Food Magazine April 2015

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Foodmagazine INGREDIENTS | PROCESSING | SAFETY | PACKAGING | EXPORT

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Foodmagazine INGREDIENTS | PROCESSING | SAFETY | PACKAGING | EXPORT

INFORMING FOOD AND BEVERAGE MANUFACTURERS

PACKAGING

APR/MAY 2015

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AUSPACK 2015:

The hottest products at the show

PLUS: How to sell your food business | Pizza maker breaks into Asian market | Exporting to China

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Improve your production line reliability and productivity through...

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WELCOME

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HE new chairman of Goodman Fielder seems to have got it right. Robin Nicholson recently stated: “If we can see an opportunity to take successful, well-established Australian and New Zealand brands and push them into Asia we’re going to seize that.”

Australia’s food manufacturing sector has for long been an industry with unfulfilled potential.

But things seem to be changing and comparisons are already being made between food exports and the resources boom.

Australia’s processed food exports to key Asian markets have grown 52 percent in the past decade, from $5 billion in 2005 to $7.6 billion in 2014. The next decade could see far greater growth especially if companies leverage the made in Australia brand.

It will also require significant capital investment as companies ramp up their production lines

and volumes. The pace of mergers and acquisitions in this sector is frenetic making Australia fifth on the list of global targets. This magazine includes a feature on selling your company and offers some unique insight that will assist those embarking on this process.

This is also the time of year when we seek out champions in the industry - and there are plenty.

Nominations to the 2015 Food Awards program close 30 April so hurry and send in your entries.

The process is simple and can be quickly accomplished online at foodmagazineawards.com.au so jump on and get started.

As always, the team at Food Magazine would love to hear from you, so drop us an email, follow us on Twitter and join the discussions on Facebook. kevin.gomez@cirrusmedia.com.au

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6 NEWS

18 INSIGHT

24 BAKED GOODS

Snack food manufacturing to experience a boost in demand

Getting accredited was a no-brainer for Hannapak

Pizza manufacturer Della Rosa has cracked the Chinese market

8 BUSINESS

19 INDUSTRY WATCH

25 AUSPACK 2015

How to maximise the value of your business

Arnott’s secrets to success

The Food Magazine team picks out noteworthy products from the show

10 EXPORTS

Avoid designing an outdated facility

20 PLANNING

32 ON THE SHELF

A one-size-fits-all strategy will not suffice for China

22 SCANNING

14 PACKAGING TRENDS

Internet of Things scanning technology and the future of food

Latest advances in aseptic packaging

16 AIP COLUMN Controlling food losses through better packaging

12 new products on retailers’ shelves

23 BULK HANDLING

34 LAST WORD Five things to consider when investing in growth

Effective bulk handling systems increase efficiency for dry milk solids producers

www.foodmag.com.au | Apr/May 2015 | Foodmagazine 5

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NEWS

Snack food manufacturing to experience a boost in demand

In brief Coke Life hits shelves

Volatile input prices, changing consumer trends and a saturated market are just some of the challenges facing operators in the snack food manufacturing industry, according to IBISWorld’s updated report on the snack food manufacturing industry in Australia.

Over the five years through 2014-15, trends expected to constrain industry revenue growth include volatile commodity prices, rising competition and increasingly health-conscious consumers switching to healthier alternatives.

In 2014-15, revenue is expected to increase by 1.6 per cent.

“The industry’s major players have endured falling profit margins, increased competition from private-label products and stagnating domestic demand, particularly in the salty snacks segment, which has historically been

the most profitable,” said IBISWorld industry analyst Ryan Lin. Consumer tastes and lifestyles have changed due to increased health awareness, which has prompted product innovation.

The snack food manufacturing industry has high production costs, which often hamper price competitiveness and open up the market to cheaper products from nations with lower production costs.

“Snack food imports are estimated to account for 10.8 per cent of domestic demand in 2014-15,” Lin said. However, the depreciation of the Australian dollar is expected to assist the industry slightly, as imports become more expensive for the local market, while exports become more competitively priced in international markets.

The proportion of Australians over 14 who are more likely to buy food labelled 'Made in Australia' has risen to 88 per cent from 85 per cent two years ago. Those who prefer the goods 'Made in China' tend to be younger (under 35) and less concerned about whether their food is fattening, genetically modified, or additive-free.

Source: Roy Morgan Single Source (Australia), January-December 2014 (n=15,944).

Base: Australians 14+ 6 Foodmagazine | Apr/May 2015 | www.foodmag.com.au

■ More likely to buy food labelled 'Made in China' ■ More likely to buy food labelled 'Made in Australia'

Do food attitudess iinfluence nfluence w whether hether w wee buy food made inn C China Australia? hina oorr A usstraliaa?

Coca-Cola Amatil (CCA) has launched Coca-Cola Life, as part of an effort to reverse the company's falling Australian revenues. The product has 35 per cent fewer calories than regular Coca-Cola, and is sweetened through a combination of cane sugar and stevia. A general move by consumers away from highly-sugared drinks has hurt Coca-Cola Amatil's sales, which were down 2 per cent in 2014. CCA has also announced a new chief financial officer, Martyn Roberts.

ACCC acts on Chinese-made 'Aussie beer' The Independent Liquor Group (ILG) has paid $10,200 after ACCC considered that, by its packaging and labelling, ILG represented that its 'Aussie Beer' product was a product made in Australia when the product was made in China. The labelling incorporated the statement '100% owned' within a map of Australia and the statement 'Australia's finest malt'. The packaging also featured green and gold colours.

Kraft and Heinz agree to merger Kraft has agreed to a merger with Heinz, which will create the third-biggest food and beverage manufacturing company in North America. Berkshire Hathaway and 3G capital - the owners of Heinz - will own 51 per cent of the new entity, to be called The Kraft Heinz Company. Kraft shareholders will own the remaining 49 per cent. Estimated revenues for the new business will be worth US$28 billion annually.

Seafood processing faces turbulent conditions Revenue for the Seafood Processing industry has been adversely affected by declining seafood production, stagnant prices and increasing import penetration over the past five years. The industry has also become increasingly dependent on export markets, as domestic prices fall due to mass imports, and highvalue export markets open up new opportunities for exporters.

Spotlight on those 'refusing' health star rating roll out CHOICE launched a campaign calling on seven food manufacturers to roll out the front of pack health star rating on their products. Those targeted include: Kellogg's, McCain, Mars, PepsiCo, Mondolez, George Weston and Goodman Fielder.

Grocery Code in full force The Grocery Industry Code of Conduct has been declared legally enforceable, in a move the AFGC called a step towards levelling the playing field for food and grocery suppliers in their transactions with the major supermarkets. The Code aims to deliver more contractual certainty in trading relations between suppliers and to reduce inappropriate use of market power across the value chain. It will be regulated by the ACCC. For more industry news, check out: foodmag.com.au

Images: Photodisc (top) ; TimArbaev (bottom) - Thinkstock

Changing consumer tastes have prompted product innovation in the Australian snack food manufacturing industry, while operators have been attempting to stimulate sales growth in a mature and stagnant market.

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BUSINESS

Maximising the value of your business There are four characteristics of a business that are highly valued by buyers. By David Baveystock and Ben van der Westhuizen.

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total of 129 food and beverage M&A transactions were reported in Australia from 2011 to mid 2014 (S&P Capital IQ), with many more being completed on a discreet and non-reported basis. This placed Australia fifth on the list of global targets and the momentum has continued into 2015. Increased buyer interest in the sector has prompted business owners to look to dispose of businesses in a favourable environment. “How do I maximise the value of my business?� is a question frequently asked by prospective sellers.

There is a diverse range of potential buyers in the Australian food & beverage industry including domestic trade players, private equity investors and overseas multinationals. There are four characteristics that are highly valued by these buyers.

1. Consistent growth in revenue and profit Consistent growth in revenue and profit is the primary driver of value in any business, as a valuation is based on the ability to reliably predict profits and cash flows into the future.

A business with a history of erratic revenues and profits often concerns potential buyers and could lead to a discounted valuation. This discounted valuation represents the level of future earnings risk in the business. If your business has a history of fluctuating earnings then a key role of an advisor is to identify these reasons and explain them to buyers. In the absence of these explanations, buyers could make assessments that may be worse than what the actual situation is.

To assist with forecasting future profits and cash flow, the current financial statements are often normalised where once-off revenue and expense items are identified and reversed (normalised). Items that are typically normalised are personal expenses unrelated to the business, restructuring costs, head office charges, royalty payments to corporate owners and general costs that won’t be incurred by a potential buyer.

Normalisation adjustments should be considered carefully. Potential buyers will review and assess the normalisation adjustments proposed by the seller. If the adjustments are not merited then the seller may risk losing credibility in the eyes of the buyer. An independent adviser can assist the business with advice on whether normalisation adjustments are commercial and acceptable practice within the market.

8 Foodmagazine | Apr/May 2015 | www.foodmag.com.au

2. A strong and recognised brand A strong and recognised brand is a key characteristic that attracts a premium in a sale process. One of the challenges for food and beverage manufacturers is finding the right commercial balance between branded sales and contract manufacturing sales.

The industry has experienced an increase in demand for contract manufacturing services, driven by the increasing presence of private label in the retail supermarkets. This additional volume is providing the benefit of increasing manufacturing production efficiencies but is reducing the overall percentage of branded product being sold.

Revenue from sales of branded products are considered to be higher quality and therefore attract higher

valuation multiples. This is especially evident for strong, distinguishable and well maintained brands aimed at an attractive customer segment. Although establishing and maintaining a brand can be expensive, brand loyalty and recurring sales revenue are benefits highly desired by potential buyers of businesses.

3. Relationships with key customers and suppliers Relationships with key customers and suppliers are important to buyers as strong relationships provide the potential buyer with confidence that business will continue under a change in ownership.

Potential buyers will review the length of relationships, contracts or agreements that are in place or any

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BUSINESS

pending disputes to form their view.

Buyers also will evaluate the level of ‘business dependency’ on one or two key customers or suppliers. In the case of a concentrated customer base the buyer will seek assurances that the relationship remains strong after the completion of the sale process.

Over the last two years, we have seen a number of owners diversifying both their customer and supplier base to minimise future trading risk. Businesses are looking for sales expansion opportunities both into export markets and other channels where they have not traditionally been present.

4. Quality of the management team

Number of deals

The quality of the management team and the calibre of the broader team are critical in building a sustainable and profitable business. A buyer wants to see a balanced, experienced management team with a track record of delivering results. Businesses with high staff retention rates and a clear management succession plan are viewed positively by buyers.

Evaluating the depth of the management talent is often done through interviews during the sale process. Excessive reliance on one or two key individuals for decision-making and leadership will be a concern for potential buyers, especially where those individuals do not transition with the business post the sale process. Hands-on business owners should consider the merits of a phased handover of day-to-day management responsibilities before the sale process stars. This transfer of management

Graph: Australian M&A deals by quarter in the food and beverage sector. Source: Grant Thornton.

Tips for prospective sellers: • Prepare for the sale process. Identify the characteristics of your business that will be attractive to buyers and make sure those features are highlighted. Also deal with weaknesses and potential risk areas in the business – place yourself in the shoes of a prospective buyer and reduce the risk of issues arising late in the process.

• Think carefully about which potential buyers you will approach to elicit interest. A discrete approach to a limited number of genuinely interested buyers will in most cases provide the best result.

