Wrapping it Up
KHS Bartelt's newest tray-shrink packager fills the center of the shop floor in the company's 80,000-square-foot plant at U.S. 301 and 57th Street in Sarasota. Eighty feet long and weighing a whopping six tons, the giant configuration of steel, electrical wires and conveyors dwarfs the half-dozen or so technicians who are disassembling it in preparation for shipping to a Coca-Cola bottling plant in Baltimore.
The machine-designed and manufactured locally by KHS engineers and technicians-was created with one task in mind: to place Coke cans in trays as quickly as possible, secure them with shrink wrap, and move on to the next case. The rapid-cycling machine accomplishes this task at breakneck speed, packaging 80 cases of Coke, at 32 cans to the case, in just one minute.
General manager Randy Uebler reaches out to pat the machine as though it were a favored child and says with obvious pride, "These are the highest-speed tray-shrink packagers in the world." The machines, he explains, can operate from 80 to 120 cycles per minute, and retail from $500,000 to more than $1 million a pop.
KHS Bartelt has been designing and manufacturing packaging machinery in Sarasota since the company, first founded in 1949 as Bartelt Engineering, relocated here from Illinois in 1977. Known then as Rexham Bartelt (the company was purchased by German-based Klockner, a KHS subsidiary, in the 1980s and renamed KHS Bartelt in 2003), it emerged as a leader in the ever-expanding packaging world with its innovative pouching machine designs. Many of the packages you see on the shelves of Publix, CVS and Wal-Mart were made using KHS machines. KHS developed the machines that package Nabisco's mini Oreo's snack packs, Dole raisins, Pup-Peroni dog treats, Kraft Easy Mac macaroni and cheese double pouches, and Cascade dishwasher two-in-one packs, to name a few.
The KHS pouching machines cost from $100,000 to $1 million, and the company sells 60 to 80 of them a year, resulting in annual revenues of $55 million.
KHS Bartelt: Profiting from a Growing Market
According to Uebler, the packaging machinery business is booming. And that boom is being felt right here in Southwest Florida. A 2004 study by the Packaging Machinery Manufacturers Institute (PMMI), a trade association with more than 500 members throughout North America, shows that U.S. packaging machinery shipments reached almost $4.9 billion in 2003, an $82-million increase from the previous year. They are forecast to grow to $5.5 billion by 2006. And, PMMI reports, Florida ranks seventh across the United States and Canada in total packaging machine sales. More than 25 Florida companies are counted among PMMI's membership, with nine located in Sarasota and Manatee counties. (See sidebar.)
The association cites several factors contributing to this growth spurt, including an export surge due in large part to a dip in value of the U.S. dollar, a high number of customers opting to replace older units with new high-tech models, and the special requirements of what it terms "giant retailers."
Uebler agrees that the giant retailers have been a windfall for the packaging industry. He credits what he calls the "club store wars" for spiking demand for new and more efficient tray-shrink packagers.
"The club stores like Sam's, Costco and BJ's are driving a lot of the business now," Uebler says. "The idea is to create these multi-packs so consumers can buy everyday products in bulk. The result is a need for machines that can do things like package 32 Coke cans, and we are innovating to meet that need."
The makers of brand-name products sold to consumers at retail are constantly looking for ways to redesign packaging to be more efficient, user-friendly and, ultimately, more attractive to consumers, Uebler says. That means pouching machine sales should continue to grow.
In light of industry trends, Uebler says KHS will increase its manufacturing operations by 50 percent in the next three to five years and add 20 to 30 additional people, mostly in the manufacturing area. KHS currently employs 120 people, 50 of whom are directly involved with manufacturing operations.
PPi: Passionate About Pouches
If the key to success in the packaging machinery world is innovation, then PPi Technologies, another Sarasota-based packaging machinery company, should have no trouble meeting its goal of increasing sales from $12 million to $25 million in the next five years. The family-owned business received the Sarasota County Economic Development Corporation's 2004 Technology Company of the Year Award.
"To remain successful in this industry, you have to reinvent yourself continuously," says R. Charles Murray, PPi's president and CEO. A self-described "graduate of Bartelt," which he dubs "the university," Murray left his position as vice president of marketing at Bartelt in 1997 to join PPi, which was started the year before by his son, Stuart.
Murray is passionate about pouches. He insists they are the wave of the future, pointing out that they reduce shipping costs and are better for the environment because they take up less space in landfills than conventional packaging. According to Murray, "Ten truckloads of rigid equals one truckload of flexible."
