Long Live Leisure Tour” that began in May 2010 and visited more than 100 retailers and events across the South. Cheerwine fans could enter in-person at various events and on the brand’s Facebook page through October. Rizzie discovered Cheerwine while vacationing in North Carolina and became a fan of the brand on Facebook.

Catchphrase contest Sunkist Soda, a brand of Dr Pepper Snapple Group, Plano, Texas, teamed with ESPN analyst and Basketball Hall of Fame inductee Dick Vitale for a contest that invites fans to submit ideas for his next catchphrase. Consumers can enter “The Sunkist Catchphrase that Pays” contest for a chance to win one of eight $10,000 weekly cash prizes. Catchphrase ideas can be entered through the end of this month on sunkistsoda.com to be judged by a panel that includes Vitale.

Packaging

Flexibility, speed key to packaging success Case packers and wrappers improving on proven technologies

For case wrapper and packer equipment manufacturers, this has meant that they, too, are on a path of change, although it’s a path that at least seems familiar. With reduced spending from beverage bottlers, the equipment manufacturers’ paths have been those of innovation and upgrading on what they already have, rather than reinventing existing offerings. From flexibility to greening equipment, case packer and Transforming Bright wrapper equipment hasn’t changed Ideas Into Brilliant Labels! radically in the last year, but the innovations and improvements that have been made are helping to point beverage manufacturing in a good direction.

C-FiT Sleeve ™

THERE’S AN OLD PROVERB FROM FRENCH NOVELIST ALPHONSE KARR THAT states, “The more things change, the more they stay the same.” As American industry and the economy have been on a free-wheeling ride during the past few years, the beverage industry has done nothing but change. Beverage manufacturers have gotten leaner, they’ve reigned in spending and they approach new ventures and ideas with caution rather than certitude.

New

The Easy to Apply No Heat Shrink-Sleeve

AUTOMATION NATION As beverage companies continue to innovate and roll out new products, case

packers and wrappers also have to keep up on the production side of the industry. Flexibility has been — and continues to be — one of the most important qualities manufacturers can have, and case packers and wrappers that can be used in a variety of ways are a part of that. “Gone are the days when many of our clients had dedicated lines or change lines over once or twice a week,” says Scott Smith, global director of market development, for Hartness International, Greenville, S.C. “Today, many of our clients change their machines over once or twice a day. Quick and repeatable changeovers are more valued than ever.” Smith also notes that a machine’s ability to handle lightweighted primary and secondary packages is critical to a machine’s flexibility. “From a shrinkwrapper perspective, we are seeing a great interest in innovative multi-packs, such as Hartness’ ‘stagger’ and ‘off-set’ packages,” Smith explains. “These packages enable soft drink and water manufacturers to eliminate pads and trays for lightweighted PET multi-packs, while maintaining package and pallet integrity.” Additionally, increasing speed and reducing downtime in changeover remain key qualities that manufacturers look for in case packers and wrappers, and more recently, reducing the cost of materials has become a top priority for manufacturers. “We’re seeing our customers try to reduce material costs by reducing the corrugate,” explains Ed Orick, director of beverage sales for Alexandria, Minn.based Douglas Machine. “And you would do that by going from trays to

>> Hartness International offers the Global Shrink line of tray former shrinkwrappers that feature 30 minute tool-less changeover as well as an efficient method of blank feeding, the company says.

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>>

BY MOLLY V. STRZELECKI

Last year, Douglas Machine added an auto-adjust capability on its Contour shrinkwrap machines that reduces changeover time to less than 15 minutes, the company says.

packs, or going from bags to fill-only. Then there are some cases where people are attempting to go to thinner film. Those are the main things we see. “It’s a win-win, because if you reduce costs, at the same time you’re able to reduce the amount of trash and waste. That’s good for everybody,” Orick notes.

GOING ‘GREEN’ Creating innovative and ecofriendly equipment is about reducing waste and energy on all aspects of the machine. “We are working toward [the goal of being more eco-friendly] in two ways — packaging source reduction and energy conservation,” says Bryan Sinicrope, vice president of sales and marketing for Tarpon Springs, Fla.-based A-B-C Packaging Machine Corp. “We offer packers that reduce corrugated consumption and all A-B-C machines are available with energy-saving features that can significantly reduce bottles’ energy usage and resulting carbon footprint.” Orick notes that Douglas recently introduced a gas-powered shrink tunnel as opposed to its current electric offering. The gas-powered shrinkwrapper replaces the electric heaters that previously were used in the tunnels. “For the most part at this point in time, gas is a lot less expensive than electricity, so it saves our customers a ton of money on the energy cost,” Orick says. Sustainability also is affecting requests at Hartness, Smith says. “Our clients certainly seem to be more concerned than ever around both wear parts and utility consumption of packers and wrappers,” he says. “We do find many clients requesting ‘not to exceed’ guarantees around consumption. These requests

are especially prevalent in Europe, but we are seeing it more and more domestically. However, most clients are more concerned with our ability to enable them to meet their sustainability initiatives around lightweighting and elimination of packaging materials. So, in that way, case packers and wrappers are enabling eco-friendly solutions.” The plunge of the economy didn’t necessarily halt innovative rollouts of new equipment, but manufacturers aren’t exactly running full-steam ahead with new ideas. “We have seen more caution in spending,” A-B-C’s Sinicrope says. “Packagers are buying new equipment but are also spending to keep older equipment in service longer. As far as innovations, if a machine offers cost savings, speed advantages or other production benefits, the interest is there.” At Pack Expo 2010, A-B-C introduced a partition opener/ inserter for the beverage industry. The machine has been wellreceived for its higher speeds, more flexibility and faster changeover compared to other machines on the market, Sinicrope says. The up-and-down economy might have caused some consternation for companies that thrive on stability to continue along the path of profitability. But the “down” part of the economy, while bleak, also can be seen as a positive. “In some ways, the economy has been beneficial for segments of our business,” Hartness International’s Smith says. “Both robotics and shrinkwrapping have seen growth despite some of the economic challenges of the last three years. Much of that success is due to our clients’ desires to not only ‘do the right thing’ relative to sustainable packaging, but also due to their continued on page 46 bevindustry.com | MARCH 2011 | Beverage Industry |

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Packaging continued from page 45

desire to reduce the cost of packaging materials. Film packaging continues to gain popularity for both of these reasons. The desire to reduce labor and requirements for increased flexibility has driven the growth of robotic solutions. “People certainly seem to have been making due with current equipment; however, capital does seem to be freeing up,” Smith continues. “Also, there does seem to be pent up demand from the last two years. One of the biggest changes is that clients really have to demonstrate a strong return on investment in order to justify end-of-line purchases.”

>>

THE FUTURE IS NOW

At Pack Expo 2010, A-B-C Packaging introduced a partition opener/inserter for the beverage industry that offers high speeds, flexibility and fast changeover.

on ualizati s i V D 3emo @ D S M W 2011 t a M o r P 3926 # h t o Bo

Case packer and wrapper manufacturers will move forward as beverage companies continue to come out with new and innovative products. As the industry

moves toward a successful path, part of that future success will be to keep in mind not only qualities of equipment that will be important, but also those that are important now. “On the horizon, I see a continuation of aspects such as updating automation, ease of changeover, and ease of access to all points of the machine by the customers and operators,” Douglas’s Orick says. “If you have a jam it needs to be easy to fix and the machine needs to be back up and running quickly.” Hartness sees demand for machines that keep up with growing beverage portfolios. “Flexibility will continue to be a critical consideration when making case packing and shrinkwrapper purchases,” Smith says. “SKU proliferation does not seem to be slowing.” Flexibility also is on the radar at A-B-C Packaging, Sinicrope says. “Ultimately, our customers, beverage bottlers, must serve their market, so they are looking for innovations that will make their products more appealing to consumers,” he says. “Machine flexibility is important because it allows them to run different bottle and package styles without buying new equipment. Eco-friendliness will continue to be a big factor, and the focus on line speeds and efficiency has always been important for our customers.” BI

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OUR INNOVATION YOUR SOLUTION

PACKAGING NEWS SLEEK, SLIM LOOK Diet Pepsi launched its Diet Pepsi Skinny Can to consumers nationwide in March. The taller, slimmer can debuted at New York’s Fall 2011 Mercedes-Benz Fashion Week in February. The slim can’s Fashion Week launch highlighted the stylish aspect of the new packaging, which was released in celebration of beautiful, confident women, the company says.

DISTINCT ELEMENTS Heineken launched a new can that features an upscale look and tactile feel. Heineken’s new can design incorporates four distinct elements: Heineken’s racetrack label is prominently featured on the front of the can while on the back, the contemporary vertical logo stands out; the new aluminum can offers a more sophisticated appearance; the curve of the can gives the package a more dynamic look; and raised ink printing technology adds texture to the can and creates the visual impression of condensation on the outside, the company says. The can is available in 12- and 16-ounce sizes and will be available in a 24-ounce size this summer. In addition, a new threeby-four suitcase format replaces the two-by-six fridge pack that is easier to stack and display at retail, the company says.

INSPIRATIONAL CUPS Caribou Coffee unveiled coffee cups featuring the winning phrases of a consumer-generated contest to find out what its customers “Stay awake for.”

The company’s “Make the Cup” contest launched in August 2010 and invited customers to submit phrases and images of what inspires them with the chance of having their winning phrase featured on millions of Caribou Coffee cups around the country. Phrases featured on cups include: “Driving with the top down,” “Finding a cure for breast cancer” and “Bicycling down country roads with friends.” Winning phrases will be featured on Caribou Coffee cups until October.

TROPICAL FEEL Tradewinds Tea introduced a fresh look for its bottled tea. The new look conveys thoughts of relaxation and refreshment derived from the experience had while drinking its quality tea, the company says. The Sweet Tea variety features a tropical backdrop that includes a sunset and sailboat accompanied by palm trees and an island in the distance. Tradewinds’ new look is first available in 20-ounce and 1-gallon bottles and new 23-ounce cans.

and research. In addition to the limited-edition cans and bottles, more than 6 billion packages of Diet Coke will carry The Heart Truth logo to raise awareness of women’s heart health year-round, the company says.