• Maintain momentum throughout the sale process. Information delays cause frustration and may result in buyers losing interest or pursuing other opportunities.

• Use experienced external advisers to manage the sale process and to provide professional and objective advice. responsibilities should provide comfort to potential buyers that the business can operate independently and on a standalone basis after a sale process.

In preparing for a sale process, businesses should prepare an Information Memorandum (IM) that outlines an overview of the business.

The IM is an opportunity to highlight the strengths and characteristics of the current business and to outline future opportunities. The IM is the key document that potential buyers use to gain an understanding of the business and perform a valuation.

To maximise the potential sale value, owners should start preparing at least three months prior to making contact with potential buyers and initiating a sale process. Engaging a specialist external adviser to prepare the business for the sale process and conducting a targeted sales process could add significant value to the transaction. For business owners not looking to sell in the short term, knowing and working towards those characteristics that are valued by buyers can systematically strengthen the business and build value over time.

Source - Comet Line Consulting and S&P Capital IQ

Selected recent transactions in the Food and Beverage industry Date

Target name

Acquirer

Acquirer country

Deal value

22/12/2014

Longwarry Food Park

Parmalat Australia

Australia

A$67 million

20/07/2014

Griffin’s Foods

Universal Robina

Philippines

N$799 million

20/11/2014

Primo Smallgoods

JBS

Brazil

A$1.45 billion

25/06/2014

Black Swan Dips

Monde Nissin Corporation

Philippines

A$115 million

2/05/2014

Harvey Beef

Minderoo Group

Australia

not available

13/02/2014

Warrnambool (WCB)

Saputo Inc.

Canada

A$537 million

27/01/2014

Goodman Fielder

First Pacific / Wilmar

Singapore and Hong Kong

A$1.3 billion

7/08/2013

Nestle SA (infant nutrition)

Aspen Pharmacare

South Africa

A$209 million

4/07/2013

Rafferty’s Garden

PZ Cussons Plc

United Kingdom

A$70 million A$880 million

27/06/2013

Ingham Enterprises

TPG Capital

United States

27/05/2013

Peters Ice Cream

R&R Ice Cream Plc

France

A$450 million

8/04/2013

Moraitis Group

King Bid Company

Peoples Republic of China

A$212 million

Table: Selected recent transactions in the Food and Beverage industry.

David Baveystock (L) (david@cometlineconsulting.com.au) and Ben van der Westhuizen (ben@cometlineconsulting.com.au) are with Comet Line Consulting, an advisory business that specialises in acquisitions and divestments within the Australian food & beverage industry.

0400 217 471 www.cometlineconsulting.com.au www.foodmag.com.au | Apr/May 2015 | Foodmagazine 9

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EXPORT

Tapping into value-adding Marketing to China is like marketing to Europe; a one-sizefits-all strategy will not suffice, writes Andrew Kuiler.

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he key for Australian producers is to stay abreast of China consumer trends and how to deliver to these needs in a timely fashion that gets Australian products into the hearts and homes of Chinese consumers. As traditional food commodity trading industries (beef, milk, etc) become saturated with foreign and domestic product, the opportunity for Australian producers now lies in value-adding in the manufacturing space to bring new brand and product experiences to an ever expanding Chinese consumer market.

Three winning proteins

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Beef

Australian beef is already thriving in China with potential upside for producers still possible though innovation and unique product propositions. The market has become crowded with beef imports which are still largely distributed in commodity form – no active branded beef presence can be seen. However, countries such as the U.S. are expanding beyond filleted and bone in cuts to 10 Foodmagazine | Apr/May 2015 | www.foodmag.com.au

charging premiums for the likes of tripe and offal parts that appeal to the Chinese consumer.

Online retailer Mangou (serving both China and Australia) sells their tripe using ‘Australia’s best beef’ as their product differentiator. According to the U.S meat export federation, beef tongue prices can also exceed choice fillets (per pound) in Asia. The differences in beef product

consumption and purchasing behaviour in China emphasise the opportunity to find market potential in completely new sub categories in the beef industry. It’s about culturally understanding which aspects of the animal the consumers use in their daily cuisine. Few Chinese consumers know how to fry up a T-bone steak at home and generally shy away from doing so in fear of ruining a very expensive steak.

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EXPORT

The opportunity presented here for Australian beef producers is how to take advantage of this growth beyond obvious filleted and offal cuts. Dried, frozen and chilled processed foods are each forecast to grow at least 10 percent annually. Among Chinese consumers, beef is perceived as a higher quality meat (compared to everyday pork) and there is plenty of room for Australian producers to occupy a ‘better for you’ branded positioning leveraging areas such as ‘organic’ or ‘pasture fed’ beef that many Australian producers can deliver on.

Value adding back in Australia could be where the big bucks are. For example, U.S. food giant, General Mills took over Wan Chai Ferry Dumplings in recent years and is now beating the Chinese at their own game with Wan Chai holding the number one brand position (44 percent of market share) in China’s frozen dumplings market. General Mills has tapped into their decades of brand and product R&D to know how to stay ahead of the curve when it comes to Chinese consumers and their dumpling needs. Appealing to urban professionals and families alike, convenient staples such as dumplings and wantons are categories to which Australian beef can also bring considerable value.

General Mills’ webpage states that by championing the combination of cultural insight and cross-border innovation, their famous Wan Chai Ferry’s has become the dumpling market leader in hundreds of cities throughout China. The company is now also expanding outside of the dim sum category into noodles - a category also up for grabs given the market has been flooded with low quality noodle products over the years.

From a yield perspective, Australia has a distinct advantage given that many slaughter-houses in China are drastically under capacity. While there is potential to easily ship livestock to China, leveraging Australia’s geographical advantage there is also potential for the processing of livestock back home to make branded products that appeal to the China market.

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products across all protein categories over the past couple of decades.

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industry. For further differentiation for Australian seafood in what is also becoming a more crowded market place, brand, product and packaging need to be carefully tailored to the Chinese market.

Fresh seafood is rarely branded in Chinese retail spaces. Like beef, commodity selling makes differentiation at the point of sale difficult for Australian producers. Innovative value adding to live product is possible through avenues such as effective packaging technology (to lock-in freshness), promotional displays and signage that talk about superior Australian growing conditions or perhaps even the ‘certified’ shipping arrangements that have been arranged between Australian producers and Chinese distributors to ensure a better quality product is delivered into China.

Seafood

China’s love of seafood accounts for 35 percent of global production.

Purchase channels are shifting away from selling only live fish, traditionally bought from wet markets, to processed and packaged varieties like Norwegian salmon which are now sold in supermarkets.

Australia’s Rock Lobster, abalone, oyster and crab have a good reputation in China.

Combined with the China-Australia Free Trade Agreement, this presents a unique proposition for the Australian lobster 12 Foodmagazine | Apr/May 2015 | www.foodmag.com.au

When it comes to lobster specifically, origin tagging combined with consumer education (at the retailer display or in restaurant tanks) could be a powerful combination to reinforce information about the (health) functional benefits of Australian Rock Lobster over the more familiar North American lobster as well as product usage tips.

With this said, Australian lobster farmers should be keeping their eye on rising Canadian lobster imports. Dalian firm Zoneco (Zhangzidao) swallowed up one of Canada’s largest producers of lobsters and online retailer TaoBao claimed 20,000 Canadian lobsters were sold online in 2013. To further differentiate itself from Canadian lobster, Australian producers may reiterate their history with the Chinese consumer in delivering quality

Dairy

The Australian dairy industry represented trade of AU$389 million in 2012, though per capita dairy consumption is still low by comparison to Western standards. Per capita dairy consumption in Australia is over 8 times higher then that of China’s 38kg (in 2012) and this is exacerbated in rural areas. 70 million elderly Chinese currently suffer from osteoporosis and whilst drinking more milk might come a little too late for them, this presents an educational opportunity for future consumers. Australian producers can emphasise our dairy innovation which helps deliver a superior product to the Chinese consumer. Take for example the ‘A2’ milk brand from Australia which uses DNA testing to identify cows that are able produce milk containing exclusive proteins. The company also offers a range suitable for those suffering lactose intolerance and also claims to provide superior calcium content which Chinese manufacturers are yet able to replicate.

This type of execution requires extensive market and consumer research along with commercial intelligence aimed at ring fencing domestic producer competition.

While New Zealand currently dominates dairy exports to China (47 percent in 2012), China has continued to look at expanding import partners. As competition increases, the dairy category will become more active with different brand

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EXPORT

Take action • Value-added products in the protein space in China presents an opportunity but requires close market and consumer understanding to determine where differentiating points lie and what is practical from a market entry point of view.

• Creating sub-category products in already busy categories can deliver new information to consumers.

• Knowing how to activate your brand and product message in-store (or on premise) is important to ensure Chinese consumers are aware of value-add efforts made and to drive differentiation at shelf among domestic and foreign brand efforts.

• Careful selection of Chinese distributor partners is paramount to provide market reach and also the right transportation conditions for value-added product investments.

claims and product formats (including flavours). However, increases in dairy livestock trade between Australia and China also gives China the capacity to produce its own dairy to such an extent that the COO of United Dairy Power warns that China will become one of their major competitors within the next 15 years. This emphasises the importance of unique value-add products to secure Australia’s future position in the China dairy market.

Reaching the Chinese market While brand and product differentiation is crucial for Australian producers, understanding competition and

who Australian companies can partner with to gain market access and coverage is equally important. Cases such as Zoneco’s purchase of Canadian lobster is exemplified by their joint venture with Australian Fishing Enterprises.

Fragmentation will eventually decrease as suppliers and producers combine to expand their reach and begin to take dominance across China.

Companies that carefully partner to gain scale and squeeze out competition will benefit most from the expected eight percent growth in the packaged foods industry over the next five years.

Nestle, for example, have not only partnered with a Chinese confectionist (Hsu

Fu Chi group) to use its supply chain, but have acquired shares in a Chinese medicinal corporation also (Hutchinson China MediTech), which gives them access to thousands of medicinal extracts allowing Nestle to bring culturally integrated products to Chinese consumers.

The right partner for entry is crucial and aspects such as cold distribution and safety regulations must be considered to ensure a clean manufacturer reputation.

Just look at Nanna’s Berries, a name occupying Australian airwaves lately given the Hepatitis A outbreak. China is working to improve its retailing supply chain, with the cold chain logistics industry expected to grow 25 percent annually to US$76 billion in 2017.

Despite this, China still lags behind even the likes of India in cold distribution, with only 40,000 trucks.

Part two of this series will cover valueadding in alcoholic beverages, enhanced soft drinks and fresh groceries.

Andrew Kuiler (Andrew@thesilkinitiative.com) is the founder of Shanghaibased food and beverage consultancy The Silk Initiative. www.thesilkinitiative.com

www.foodmag.com.au | Apr/May 2015 | Foodmagazine 13

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PACKAGING

Advancing with aseptic packaging Technological developments in aseptic packaging are bringing substantial efficiency benefits for the food and beverage processing industry, as well as delivering food safely to consumers. By Hartley Henderson.

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he aseptic process involves sterilising the product and package individually, filling the package with the product, and then sealing the carton under sterile conditions without the product being reinfected by microorganisms.