Murray credits PPi's success to its ability to find solutions to customer's problems. "Got a problem? We provide the solutions," he says. "We hold more than 500 patents covering all sorts of machinery and packaging solutions."
PPi developed a special pouch cap so the items would hang properly on displays. It invented slides for ease of opening and closing Perdue chicken packs and came up with the Smart Valve, that little plastic button on coffee pouches that releases pressure, allowing the coffee to breathe. One company approached them about creating packaging for pocket shots, individual servings of alcoholic beverages that come in their own little pouches. And PPi is touting its Fast Fine Cuisine, fresh food packaged in microwaveable containers that also incorporate the Smart Valve technology. The company is also working on a venture with Bradenton-based Tempra Technology to produce self-heating pouches of soup. (Two pouches are joined together. One contains the soup and the other contains a substance that produces heat when broken. The idea is to break the contents of the second pouch and wrap the first in it and-presto!-hot soup on the go without a stove or microwave.)
PPi operates with a skeleton staff of 24, relying on outsourcing for administrative functions and the manufacturing of heavy lifting machines, which are made in South Africa (Murray's native country), Germany, Japan and South Korea. Final testing is done at PPi's facilities here. Most of its customers hail from the United States and Canada, and the company is now pursuing customers abroad.
New England Machinery: Restoring Order
Bradenton-based New England Machinery (NEM) relies on ingenuity, forward-thinking technology and aggressive exports to fuel its growth. NEM was created in 1974 in Connecticut after its founder, Geza Bankuty, built an unscrambler-a packaging machine that takes empty containers scattered in all different directions, such as plastic bottles, and sorts and places them upright onto a conveyor so they can be filled in rapid succession. Bankuty's unscrambler, which he created in his home garage, provided an approach to orienting plastic bottle containers that was revolutionary for its time. From that one machine design, Bankuty set up shop. Today his daughter, CEO Judith Bankuty Nickse, and son, executive vice president of manufacturing Geza F. Bankuty, run the operation that has grown to produce net revenues in the $4-million to $6-million range.
The company has 50 employees, about half of whom are involved in manufacturing operations. NEM offers a variety of unscramblers, including a hybrid model specifically designed for Vlasic pickles. The cucumber unscrambler is designed to take loose bundles of giant cucumbers and align them single-file for uniform slicing. NEM also produces equipment known as cappers, lidders, pluggers and retorquers, machines that place and tighten lids and caps on containers holding everything from hair spray to eye drops to neutraceuticals. One of its inventions, a scoop sorter/feeder/dropper, sorts and feeds scoops into pre-filled containers of drink mix. The company invented a unique feature that pushes the protruding scoop down into the pre-filled powder, allowing a tight seal to be placed on the container.
NEM has doubled its export sales every year since 2001, earning it the 2004 Governor's Business Diversification Award and the U.S. Department of Commerce's 2004 Export Achievement Award. The company ships equipment to Latin America, Europe and Asia. After NEM executives accompanied U.S. Secretary of Commerce Donald Evans on a trade mission to Russia in 2001, the company began exporting equipment there. Plans are for a continued push into foreign markets.
"We will continue to concentrate our efforts in exporting as well as strengthening our national sales presence to increase our domestic market share. Our goal is to increase sales by 10 percent a year," says NEM director of sales and marketing Marge Bonura. "As new companies develop new products and as the packaging industry continues to reinvent itself, there will be a greater need for our type of products." She predicts offshore opportunities will continue to increase, particularly in Mexico and China, as companies continue to move their production facilities offshore to take advantage of cheaper labor. "But there will always be a need for sophisticated machinery manufactured with U.S. engineering know-how," she insists.
Sarasota and Manatee counties are home to a number of companies that manufacture packaging machinery.
Dumas Packaging Machinery-Sarasota-(941) 360-8833
Inline Filling Systems-Venice-(941) 486-8800
Intertape Polymer Group-Bradenton-(941) 727-5788
KHS Bartelt-Sarasota-(941) 359-4000
Multiflex Systems-Sarasota-(941) 360-6500
New England Machinery-Bradenton-(941) 755-5550
PPi Technologies-Sarasota-(941) 359-6678
Sure Torque-Sarasota- (941) 753-1095
Source: Packaging Machinery Manufacturers Institute (PMMI), www.pmmi.org.