BIODEGRADABLE BOTTLES Redleaf Water, Chilliwack, British Columbia, offers its premium bottled water in a biodegradable and recyclable water bottle. Redleaf’s Bio Bottles produced by Arizona-based ENSO Plastics, will biodegrade naturally in aerobic and anaerobic (landfill) conditions and are No. 1 PET, which allows the bottles to be recycled without requiring any special handling, the company says. Although the bottle is designed to be placed into the existing recycle streams, if placed into a landfill or other natural environments, depending on the natural microbial activity, the bottles will disappear within one to 15 years, Readleaf Water says.

CANS WITH HEART In conjunction with The Heart Truth campaign, Diet Coke once again released limited-edition cans and bottles in recognition of American Heart Month in February. The packages feature a stylized stick figure waving a heart flag in support of The Heart Truth, a campaign dedicated to raising funds and awareness for women’s heart health education

CRAFT VARIETY PACK The SanTan Brewing Co., Chandler, Ariz., released four of its craft beers — Hopshock IPA, HefeWeizen Wheat, Devil’s Ale and Epicenter Amber Ale — in a new variety 12-pack of cans. The new SanTan mixed 12-packs initially will be available year-round at select retail locations in Arizona.

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PACKAGING NEWS SMALLER OFFERING Bota Box announced the extension of its environmentally sensitive packaging portfolio with the launch of Bota

500-ml. wines nationwide with four of its varietals: Cabernet Sauvignon, Merlot, Pinot Grigio and Chardonnay. The wines are packaged in Tetra Pak

You Fill It. We’ll Pack It.

cartons, which are tailored to the active, modern lifestyle, the company says. The packaging uses fewer fuel emissions due to lighter shipping weight and are produced primarily from paper, the company says.

SHOWCASING INGREDIENTS Numi Organic Tea unveiled its new packaging that showcases the ingredients used throughout the product line. Numi’s new packaging aims to educate existing and new tea drinkers about the quality and ingredients in its teas, the company says. The new packaging will continue to use natural, biodegradable filterpaper tea bags and recyclable boxes, which are made of 85 percent postconsumer waste and printed with soy-based inks. An Eco-Audit that reflects the waste reduced due to the company’s eco-responsibility effort is featured on the bottom panel of the box, the company says. Teas are available in boxes of 16 to 18 teabags for $6.99 to $9.99, as well as loose leaf tea canisters for $8.99 to $14.99.

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| Beverage Industry | MARCH 2011 | bevindustry.com

Jam Jar Sweet Shiraz unveiled a new look. The retro-inspired red and white pattern replaced the original checkered gingham on the screwcap capsule and carton. Shapes incorporated in the pattern include diamond-shapes inside a larger circle with some diamond-shapes featuring a smaller circular shape inside the diamond. The design launched on the 2010 vintage bottles and is available nationwide. In addition, refinements were made to the text of the logo and the label, the company says.

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Beverage

Digestion aids expand beyond regularity Probiotics, fiber keep people’s guts balanced

DIET, SCHEDULE, STRESS, MEDICATIONS, LACK OF EXERCISE AND AGING ARE all factors that can contribute to digestive upset. Growing digestion aid sales suggest that more consumers are suffering from digestive health issues and are searching for more beverages with probiotics and fiber to provide relief. “What you’re seeing for digestive health is not only an increase in probiotic sales, but you are seeing an increase in soluble fibers — whole grain fibers,” says Peggy Steele, global business director at Danisco Health & Nutrition, Madison, Wis. “Digestive health as a whole has become a significant issue, or maybe it’s an issue people are becoming more comfortable talking about.”

>>

BENEFICIAL BACTERIA

Yakult cultured drink features its own propriety strain of probiotics.

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Probiotics are an ingredient group that has emerged because of the growing number of digestive health issues and the increasing number of products with probiotics that show results. The World Health Organization defines probiotics as “live microorganisms that when administered in adequate amounts confer a health benefit on the host.” Probiotics traditionally are used to restore the balance of the intestinal microflora which can become unbalanced due to illness, stress, age, traveling and the use of medication such as antibiotics, says the International Probiotics Association (IPA), Des Plaines, Ill. It is estimated the human gastrointestinal tract contains more than 100 trillion bacterial cells from more than 500 different species, the IPA says, but only probiotic bacteria are considered to have documented beneficial effects. Consumers’ awareness level about the ingredient varies greatly. Probiotic beverage company Yakult, which has its headquarters in Japan and a U.S. office in Torrance, Calif., invests in educating consumers about probiotics. “The knowledge of consumers is still limited because health care professionals are still trying to understand it,” says Lauren Weidelman, corporate communications manager for Yakult USA. “The number of studies on probiotics has significantly increased over the last decade per year. So for health care professionals, it’s hard for them to keep up with the research.” Increased clinical documentation of probiotics’ health benefits is helping probiotics emerge, Danisco’s Steele says. “The science is really becoming solid, and we have premier researchers around the world now trying to understand mechanisms and how these work,” she

| Beverage Industry | MARCH 2011 | bevindustry.com

says. “The products really do seem to work. People start to take Activia for a few weeks, and they actually do start to feel better, and that drives more sales along with the increase in evidence.” Consumers are obtaining most of their knowledge about probiotics from TV ads and through the medical field, says Julie Mazzoleni, Rosemont, Ill.-based Fonterra USA’s group manager for technical nutrition. Health-conscious consumers are one consumer group becoming more familiar with probiotic benefits, she says. Many Asian and Hispanic populations also are familiar with the benefits of probiotics, Yakult’s Weidelman says.

PROBIOTIC PERFORMANCE The use of probiotics continues to increase in food product and supplement categories, including beverages. “There has been a significant increase in beverages with probiotics and some key success stories this year in juices, dairy drinks and dry beverages,” Steele says. “In fact, this category has been indentified as the category that should see the fastest growth in the coming three to five years.” Beverages with probiotics are a definite area of interest for consumers because they provide a convenient medium to consume probiotics. “We are beginning to see customers look at what it takes to put probiotics into their beverages,” Fonterra’s Mazzoleni says. “When consumers think of probiotics, they think ‘dairy,’ so getting probiotics into non-dairy based beverages can be a challenge and a learning curve for the consumers.” The greatest challenge in formulating probiotics into non-dairy based beverages is the survival rate, Mazzoleni says. “Today, there are specialty packages and beverage caps that can be used to house the dried probiotic strains,” she explains. “Consumers can then ‘pop’ the top, shake it and drink it within a couple of hours.” Probiotics’ effects also are strain specific, meaning every probiotic functions a little bit differently. Most probiotic organisms belong to the bifidobacteria and lactobacillus genera. Fonterra’s strain of bifidobacterium lactis HN019

BY ELIZABETH FUHRMAN

probiotics, it is obvious that probiotics are trending up, Fonterra’s Mazzoleni says. “People are looking to get the benefits of probiotics in their diets through food,” she says. “We are seeing this in many food and beverage formats.”

FRIENDLY FERMENTATION When the 2010 Dietary Guidelines for Americans was published at the end of January, the report called attention to the fact that fiber is consumed below recommended levels in the typical American diet. The guidelines emphasized that consuming sources of dietary fiber could improve Americans’ health in multiple ways, including gastrointestinal function. While a larger range of people have fiber intake and regularity on their radar screens, an understanding of how digestive health promotes overall health and well-being also is increasing, says Andy Hoffman, director of wellness product development for Tate & Lyle, Decatur, Ill. “Some recent reports actually showed that consumption of soluble dietary fiber leads to increased calcium and mineral absorption that helps with bone health,” he says. Soluble fiber aids in digestive health by boosting the growth of good bacteria in the colon that promotes bowel bulk and regularity, says Mar Nieto, senior principal scientist at TIC Gums, White March, Md. “The fermentation of soluble fiber in the colon continued on page 52

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(DR10), and lactobacillus rhamnosus HN001 (DR20) clinically have been proven to have health benefits in the area of gut health and immunity, Mazzoleni says. Because probiotic benefits are strain specific, beverages also need to contain different numbers of colony forming units of the bacteria. “Formulators would need to put in enough probiotic ingredients to survive the shelf life of the finished product,” Mazzoleni explains. “In other words, at the end of the shelf life, the product and probiotic will still need to impart the claimed health benefit to the host.” Yakult’s beverage contains the company’s own proprietary probiotic strain, lactobacillus casei Shirota. “There are very few products out there where the company is developing the strain,” Weidelman says. Danisco also offers a range of probiotics that are documented with clinical studies supporting their immune or digestive health benefits. This range contains three single probiotic strains: Howaru Dophilus (lactobacillus acidophilus NCFM), Howaru Bifido (bifidobacterium lactis HN019), and Howaru Rhamnosus (lactobacillus rhamnosus HN001) and blends Howaru Protect and Howaru Restore. “We would consider them among the best documented strains available on the market,” Steele says. “This is very important for regulatory reasons, but perhaps more importantly so that you know that your products containing these strains will deliver benefits consumers will feel.” While consumers are just beginning to understand

Lifeway Foods launched a line of BioKefir shots that includes BioKefir for Digestion, featuring a probiotic formula to soothe digestive ailments. All BioKefir shots contain Lifeway’s ProBoost blend of 12 live and active probiotic cultures with more than 20 billion units of live and active probiotic activity in each 3.5-ounce shot.