According to the technical director of Tetra Pak Oceania, Quan Brown, aseptic technology opens up many different markets due to the long shelf life of products without refrigeration. “The consumption growth of aseptic packages is on average five percent per year, and in some countries it’s as much as 10 percent,” he said.

“Technical advantages and higher speed in processing and packaging are increasing the interest in aseptic technology in the industry at a time when the requirements for product safety are growing.

“Whilst pasteurisation can be used to kill the bacteria in food that causes illness, it is considerably more difficult to kill spores that can be formed by certain bacteria. Therefore, Ultra High Temperature (UHT) is required with one or more separate heat treatment stages.

“The latest aseptic processing and packaging lines provide greater efficiency to help drive down costs. Tetra Lactenso Aseptic with OneStep technology, for example, is an all-in-one customisable system that simplifies food processing to cut running costs by up to 50 percent, and eliminates the need for pasteurisation and intermediate storage.

“In addition, advances in packaging systems such as the Tetra Pak iLine can reduce running costs by up to 40 percent.”

Automation The Tetra PlantMaster system is an advanced scalable automation solution that is applicable for production of anything from flavoured milk and juice products, to whey powder and icecream, ensuring a high level of accountability and quality control.

Problems such as blockages and bottlenecks can be detected rapidly by this technology, and by mechanising most of the process, labour is minimised, accuracy is improved, and waste is reduced.

“Faster filling machines are enabling

greater volumes of production and the Tetra Pak A3/Speed iLine is the fastest line available from Tetra Pak with a maximum production capacity of 24,000 packs per hour,” Brown says.

“Customers requiring a greater degree of flexibility have the option of the Tetra Pak A3/Flex, which allows for easy switching between cartons of different shapes and sizes.

A Tetra Pak A3 Flex filling machine

Long life cartons, like these Tetra Prisma Aseptic cartons, offer long life shelf life without the need for refrigeration.

“Tetra Pak is also conducting field trials of new eBeam sterilisation technology for carton packaging which is designed to lower energy use, reduce carbon emissions, and support higher line capacities. When launched, eBeam will play a significant role in operation of the new Tetra Pak A3 filling machine for super high speed packaging.”

In addition to developing innovative technologies for its manufacturing customers, Tetra Pak has a focus on the increased consumer demand for packages with better environmental performance, and on cartons that can easily be used by people on the go and older people.

14 Foodmagazine | Apr/May 2015 | www.foodmag.com.au

“An increasingly urbanised population is driving a need for portable aseptic products, so we are making developments to carton openings and offering cartons in different shapes and sizes, as well as designing packages that are easy to open for older people,” says Charles Vorrath, marketing director of Tetra Pak Oceania.

Bag-in-box technology In the early 1980’s a radical bag-in-box technology was developed in Australia by one of the pioneer manufacturers of the iconic ‘wine cask’. The new method used a system of sealed membranes fitted to the filling port on the bag, providing a

steam sterilisable and resealable interface between the sterile product supplied to the filling machine and the pre-sterilised bag interior.

The concept quickly gained acceptance as the system of choice for many of the major producers, particularly for critical low acid products such as dairy, coconut milk, biomedical, and delicate fruit and vegetable applications.

Bags to suit this system are now produced worldwide by several major flexible packaging manufacturers and range from two litre retail juice packs with a dispensing tap through to 1300kg multilayer high barrier bulk storage units.

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Process control with Tetra PlantMaster.

In 2012, Engi-O was established in Melbourne to continue the development and manufacture of the aseptic filling machines and associated equipment for the ‘membrane port’ system and also a range of conventional non-aseptic filling equipment.

Ian Anderson, who is a consultant to Engi-O, is the inventor and original developer of the membrane port aseptic bag-in-box system. He brings over 30 years of food technology and engineering experience in the flexible packaging industry to the company.

Anderson says the company has retained alliances and mutual development arrangements with machine manufacturers in Europe and USA that also operate as Engi-O agents in those markets.

“Being independent, Engi-O is free to liaise with any bag manufacturer and any of the suppliers of upstream aseptic processing plant. Seamless control and mechanical integration between the process and packaging parts of any aseptic installation is essential for its safe and reliable operation,” he told Food magazine.

“For what is a relatively simple principle, aseptic processing and packaging can pose some quite complex issues in

compliance with process safety requirements and legislated standards.

“Depending on the product application and country of installation, and particularly for critical low acid products such as in dairy, vegetable, meat, and biomedical applications, an individual machine may have to comply with vigorous ISO, CE, 3A, JIS, EHEDG, and other national standards of control and construction of the equipment. The whole installation may require validation to satisfy the strict requirements of organisations such as the USFDA. “Engi-O is well versed in these issues and can adapt its bag-in-box filling technology to comply with specific regulations, as demonstrated by such recent diverse projects relating to Australian dairy, soymilk and fruit processors, a Canadian vegetable puree operation, and a New Zealand nutriceutical supplier.

“Aseptic bag-in-box is now a well established segment of the industrial packaging spectrum, and the industry is turning its attention to new developments in processing technology.

“These include ultra high pressure treatment, pulsed electric field sterilisation, microwave, electron beam, pulsed light, and other interesting concepts used alone or in combination to provide high quality sterile product to the filling machine.

“Our challenge is to be ready with the appropriate packaging and filling system as these developments become viable.”

prepared foods processing systems meat | poultry | seafood french fry | vegetables batter + breading applicators fryers + ovens branding + searing flavouring + seasoning blending systems distribution + accumulation controls + IT

Engi-O 0499 095 393 www.engi-o.com Tetra Pak 02 8719 7300 www.tetrapak.com.au

info@heatandcontrol.com | heatandcontrol.com

www.foodmag.com.au | Apr/May 2015 | Foodmagazine 15

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PACKAGING

Controlling food losses through better packaging Various packaging technologies can help food handlers remain competitive by reducing spoilage and delivering consistent, quality products, Pierre Pienaar writes.

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hose involved in food and beverage packaging know well that consumers and brand owners are both demanding less food losses and increased shelf life from products. The modern food industry has developed and expanded because of its ability to deliver a wide variety of high quality food products to consumers on a nationwide and worldwide basis. This feat has been accomplished by building stability into the products through processing, packaging, and additives that enable foods to remain fresh and wholesome throughout the distribution process.

The terms active packaging and smart packaging refer to packaging systems used with foods, pharmaceuticals, and several other types of products. They help extend shelf life, monitor freshness, display information on quality, improve safety, and improve convenience.

More recently this has been updated to include intelligent functions (sensing, detecting, recording, tracing, communicating and applying scientific logic) in order to extend shelf life, enhance safety, improve quality, provide information and warn about possible issues.

There is a commercial need to allow products to stay fresh on a retailer’s shelf for longer. This extension of shelf life is aimed at slowing down the deterioration of the product using a range of processes. Each of the processes is interdependent on packaging to preserve the product in a suspended state.

The principal mechanisms involved in the deterioration of processed foods are: 1. Microbiological spoilage sometimes accompanied by pathogen or germ development.

2. Chemical and enzymatic activity causing the breakdown of colour, odour, flavour, and texture changes.

3. Moisture or other vapour migration which produces changes in texture, water activity and flavour.

Therefore to enhance shelf life the focus ought to be on: • Reducing microbial activity • Increasing the acidity • Addition of additives • Reducing water activity • Modified-atmosphere packaging (Modify the immediate environment) Initially extending the shelf life of products was an issue for the supply chain, but it is now a consumer concern as freshness coupled with sustainable packaging has become an important buying factor.

Consumer demands for convenience have created new innovations in the food product development and packaging industries. The widespread desire for products to use in the microwave oven has added further to the effort.

Consumers are demanding more sustainable packag16 Foodmagazine | Apr/May 2015 | www.foodmag.com.au

ing solutions that also perform shelf life-extensions, whilst brand owners understand the commercial advantages that active packaging technology can deliver to their products.

In the supply chain, more research and development work is being done on oxygen scavengers, moisture absorbers and barrier films that will enhance the shelf life of products. Consumers want packaging that keeps products clean, ready for eating, with a longer shelf life, product security and value for money. This remains a big ask, but if success is to be achieved, packaging technologists need to rise to these demands.

Active Packaging There is a range of active packaging techniques which are available; the broad categories are: • Absorbers/removers: added to enclosed packaging to assist in removing or decreasing the level of oxygen in the package, also called oxygen scavengers.

• Release systems: antimicrobial agents incorporated in the packaging used to prevent micro-organism growth on the food.

• Self-heating/cooling: exothermic chemical reaction to generate heat and an endothermic reaction to create cooling.

• Selective permeation: modifying polymer properties to alter the relative permeability of gases.

• Antimicrobial agents: control or inhibit the growth of non-desirable micro-organisms on the food surface.

Smart Packaging In conjunction with the developments in packaging materials, which help to extend and protect shelf life, there is also a complementary group of devices which monitor the products in the packs. These include time temperature indicators and leak and gas indicators, which provide an indication to the consumer of the state or freshness of the product.

• Time temperature indicators: operate by physical, enzymatic or chemical reactions.

• Leak or Gas Indicators: show the absence or presence of gases.

• Tracking services: packed goods can be tracked over the delivery and storage processes.

• Freshness Indicators: attached inside the packaging and are dependent on any inference from temperature history, they signal product quality of the packed food.)

market has expanded to a worldwide marketplace, it is requiring a longer shelf life. New materials incorporating nano-particles have been able to reduce and in some cases eliminate the transmission of oxygen, and in addition have blocked the transmission of moisture from the product.

Packaging today not only has to be multi-functional by meeting design requirements, but with the added pressure towards sustainable packaging, it has to be environmentally friendly in the effort to reduce our carbon footprint.

With the daily challenges of preserving product and minimising losses, growers, packers, shippers and retailers of produce now have new packaging options that allow them to dramatically increase shelf life.

Various packaging technologies can help food handlers remain competitive by reducing spoilage and delivering consistent quality products on every shipment. Innovations in packaging for extending shelf life will be a key driver over the next few years for manufacturers. Enhanced technical knowledge and input by packaging technologists and packaging engineers through improved performance qualities of materials will be required to fuel market growth.

Nanotechnology

Pierre Pienaar is education director at the Australian Institute of Packaging (AIP).

One of the fastest growing areas is the application of nanotechnology in packaging materials. As the food

www.aipack.com.au

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INSIGHT

Packaging Safety: Have you missed the boat?

Getting accredited involves investment and change, but for Hannapak, it was a no-brainer. Jasmine O’Donoghue reports.

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ndependent carton board packaging manufacturer, Hannapak was recently certified with FSSC 22000 accreditation after a rapid installation of less than four months.

“We were proactive, we had dedicated staff and a dedicated team putting it in,” says Ben Knight, marketing manager, Hannapak.

“There’s been a lot of talk about certification for years with different customers, global customers wanting certification. In years to come we’d need that certification. We could have waited until then, but we decided to get in early and set the benchmark.

“The writing was on the wall that at some point during the future it would be mandatory, so why not do it on our terms and our timing and use it as our advantage and not wait for it to put pressure on the business?”

Knight says certification gives Hannapak an advantage with future customers from the FMCG category.

“We’ve got customers in the FMCG business that aren’t even FSSC accredited, and they were quite impressed that we were.”

Hannapak decided to go down the path of FSSC 22000 accreditation as it was one of the most globally recognised.

