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Esio Beverage attracts a co-packer--without a product

Groundbreaking pouch beverage system was merely an idea. But Esio landed the right partner, with the right equipment, through a shared imagination of ‘what could be.’
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How do you interest an external packager in handling your product when you don’t have one to show them? Sell them on the possibilities of bringing innovation to a product category. That’s how Esio Beverage Co., Mesa, AZ, persuaded IPN USA Corp. (www.ipnusa.com) to take a calculated risk and provide packaging and other services for Esio’s budding Esio Beverage System.

IPN took on the project even though it doesn’t consider contract packaging to be among its core services. However, IPN recognized the beverage system as an opportunity to customize a product to meet a manufacturer’s needs, with packaging included as a value-added service.

“They decided that they would be the total solution co-packer, and that was very important to us,” says Lyle Myers, president of Esio Beverage, a three-year-old company. “We’re innovators. We had a new product, we knew how we wanted to do it, but we didn’t know anything about co-packing.”

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Initial meetings

Meyers remembers the day when he and his partner sat down with IPN USA President Luis De la Mora and his staff to tell the story of their new beverage system. Myers was the animated presenter, the perfect counterpart to his focused yet affable partner, Frank Leonesio, whom Myers describes as the “quintessential entrepreneur.” Together, they created a compelling vision about what the beverage system could be.

“We were looking for somebody who was willing to sit down and listen to us,” Myers recalls. “A number of people that we interviewed didn’t listen. We wanted them to think outside the box: ‘We know you’ve been doing it this way, but how can you get your game to the next level as a co-packer?’ We asked them to begin with the end in mind. And we asked them to imagine a little bit. There had to be some trust factor between the two of us.”

Choices abound

What Esio was asking IPN to put its faith in was an on-demand drink system that essentially puts hot and cold products in a standard water cooler, offering beverages from a selection of 13 concentrate varieties packaged for up to a one-year shelf life. The Esio Beverage System’s central operating components are an innovative pouch with a self-sealing fitment and a disposable pump, as well as a custom water dispenser that Esio created to function as a beverage fountain.

Besides hot or cold beverage options, the beverage system’s technology offers other benefits. One is serving-size flexibility. Users can dispense drinks from 1 oz to 108 oz by pressing a button on the machine. Near the serving-size button, a dial provides the option of customizing a beverage’s taste strength by selecting one of the 15 settings.

Leonesio licensed the beverage system’s patented dispensing technology, which Esio calls drop’n drink™, from intellectual property provider Intelligent Coffee Co. (www.iccinnovations.com). Drop’n drink enables users to place an airtight concentrate pouch into either a 5-gal water bottle or a reverse-osmosis, filter-fed water-dispensing system.

By selecting and depressing either the hot or cold button on the dispenser, water emerges either from the 1/2-gal hot reservoir or the 1-gal cold reservoir while the concentrate is dispensed from the pouch through a proprietary dispensing pump. The water and concentrate mix in mid-air within the machine, and the beverage—coffee, tea, juice, or an electrolyte replacement beverage—flows from a dispensing nozzle into the user’s drinking container.

Myers emphasizes that the technology used in the dispensing system prevents cross-contamination of flavors.

After a beverage has been poured, the self-sealing pouch can be removed from the machine and stored for future use. The concentrate in each 3-oz pouch makes up to 18 6-oz beverages. Pouches are packed three to a carton.

The pump pouch is a primary component of the drop’n drink system. The pouch connects into a tubular electromagnet in the beverage system. When a pouch drops into the dispensing system, a metal ring inside the pump is activated, at speeds of up to 40 open-and-close cycles per second, by a solenoid inside the dispenser. This high rate of turnover ensures that the concentrate does not come in contact with air until dispensing.

“That was another key component to picking a co-packer,” Myers says. “We needed a piece of machinery that could pretty much package our products in an air-free environment.”

The pieces fall into place

Leonesio found the technology for the beverage system in June 2005, shortly before Esio Beverage began operations. By early 2006, Esio’s owners had a rapid prototype for their invention to take to consumer focus groups. Consumers warmed to the product’s ease of use and convenience.

With a prototype and consumer support in place, the next step was finding a contract packager. As a small marketer, Esio Beverage is in the business of creating its products but not packaging them. “We had to find somebody who could put our beverage products into these little, tiny packs,” Myers says.

Keys in the co-packer selection process were that the packager had to share Esio’s entrepreneurial spirit and also accept that initial production volume would be low.

“We created a strong partnership with IPN so that we could debut a more formalized prototype at a trade show in October 2006, to make sure that business owners would accept this type of product,” Meyers adds. “By January 2007, we knew that we were going into production. We had our first production prototypes in March of that year.”

Reasons for a good fit

Besides its co-packing capabilities and willingness to share some risk upfront, Myers notes, IPN fit like a glove for the project because foremost, it is a flexible-pouch spout and closure supplier. Contract packaging is offered as a secondary service. IPN also provides services such as pouch design, converting, and filling equipment operations.

One IPN contribution to the Esio Beverage System is a 4-mm connector fitment coupled with a custom-designed disposable liquid pump, which Intelligent Coffee Co. assisted in producing. The connector fitment controls the strength of the concentrate dispensed from the pouch and the pouch’s automatic reclosability feature.

De la Mora notes that in handling other small co-packing jobs, his company had developed slow- and medium-speed equipment and chemical filling capabilities.

“Lyle said, ‘This is the dream.’ We said, ‘Let’s go ahead and do it.’ So we helped develop the pump,” De la Mora says.

“We are a Dutch-based company, and our first technology is called Clean-Clic®, he explains. This is a connector that will open when engaged, but then as you disengage from a dispenser or from a male probe while filling, it will close again, so your filling is almost 100% errorless. We realized that the pump on the Esio system was the best fit for Clean-Clic because we could still do an almost errorless fill. Then once we inserted that pump into the Clean-Clic, the Clean-Clic would remain open, but there would be no error because of the mechanism of the pump.

“It’s a very neat application for us, and this was a perfect opportunity for us to get involved from the get-go, because that is when we can help design a different application than what may be out in the market, which is what the pump ended up doing.”

Multiple sites get involved

IPN makes the pouch’s Clean-Clic and custom-designed disposable liquid pump at its facility in the Netherlands, then ships the components to its Peachtree City, GA, facility. There, they are joined with premade pouches that are converted by a partner of IPN India plc. IPN USA then fills the pouches on custom seal/fill/apply (SFA) machines and puts them in cartons. “We can do 40 pouches a minute on this beverage,” De la Mora says. “We have a manual cartoning machine, and then we do carton marking and printing. We had to adapt rather quickly because of the growing number of SKUs and the way that seasonal demand goes. We get the products ready to be packed on totes, we connect them to our lines, and we’re good to go.”

The right company, the right approach, at the right time: Myers says those three considerations were essential to the success of customization efforts in both components and packaging for the Esio Beverage System.

“None of it would have been available to us had we not been able to partner with our co-packer at the beginning and give them the dream and let them understand where we’re going,” Myers says. “They were willing to invest themselves and invest money in our dream.”

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