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Beverage

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continued from page 51

PRE Probiotic Enhancer is an organic juice blend enhanced with a prebiotic formula.

also results in the production of short chain fatty acids like butyric and propionic and the lowering of bowel pH,” he explains. “Butyric acid specifically has a protective effect on mucosal lining and promotes repair of mucosal damage. The lowering of pH also helps in preventing bacterially induced toxin production.” Certain fibers are prebiotics, a non-digestible ingredient that stimulates the growth of probiotics. These prebiotic fibers selectively are fermented in the colon by various beneficial bacteria, altering the colonic microbial ecosystem and producing short chain fatty acids, which have been shown to aid in maintaining digestive health, says Lorraine Niba, business development manager, nutrition for National Starch, a recently acquired company of Corn Products International, Westchester, Ill. It’s not clear how many consumers associate fiber with digestive health, as opposed to just knowing that fiber is good for you, says Deborah Schulz, product manager for Cargill Health & Nutrition, Minneapolis. “Interest skews to older populations,” she says. “However, interest in fiber is high and still growing.” Even though the beverage category is not an area where American consumers traditionally have looked for fiber, market research shows an increasing interest in beverages as a source of fiber, National Starch’s Niba says. “This is because many of the conventional fibers

were not functionally suitable for clear, shelfstable beverages, and often imparted undesirable viscosity, turbidity and grittiness, and therefore were mostly available in supplement form,” she explains. “Improvements in ingredient technology have enabled the use of soluble fibers beyond supplements, into innovative and growth segments like healthy beverages.” Formulating fiber into a beverage can almost be easier than including fiber in a snack bar, says Adrienne Stucky, a Tate & Lyle food scientist. “In a beverage, with some particular fibers, including Tate & Lyle’s Promitor Soluble Corn Fiber, it readily dissolves, has no color issues and no taste,” Stucky says. “You really can’t taste that it’s in there. If you put it into a bar, you need it to function as sugar when you are replacing sugar, and it has some additional issues you have to work out to make sure that the product forms the bar and has the correct texture.” Beverages also offer the opportunity to provide efficacy at lower doses, says Juliana Zeiher, business development manager of nutrition for Corn Products. “People are looking for products that deliver as close to a full dose of the active ingredient, so they don’t have to split usage into several servings,” she says. Additionally, more products are being formulated with increased levels of fiber as fiber in place of sugar is known to have more benefit for people looking to manage their weight, says Kati Ledbetter, product development scientist for ADM, Decatur, Ill.

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pathogens to the large intestine, protecting the body from invasion by harmful bacteria.”

FIBER FORWARD Consumers continue to rank digestive wellness among their top health concerns and it is a benefit that applies to all age groups, from infants to elderly. Because of this, the market will continue to see an increased number of beverages containing fiber, Corn Products’ Zeiher says. Dairy continues to be among the most innovative categories when it comes to digestive health, she adds. Fiber also is appearing in new sports drinks and enhanced waters. “It’s interesting to see the growth in sports drinks and waters because those aren’t traditional areas that people would consider as likely to include fiber as fruit juice, for example, where there is a long history of understanding that fruits and vegetables contain fiber,” Tata & Lyle’s Hoffman says. The proportion of new beverage products launched with fiber is still relatively small, National Starch’s Niba adds, but untapped potential exists for beverage manufacturers. Fiber use in beverages remains a popular trend among manufacturers looking to make a “betterfor-you” product, ADM’s Ledbetter says. Although launches of new beverages that make high- and added fiber claims have remained steady during the past several years, launches of new beverages that make functional claims for digestive health, satiety and weight management have increased, she says. “As consumer focus on healthier products increases, the potential remains high for adding fiber to beverages,” Ledbetter says. Knowing the many options for fiber ingredients, adding a functional dose of fiber to a traditional beverage is not really an issue of sensory acceptability as it is cost, says TIC Gums’ Nieto. “If consumers are willing to pay extra for the fiber in their favorite beverage, the choice of beverage to fortify is plenty,” he says. “Bottom line is that food companies must have a good marketing strategy to sell the fiber.” BI

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“Fiber frequently has a lower caloric value than simple sugars,” she explains. “Thus, the addition of fiber to some foods can decrease the energy density per serving. Additionally beneficial, some fibers can increase satiety and delay hunger such as Fibersol-2.” Fibersol-2 digestion resistant maltodextrin from ADM/Matsutani is a low-viscosity soluble dietary fiber that clinical research has indicated helps to support and maintain intestinal regularity. Although formulating fiber into beverages can be a challenge, several fiber options are now available for beverages. Cargill offers OliggoFiber inulin for beverages. Inulin is a highly soluble prebiotic fiber, which has a mild sweet taste, is clear in solution and has a thin viscosity when used at levels in a beverage equivalent to an excellent source of fiber, such as 5 grams in 8 ounces, Schulz says. It also is stable to heat processing. “Inulin works great in refrigerated, low pH beverages, such as juices, and is a great source of fiber for neutral pH beverages such as weight-loss formulas and other supplements,” Schulz says. Inulin is sensitive to pH though, and usage in shelf stable low pH beverages is limited because the fiber content degrades over time, she says. Corn Products and National Starch supply a range of prebiotic process-stable, instantly dispersible soluble fibers that are suitable for a variety of beverages. Nutriose soluble fiber, which is manufactured by Roquette and distributed by National Starch, has been shown to have prebiotic and digestive health benefits. Corn Products also offers Purimune galactooligosaccharides (GOS), a prebiotic that selectively stimulates the growth of lactobacilli and bifidobacteria in the colon. “Purimune is unique compared with other prebiotics because of the multi-mechanistic way in which it influences the large intestinal microflora,” Corn Products’ Zeiher says. “In addition to selectively enhancing the growth and/or activity of healthy bacteria, GOS has shown to inhibit the adhesion of

NuVitae Inc., Jacksonville, Fla., released Fiberceutical Drink, a sparkling citrus beverage that contains 12.5 grams of fiber.

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Beverage R & D NEWS

CREATOR’S BRIEFS

Sensient Colors LLC, St. Louis, added aseptic packaging capabilities to its manufacturing plant. Aseptic packaging capabilities offer customers preservative-free colors that deliver maximum shelf life and enhance sustainability, the company said.

FIBER VIDEOS

Cargill, Minneapolis, assumed sales and marketing for Louisiana Sugar Refining LLC, of which Cargill is onethird owner, and is shipping sugar to its customers. Omega Protein Corp., Houston, announced its acquisition of Cyvex Nutrition, Irvine, Calif., which is a provider of condition-specific nutraceutical ingredients. DuPont, Wilmington, Del., entered into an agreement to acquire enabler, cultures and sweetener company Danisco, Copenhagen, and its enzymes division Genencor for $5.8 billion.

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As part of its Video Education Series, Tate & Lyle has released two new videos about global fiber trends and the benefits of synbiotics for digestive health on its fiber website, promitorfiber.com. The first video, “Use Fiber to Boost Your Bottom Line,” provides commentary from Krista Falon, senior analyst at Mintel International, and Tate & Lyle fiber experts David Lewis, health and wellness product manager, and Andy Hoffman, director of health and wellness innovation. Falon demonstrates the growing trend of adding fiber to foods and beverages globally and shares information about the growing trend of formulating products with multiple ingredients with a healthy halo. Lewis provides global insight about the fiber and health and wellness trends globally while Hoffman helps manufacturers understand the costs associated with adding fiber to the manufacturing process. The second video, “Impacting Digestive Health with Prebiotics and Probiotics,” features fiber expert and registered dietitian Lisa Sanders. Q Tate & Lyle, 2200 E. Eldorado St., Decatur, Ill. 62525; 217/423-4411; tateandlyle.com.

FRESH FLAVORS Variations in fruit types, growing areas and processing conditions can have an affect on the flavor of straight

| Beverage Industry | MARCH 2011 | bevindustry.com

juice products. To accommodate for this, David Michael & Co. offers a line of Fresh Flavors — non-characterizing flavors that when added to a product using fruit, build back the freshness for a “just picked” sensation. Fresh Flavors also help to reduce the slightly stale taste that juice products typically develop during the course of their shelf life. Fresh Flavors also can be combined with David Michael’s with other natural fruit flavors to produce refreshing results in juices and other food items. Q David Michael & Co., 10801 Decatur Road, Philadelphia, Pa. 19154; 215/632-3100; dmflavors.com.

FLAVOR EMULSION Dow Wolff Cellulosics, a business unit of The Dow Chemical Co., launched a cellulose-based flavor stabilization solution for beverages: Methocel for Flavor Emulsions. In the past, octenyl succinic anhydride (OSA) starch and Arabic gum were the only flavor stabilizing options preventing oil separation in beverages. Methocel for Flavor Emulsions provides an alternative to these stabilizers, and analysis shows that the flavor emulsion provides equal or better performance compared to OSA starch or Arabic gum, using up to 10 times less product, the company says. Q Dow Europe GmbH, Bachtobelstrasse 3, CH-8810 Horgen, Switzerland; +41 44 728 2111; dowwolff.com.

Ingredient Spotlight

BY JESSICA JACOBSEN

Formulations sourced from the ground AS BEVERAGE MANUFACTURERS LOOK TO PRODUCE FUNCTIONAL PRODUCTS that address consumer trends, such as health, wellness, energy, cognition and relaxation, many are turning to herbs and botanicals to meet consumer demands.

Herbs and botanicals offer healthy options

OFFERING INCREASED FUNCTION With the expansion of functional beverages, herbs and botanicals are being incorporated into many of them. “They’re using them [by] targeting certain health functions,” says Amy McKelvey, director of new markets for Ethical Naturals, San Anselmo, Calif. McKelvey says that companies can use herbs and botanicals to target heart health, relaxation, mental clarity, energy, immunity, eye health, beauty as well as anti-aging. Patrick Anderson, Western regional sales manager for Terry Lab, Melbourne, Fla., also sees functional beverages as a market that is emerging. “The latest trends in the beverage industry with herbs and botanicals seem to be coming in the form of the multi-functional drink,” he says. “Consumers are looking at shopping budgets and are realizing that a drink not only fills the thirst need but is also beneficial as a vitamin enhancer, mineral enhancer, skin rejuvenators, energy, etc.” Herbs and botanicals often offer multiple benefits, which help aid multi-functional drinks in providing several health claims, Anderson adds.