“There was definitely a level of investment to go down that path and there was a level of change to the factory, the manufacturing facility and the culture of the business,” Knight says.

Investing in change As part of certification, Hannapak implemented a number of processes.

“When you come through the facility there is no jewellery allowed and you need covered in shoes. That safety aspect is not just for your safety, but for the safety of the products as well.

“The equipment manufacturing practices is a big component of it as well, so the cleanliness, the wash-in, wash-out of the factory, keeping the factory neat and tidy and other processes.”

Different areas of the facility also had to be rearranged or modified.

“A lot of the entry points into the factory we had to either close down or make them entrance points for a washing facility. We had to take a lot of stuff out of the factory, people eating, different types of drinks, café bars, that type of thing, had to come out of the factory. You can drink water in the factory and that’s pretty much it.

“Culturally, people have been working here for a long time and being a community-based employer, we have a high staff retention rate as well. A lot of those people had been here and been set in their ways for a lot of years, so we had to supply them lockers, uniforms, and those facilities, the lunch room, so they had places to go.

18 Foodmagazine | Apr/May 2015 | www.foodmag.com.au

“That level of investment has been logistical and then there’s training as well, along with the cost of putting that accreditation in and staying accredited,” Knight says.

How does certification work?

“It works like this: a consultant will come in and do a gap analysis and you’ll get a list that you need to comply with and they help you through it,” Knight says.

“They’ll come back and say ‘where are you up to with this?’ And work through the process until you get to the final stage where you want to become accredited.

“Then they come through, they do that accreditation process, and there still might be a couple of things to close out. Once those are closed out, you become certified.

“After 12 months you have to be recertified and have an audit conducted of your facility to see if you are still holding those standards that were set on that previous certification. If something lapses, for example, you’ll get a notice what needs to be fixed up, if that’s not fixed up or closed out within a certain period of time, then you lose that certification.”

Further investment Investment at Hannapak has stretched beyond certification, with the company also updating their technology and equipment over the past few years.

The highest level of investment has been in the printing and die-cutting process, Knight says.

Hannapak has implemented “the latest high speed printing presses with the latest quality enhancements on there, being the in-process inspection. With the die-cutting, we’ve put high speed die-cutting in with the power registered technology. It allows us to control the process and reduce board, which is not only cost saving but a sustainability piece as well.

Further innovations in the printing process include the in-line foil technology on the printing press.

Hannapak has been able to “convert current customers from traditional methods, to using a modern foil and also customers that were using polyestermetalites substrates. We’ve been converting them over as the in-line foil process, which is able to go through the postconsumer recycle chain.”

“Quality systems is probably where the big focus has been in the last few years so it’s investing in the equipment and investing in the quality systems that go on the equipment, whether it is printing, or die-cutting or gluing, so in-lines, inspections, code readings, in-line sorting, that sort of investment,” Knight says.

“We don’t focus on our competitors, we don’t focus on anything else but what we have at hand, what’s in front of us, but we have an end-game.”

Hannapak is staying tight-lipped about future plans, but Knight says the company is “always planning for the future.

“The next 12-24 months will be ‘watch this space.’

“We’ve invested in equipment over the last couple of years and a lot of that equipment is coming to fruition in processes and how that equipment runs. This year we have taken on some additional work, so this year we will be focussed on our customers, getting that work done and growing their businesses.”

The Hannapak site visit was organised by the Australian Institute of Packaging.

Hannapak 02 4571 1000 www.hannapak.com.au

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INDUSTRY WATCH

Arnott’s secrets to success

Naturally, when a food manufacturer reaches the 150 year milestone, e, you want know how they did it. Jasmine O’Donoghue reports.

nging 0 years of ‘Bri To celebrate 15 ine ’, Food Magaz out the Biscuits pply Su P ig Funnell, V of spoke with Cra r to ec ir D h Rya n, Cha in and Sa ra . es ap Sh t’s ot Marketing A rn

1. How has Arnott's maintained relevance over 150 years?

Craig: To remain relevant with consum-

ers and retailers in Australia you need to be both innovative and cost competitive.

It also helps if you can own the shelf in in the supermarket! Arnott’s has market share of more than 60 percent and to retain our position as category captains, we continually invest in many areas including infrastructure, ensuring our food safety and quality standards continually rise to meet higher consumer expectations.

Sarah: Arnott’s has a commitment to great consumer insights, which ensures we remain in touch with market trends and

our consumers. Over the past 150 years we’ve evolved to meet changing needs of our consumers. We do this in a number of ways - renovating favourite products (like new Shapes flavours in keeping with current trends) while also understanding that many of our products have stood the test of time and should remain untouched, for example, Milk Arrowroot (1882) Iced VoVo (1906) and SAO (late 1800s).

Shapes Light & Crispy is a really good example of how we have approached changing trends to stay relevant. Health and wellness is a growing trend in food and we saw there was an opportunity to develop a Shapes product that allowed consumers to enjoy the Shapes flavour hit they love with a lighter and crispier

texture, 75 percent less saturated fat and no artificial colours or flavours. Shapes Light & Crispy has been launched in four on-trend flavours, with our top seller being Tasty Cheddar and Chives. The product has contributed to strong growth of 15 percent for total Shapes, which indicates that when you tap into a market trend and deliver a great product to meet it, you can really improve your consumer relevance and drive great growth.

ales percent of our portfolio sales and savoury biscuits 44 percent.

Some other key changes include increasing sophistication of products over time, as consumer food interests and manufacturing capabilities have evolved. The proliferation of products, as manufacturers responded to the needs

2. How has the Australian Food Manufacturing industry changed over time?

Craig: To remain viable, Australian manufacturers need to constantly address productivity. Operations also need broad capability to meet innovation challenges.

For Arnott’s, our biggest priorities remain the health and safety of our people and the quality of our food.

As many of our competitors have exited the Australian manufacturing industry, we are now increasingly up against Asian/ NZ and European imports which are lower in cost. For Arnott’s, that means we have to continue to provide the most relevant products to meet our consumer’s wants and needs and continue to be quality driven.

3. How has the market changed and how has Arnott's responded?

Sarah: Arnott’s started baking Ships biscuits and pies in 1865 for the Port of Newcastle. Ships Biscuits were a very functional, hard biscuit designed to last for long journeys at sea. They were for sustenance really. In the following years, sweet biscuits became popular. Today, sweet biscuits and chocolate biscuits are popular but savoury biscuits and snacking is increasing in popularity - Shapes now makes up 19

of different consumers and for different products for different occasions e.g. snacking and entertaining.

The Shapes biscuit range is a great example here. Shapes was launched in 1954. Over time the popular biscuit flavours have remained relevant, tasty snack for Australians, but the range has expanded to meet the needs of specific consumers and occasions. In 2008, Shapes Sensations were launched to meet the needs of an older consumer.

The product delivers more sophisticated, foodie flavours to meet the needs of an adult snacking occasion. In 2014, we launched Shapes Light & Crispy, which is targeted to meet the needs of a female consumer. In 2015, we have launched Shapes Extreme, which is designed to meet the snacking needs of teen boys.

These biscuits deliver to teen boys by delivering a bigger, bolder flavour, a bigger biscuit with an extreme crunch and an attitude to match. The hero flavour Chilli Charge is a great example of the taste intensity of the range.

4 What 4. at le lessons essons has Arnott's learned?

Sarah: We must always put our consumers first and deliver fantastic food delicious food that has no substitute for quality.

5. What has Arnott's got planned for the next 150 years?

Craig: Our focus is always our consumers, their preferences and of course, there’s no substitute for quality! In the next 150 years we will continue to innovate and expand into new areas and look for ways to keep biscuits relevant in Aussies day-to-day lives.

Sarah: A lot! To keep making Australia’s favourite biscuits. Innovation into new spaces - more moments with the right biscuits. Capitalising key trends health and wellness, foodie trend, on-thego snacking. And finally, continuous improvement - leveraging new technologies to continually improve our products to deliver best quality and maintain relevance for our customers.

Arnott's 1800 24 24 92 www.arnotts.com

www.foodmag.com.au | Apr/May 2015 | Foodmagazine 19

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PLANNING

Avoid designing an outdated facility While the media describes Australia as the ‘food bowl of Asia’, the real story paints a different picture. By Steve Christie.

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he reality is that we import more food than we export. Looking at our competitive position in the food trade worldwide isn’t encouraging. In the decade 2002-2012, the Australian share in Asian food markets dropped significantly.

Similarly, Australia’s ranking as food supplier to these countries has slipped; in some cases dramatically so. This indicates Australia’s market share in Asia is being usurped by other nations as we fail to capitalise on the demands and opportunities that the food industry offers up.

Further investigation has shown that while global profitability in the food industry has remained relatively constant since 2010. The same cannot be said for food industry profitability in Australia; with rates nearly halving since 2011.

The greatest areas to be addressed by food manufacturers concern Australian labour and energy costs which have skyrocketed in comparison to the rest of the world. While the Emissions Reduction Fund (ERF) will make government funds available to companies to reduce and improve their energy consumption and efficiency, labour cost is a significant issue that requires careful consideration. Thinking differently and designing differently to maximise labour productivity and best utilise technological innovations is one of the many ways food processors can deliver progress in their facilities.

Thinking differently Working in the modern food processing industry is about delivering value; value to the supplier, value to the consumer and value to the market. Being the centre of that value equation, food processors must learn to adhere to the old adage and work smarter, not harder; think differently and design differently.

Although the picture seems overly gloomy, the food market provides a huge opportunity for producers and processors if we can increase our ability to compete within the world market. This opportunity lies in the rapid growth of the Asian market and the growing middle class. The Asian middle class will reach 3,228 million people by 2030; roughly 140 times the current Australian population. With this surge in affluence comes greater purchasing power.

The task is clear. The factory of the

future must be competitive on a world standard; our labour will always be expensive, so we must seek ways to minimise these costs using technology and improving the productivity of remaining labour positions.

Human-centred design Human-centred design is a term that speaks to efficient design practices between people and technology; giving attention to the psychological needs of humans. Human-centred design seeks to prioritise people over machine efficiency.

When processing is your core business, it is critical to your success that these practices are optimised for the operator, robotics and automation, and the end user.

One principle of human-centred design suggests that greater autonomy over tasks and production methods should be allowed to encourage the implementation of human ingenuity, experience and intelligence (traits of which we are yet to automate). While engineers like to design straight lines, this is not necessarily the best configuration to improve human interaction; in fact it is isolating, and discourages operator cooperation and internal communications.

A further critical element to the successful implementation of sociotechnical system design is feedback. This provides staff with a rationale for their work, a why; thereby satisfying a number of their psychological needs.

Working smart Advancements in robotics, automation and machinery have led to designers increasingly working to satisfy sociotechnical design aspects in order to develop ‘smart’ devices and systems.

We can begin to see the effects of these innovations in the development of technologies like Baxter and Kuka products; robots capable of performing repetitive tasks with the same efficiency as current manufacturing robots with the added ability of working safely and intelligently next to people. These collaborative

20 Foodmagazine | Apr/May 2015 | www.foodmag.com.au

robots offer a level of human-plant interaction that is unprecedented in manufacturing facilities.

The technological level of Automated Guided Vehicles (AGVs) has grown significantly, particularly with the advent of Google electric driverless cars.

The application within manufacturing facilities has become more achievable as systems adapt to the infinite variables of working with humans. The safety standards of smart devices utilising such sensor technology has opened the door for the integration of human and robotic logistics systems.

Big data Lately, there has been much hype about the mining and analysis of big data within businesses. The benefits of such data collection offers an opportunity for food processors to truly bring their facilities into the technological age of the fourth Industrial Revolution.

The biggest limitation for accessing data and utilising it to improve production processes and procedures is the wide array of operating systems that are currently utilised. In most facilities there is limited

capability for these systems to interact, let alone work together. This complicates the process wherein food manufacturers can access, analyse and interpret data supplied by their production facility. By collating data and implementing a methodology of reporting, food manufacturers have the opportunity to gain significant insight into their entire process on both the macro and micro scales, representing an opportunity for improving efficiency, operations, and subsequently profitability.

Australian manufacturers must invest in new plant and equipment to stay in the game. We must use the best equipment and embrace the new design paradigm to achieve plants that are better than our competitors. We must get better value from the money we are investing in capital by using modern collaborative project delivery systems. This is how we will build the food facility of the future.

Steve Christie is the director of Process Engineering at Wiley.

1300 385 988 connect@wiley.com.au www.wiley.com.au

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SCANNING

Internet of Things scanning technology and the future of food Demands for food safety and traceability can make it difficult for manufacturers to ensure they maintain the quality of their produce. David Arkles investigates.

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2. Simplify returns management

ollowing the recent frozen berry hepatitis A outbreak, the Australian food manufacturing industry has been under the spotlight with increasing demands for better food quality and labelling.

These demands, coupled with a wide range of transportation and storage facilities that differ across Australia, makes it difficult for manufacturers to ensure they maintain the quality of their produce. There is increased pressure on manufacturers to ensure that existing processes allow them to fulfil customer orders in an efficient and safe manner.

A global Internet of Things (IoT) study by Forrester Consulting in 2014 revealed that senior IT decision makers inside key industries like food manufacturing believe that the IoT will be transformational and will play a key role in streamline the process in the foodchain.

Distributors need to have plans and processes in place to execute recalls quickly and efficiently. The degree of traceability that suppliers and distributors have over their products is what determines the size, scope and expense of a recall. Having clear visibility over the entire supply chain allows for product recalls to be completed in a more expeditious manner as the source of the problem in the manufacturing process can be detected almost instantaneously.

Production control systems and auditing procedures using RFID technology can enable manufacturers to isolate quality or compliance problems at the lot level.

By making lot-level traceability available throughout the supply chain with a barcode scan, businesses can recall specific quantities and shipments. This degree of traceability limits the logistics handling costs and administrative burden, so recalls can be resolved more quickly.

Benefits of location tracking and traceability Food manufacturers today recognise the need for realtime visibility of their products as they move through the supply chain. One of the best ways to address the need for visibility in the supply chain is through the implementation of IoT scanning technologies such as RFID and Real Time Location Services that can provide manufacturers with greater visibility over the entire supply chain, and better manage their assets.

For example a Zebra Technologies customer in the baking industry reduced their inventory and distribution costs by $3 million in the first year after installing an automated pallet labelling and identification system.

The company, which operates six warehouses and previously was not able to measure and balance inventory throughout its operations, began printing and applying barcode labels to all its cases and pallets and then scanning the bar codes to capture quantity, location and product identification numbers, including lot codes.

The system enabled the company to gain an accurate, timely view of inventory and to increase the average number of pallets per shipment from 47 to 61, a 30 percent improvement. By increasing load yields, the company significantly reduced the need for less-thantruckload shipments to customers to fulfil orders.

Shortly after implementing the system, the company recalled some products because it received a bad batch of ingredients from a supplier. Using the lot number information captured from bar code scanning, the company traced its shipments and conducted a highly targeted recall by contacting only those customers who had received the affected products. The recall was completed quickly, with minimized cost, and without having to pull unaffected products from store shelves.

22 Foodmagazine | Apr/May 2015 | www.foodmag.com.au

3. Tighten container management

Source: Zebra Technologies

1. Streamlined warehouse management Food manufacturers can use bar coding and RFID with warehouse management system (WMS) software packages, to improve labour productivity, documentation, and efficiency within the supply-chain. For example, a basic function of a WMS can calculate the most efficient picking and put away inventory sequences, which will reduce required labour and handling. When supported with timely, accurate information, a WMS scan can manage inventory by expiration dates to reduce spoilage.

Automatic identification systems can track pallets, milk cartons, trays and other returnable containers which can provide a strong return on investment by lowering operating expenses. Many producers and distributors lack accurate information about the quantity and location of their shipping containers because the assets often dwell at customer facilities, and are not returned promptly. As a result, food manufacturers can purchase more returnable containers to ensure they have an adequate supply, creating excess capacity and locking capital into fixed assets.

Identifying returnable containers and tracking them to customers provides the information businesses can use to improve returns and recoveries. The first step is to permanently identify each asset with a bar code label or RFID tag. Workers can scan the assets when they are loaded onto trucks at the distribution centre, or in the field upon delivery. Systems could record the information in the customer record or order management system, or in a separate database. Returned assets would undergo scanning to check them back into the distribution centre, similar to a video rental return.

Managers could consult the system software to get a real-time view of container availability. The customer could track outstanding containers, with documentation provided to aid return and recovery.

David Arkles is ANZ regional sales director, Zebra Technologies.

Zebra Technologies 02 8860 9194 www.zebra.com

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BULK HANDLING

CASE STUDY: Flexicon’s bulk handling system An effective bulk handling system can increase efficiency, sanitation and quality for dry milk solids producers.

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lexicon Australia has a number of installations for bulk handling and transfer of powdered milk products in Australia and New Zealand, as does Flexicon worldwide.

One example is Franklin Farms East in the U.S., which has improved blending and transfer of dry milk and nondairy food ingredients by installing a bulk bag discharger, bag dump station and flexible screw conveyors.

Franklin Farms East is a producer of dry milk and non-dairy food products used in the production of commercial baked goods, ice creams and confectionary products.

The company installed a Flexicon bulk bag discharging system and bag dump station to improve cleanliness and increase the output of its increasingly diversified product line, while simultaneously elevating product quality.

A family owned and operated business since 1983, Franklin Farms East was founded as a distributor of dry milk products, which it purchased in bulk from dairy cooperatives and other wholesalers. Franklin Farms then hired contract manufacturers to blend and repackage the final mixes, which it sold to customers ranging from “mom and pop” operations to high volume commercial bakeries, ice cream producers and confectionary firms.

In 1997, as the business continued to grow, the company decided to build its own processing and repackaging facility in Maryland. With its own in-house blending capabilities, the company could expand its product line beyond dairy products like buttermilk and whey to include formulations based on corn and wheat flour, such as non-dairy coffee creamers and lactosefree products.

Since then, sales have grown from 20,000kg per month to over 454,000kg per month today as the company has expanded into new markets such as ice cream mixes, gelato and yoghurt.

New plant focuses on sanitation When the new plant first opened, bags of powdered ingredients from suppliers were cut open and emptied manually into a hopper that feeds the ribbon blender.

This resulted in dust in the air, wasting product and creating a potentially hazardous environment.

“This was common practice in the industry at the time,” says Jonathan Riggs, Franklin Farms East vice president of Production. “During the early 2000’s, however, the USDA and the FDA began strictly enforcing sanitary and safety regulations, including third party inspections.

“Contact with and possible contamination of food products was strictly prohibited, and a clean work environment was absolutely required. Our customers also began asking for verification of sanitary conditions in our production facilities.”

To comply with government requirements and customer

raising the bag into a steep “V” shape to promote total discharge into the floor hopper.

Minor ingredients, in 23kg bags, transfer to the batch blender through the manual bag dump station, hopper and flexible screw conveyor – again, all enclosed for dust-free operation.

Bag dump station A high-velocity vacuum fan activates as the operator opens the hinged lid of the bag dump station. As individual bags are emptied through the hopper screen, airborne dust in the vicinity of the hopper opening is drawn into the dust collector and deposited on the outer surfaces of two cartridge filters. Periodic blasts of compressed plant air blown onto the filters dislodge the dust particles, which fall into the hopper. The process is continuous with compressed air blasts alternating between the two filters.

The operator passes the spent bag through a chute in the sidewall of the hopper hood into the bag compactor.

demands and to eliminate waste, Franklin Farms East installed a bulk bag discharging system from Flexicon.

The system consists of a forklift-loaded model BFF-C-X split-frame Bulk-Out bulk bag discharger, with a 226L capacity sanitary stainless steel hopper, and a manual bag dump station, bag compactor and hopper for adding smaller amounts of ingredients to the blender. Both the bulk bag discharger and bag dump station feed their ingredients to the blender through flexible screw conveyors. “The ingredient discharge, blending and repackaging process is now totally enclosed and dust-free,” Riggs says.

Bulk bags unloaded directly “We receive our major raw materials in 900kg bulk bags,” Riggs says. But headroom in the dry blending room is currently limited by the low ceiling. To overcome this limitation, a forklift holds the bulk bag directly over the lower half of the split frame discharger, while the bag discharges through a manual Spout-Lock clamp ring positioned atop a pneumatically-actuated Tele-Tube telescoping tube. The tube raises the clamp ring for dust tight connection to the bag spout, and then lowers, applying downward tension to keep the spout taut for total evacuation. At the same time, Flow-Flexer bag activators raise and lower the bottom edges of the bag, directing material into the outlet spout and

As a pneumatic air cylinder compresses the empty bag into a removable bin, dust generated by compaction is drawn into the dual filters.

Batches blended in 10 minutes One blended batch, weighing 1134kg, usually consumes one bulk bag and as many as 25, 23kg bags of individual ingredients. Each batch requires about 10 minutes for thorough mixing, and the blender can produce 30 to 40 batches per day. The blended batch proceeds through a screener, a metal detector, and then to the bagging machine, which fills 11.4kg to 23kg bags, at a rate of one bag per minute, and labels them with the name of the blend. The bags are finally loaded onto shipping pallets.

“We are currently running the blender at maximum capacity, but plan to expand the room to increase production with a larger blender and raising the ceiling,” Riggs says. “We will use the entire split-frame discharger by loading the bulk bag in its lifting frame onto the lower half of the discharger. The lower half will be equipped with load cells to control the amount of material transferred through the flexible screw conveyor to the blender by measuring weight loss.”

Flexicon Corporation (Australia) 07 3879 4180 www.flexicon.com.au www.foodmag.com.au | Apr/May 2015 | Foodmagazine 23

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BAKED GOODS

Tailored products deliver a bigger slice Victorian-based fresh pizza manufacturer Della Rosa has cracked the Chinese market, with plans for Taiwan, Japan and Korea. Jasmine O’Donoghue reports.

“

I didn’t find it hard to get into China but you need to adapt to the type of product they need and our product has changed a lot for them and their tastes,” says Emilio De Lorso, director of Della Rosa Fresh Foods Group.

One modification Della Rosa made to their products for China is the salt content. In China, Della Rosa products taste less salty than the company’s products sold in Australia.

Della Rosa identified a need to make these modifications by first finding a buyer, who helped work out what type of products would work well in the country.

“For example, in China we’re not importing products with meat. The three products that we’re exporting are vegetarian. In Costco Taiwan, we’re not going to have any problem with meat, because meat from Australia is already allowed to export to Taiwan,” De Lorso says.