TIME TO RELAX Among the functional drink segment, some ingredient suppliers have noted product releases that continued on page 56

>>

The functional and health and wellness categories top the list of where herbs and botanicals have been positioned within the beverage industry so far, says Walter Postelwait, vice president of marketing and sales with BI Nutraceuticals, Long Beach, Calif. Those categories are followed by specific niche products, he says. Among the number of herbs available, tea is a prominent one being used, especially green and black teas, says Gary Vorsheim, director of extract sales for Martin Bauer Inc., Secaucus, N.J. The National Center for Complementary and Alternative Medicine of the National Institutes of Health, Bethesda, Md., states that green tea and green tea extracts have been used in beverages for improving mental alertness as well as aiding weight loss. The tea and extracts also are known for containing epigallocatechin gallate (EGCG), an antioxidant catechin. “The functional attributes of green tea — the thermogenic properties of metabolism — have become more well known,” BI Nutraceuticals’ Postelwait says. “Also the antioxidant properties of green tea — the EGCG — is becoming much more popular.” Vorsheim also agrees that a top interest of consumers and beverage companies is antioxidants. The active compounds in tea, such as antioxidant polyphenols and flavonoids, are of keen focus to beverage-makers, he adds. For cognition, Martin Bauer has noticed that herbs and botanicals such as ginseng, guarana, ginkgo biloba and kola nut are being used, which also are used in many energy drinks. “Those are pretty much the classics that you find in a lot of beverages, primarily for the caffeine found in most of those,” Vorsheim says. Caffeine is among some of the key benefits of herbs and botanicals, Vorsheim says, because it is a natural raw material with which consumers are familiar. When addressing the energy segment with herbs and botanicals, it is not just about waking up, but maintaining energy levels throughout the day, he adds.

up

Rishi Tea introduced five organic and caffeine-free herbal teas that contain a blend of natural botanicals, including sage, ginger, hibiscus and chamomile.

bevindustry.com | MARCH 2011 | Beverage Industry |

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Ingredient Spotlight continued from page 55

anise, valerian root and hops. The ingredients were selected to provide concentrated relaxation effects, the company says. “You’ll see chamomile being used in tea bags … so it’s already known for the hot beverage sector of the North American market as being beneficial to help relax,” Martin Bauer’s Vorsheim says. He adds that relaxation beverages are designed to pull consumers back from the energy they might feel from the extra caffeine found in the energy drink sector. McKelvey says that although relaxation beverages are not of the same product magnitude as the energy drink market, she thinks that slowly could change. “We’re all stretched and over-connected and finding ways to relax and counter that kind of nervous energy that comes with being very busy and very connected,” she says. Opposed to the high-energy formulations that can be associated with energy drinks, McKelvey notes another energy avenue to which people might look. “We want an energy that is focused and that’s also a little bit of a calming energy so that we can be more productive in our lives and stay healthy,” she says.

highlight rest and relaxation are expanding. Some of the herbs and botanicals that suppliers have seen used for relaxation purposes include chamomile, lemon balm, passion flower, valerian root, linden flower, balm mint and lavender. “People are looking to these plants for their antianxiety benefits,” Ethical Naturals’ McKelvey says. For example, Two Leaves and a Bud Tea Co., Basalt, Colo., launched a Better Rest Blend that contains lemongrass, peppermint, chamomile, orange peel, lemon balm, fennel, ginger, rose hip,

>>

MARKET INNOVATIONS Using ingredients such as valerian root and chamomile, Two Leaves and a Bud Tea Co. offers its Better Rest Blend to provide concentrated relaxation effects, the company says. The line also includes Better Belly Blend and Better Morning Blend, which are formulated with herbs and botanicals, too.

Although ingredient suppliers have seen beverage companies use herbs and botanicals for multiple beverage categories, suppliers still foresee more innovations for these ingredients.

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soluble in water,” she says. “I think you’re going to see a lot more trends with that type of nano-structured lipid carriers for a lot of herbal extracts that are not soluble or that have very strong flavor profiles.” McKelvey adds that certainly flavor is important because if a consumer can’t drink the beverage, they aren’t going to buy it again. But companies shouldn’t get caught up in solubility, she says. “I think as society gets healthier and healthier that people are going to be looking for sediment at the bottom of their drink to prove that there’s some yummy herbs and botanicals in there and some true functionality,” McKelvey says. Innovation also can be focused on finding new beverages that can benefit from use of herbs and botanicals. Whether it is for antioxidant association, reducing the amount of juice used in a product, altering a taste profile, adding them to dairy drinks or for use in kids’ products, Vorsheim sees many ways that herbs and botanicals can expand. And part of that expansion could be aided by consumers becoming more familiar with herbs, he says. “I think we’re poised for some great activity, and innovation will be inherent with herbs because herbs haven’t really been a mainstay in our culture,” Vorsheim says. “It will take innovation to imbed herbals whether it’s in existing beverages or the future beverages that are being developed.” BI

The Irony Labs Calming Cosmo is a functional mixer that uses extracts from Ethical Naturals, including lemon balm, passion flower and hops.

>>

“Some of the biggest challenges are obviously taste when you’re working with botanical ingredients that aren’t juice based,” BI Nutraceutical’s Postelwait says. “You’re trying to capture a lot of your flavonoids and so forth in your botanical product to get it in there, but you also want to keep the off notes down as much as you can.” In the United States, Vorsheim says that because some herbal raw materials and herbal extracts might not have a pleasant taste that has been one of the biggest problems when formulating healthspecific beverages. “[To] make a beverage that truly provides a function like … some of these relaxation beverages, you have to have a certain amount of extract in there, and when you do that, now you’re adding a flavor issue to your formulation that some people can work around; some people can’t,” he says. “That’s I think a main concern right now. We’re seeing that people gravitate toward hibiscus and certain extracts that have at least a reasonably pleasant taste, and a lot of people are slowly working their way toward these other more functional herbal extracts that present a challenge as they make product.” To reduce the off notes in herbs and botanicals, Postelwait sees most of the innovation dedicated to the technology of extracting the botanical. He says this also can help address the ingredient’s solubility. “Not always can you achieve 100 percent on either one — solubility or the reduction of off notes — but getting them down quite a bit is helpful,” Postelwait says. One way that Ethical Natural’s McKelvey has seen technology address the solubility aspect for resveratol is by using nano-structured lipid carriers, which encases the extract and allows it to be soluble and also helps with the flavor. “It masks the flavor and allows the molecule to be

Ayala’s Herbal Water offers a line of sparkling waters that contain herbs, including lemongrass, spearmint and ginger.

bevindustry.com | MARCH 2011 | Beverage Industry |

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Distribution

BY DAVID KOLMAN

Revised braking regulations checkup Manufacturers must comply with new regulations

THE NATIONAL HIGHWAY TRAFFIC SAFETY ADMINISTRATION REVISED ITS Federal Motor Vehicle Safety Standard (FMVSS) 121 to include new stopping distance standards that effectively shorten the majority of large tractor stopping distances by 30 percent. In essence, the regulations have reduced the maximum allowable stopping distance to a minimum braking performance of 250 feet from 60 miles per hour, which is down from the previous standard of 355 feet. Additionally, all heavy truck tractors must stop within 235 feet when loaded to their “lightly loaded vehicle weight.” Stopping distance requirements also were shortened for other load and system operating conditions. FMVSS 121 is being implemented in phases. Three-axle tractors with a gross vehicle weight rating (gvwr) of 59,600 pounds or less must meet the reduced stopping distance requirements by Aug. 1. All other tractors must be in compliance by Aug. 1, 2013. The regulation does not apply to retrofitting, as existing vehicles are not affected. Nor does it pertain to air-braked straight trucks, buses or trailers.

BRAKE SPECS

David Kolman is a veteran truck communicator, keynote speaker and long-haul trucker. Commissioned as an Honorary Colonel on the Kentucky governor’s staff for his work promoting traffic safety, he actively participates in trade associations and reports news and information about the trucking industry for broadcast and print media.

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The truck manufacturer is responsible for making sure its vehicles are compliant with the new stopping distance regulation. The new rule will not significantly change brake system specifications or brake maintenance and service practices, but changes to foundation brake types and sizes are expected. Today’s foundation brakes and air brake systems can meet the new requirements for the majority of the vehicles with some enhancements. However, for heavier gvwr tractors and two-axle tractors, the consensus is that air disc brakes will grow in use. The major advantage of air disc brakes is that they don’t fade after repeated applications and last longer than drum brakes. The drawback is they are heavier and more expensive than drum brakes. Solutions available to meet the new requirements include higher performance steer axle drum brakes, which include larger diameter drum brakes, wider brake shoes and linings, air disc brakes or a hybrid combination of disc front and rear drum brake systems. Manufacturers will offer options, so it will be up to the truck manufacturers to decide, by platform, how they will meet this regulation. Progressive options are available to meet the new braking requirements: Q 15-by-5-inch or 15-by-6-inch drum brakes on the steer axle and 16.5-by-7-inch drum brakes on the drive axles.

| Beverage Industry | MARCH 2011 | bevindustry.com

Q 16.5-by-5-inch or 16.5-by-6-inch drum brakes on the

steer axle and 16.5-by-7-inch or 16.5-by-8.63-inch drum brakes on the drive axles. Q Air disc brakes on the steer axle and 16.5-by-7-inch or 16.5-by-8.63-inch drum brakes on the drive axles. Q Air disc brakes on the steer and drive axles. Each progressive option provides more performance. From a service standpoint, the new brake systems will not necessarily have components that can be interchangeable with the brakes on vehicles today.

SERVICE CHANGES It is anticipated that FMVSS 121 is not going to significantly affect the amount of drum brake maintenance that is needed. Furthermore, the new upgraded steer axle brakes should now approach the performance capability of a rear brake. In some applications, the front brake can be doing more work and that work is distributed over more axles. There’s an opportunity for longer brake life if everything is optimized across all axles of a combination vehicle. With the larger drum and disc brakes maintenance costs should go down. Larger brakes will provide such advantages as increased lining volume to drive longer service intervals, lower operating temperatures, reduced fade and improved performance. Air disc brakes are internally adjusted and factorygreased so maintenance requirements are reduced. Air disc brakes also have fewer parts to replace.

BRAKE BALANCE Tractor and trailer braking system balance will not be affected. The air systems will be balanced like they are today, with no need for pressure hold-off valves or changing chambers, etc., to get compatibility among tractor and trailer brakes systems. However, some algorithm changes on ABS systems might occur because of the performance difference. The tractor will incur a little more of the braking workload, which will have some affect on the front axle and suspension components. The trailer will experience a proportionate reduction in workload. Another thing to be aware of is that with trucks that can stop in shorter distances, more attention must be paid to properly securing cargo. BI

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Operations

BY JAMIE POPP

Improving manufacturing with processing automation

>>

Blend of equipment and technology achieves the right mix

The Admix Fastfeed Inline power induction and dispersion system ergonomically feeds and disperses dry ingredients into mix tanks.

DOING MORE WITH LESS IS ONE OF THE GOALS WHEN AUTOMATING BEVERAGE manufacturing. Although many steps are involved, beverage mixing and blending equipment and technology help facilitate changeovers and can get more products to market faster with more efficient processes no matter how complicated the formula. Equipment and technology manufacturers enabling process automation such as Admix Inc., Manchester, N.H., and Techniblend Inc., Delafield, Wis., continue to adapt plant floor systems as a result of constantly changing formulation requirements. “Manufacturers have introduced several new sweeteners and are bringing sucrose back, which is adding the requirement for additional equipment and systems to the bottlers,” says Derek Deubel, vice president, Techniblend Inc. The company introduced Clean in Place (CIP) On-Demand to make the process of mixing operate smoother with less waste, the company says. But as the market supports changing tastes and flavor combinations, ingredient blending has become an ever challenging task. “Today’s formulas require more solids and less water to make the batches,” says Rick Earley, beverage market manager at Admix Inc. “It’s a very real challenge to dissolve all the powders in the limited amount of water in the formulas.” Beverage trends such as increased percentages of powdered ingredient formulas and faster production speeds affect mixing technology. Flexibility to produce all products with minimal changeover requirements is the key to reducing batch time, Earley says. By conducting in-plant trials with Admix equipment, processors have realized batch time reductions from two to six hours down to 20 to 40 minutes in in-plant trials, Earley says. Fastfeed is Admix’s skidmounted mixer for in-line powder induction and dispersion. It uses a powder suction pump and high-shear mixing technology to incorporate and wet out difficult powders. Its DynaShear in-line mechanical mixer reduces the number of passes required to combine ingredients because it pre-mixes ingredients in the axial stage and refines the mixture in the radial, high-flow rotor discharging stage, the company says.

Admix gains valuable feedback from its customers by conducting in-plant process audits and equipment trials to improve the performance and make its in-line mixers more user-friendly, Earley says. At the same time, the company continues to work on equipment advancements to meet customer demands for automation, reduced cleaning time and increased capacity. “We now have available a model that is twice the capacity of the initial unit we launched,” Earley adds. Specialized blending requirements also drive Admix’s business development. Conventional mixing technology might not solve business needs economically or from a quality perspective as powder concentrations increase. Having more powder in less water is an issue for processors unequipped to wet, disperse, dissolve and hydrate the influx of powders in energy drinks and nutraceuticals, Earley says. “Historically difficult viscosity enhancers like xanthan, pectin, guar gum, CMC can be inducted, wetted, dispersed into a final batch tank on a single pass at 20 to 60 pounds per minute with no fish eyes, lumps, agglomerates with Fastfeed technology,” he says. In some cases, when a processor does have the capability to dissolve complicated powders, a powder transfer system might not be in place to safely and efficiently get all the powders to the mixer. “Our Powder Induction and Conveying (PIC) unit is a simple and reliable way to get powders and liquids into a tall mixing tank but from the safety of the floor level,” Earley says. The advantage of premixing the powders during the induction and wetting process decreases the mixing necessary to finish the process in the destination tank, all done from the safety of floor level, he adds. Customers can test Admix’s equipment and technology by visiting its lab in Manchester. Visitors to the lab can put the company’s mixers to the test on various products and Admix experts qualify the best mixing technology based on individual beverage formulas. Whatever is made in the lab can be scaled to any production process, Earley says. Although mixing a multitude of ingredients requires specialized equipment and technology, continued on page 62

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| Beverage Industry | MARCH 2011 | bevindustry.com

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Operations continued from page 60

Techniblend Inc. has blenders that not only help manufacturers with changeovers and shorter production runs, but are more efficient. Its twostream syrup and water blenders

have integrated deaeration, blending and in-line carbonation. And while operator involvement in most installations is still necessary, Techniblend’s Deubel

>>

the process of blending changing beverage formulations also has to be energy efficient to help companies control costs and waste, suppliers say.

The Techniblend TB-200 system features integrated in-line carbonation and integrated CIP On-Demand. It is designed to use less water, syrup, carbon dioxide, electricity and space, the company says.

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says automation in more recent system installations makes operator dependence a feature of the past. Techniblend’s most recent installation in Orlando, Fla., allows changeover function control of the can filler from the blender and the lab, he says. “Operators can select a flavor and then CIP, then another flavor, followed by a CIP, and the system changes over automatically, repeatedly and quickly,” Deubel says. Making improvements to changeover speed in CIP systems has been a recent focus of Techniblend because conventional systems use too much water and energy, and cleaning is not as effective, he says. The CIP On-Demand system was launched to decrease the time spent on such inefficient processes. “Since our customers have to changeover more frequently and as they continue to run more flavors with more diverse ingredients and sweeteners … the CIP On-Demand addresses both the CIP efficacy and CIP times,” Deubel says. In addition to time savings and flexibility, having a CIP system integrated into the blender can shorten the circuit thereby decreasing water, chemical heat and energy use for hot CIP cycles because everything is housed in the same unit, he adds. The new combined system, available in Techniblend’s most recent TB-200 series blenders, also reduces hot and cold spots during chemical delivery. Poor process control can lead to too much chemical being added to the mix in a conventional CIP system, Deubel says. To reduce this, Techniblend blending technology instantly blends the target concentration of chemical and water, he says. BI

Supplier’s Marketplace NEWS Pacific Ozone, Benicia, Calif., in conjunction with the U.S. Department of Commerce’s U.S. Commercial Service, completed a trade mission in a joint effort to expand exports of U.S. developed and manufactured advanced clean technologies. The goal was to expand the reach of advanced ozone technology, which has been pioneered in the United States, for industrial applications in key South American markets.

To decrease the company’s overall installed beverage can capacity in North America and to better align with changing customer demand, Ball Corp., Broomfield, Colo., announced it will close its Torrance, Calif., beverage can plant by the end of the third quarter of 2011, subject to customer requirements. The plant operates three lines, two that produce 12-ounce cans and one that produces 16-ounce cans. One of the 12-ounce production lines from Torrance will be relocated to Ball’s Whitby, Ontario, beverage can plant and is scheduled to start production during the second quarter of this year. Railinc Corp., Cary, N.C., announced that its new Damaged and Defective Car Tracking system was successfully launched and is now operational for rail carriers, freight car owners and freight car repair shops. Authorized users across the rail industry are now using the new tracking system to enter and respond to damaged and defective car incidents.

Product redesign Spirax Sarco released its half-inch FTS-150 and FTS-300 float and thermostatic steam trap series. The product was redesigned to replace the OK series, which was a mixed material trap with a forged steel cover and stainless body, to an all stainless steel material trap, the company says. These products do not rust and are corrosion resistant, the company adds. With its single seated mechanism, all models of the FTS series are full modulating with 100 percent turn down ratio on both pressure and flow. The series also has a tight shut-off on no load, resulting in instantaneous response to condensate load changes, the company says. The trap operates at saturated steam temperatures with no back up of condensate into the inlet piping. All thermostatic air vents are able to operate up to 572 degrees Fahrenheit and remove air rapidly on start up making it water hammer resistant and capable of withstanding superheat, it says. The standard offering includes two operating ranges 0 to 150 pound-force per square inch gauge (psig) and 0 to 300 psig. QSpirax Sarco USA, 1150 Northpoint Blvd., Blythewood, S.C.

29016; 800/575-0394; spiraxsarco.com.

Swiss-based Sidel inaugurated a new training lab at its Parma, Italy, site. The lab is dedicated to the manufacture of fillers and end-of-lines for liquid foods. DAK Americas LLC, Charlotte, N.C.,

announced that it has completed the acquisition of the integrated PET and PTA business of Eastman Chemical Company. The acquisition includes three production facilities in Columbia, S.C.

OUTDOOR MOCK BEVERAGE DISPLAY

Flexible solution Sidel launched the AQ-File conveyor, a new singlefile accumulation system. It can be used on bottling lines with speeds of less than 30,000 bottles an hour, for all types of industries, including wine and spirits and liquid dairy products, the company says. AQ-File is composed of a horizontal chain that winds around a wheel mounted on a mobile carriage. Accumulation is done by varying the length of the accumulation chain: the carriage moves back to create accumulation and advances to discharge the containers. AQ-File therefore operates without transfer and with just a single chain. The design of AQ-File offers optimal accessibility for all of its components at chest height, the company says. In addition, AQ-File retains all of the qualities associated with single-file accumulation: respect for container orientation and first-in, first-out conveying, it says. QSidel Group, 5600 Sun Court, Norcross, Ga. 30092;

678/221-3087; sidel.com.

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SIG Combibloc is expanding its product range by adding a new screw cap. The new closure mechanism weighs 1.85 grams. The screw cap CombiCap is based on a process developed by SIG Combibloc. In this process, the screw cap is applied over an over-coated hole. Later, the closure, which is affixed to the carton pack after the product has been filled, can be opened by the consumer with a single twist, as the cardboard layer has already been removed and only the thin aluminum and polyethylene layers need to be pierced, the company says. The closure consists of a flange with integrated cutting ring and a screw cap. With a single twist of the screw cap, the tamper evidence feature on the original seal is broken with an audible click. At the same time, the twisting motion opens the overcoated hole cleanly and smoothly, the company says. The tamper evidence feature enables the consumer to see whether the carton pack still has its original seal or has already been opened, it says. To reclose, the cap is screwed back on, ensuring the carton pack remains leak-proof. QSIG Combibloc Inc., 2501 Seaport Drive, Chester, Pa. 19013;

610/546-4200; sig.biz.