Della Rosa was then provided with a list of ingredients it is allowed to bring into China.

“We build the product basically on what we’re allowed to sell in the country.”

When the product went to market in China, Della Rosa put their demo team to work, three days a week in five major stores for three months.

One point of difference that helps set Della Rosa apart is the company’s “constant cycle of innovation.”

Della Rosa recently launched a newly designed product exclusively for Coles Supermarkets.

“We launched a box that looks like a freezer box but it’s got a window that allows you to see right through, to the product,” De Lorso says.

“The window in the box has a large impact. We are in the fresh section; but we go in the frozen section. The frozen section often uses a full box so often people see

Coping with demand

a fantastic photo and when they try the product, it’s not what they saw in the photo.

“So we allowed people to see the product through this window, which is like a quarter of the packaging. To balance the packaging, we then replicated the real product inside with a photo on the box. It’s extremely new in this country…what you see is what you get.”

Testing trends Della Rosa creates new products by keeping an eye on the trends in Australia’s food industry and incorporating them into their products.

“We work around what is the latest trend. The trend is launched by all the food retailers, that is; McDonalds, Kentucky Fried Chicken, Nando’s and so on. They are the people who decide what’s new. Then we create products around what people have accepted.

“Plenty of times what [the food retailers are] launching is not accepted into the marketplace and you can tell straight away because it is cut in two months,” De Lorso says.

Keeping it local - a necessary expense Della Rosa sources 95 percent of its ingredients from Australia and 80 percent of which is from Victoria.

“We don’t find it a problem getting [ingredients] locally, what you face is competitiveness in price. A supplier from another state, if they want to enter into Victoria they may have a better price than the local one but [sourcing locally] is part of quality.”

Another consideration for Della Rosa is finding a supplier with the right certification to allow the product to enter into supermarkets.

24 Foodmagazine | Apr/May 2015 | www.foodmag.com.au

Della Rosa has grown between 20 and 30 percent every year, with this year witnessing an additional five percent growth.

“The demand is there and at the moment we manage to cope with the demand by working Saturday, Sunday and overtime, so we have this extra expenditure. By spending on new equipment, we will release this pressure.”

For a more sustainable way of coping with demand, Della Rosa is building a new 10,000m² facility, which will boost production from 1,500 units per hour to over 4,500 units per hour.

The new facility will be Della Rosa’s second line.

“The second line is three times bigger than the first one and because of that, we’ve purchased land and we are building a new premises where the new line has got to go.

“There’s going to be new refrigeration, it’s all completely new and then we’re going to move there, which is only two doors down from where we are. It’s on the same street but the factory is purpose-built for the new equipment.”

So what's next for Della Rosa?

Aside from the growing export business, De Lorso says the next big step will be into foodservice. This will be accommodated by the new equipment, due to arrive in June.

As for growth, De Lorso says it’s “not an issue.”

Della Rosa Fresh Foods 03 9357 7070 www.dellarosa.com.au

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PACKAGING

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+ PROCESSING

30TH ANNIVERSARY

OWNED AND PRESENTED BY THE APPMA

IRB 1200 Case Packing Robot

New Products at AUSPACK 2015 AUSPACK 2015 saw the largest amount of visitors, exhibitors and floor space in its 30 year history.

There wasn’t a dull moment with lots to keep visitors busy, including Packaging & Processing Week, a range of educational and social functions, the 2015 APPMA Industry Excellence Awards and a vast amount of new products. We present some of the products which caught our eye.

IRB 1200 is a fast, compact case-packing robot that is suited for high speed pickand-place applications, particularly case packing and the loading of thermoform packaging machines. The IRB’s compactness is achieved by design as it has no offset in axis two. This innovation results in a longer stroke than other robots, meaning the IRB 1200 can work very close to its base and still be functional. One particular benefit of this is that it allows for a much more compact installation when the robot is mounted on the ceiling inside a small cell. As a complete solution, the IRB 1200 excels in situations that require a compact package without sacrificing working range or functionality.

ABB Australia 1800 222 435 www.abbaustralia.com.au

Domino A520i IP66 inkjet printer The Domino A520i continuous inkjet printer has been designed to meet the specific needs of wash down or very dusty environments using marine grade stainless steel. The IP66 electronics sealed enclosure is cooled using an innovative plenum cooling system. The total cost of ownership is significantly reduced through the combination of ultra-low make up usage and service-free operation through the innovative i-Tech ink system. Incorporating Domino’s SureStart print head technology, the A520i builds on the heritage of the highly reliable and versatile A-Series

HEUFT prime

range. Designed for convenient integration, the touchscreen can be mounted remotely and allows control of multiple printers from the single point. A truly green solution to inkjet printing, the efficient A520i reduces your solvent footprint by up to 60 percent compared to a standard inkjet printer. Overall the A520i provides a reliable and efficient solution to manufacturers requiring printing solutions in wash down or very dusty environments.

The HEUFT prime makes checking full containers on filling and packaging lines of the beverage, food and pharmaceutical industry easier.

The compact device combines tried and tested modules for examining fill levels, closures, internal pressure and labels as well as detecting burst bottles and serial faults with a very high degree of automation and a revolutionary new user guidance. Carrying out brand changes, starting self-test programs and dealing with cleaning and maintenance is possible with the HEUFT prime.

The HEUFT prime is suited for the in-line quality control of filled containers along filling and packaging lines of the beverage, food and pharmaceutical industries.

insignia 1300 467 446 www.insignia.com.au

Foodmach 03 9468 1900 www.foodmach.com.au

Guardmaster 440C-CR30 configurable safety relay The Guardmaster 440C-CR30 software configurable safety relay is flexible, cost-effective, and easy to use.

It is ideal for applications requiring as many as ten dual-channel safety circuits and controlling as many as five output zones. You can configure this relay by selecting certified safety function blocks to rapidly build your applications. It completely integrated with Allen-Bradley Logix controllers and can be configured in the Rockwell software Studio 5000 environment. The Guardmaster 440C-CR30 safety relay meets PLe, SIL 3 per EN ISO 13849-1 and IEC 62061. With 22 on-board safety I/O points, including six configurable I/O, the Guardmaster 440C-CR30 safety relay is a suitable solution for applications requiring multiple safety zones. The safety relay also permits interoperation with multiple standard-control

platforms, enabling the safety control to remain the same even if the standard control changes.

Rockwell Automation 03 9757 1111 www.rockwellautomation.com

www.foodmag.com.au | Apr/May 2015 | Foodmagazine 25

FD0415_026

PACKAGING

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+ PROCESSING

30TH ANNIVERSARY

OWNED AND PRESENTED BY THE APPMA

PSENcode - Slimline design The coded safety switch PSENcode offers maximum manipulation protection in the smallest space. The slimline version of the PSENcode is characterised by very low profile housing and can be used to safeguard gates, flaps and covers.

It also has up to four actuation and approach directions and two different operating distances.

Its simplified design has one set of installation dimensions for magnetic and RFID safety switches. The coded safety switch PSENcode benefits also include maximum safety up to PL e with one safety switch. It is a flexible, spacesaving installation due to its lower modular depth of 13mm and 19mm.

Datalogic SG4-H safety light curtains SG4-H Safety Light Curtains with IP67 and IP69K stainless steel housing offers the highest mechanical protection, without the need for any protecting tubes, for advanced applications in processing and packaging machinery for pharmaceutical and food and beverage industries, where routine wash down and sterilization are vital to prevent bacterial contamination.

The SG4-H is developed in a 30x50mm compact profile, with controlled heights 150, 300 or 450mm, resolution 14 mm and operating distance up to 6m, reaching IP67 and IP69K protection without the need of additional accessories.

pilz 1300 723 334 www.pilz.com.au

Cama's IF316 monoblock loading unit

Datalogic Automation 03 9558 9299 info.automation.au@datalogic.com

The IF316 is a compact machine, which includes a compact former, a loading system with delta robot and a closing system with a two interpolated axis robot incorporating a specific lidding tool. The machine is set up for the secondary packaging of flow-packed snack bars, but it can be adapted to pack other kinds of products, and can be easily integrated in a packaging line just before the palletising station. The IF316 has been built by Cama according to its new cabinet-free design concept, offering a reduced footprint by integrating the electrical and pneumatic component control cabinets into the machine pedestals angles.

The compactness of the machine helps to minimise cabling and makes it easier to place the utility devices right where they are needed, with further benefits in terms of accessibility for maintenance tasks.

Cama Australia 03 8532 5333 www.camagroup.com

Restuff-IT container/truck loader & unloader Restuff-IT is a PLC controlled ergonomic assist device that aids workers manually handling product into and out of floor loaded containers and trailers. The selfpropelled machine has an integrated DC powered dual travel drive and steering system capable of negotiating dock leveller slopes and transition plates while driving in and out of containers or trailers. A pivoting conveyor, with a high grip belt, is effortlessly guided up, down, left and right to put it right where the product is. A height adjustable platform also puts the operators

26 Foodmagazine | Apr/May 2015 | www.foodmag.com.au

in the best ergonomic position. It comes with LED lights mounted on top of one mast to illuminate the interior of the container or trailer. By using Restuff-IT, workers are less fatigued and there is reduced muscle strain and injury from repetitive lifting, twisting, carrying and overhead reaching. It is designed for demanding, continuous multi shift operations and to be integrated with extendable or flexible conveyor systems.

Materials Handling 1300 68 68 96 www.materialshandling.com.au

FD0415_000_BES

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PRESSURE GAUGES, LEVEL & OEM SENSORS FOOD TEXTURE ANALYSER

NON-CONTACT TEMPERATURE SENSOR INLINE COLOUR MEASUREMENT SYSTEM FLEXIBLE PACKAGE LEAK TESTERS

Bestech Australia Pty Ltd U14/44 Garden Bvd, Dingley, VIC 3172 Tel: 03 9540 5100 Fax: 03 9551 5541 Email: enquiry@bestech.com.au Web: www.bestech.com.au

UV LIGHT DISTRIBUTION MEASUREMENT FILM

FD0415_028

PACKAGING

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+ PROCESSING

30TH ANNIVERSARY

OWNED AND PRESENTED BY THE APPMA

BVC 260 Bagger BVC 260 Bagger has a modern design in a closed tube-frame-free housing, and new ‘sense and seal’ technology. The ‘sense and seal’ technology allows the BVC 260 to sense product trapped in the seal and flag the bag to be rejected, without the need to stop the machine. This results in significant uptime and greatly improved line efficiency. The continuous motion BVC 260 was developed to comply with modern hygiene requirements

T63 (Autolabel series) Developed with user friendliness as the focal point, the Autolabel Series is compact, simple to operate and easy to maintain. For optimal functionality and user friendliness, Autolabel design the printers and applicators as one system. The T63 uses thermal transfer technology and can also handle direct thermal. The Autolabel T63 printer is suitable for pallet and box labelling, where large labels carrying a lot of data often are used. The solid aluminium chassis is machined as one piece for perfect alignment of the wide label and transfer rollers, print head, etc. This eliminates the need for any mechanical adjustments and ensures secure, high quality printing over time.

Matthews Australasia 1300 263 464 www.matthews.com.au

28 Foodmagazine | Apr/May 2015 | www.foodmag.com.au

while, at the same time, featuring functionality with its real time P@ck Control software.