Czech Republic’s Madeta AS has selected German-company GEA Group to offer a complete turn-key evaporator to process sweet whey. Columbus, Ohio-based Mac Tools will now distribute JPRO Fleet Products from Noregon Systems, Winston-Salem, N.C. Noregon also has teamed with VIPAR Heavy Duty, Crystal Lake, Ill., for distribution.

Lightweight cap

| Beverage Industry | MARCH 2011 | bevindustry.com

Safestrap Co. unveiled the Pallet Decoy display for use by beverage brands that are looking to increase brand visibility in convenience stores and gas stations. The Pallet Decoy is a mobile display designed to simulate a full pallet of boxed beer or soda. The mock displays are designed to drive sales without the retailer having to use actual product, which often ends in sacrificing profits to theft and weather-related damage, the company says. The mock display attaches to an empty wooden pallet and can be safely placed in a highly visible outdoor location. Designed to be outdoors, the displays are capable of standing up to harsh sunlight and wind, the company says. Pallet Decoys are available in three sizes in Coca-Cola, Pepsi and Anheuser-Busch products. QSafestrap Company Inc., 105 W. Dewey Ave., Building D, Wharton, N.J. 07885; 973/422-4623; safestrap.com.

SALIENT LISTED IN ‘MAGIC QUADRANT’ FOR BUSINESS INTELLIGENCE Salient Management Co., an organizational performance management firm that has developed Business Intelligence technology to help beverage companies improve efficiency and profitability, announced that it has been positioned by Gartner Inc. in the “Niche Players” quadrant of the “Magic Quadrant for Business Intelligence Platforms.” In the Gartner research report, Salient was evaluated as a market player based on its “ability to execute” in areas, such as product and service; overall viability; sales execution and pricing; market responsiveness and track record; market and customer experience; as well on its “completeness of vision” in terms of market understanding, product strategy, business model and innovation. “We believe this recognition confirms our mission of 25 years to enable every decisionmaker enterprise-wide to bring value intelligence into any situation in time to impact the business and improve efficiency,” says Guy Amisano, Salient president and chief executive officer. “But we are not resting on our laurels. Our new version, which is due out this spring, will include several new user-driven features that will further enhance our visual data mining and knowledge sharing capabilities.” To be included in the Magic Quadrant, vendors must deliver at least nine out of 13 capabilities detailed in Gartner’s market definition/description under the categories of integration, information delivery and analysis. Candidates also must be able to obtain a minimum of 20 customer survey responses that use the vendor platform as their enterprise Business Intelligence platform. The Salient solution allows users to “pull” the information they need as soon as they need it and in the format they require, and lets them continue asking questions and “pulling” answers so that they can achieve peak business performance.

“Our system measures the effect of managerial actions on outcomes, and enables managers to convert this knowledge into better decisions,” Amisano says. “The result is absolute control over resources, which translates into less waste and better performance. It can transform any enterprise into a fact-based, knowledge-driven management environment. We understand economics and we know how business-minded individuals need to relate to business activity in order to measure and improve results.” Gartner’s Magic Quadrant is a graphical representation of a marketplace at and for a specific time period. It depicts Gartner’s analysis of how certain vendors measure against criteria for that marketplace, as defined by Gartner. Gartner does not endorse any vendor, product or service depicted in the Magic Quadrant, and does not advise technology users to select only those vendors placed in the “Leaders” quadrant. The Magic Quadrant is intended solely as a research tool, and is not meant to be a specific guide to action. Gartner disclaims all warranties, express or implied, with respect to this research, including any warranties of merchantability or fitness for a particular purpose. QSalient Management Co., 203 Colonial Drive, Horseheads, N.Y., 14845; 607/739-4511; salient.com.

bevindustry.com | MARCH 2011 | Beverage Industry |

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Supplier’s Marketplace Handheld computer LXE launched the Tecton, a handheld computer that targets supply chain applications. The IP-65 rated computer accelerates real-time data capture with a PXA 320 806MHz processor that runs on Windows Mobile 6.5 or Windows CE 6.0, the company says. The unit’s multi-range scanning capabilities enable bar code reads from 4 inches to 40 feet, so that operators can perform warehouse moves including receiving and full pallet put-aways with the same version of the computer. Scan-intensive picking can be enabled with the Tecton computer’s available easy-grip removable handle with two-finger trigger, and every Tecton computer comes with LXE’s ToughTalk technology for voice-driven processes. The device also features a scan vibration signal that can be used to verify successful scans in loud warehouses and multiple built-in data entry options. QLXE Inc., 125 Technology Parkway, Norcross, Ga. 30092;

770/447-4224; lxe.com.

New market system CFL International LLC introduced the aquablubox, a 3- and 5-gallon pre-filled bottled water vending machine. Sanden Vendo America Inc. manufactured the aquablubox. The machine provides customers with unlimited access and requires no store employees to sell, stock and inventory the large bottles of water, the company says. QSanden Vendo America Inc., 10710 Sanden Drive, Dallas,

Texas 75238; 800/344-7216; vendoco.com.

Narrow aisle forklift Crown Equipment Corp. released the Crown RM 6000 Series, a narrow aisle reach truck with a MonoLift mast. The product is a pantograph reach truck that can reach 505 inches and deliver up to 1,000 pounds more capacity at full height, the company says. It is equipped with forks that travel upward at a pace of 153 feet a minute. Visibility has improved on the Crown RM 6000 at height, eye and ground levels, the company says. The MonoLift mast is offset 7 inches to the left of the operator and narrows the higher it goes. Crown also reshaped the reach carriage to create a larger window at eye level giving the operator a better view of fork

The World Health Organization (WHO), has just recommended that all drinking water contain at least 25 mg of magnesium per liter, to prevent heart attacks and strokes. See: www.MgWater.com/download Adobe Springs contains 110 mg of magnesium per liter, and is the only licensed bottled water source in California that meets the WHO standard.

Our 5 trained Board Members are all licensed Contractors--- average age 45.

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| Beverage Industry | MARCH 2011 | bevindustry.com

tips and load, it says. The load backrest was modified by designing a notch in the upper right-hand corner so that operators can scan at ground level from their position in the forklift. Crown RM 6000 also features the Crown OnTrac Anti-Slip Traction Control to assist the truck from slipping on wet, dusty and sealed floors. QCrown Equipment Corp., 44 South

Washington St., New Bremen, Ohio 45869; 419/629-2311; crown.com.

management baseline. The tool is based on the Rockwell Automation Industrial GreenPrint methodology, which is designed to provide manufacturers with a customized, strategic roadmap for industrial WAGES resource management. The methodology consists of four stages — awareness, efficiency, optimization and aggregation — and helps companies transform their practices and production, improving profitability and enabling supply chain optimization, it says. QRockwell Automation Inc., 1201 S. Second

St., Milwaukee, Wis. 53204; 414/382-2000; rockwellautomation.com.

Software additions

Tubing line Polyethylene-lined ethylene vinyl acetate (EVA) tubing is a co-extruded product now available from NewAge Industries. The tubing combines the functionality of polyethylene with the flexibility of EVA and is used in many applications, including beverage processing, the company says. Polyethylene tubing is typically a semi-rigid product, but the addition of EVA gives it enhanced flexibility and allows its use with economical barbstyle fittings. The tubing’s patented manufacturing method ensures a permanent bond between the inner and outer layers. First the core of low density polyethylene is extruded, then farther down the production line, the EVA covering is extruded around the core using a patented process. The result is tubing that offers different performance characteristics for cleanliness inside and flexibility outside of the tube, the company says. QNewAge Industries Inc., 145 James Way,

Southampton, Pa. 18966; 215/526-2300; newageindustries.com.

Online energy management tool Rockwell Automation developed a free online tool, called the WAGES systems, that gives a manufacturer a complete analysis of its current water, air, gas, electric and steam management performance. It also provides a clear understanding of how its operating strategies compare with peers in both the same industry and across other sectors, the company says. The tool uses a 20-minute online assessment to generate a real-time report outlining a facility’s competitive WAGES

Building on the current version of JPRO Fleet Diagnostics software for heavy-duty vehicles, Noregon Systems announced the release of JPRO Fleet Diagnostics version 5.0 that updates diagnostic capabilities for heavy-duty vehicles through the 2010 model year. In addition to the existing heavyduty package, beginning spring 2011, JPRO Fleet Diagnostics v5.0 will offer diagnostic capabilities for medium-duty platforms with the purchase of OEM specific software modules, the company says. This upgrade will begin with Ford E-series and F-series trucks (model years 2004 and newer) and additional releases in 2011 for GM, Dodge, Hino, Isuzu and MBE-Sprinter. As an added enhancement, JPRO v5.0 software will implement an Internet-based activation and registration process. QNoregon Systems Inc. 100 North Main

St., Suite 2200, Winston-Salem, N.C. 27101; 336/768-4337; noregon.com.

Stainless steel motors Boston Gear launched a new line of stainless steel motors for washdown performance. These stainless steel motors are designed to provide long-lasting performance in harsh washdown environments where high-pressure caustic solvents and cleaners are used to help meet Federal Drug Administration bacteria and food contamination guidelines, the company says. Exterior construction consists of 300 Series stainless steel housing, end bells, output shaft, and conduit box. Motors are Underwriters Laboratories/ ULC certified and conform to 2007 Energy Independence and Security Act efficiency standards, the company says. All units feature Class F insulation, Class B rise at 1.15 service factor, and epoxyencapsulated windings. Internal locked bearings eliminate unwanted axial movement, the company says. QBoston Gear, 701 Carrier Drive, Charlotte,

IN-HOUSE CUSTOM GRAPHICS CAPABILITIES

N.C. 28216; 704/588-5610; bostongear.com.

bevindustry.com | MARCH 2011 | Beverage Industry |

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Supplier’s Marketplace use of the O-I 14-ounce lightweight bottles will provide carbon dioxide savings of more than 70 metric tons, the company says. QOwens-Illinois Inc., 1 Michael Owens Way, Perrysburg, Ohio

PEOPLE Intelligrated, Cincinnati, appointed Kevin O’Reilly to the position of sales engineer II for the company’s Somerset, N.J.-based Eastern regional operation.