This takes the guesswork out of setting up bag parameters, making it easier to process virtually all mono and laminate packaging materials of different thickness and producing a variety of bag styles.

J.L. Lennard 1800 777 440 www.jllennard.com.au

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PACKAGING

+ PROCESSING

30TH ANNIVERSARY

OWNED AND PRESENTED BY THE APPMA

Robotic tank inspection

Skyfall Conveyor System

Furphy’s climbing robot technology provides remote access to view the interior surface of a tank. The robot features sliding vacuum pads and a hi-grip caterpillar track and is computer controlled to move up, down and around the interior tank surface, adapting to different surface conditions.

The camera system captures and records high definition video footage of the tank surface, to identify cracks or any maintenance concerns. Robotic testing replaces the manual process of using abseilers, scaffolding and rope to conduct an inspection and reduces the number of contractors required to conduct a manual tank inspection, as only one controller is required. It replaces the possibility of multiple inspections.

The video footage provides an accurate assessment of the interior surface; allows playback or reassessment of potential problems; and removes the potential for human error.

Skyfall is a highly flexible conveyor and processing system that can be used across a wide range of industries.

It has been designed for conveying from A to B, linking processes in a simple way, compensating of varying process speeds, decoupling processes by buffering, order-picking, sorting, processing, controlling. Thanks to the three-dimensional line routing, Skyfall makes full use of the spatial conditions. The system utilises gravity to achieve a maximum in cost and energy efficiency. Thanks to the navigator, the control, visualisation and evaluation of production and processes become child’s play and interfaces to control units of third parties are easily achieved. Data input, assignment of production modes and quality control can be monitored by fingertip thanks to the navigator’s operating sequences.

Furphy 03 5832 1400 www.furphys.com.au

CLP Casepacker

Ulysses Shelf Ready Case Packer Manufactured in Australia by Adaptapack, this new machine has been specifically designed to offer a robotic, automated packaging solution for shelf ready products, a growing trend in today’s market. The Ulysses uses a patented collation system to offer simple collation for product lines. It has a small footprint and the flexible design can easily be tailored to suit individual customers’ needs by combining with existing case erecting/sealing equipment if required. Adaptapack tailors each machine to the specific customer’s needs, meaning it can be used to pack a range of different items, including pouches, cartons, trays, bags. Ulysses can also assist in reducing product loss due to damage or contamination, as well as saving money in the long run in reduced operating costs. The Ulysses offers simplified operation and maintenance, with the robot making the packaging processes considerably more flexible.

Walls Machinery 02 9891 9100 www.wallsmachinery.com.au

The CLP Casepacker is a highly flexible compact designed pick and place casepacking machine. The system loads products into plastic crates, corrugated cases or open top trays (with or without stacking shoulders) automatically.

Since product buffering does not take place, the CLP is suitable to handle a large variety of different products which can be rigid, semirigid or flexible. The infeed system is capable of turning or not turning products, which offers a huge variety of packing patterns and the best footprint utilisation for fixed plastic crates or open top trays. Before vacuum is applied, programmable side compactors lightly compress the product group to ensure they are inside the internal dimensions of the final outer packaging, this feature provides the ability to overlap lipped type products and pack extremely tight internal packaging tolerances. Placing the products in the case only involves a downward movement which is more like controlled gravity as the product is not lifted. The standard machine is programmable to handle single or multiple layer packing formats at a speed of 30 layers per minute.

Case Packing Systems 03 5781 0779 www.casepacker.nl

Denipro 02 8336 270 www.denipro.com

Coffee Pod Cartoning Machine (HMPS) The HMPS8000 is a carton erector and robotic pick and place system for small pre-sealed product (pods), and is manufactured at HMPS in Adelaide. The major requirements of the coffee pod cartoning machine were to provide a means of conveying the coffee pods from two different types of filling machines to the HMPS8000 Carton Packing Cell, with the proviso that either system could be used with minor changes required. The solution was designed to be highly flexible to allow for the initial rate of 120 pods per minute and to increase to 360 pods per minute when the clients machinery was upgraded, while performing at a efficiency of 96 percent or higher.

The HMPS8000 is a new end of line tertiary packing solution, designed to meet the growing market for packaging of drink product pods. The HMPS8000 can be adapted to other drink products such as tea and hot chocolate.

HMPS 08 8150 1000 www.hmps.com.au

www.foodmag.com.au | Apr/May 2015 | Foodmagazine 29

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PACKAGING

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+ PROCESSING

30TH ANNIVERSARY

OWNED AND PRESENTED BY THE APPMA

Delta Robot The BPA Delta Robot Packing solutions are designed to create a flexible platform to pack a wide range of different products. Depending on the capacity needs the systems are provided with a single Delta Robot cell or with multiple cells. The Delta Robot can be used for primary and secondary packaging, such as: horizontal and vertical packing systems for cases/trays, automatic flowwrap loading systems, carton loading systems, pancake and tortilla stacking and loading solutions, applying the BPA patented stacking head with controlled product lift. The machine has a compact design and is easy to operate with a quick changeover. It has a capacity from 40 up to 600 products per minute, with a weight range from 10 grams to six kilograms.

Blueprint Automation (BPA) www.blueprintautomation.com 03 9399 5300

Xpeed 1 Xpeed 1 is the compact tray sealer by Gruppo Fabbri suitable for packing fresh foods with lid trays and film. Based on the Xpeed 5 platform, Xpeed 1 shares the main structural and operational features of the flagship version, bringing innovations in tray in-feed, gas consumption, flexibility and format change. Xpeed 1 is the only tray-sealer in its segment with both double and single-line in-feed. It is made of stainless steel for maximum durability in harsh envi-

ronments. Xpeed 1 is suitable for applications in: vacuum gas for protective atmosphere for medium and long-term with minimal levels of residual oxygen, gas flushing to obtain a protective atmosphere for short and medium-term, skin configuration, versions with protruding product and single tray closures with a film lid.

Rollex 1300 943 947 www.rollex.com.au

ADAL C

Welcome Florigo...to the new modern family tna’s start-to-finish solutions now include Florigo’s high-volume materials handling and patented processing solutions. materials handling | processing | coating | distribution | seasoning | weighing | packaging metal detection | verification | controls & integration | project management | training paul irwin » regional sales manager » tna australia pty ltd p: +61 (3) 9839 2300 » m: +61 412 366 351 » f: +61 (3) 9839 2399 » info@tnasolutions.com Follow us @tnasolutions

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30 Foodmagazine | Apr/May 2015 | www.foodmag.com.au

Search tna packaging solutions

FD0415_031

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PRODUCTS

TrueDry CV-9 High Precision Moisture Meter Decagon Devices has released the TrueDry CV-9 High Precision Moisture Meter, an instrument that accurately measures the moisture content of nine samples with just four minutes of hands-on time.

The new technology dries each sample to a standard which was previoudly impossible to attain by passing heated, desiccated air over them until achieving a uniform value of one percent relative humidity.

The TrueDry monitors weight automatically and dries at lower temperatures, preventing the loss of materials other than water.

As each sample dries, TrueDry monitors the weight by cycling each sample onto

a high precision electromagnetic balance for repeated weight measurements.

It also eliminates error due to ambient conditions. This is done by maintaining constant vapor pressure in its chamber regardless of ambient

conditions, resulting in more consistent results over drying oven technology.

In addition, the TrueDry is the only high-throughput moisture meter that dries samples instead of burning them.

Burning samples at high temperatures expels mass from the sample in addition to water (i.e. alcohols, etc.). The controlled contact drying technology in TrueDry makes it possible to analyse samples at lower temperatures, eliminating the loss of materials other than water, and providing confidence in the accuracy of moisture content measurements.

from Michell fully calibrated, with a traceable calibration certificate.

QuickLabel introduces - The Kiaro! 50, a compact colour label printer, designed for printing small labels quickly.

Developed for businesses with small products and big labelling needs, the Kiaro! 50 creates labels from 2.54cm 5.49cm in width and 2.54cm - 39.70cm in length.

Standing just under 10 inches (25.40cm) tall and weighing just over 4.5 kg, the Kiaro! 50 are capable of printing up to 68 labels per minute (based on a 4-inch long label).

The Kiaro 50 is suitable for businesses with smaller-size labels or a less frequent need to print labels. The Kiaro!

50 uses QuickLabel’s dye-based ink formulation which provides the widest possible colour gamut for colour matching, and is compatible with glossy label stocks as well as matte label stocks.

The Kiaro! 50 will automatically detect when cleaning is necessary and if needed, the Kiaro! 50 will pause during the print job, perform an automatic cleaning, and then resume printing on the same label.

There is no messy manual cleaning required. The user will never have to break the web and splice label rolls because the Kiaro! does not waste a single label for maintenance. With the Kiaro! 50 there are no wasted labels when starting, ending, or pausing a printing run.

With front loading inks and labels, the Kiaro! 50 fits into any workspace.

The Kiaro! 50 is easy to use, operate and set up. The intuitive, fully-integrated design lets operators load labels and inks in seconds, and is user friendly.

QuickLabel is represented in Australia and New Zealand by Metromatics.

AMS Instrumentation & Calibration sales@ams-ic.com.au www.ams-ic.com.au

Metromatics Pty Ltd 07 3868-4255 www.metromatics.com.au

Graintec Scientific 1300 640 299 www.graintec.com.au

Anton Paar Alex 500 A new alcohol and extract meter for beer, Alex 500 from Anton Paar, frees craft brewers from the need for external laboratories.

The lab-grade analyser determines beer’s alcohol and extract content, calories, degree of fermentation and many more parameters.

Alex 500 puts craft brewers in control of their entire production process, from fermentation monitoring to quality control of the bottled beer. The compact, easily operated instrument can be used in two modes. In the fermentation monitor mode, it directly displays a fermentation curve, assigned to a tank via sample ID. In the final production stages, Alex 500 can be switched to its standard mode, to determine a beer’s alcohol content, original or real extract content and many other beer parameters like calories or degree of fermentation with lab-grade accuracy.

Alex 500 measures alcohol with an accuracy of 0.2 percent v/v and determines density with an accuracy of 0.001 g/cm³.

This speed is one of many differences that set Alex 500

apart from the glass hydrometers still commonly found in smaller breweries. In contrast to these, Alex 500 covers the entire beer measuring range, not just part of it. Brewers are provided with direct, real-time results, without the necessity for a separate calculation or distillation. They only a single instrument for all outstanding new beer at all times, based on their own impulses, with all measurement necessities under their own roof.

MEP Instruments 02 9878 6900 www.mep.net.au

I7000 Hygrosmart relative humidity and temperature sensor Michell’s I7000 humidity and temperature modules ensure reliable temperature and humidity control for product storage.

The I7000 Hygrosmart Relative Humidity and Temperature sensor provides highly reliable and accurate measurements of the key parameters for ensuring food is kept fresh and in good condition.

The sensor is accurate to ±2%RH and to ±0.2°C and is gives long-term stability with less than 1 percent RH

drift over a year to maintain the ideal storage conditions over time.

The robust sensor’s small size makes it easily interchangeable. It has a simple ‘plug and play’ system, which means that users can maintain the accuracy of their RH and temperature measurements in the storage units themselves.

The easy procedure, which is comparable to changing a lightbulb, takes only few minutes and is extremely cost efficient.