43551; 567/336-5000; o-i.com.

Electric lift trucks

Rockwell Automation Inc., Milwaukee,

elected two new corporate officers who will lead the company’s two operating segments effective April 1. Blake Moret was named senior vice president of control products and solutions segment and Frank Kulaszewicz was appointed senior vice president of architecture and software segment. Owens-Illinois Inc., Perrysburg, Ohio, named Deborah Hockman vice president of global environment, health and safety.

H.B. Fuller Co., St. Paul, Minn., selected Wendy Arent as senior technical manager. Groskopf Warehouse and Logistics,

Sonoma, Calif., appointed David Hammond vice president and general manager.

Lightweight bottles Owens-Illinois Inc. (O-I) expanded its line of lightweight glass wine bottles in North America. The newest bottle weighs 14 ounces. The new line of 750-ml. lightweight claret and Burgundy bottles is part of the O-I Lean+Green initiative designed to create aesthetically pleasing, durable, yet lighter weight bottles using advanced manufacturing techniques, the company says. The Lean+Green line is available in a variety of colors, including champagne green, flint, emerald green and dead leaf green, and will be between 16 and 27 percent lighter than current offerings. With the addition of the new 14-ounce 750-ml. capacity bottle, O-I North America now offers lightweight wine bottles ranging in weight from 11.6 to 16 ounces. Based on the production of 1 million bottles,

Yale Materials Handling Corp. unveiled its next generation of electric lift trucks. The ERC-VA series features the following: newly designed operator compartments and comfort; 16 percent more floor space; relocated multifunction displays for enhanced visibility and precise pallet control; improved brake pedal layout; Auto Deceleration Systems; and steel hoods for maximum battery service access, the company says. Yale’s ERC-VA series has lifting capacities of 3,000 to 4,000 pounds. The Yale-designed thermal management system continuously monitors the ERC-VA series’ controller and motor temperature and, upon identifying irregularity, the system protects the component by automatically adjusting truck performance, the company says. QYale Materials Handling Corp., 1400 Sullivan Drive, Greenville,

N.C. 27834; 252/931-5100; yale.com.

bevindustry.com Delivering More News and Information to the Beverage Marketplace than Ever Before. Now Featuring... - Breaking News - Cover Story & Feature Articles - Archived Articles - White Papers - Webinars - Searchable Directory - Videos from Manufacturers SUBSCRIBE TO OUR WEEKLY E-NEWSLETTER and receive the latest industry news right to your inbox. box.

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To place your classified ad in Beverage Industry call Catherine Wynn at 847-405-4010 Fax: 248-502-9109 E-mail: [email protected] AUCTION

BOTTLING EQUIPMENT

CUSTOM FORMULATION

HILCO WEBCAST / ONSITE AUCTION THURSDAY, APRIL 14th, 10 AM LOCAL Complete Plant Closure

Preview: Wed., April 13, 2011 from 9 AM to 4 PM Auction & Preview Location: 2800 S 16th Ave., Yakima, WA 98903

State of the Art Bottling Operations and Printing Facility for Private Brands • Husky Hypet 120 Injection Molder Hydraulic System Chiller, 32 cavity 28mm PCO molds, Cool Pix robot, ConAir first stage dryer, dryer control and chiller, and second phase dryer. Installed 2007. • Evapco Cooler ATW900 with 600-gallon process tank • Carbonation Bottling Line with TriBlock pressurized filler, rinser, and capper. Installed 2010. • (2) Bottling Rooms Clean room air filtration and pressurization system • (2) Bottling Lines Automatic Bottle Unscrambler, Bottle Rinser, Bottle Filler, Capper/Labeler, Cap Cincher/Tightener, 12' x 12' Accumulation Conveyor, Code Printer, Heat Shrink Wrapping System, Heat Tunnel, Shrink Pallet Wrappers

• Glycol Chill Plate • HP 4500 Printing System including HP ws4500 digital printer • Rotoflex Converting Line Installed 2007. • Blow Molders Four Cavity Blow Molding System, Isolated Sealed Machine Room, Six Cavity Blow Molding System. Installed 2006. • Ultraviolet Pretreatment System • Reverse Osmosis Pretreatment System • 4,300 Gallon Water Storage Tanks • (3) Ozone Systems with 50 GPM Dual Pumps Monitor • Large Qty. of Test Equipment for In-House Production

s#USTOM"EVERAGE$EVELOPMENT s/PERATIONAL3UPPORTFOR#OMMERCIALIZATION s"USINESS0LAN$EVELOPMENT &LEXIBLE2ATES!LLPROJECTSCONSIDERED 4HElNALFORMULATIONIS9/523FOREVER &OR-ORE)NFORMATION #ONTACT#YDNEY7HITMOYER

610-916-2439 % MAIL0!2+"%6%2 AOLCOM WEBWWWPARKSIDEBEVERAGECOM

CAREER OPPORTUNITY

For further information please contact Mark Reynolds at 205.595.5999 or Email [email protected]

These are partial listings only. For more info. on additional auctions or to subscribe to our email/mailing lists, visit

www.hilcoind.com To Schedule an auction, please call us at 1-877-37-HILCO. A Buyer’s Premium Is In Effect for All Sales • IL License #444.00215

Do You Hear Opportunity Knocking?

EQUIPMENT FOR SALE

Call Catherine Wynn Beverage Industry Classified Sales Manager 847-405-4010 or email: [email protected] BEVERAGE BODY/TRAILER PARTS FOR SALE

SPECIAL EVENTS TRAILERS ALL STEEL - THE REAL DEAL serving bottlers for 3 decades

SUPREME PRODUCTS INC. 254/ 799-4941

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| Beverage Industry | MARCH 2011 | bevindustry.com

www.supremeproducts.com

To place your classified ad in Beverage Industry call Catherine Wynn at 847-405-4010 Fax: 248-502-9109 E-mail: [email protected] CONTRACT PACKAGING

CONTRACT BOTTLING

www.unitednutritionlabsinc.com

HOT FILL, COLD FILL & PASTEURIZATION

JUICES, TEAS, SAUCES, SYRUPS, ENERGY DRINKS, ISOTONICS, ETC. BOTTLE SIZES 3oz - 30oz, PET

OR

GLASS

Contract Shrink Sleeving & Banding, Encapsulating, Tableting, Coating, Pouching, Blister Packs, Powders, Softgels, Package Printing, & More! Private Labeling Available on 100+ Stock Products (24 Minimum)

1-866-692-1997 Direct All Inquires to Cliff [email protected]

5135 OLD US HWY 322 REEDSVILLE, PA 17084

CERTIFIED

EQUIPMENT FOR SALE

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Expand your advertising reach! CALL CATHERINE WYNN BEVERAGE INDUSTRY CLASSIFIED SALES MANAGER

847-405-4010 OR EMAIL: [email protected]

bevindustry.com | MARCH 2011 | Beverage Industry |

71

To place your classified ad in Beverage Industry call Catherine Wynn at 847-405-4010 Fax: 248-502-9109 E-mail: [email protected] CONTRACT PACKAGING

EQUIPMENT FOR SALE

Mission, Texas 78572

Co packer Hot fill Juices, Teas & Beverages Can, Glass & PET

EQUIPMENT FOR SALE

• Expanded Capabilities • Gripper bottle, Shrink label, New sizes “GFSI - Certified Facility” Contact Dodson Galloway 956-585-8321 email: [email protected]

EQUIPMENT FOR SALE

Syrup Tanks / CO2 Cyls. We Buy & Sell 3 & 5 gallon Syrup Tanks & all sizes of CO2 Cylinders

check out more classifieds at www.bevindustry.com PLANT FOR SALE

WATER BOTTLING PLANT FOR SALE

• Award winning water bottling plant for sale in Beaver, Utah. • 3 acres of I-15 freeway frontage, includes a 28,000 sq. ft. building • High speed Úll line, labeler, tray packer, heat shrink tunnel • Two bottle blowing machines • All ancillary equipment necessary for production. • Great R&D facility for a large beverage co.

PRICED AT ONLY $2,500,000

All Safe, Inc. Contact Mike @ 612-366-0967 or [email protected]

NEW/USED WALK-IN-COOLER-FREEZER BOXES REFRIGERATION SYSTEMS – EQUIPMENT HUGE INVENTORY, ALL SIZES Buy Sell - Nationwide - Wholesale Prices

Tel. 216-426-8882 www.awrco.com [email protected]

Please contact Trent at 702 682-1277 or [email protected] PLASTIC SLIP SHEETS

Join our pooling program & save BIG. No downtime. No machine stoppage. No dunnage shortages. No cross country dunnage shipments. No machine repairs. We manufacture and manage plastic dunnage: separator sheets, pallets & top frames.

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Reusable plastic dunnage, expertly managed.

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TRUCKS FOR SALE

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| Beverage Industry | MARCH 2011 | bevindustry.com

SERVICES

WANTED TO BUY

Ad Index ADM/Matustani .................................................14-15

MRI Flexible Packaging ........................................44

www.matsutaniamerica.com

www.mriflex.com

Adobe Spring Water Co.........................................66

NEPA Carton & Carrier Co. .................................. 47

www.mgwater.com

www.nepacartons.com

Aloecorp .................................................................52

NVE Pharmaceuticals .......................................... 37

www.aloecorp.com

www.nveusa.com

BASF AG .................................................................. 2

Overnight Labels, Inc ...........................................45

www.crosspure.com

www.overnightlabels.com

READER & MARKETING SERVICES LETTERS

BI Nutraceuticals .................................................... 5 www.botanicals.com

Bioenergy Life Science, Inc..................................56 www.bioenergy

BSN .................................................................... 31, 41 www.endorush.com

C&C Beverages ......................................................28 www.cccola.com

Closure Systems International............................ 75

Owens-Illionois .......................................................21 www.o-i.com

PakTech ..................................................................30

CUSTOM MEDIA

www.palacestreetfoods.com

Raw Foods International ........................................ 9

Robertet Flavors, Inc. .......................................16-18 www.robertet.com

www.rocketproducts.com

www.ryson.com

Satellite Logistics Group......................................29

www.douglas-machine.com

Flavor Producers ................................................... 39 www.flavorproducers.com

Hartness International ......................................... 23 www.hartness.com

CHRIS WILSON E-mail: [email protected] Call: 248.244.8264

www.rawfoodsinternational.com

www.colormaker.com

Douglas Machine, Inc. ...........................................34

CUSTOMER SERVICE

Palace Street Foods ..............................................25

Ryson International, Inc....................................... 33

www.contitech.de/ih

E-mail: [email protected] Call: (248) 244-6499

T: (847) 763-9534 F: (847) 763-9538 E-mail: [email protected]

www.paktech-opi.com

www.cmc-kuhnke.com

ContiTech Schlauch, GmbH .................................... 7

SINGLE COPY SALES/ BACK ISSUES

SUBSCRIPTIONS

Rocket Products, Inc. ...........................................40

colorMaker, Inc. ......................................................12

Mail: Beverage Industry 155 Pfingsten Road, Suite 205 Deerfield, IL 60015 E-mail: [email protected]

ANN KALB

www.csiclosures.com

CMC-Kuhnke, Inc. .................................................... 4

ELIZABETH FUHRMAN

LIST RENTAL

FOR POSTAL INFORMATION: Contact Rob Liska at 800-223-2194 x726 [email protected]

FOR EMAIL INFORMATION: Contact Shawn Kingston at 800-409-4443 x828 [email protected]

www.slg.com

PRINT & INTERNET ADVERTISING

Schneider Packaging Equipment Co. ..................48 www.schneiderequip.com

STEVE PINTARELLI

Sensus Flavors .......................................................51

Midwest/West Coast E-mail: [email protected] Call: (203) 267-3388

www.sensusflavors.com

TOM BACHMANN

Sethness-Greenleaf, Inc. ...................................... 53 www.sethnessgreenleaf.com

SG Beverage Solutions ......................................... 67

Informational Resources, Inc. ..............................62

www.sgbeveragesolutions.com

www.cpgsummit.com/BI

Swisslog Logistics ................................................ 63

iTi Tropicals ...................................................54, 65

www.swisslog.com

www.iTitropicals.com

Terry Laboratories, Inc. ........................................ 57

Mark Andy Brands, Inc. .........................................19

www.terrylabs.com

www.mikeshardlemonade.com

Union Pacific.......................................................10-11

Mid-Atlantic/Southeast/Texas E-mail: [email protected] Call: (941) 473-7739

BRUCE KLION Northeast/Canada E-mail: [email protected] Call: (516) 944-5885

CLASSIFIED

CATHERINE WYNN E-mail: [email protected] Call: (847) 405-4010

REPRINT www.unionpacific.com

JILL DEVRIES [email protected]

United Brands Company.......................................43 BEVERAGE INDUSTRY (ISSN 0148-6187) is published 12 times annually, monthly, by BNP Media II, L.L.C., 2401 W. Big Beaver Rd., Suite 700, Troy, MI 48084-3333. Telephone: (248) 362-3700, Fax: (248) 362-0317.

www.drinkjoose.com

Vacuum Barrier Corporation ................................. 13 BNP Media

No charge for subscriptions to qualified individuals.

www.vacuumbarrier.com

Annual rate for subscriptions to nonqualified individuals in the U.S.A.: $178.00 USD. Annual rate for subscriptions to nonqualified individuals in Canada: $216.00 USD (includes GST & postage); all other countries: $228.00 (int’l mail) payable in U.S. funds.

VPX Sports ..........................................3, 49, 59, BC

Printed in the U.S.A. Copyright 2011, by BNP Media II, L.L.C. All rights reserved. The contents of this publication may not be reproduced in whole or in part without the consent of the publisher. The publisher is not responsible for product claims and representations.

Wacker Chemical ................................................... 35

Periodicals Postage Paid at Troy, MI and at additional mailing offices. POSTMASTER: Send address changes to: BEVERAGE INDUSTRY, P.O. Box 1080, Skokie, IL 60076. Canada Post: Publications Mail Agreement #40612608. GST account: 131263923. Send returns (Canada) to Pitney Bowes, P.O.Box 25542, London, ON, N6C 6B2. Change of address: Send old address label along with new address to BEVERAGE INDUSTRY, P.O. Box 1080, Skokie, IL 60076. For single copies or back issues: contact Ann Kalb at (248)244-6499 or [email protected].

155 Pfingsten Road, Suite 205 | Deerfield, IL 60015 Phone: (847) 405-4000 | Fax: (847) 405-4100

www.vpxsports.com

www.wacker.com/food

Westfalia Technologies, Inc. .................................46 www.westfaliausa.com

Reaching an average qualified circulation of 35,189 copies. Source: December 2010 BPA circulation statement. Also publishers of BrandPackaging, Candy Industry, Dairy Foods, Flexible Packaging, Food & Beverage Packaging, Food Engineering, Industria Alimenticia, The National Provisioner, Prepared Foods, Private Label Buyer, Refrigerated & Frozen Foods Retailer, and Snack Food & Wholesale Bakery.

Beverage Industry | MARCH 2011 | bevindustry.com |

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WELLNESS WATCHMEN BY JENNIFER ZEGLER Managing Editor

A

s part of the fight against obesity, food and beverage companies have pledged to better communicate to consumers in regard to the calorie and nutrient information of their products. Last year, American Beverage Association members began rolling out beverage containers bearing front-ofpackage nutrition information across the country. Calorie counts are beginning to appear on the front of packages of major brands from Coca-Cola, PepsiCo, Nestlé Waters and more. Also helping consumers make healthy choices, retail giant WalMart announced a plan earlier this year to provide customers with healthier and more affordable food choices. In February, Leslie Dach, vice president of Wal-Mart, appeared on “The Colbert Report,” a satirical news show. The show’s host Stephen Colbert described Wal-Mart’s initiative as, “Big Brother mandating — through opportunity — that I not eat myself into a coma of Cheetos.” Dach said Wal-Mart’s plan responds to demands from its shoppers, which the company reports amount to more than 140 million customers each week. “[Consumers] want to eat healthy but they don’t know what to do,” Dach said. “They see all these weird things on TV. They go to the stores, and they can’t understand the labels. They see something healthy, but it’s too expensive. So we said, ‘You know what? We can make the food healthier. We can make the healthier food more affordable.’” As part of its multi-faceted plan, WalMart pledged to reformulate key categories of its Great Value private brand. In addition, the retailer will collaborate with suppliers to reformulate comparative national brands by 2015. Its plan aims to reduce sodium by 25 percent, decrease added sugars by 10 percent and remove all industrially produced trans fats in all packaged food products.

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Comedic partnership Sledgehammer wine partnered with comedian Adam Carolla and his media company, ACE Broadcasting, as part of the wine’s effort to reach millennial male wine drinkers. As the official wine of “The Adam Carolla Show,” Sledgehammer will host tasting events in conjunction with Carolla’s upcoming U.S. comedy tour dates.

Century-old whisky After more than 100 years encapsulated in Antarctic ice, three bottles of Whyte & Mackayowned brand Mackinlays whisky were recently returned to Scotland for analysis. The bottles of Mackinlays whisky accompanied Ernest Shackleton on his 1907 expedition to Antarctica and have been encased in Antarctic ice since then. The finding is considered so rare that Antarctic Heritage Trust and New Zealand authorities refused to send the bottles to Scotland without an escort. The bottles were picked up by Whyte & Mackay owner Vijay Mallya and returned to Scotland using his private jet. The company’s master blender Richard Paterson will analyze, nose, taste and deconstruct the whisky before returning the bottles to Shackleton’s hut in Antarctica, the company says.

Artisan road trip The Balvenie, a single malt Scotch whisky owned by William Grant & Sons Ltd., launched The Balvenie Rare Craft Roadshow, a nationwide search for craftsmen and artisans. Starting March 10, brand ambassadors Andrew Weir and Nicholas Pollacchi will travel across the United States in a handcrafted Morgan car in search of artisans who are as dedicated to the practice and preservation of traditional crafts as The Balvenie is to the craftsmanship of its whisky, the company says. The roadshow will visit artisans, such as brewers, vintners, cheesemakers, apothecaries and bicyclemakers, who were nominated online. The people discovered along The Balvenie Rare Craft Roadshow, will be featured on a dedicated website, in a nationwide print campaign and a series of interactive web videos that will be made into a longer form documentary charting the journey and people met along the way, the company says.

Dog lovers’ promotion New Belgium Brewing partnered with Outside Magazine to present a Facebook promotion designed for dog lovers. The promotion is planned in tandem with the brewery’s release of its spring seasonal Mighty Arrow. Through the beginning of this month, Facebook visitors could post pictures and videos of their dogs with the opportunity to win weekly dog-centric prizes. New Belgium Brewing and Outside Magazine will donate a dollar for every participant up to $10,000 to the Humane Society of the United States.

‘Unbelievable’ promotion Dr Pepper Snapple Group’s Diet Dr Pepper launched a major online scavenger hunt campaign with web company Yahoo. “The Hunt for the Unbelievable” program invites visitors to search for six Dr Pepper characters across Yahoo properties, including entertainment pages and mobile platforms. The program is the first online extension of Diet Dr Pepper’s “We Exist” campaign, which features a leprechaun, alien, sasquatch, tooth fairy, Easter bunny, and Santa Claus. “The Hunt for the Unbelievable” uses the Diet Dr Pepper Guy character to introduce the game on Yahoo’s Movies page. Each mythical creature is hidden on one of six Yahoo pages and those who find all six have the chance through the end of this month to win a getaway worth $10,000.

| Beverage Industry | MARCH 2011 | bevindustry.com

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