All the I7000 modules are supplied

QuickLabel Kiaro! 50

www.foodmag.com.au | Apr/May 2015 | Foodmagazine 31

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ON THE SHELF

1

2

3

4

5

6

1 - Yol'Oats

2 - Fruit & Vegetable Yoghurt

3 - SuperBlend Range

Yol’Oats is an oat cereal that has been presoaked in coconut water, covered with a layer of creamy coconut and yogurt, topped with a 100 percent fruit compote. Its available in four flavours: Fig & Macadamia, Apple & Cinnamon, Pineapple, Lime & Coconut and Strawberries & Cream.

Manufacturer: Yol’Oats Shelf Life: Two weeks Packaging: 280mL plastic tamper evident tub

Yummia's new yogurt range is made with both fruit and vegetables. Each tub has half a serve of vegetables per serve and a 5.0 star health rating.

Flavours include Strawberry & Beetroot, Apple & Carrot, Sweet Potato & Cinnamon. For extra convenience, each pot comes with a spoon.

Manufacturer: Yummia Shelf Life: 28 days Packaging: 150g tub Website: www.yummia.com.au

The Superblend range combines the benefits of the original superfoods with ‘newer’ recognised ancient grains. There are three variants; fibre, protein and energy. Each is blended specifically to target a nutritional platform. The range can be used in soups, sides, salads or as a rice substitute.

Manufacturer: Ward McKenzie’s Shelf Life: 12 months Packaging: 350g Pouch Website: www.mckenziesfoods.com.au

4 - Just Add Water

5 - Quinoa Vodka

6 - Flavoured Coconut Milk

La Zuppa has launched an all natural alternative to cup of soup, that is gluten free, dairy free and low in fat. Just Add Water is available in five flavours including: Chicken, Vegetable & Rice, Lentil, South American Style Chicken & Corn, Tom Yum and Vegetable & Bean.

Manufacturer: Valcorp Fine Foods Shelf Life: Two Years Packaging: Single Serve Foil Pouches Website: www.lazuppa.com.au

FAIR Quinoa Vodka is a new generation of vodka, produced and bottled in France, in the Cognac region, using Bolivian quinoa seeds cultivated according to the methods of organic farming.

It is made using only organic and Fairtrade ingredients.

Manufacturer: FAIR. Packaging: 700ml glass bottle Website: www.noblespirits.com.au

Coco Joy Flavoured Coconut Milk is made by pressing coconut pulp and blending it with pure filtered water and other ingredients like vitamins, minerals and natural flavours. It is free of dairy, soy, lactose, gluten, casein, egg and MSG and rich in vitamin D and calcium.

Manufacturer: FAL Food and Beverages Shelf Life: Two years Packaging: 500ml and 250ml bottles Website: www.falstore.com.au

32 Foodmagazine | Apr/May 2015 | www.foodmag.com.au

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ON THE SHELF

7

8

9

10

11

12

7 - Organic Sea Salt Truffles and Organic Salted Caramel Truffles

8 - Chobani Oats

9 - At One's Raw Superbars

The truffles have a dark chocolate shell and a centre made with coconut oil and speckled with Fleur de Sel de Guerande. The Salted Caramel Truffle has caramel blended throughout the filling.

Manufacturer: Alter Eco Shelf life: 15 months Packaging: individually wrapped and then packaged in cardboard pouch Website: www.altereco.com.au

Chobani Oats are a blend of real steel-cut oats and fruit in Chobani yogurt, for people on-thego. Packaged in the convenience of a pouch, Chobani Oats targets breakfast-skippers. It is available in four flavours; Apple Cinnamon, Banana Maple, Cranberry and Coconut.

Manufacturer: Chobani Australia Shelf Life: 42 Days Packaging: 140g Pouch Website: www.chobani.com.au

At One Raw Superbars are an all-natural snack bar made from dried fruit, raw nuts, seeds and superfoods. It has no preservatives, no added sugar, no added flavours or colours. The bars have a rich, fudge-like texture, and come in two flavours: Cacao Incaberry and Banana Pecan.

Manufacturer: At One Shelf Life: 18 months Packaging: 40g single serve bars Website: www.atonefoods.com.au

10 - Charlie's Bikkie Bites

11 - Homer Hudson

12 - Nanna's Crumble Cakes

This new range is packed and priced for everyday consumption. The collection of five flavours include: Passionfruit Heart Bites, Gingerbread Baby Bites, Anzac Bikkie Bites, Handmade Double Choc Chip Bites and Savoury Parmesan & Paprika Cheese Bites.

Manufacturer: Charlie’s Cookies Shelf Life: Nine months Packaging: Sealed cello bag and cardboard box Website: www.charliescookies.com.au

Advertising and design agency, The Monkeys and Maud has relaunched Homer Hudson. The five new varieties are Prom Queen, Choc and Awe, Gold Cadi Crunch, Mo Dough and Super Bowl. Packaging design has been created in collaboration with British artist, Serge Seidlitz.

Manufacturer: The Monkeys and Maud Shelf life: 12 months Packaging: 473ml tub Website: www.homerhudson.com

Nanna’s new dessert combines cake and crumble and comes in two flavours. Lemon Coconut Crumble Cake is a fluffy cake with a lemon curd filling and coconut crumble topping. The Choc Berry Crumble Cake is a chocolate cake with a berry sauce and a choc chip crumble topping.

Manufacturer: Patties Foods Shelf Life: 18 months Packaging: Foil tray in box Website: www.patties.com.au

www.foodmag.com.au | Apr/May 2015 | Foodmagazine 33

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LAST WORD

Five things to consider when investing in growth In the current environment, finding additional capital to fund growth can be challenging. By Tony Pititto.

I

n a recent Grant Thornton global study, 53 percent of Australian food and beverage executives highlighted the need for additional capital to fund growth. We acknowledge this can be challenging in the current environment and have highlighted five key considerations when seeking to finance growth.

Agility requires investment Product innovation and flexible supply chains are key to unlocking growth potential. Securing funding for these areas should be top priority in any financing strategy.

Investing in agility minimises exposure to the pressures of the retail supermarket and opens up new potential revenue streams. Australian businesses are heavily exposed to retailers and are vulnerable to changes in the supermarkets’ strategies. The agility of the business to adapt quickly to these changes often determines the success or failure of their product.

The real growth starts with food and beverage producers that reduce their reliance on supermarkets through product innovation and securing new channels to market.

While product innovation is occurring in certain areas such as healthy eating products, Australian businesses could do more. Our global survey indicates that Australian F&B businesses spend just under 1 percent of sales on research and development compared to their North America counterparts who spend double that amount.

A changing funding landscape Pricing within the banking sector has remained relatively stable, creating growth opportunities. We’re seeing many F&B companies typically sign up to short term debt cycles with an average of three year terms.

This limits the ability to capitalise on new market opportunities, which often require funding well beyond this timeframe.

More non-bank lenders are entering the market, with hedge funds, credit funds, specialist agriculture funds and private equity looking to put capital to work.

Non-bank lenders tend to offer longer-term nonamortising fixed rate debt with tenors as long as six to 10 years. This type of debt can be attractive as it eases pressure on working capital and allows cash to be reinvested towards growth rather than making amortisation payments. There is, however, a trade-off as additional premium is payable for the increased flexibility.

We recently assisted a client source debt funding from an alternative capital source to make an acquisition which resulted in a significant uplift in its competitive market position and ultimately earnings profile.

Whilst these funds come at a premium to traditional 34 Foodmagazine | Apr/May 2015 | www.foodmag.com.au

debt, it was significantly cheaper than the cost of missing this opportunity to create a step change in their business.

A joint venture is another alternative growth strategy allowing growth without having to borrow additional funds. Australian F&B businesses can benefit from entering into joint venture partnerships to grow their distribution and customer networks, whilst simultaneously sharing the risks with other joint venture partners.

Private equity looking to deploy capital Our M&A research on activity in the Australian F&B sector revealed that whilst private equity buyers only participated in a relatively small proportion (14 percent) of total F&B deals in the period 1 January 2011 to 30 June 2014, they were much more prevalent in the larger deals.

One of the largest transactions in this sector was Bright Foods Group’s acquisition of a 75 percent stake in food distribution company Food Holdings Pty Ltd from CHAMP Private Equity for A$516 million.

PE firms currently have significant un-invested capital to deploy and are therefore competing with trade for attractive assets.

The return of the IPO Our study also highlights a total of 90 new companies listed on the ASX over the 18 months to 30 June 2014, compared with 100 in the preceding 18 month period.

However total value of funds raised in this period was more than a five times greater than the preceding period.

Not only that, but the total amount raised from new listings on the ASX in the financial year 2014 was higher than in the boom years immediately preceding the GFC; a very encouraging sign of improving market conditions.

Australia had only one significant F&B listing throughout the observed period being that of Bega Cheese Limited with a total offer size of $35 million.

The company has since been trading at a premium to its offer price.

There were three other significant IPOs for F&B businesses in 2014 with the most significant raising being Huon Aquaculture (Salmon) raising $133 million.

Bellamy’s Australia (infant formulas) raised $25 million and Australian Dairy Farms Group (fresh milk) raised a further $9 million. All of these companies have good exposure to the Australian majors and perhaps more interestingly have strong growth prospects through export into the Asian markets.

What is the tax impact?

Whatever the form of funding obtained there will be tax implications to be considered. Australia has

recently tightened its thin capitalisation provisions restricting the level of debt foreign controlled or Australian outbound entities are able to have in Australia. The safe harbour ratio has been reduced from 75 percent to 60 percent of relevant assets, with interest deductions denied in respect of excess debt.

There are a multitude of other tax issues to consider in the context of debt funding, such as whether the relevant financial arrangements are considered “debt”, which attracts interest deductions, as opposed to “equity”. Similarly withholding taxes and gross up clauses will become highly relevant for a non-resident lender. Foreign currency denominated loans will also give rise to potential assessable/deductible FX gains or losses.

In the context of IPO’s or other share placements, the deductibility or otherwise of capital raising costs can cause issues, as with the recovery of input tax credits on such costs. It is also necessary to consider the impact of share issues on the availability of any tax losses purportedly carried forward in any corporate entity.

Unlocking growth potential When prioritising projects the best place to start is investing in agility and product innovation which could open up new revenue streams. Consider the alternative funding sources available and the tax implications thereof. Now is a good time for savvy food and beverage companies to capitalise on growth through alternative funding options available amidst the changing landscape.

Tony Pititto is partner and national head of food and beverage at Grant Thornton Australia. www.grantthornton.com.au

Nominations close on April 30th 2015

NOMINATIONS HAVE BEEN EXTENDED UNTIL 30 APRIL! So get in quick and NOMINATE TODAY before it is too late!

These prestigious awards recognise best practice and innovation in the Australian and New Zealand food and beverage manufacturing and packaging industries.

Submit your entry and you can see your success and hard work rewarded at a glamorous gala event. All finalists will be profiled in Food Magazine and on the website.

They will also be given two free tickets to the gala dinner where the winners will be announced.

The categories: Beverages Baked Goods Community Engagement Dairy Employer of the Year Food Safety & Innovation in Non-Food Health and Wellness Ingredient Innovation Label Design Meat and Smallgoods Organics Packaging Design Prepared Foods Snack Foods Sustainable Manufacturer Ready Meals

For more information on the awards or to download the nomination kit please visit: foodmagazineawards.com.au/nominations

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