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March 16, 2015 Issue

The Most Powerful Name In Corporate News and Information


Stand Up Pouch and Tray Machinery Solutions


R. Charles Murray



PPI Technologies Group



Interview conducted by:

Lynn Fosse, Senior Editor, CEOCFO Magazine, Published – March 16, 2015


CEOCFO: Mr. Murray, what is PPI Technologies Group?

Mr. Murray: It is a company with three divisions. The first division, PGS, is a company making stand up pouch and tray machinery. The second division is Penta 5 Contract Packing. We will pack customers products into pouches for them. The third division is a consumer division called Redi-2-DrinQ™ ShotPak™. This has fifty five consumable products in a pouch. It sells spirits, cocktails and water to the beverage industry.


CEOCFO: What is the competitive landscape in the areas that you work?

Mr. Murray: In the stand up pouch machinery, we are number one in the United States, and we have about a dozen competitors chasing us. In the contract packaging area, we are very unique in that we are doing products for the industrial segment, for the pharmaceutical industry, for the food and liquor, which makes us an exceptionally different type of contract packaging operation. As regards to the Redi-2-DrinQ™ Group, we are the innovators in introducing alcohol in a pouch in the United States. The other alcohol pouches being sold that are following us in this new trend.


CEOCFO: Would you tell us about alcohol in a pouch?

Mr. Murray: I developed a pouch with a special film structure that keeps the alcohol shelf stable. We launched a range of the top ten American cocktails with all of the right ingredients in a hip shaped pouch. You take the pouch; you can either drink from the pouch or you could pour into a mixer and add your favorite soda water or Sprite™ or Champagne and make yourself two cocktails. All of the ingredients and everything you need is in the pouch. Our reason for choosing the pouch, particularly in Florida, is that all pouches are incinerated down here. Therefore, we recover the energy that was used to make the pouch and is a zero landfill product. We do not leave a carbon dioxide footprint behind.


CEOCFO: Do customers recognize the value or do you have to explain?

Mr. Murray: When you are selling to the big chain stores and you can tell them that this product is not going to leave a footprint behind - that has an impact on what they are doing. They are so big and they are so extensive in their distribution that that is one negative that they do not want to have to leave behind. Therefore, while the consumer might not see the actual results of that feature, the people driving the distribution see the importance of not leaving their CO2 footprint behind. I would say it was more industry driven and not particularly important to older consumers. However, younger people are learning about it at school and there is a certain awareness of protecting our environment.


CEOCFO: Would you tell us a little bit more about the Contract Packing division? Who is turning to you? What is the process?

Mr. Murray: Let us say that someone has a chemical product that they would like to launch. They were traditionally in bottles; however bottles in the chemical industry are very difficult to dispose of because of the hazards. Therefore, they arrive here and say, “I have got this one pound bottle. We would like you to pack it for us.” We will then work out a pouch design that gives them a little bit of a proprietary shape. We make sure that all of the information that they need is printed onto the pouch. We check the compatibility of the product with the pouch. Then we pack it for them and as the product line grows under our packing they will be able to buy the complete room of the equipment and take it into their facility. This gives them the opportunity to grow into the pouch without spending capital money other than a packing fee and as the pack takes resonance or starts growing in the market they can say, “Okay, we need to bring it in house now,” and they buy the equipment and then we give guidance in setting up at their plant.


CEOCFO: Was that always the concept or did it develop over time?

Mr. Murray: We developed it over the last ten years with the nursery (startup) to graduation (packed in their own facility) approach. We know that people are pretty excited in seeing the new pouch pack with their product. We offer to, “pack it for you over six months or for a volume of one million and if it works take it into your operation.” They feel very comfortable in this less risk scenario.


CEOCFO: Outside of your products, has there been or is there much innovation in the industry?

Mr. Murray: The StandUp pouch itself was developed in 1965. Therefore, it is not new, but it is relatively new if you compare it to a can or a bottle. Let us look at 1965, when originally it was used for juice. From the juice era, after the patent expired, zipper companies applied the zipper and it suddenly became very useful in the nut industry and the snack industry. The next evolution became taking that zipper approach and replacing it with a spout. If you look at the last three years, it is now close to one hundred million pouches sold in the baby industry, replacing glass. The pouch has allowed itself to develop with some proven techniques from the rigid side of packaging and move towards the flexible pouch. The stores like the pouch from the point of view that if they drop it on the floor they do not break. The stores like them because they are light weight and they can deliver a lot more on a truck to the store. Regarding innovation, I believe that there are new developments with the Near Field Communication, known as NFC. We developed a method with another company called iZipline, whereby a customer can have the NFG Tagz on the pouch. You take your telephone and you touch the pouch and now the owner of the brand is speaking to the person that holds the pouch. You could say simple things like, “Welcome. Thanks for buying our pouch. Would like a coupon?” or “Welcome, sorry you bought an out of date pouch,” because the date had elapsed. Therefore, the NFC Tagz that we are putting on the pouch is from day one until it dies with the pouch. The information you are putting on the NFC Tagz, can be developed by iZipline and can be simple, “Welcome them. Please see our website and start a journey within the organization.” Another feature is what they call the Second Chance. If it is pasta, for example, we can take them to restaurants in the area using our pasta or take them to a store where you can get the rest of the recipe and so on. We see the pouch growing even further now as we apply the NFC Tagz. Let me touch on the cannabis industry. The cannabis industry, from the press reports, tends to look at smoking. This is always in the news. People love to read about controversial news. The cannabis industry has a huge, food segment. And the food needs to be identified; for example, am I taking one percent of the THC, or am I taking five percent? Those are very important percentages, depending on your medicinal needs. (I am not talking about recreational use.) However, in the twenty states that have medicinal use, we are offering them the tagz for the customer to identify the food they are buying. They are getting exactly the percentage that they need. Another point is that this is going to help law enforcement. They will be able to check, “Okay, you are in our register. You are on your way,” and if you are not on the register they will ask you to account why you have got cannabis on you. That is the benefit. We see this helping in identifying the users from the non-users or the people that should not have it. We see it helping the health people by identifying what product they are getting. If I may jump into another area, the chip on there can be used as a GPS for where a package went. Let us say you are a pizza store and you want to know, over the course of the day, how many people buy pepperoni; at what hours of the day, what person bought the vegetable verses what person bought the meat pizzas. By putting the tagz on the delivery can touch and start feeding that information back to the source saying, “You do lots of pepperoni between ten and twelve and you do none between three and four and area code thirty four does five thousand every hour.” Its ability to track is huge and the ability to find where you are sending it. The coupon industry is another opportunity, where they print one hundred thousand coupons and say ten thousand are redeemed, which is great. They do not know who has redeemed the ten thousand. The tagz will help them to see precisely, exactly who touched with a telephone and bought the product. The brand managers are going to really enjoy this opportunity. The NFC Tagz is the next generation growth area.


CEOCFO: Would you be talking with companies directly about NFC Tagz and their products or with marketing companies?

Mr. Murray: We are working directly with the marketing companies. For example, if someone says to me, “I want a launch a drink called Go Big.” The first thing we ask is, “Where do you want to sell it? What information do you want to know? Do you know what segment it has to be marketed in?” Anyone with a telephone has an identity. The tagz identifies the telephone and finds out who the person is for the Brand Manager. The tagz starts the consumer journey around the product.


CEOCFO: Do people come to PPi TG because they realize that you are more than just a manufacturer or are they sometimes surprised at the breadth of your knowledge and offering?

Mr. Murray: We are nineteen years old now. We long ago forgot that we were selling machinery. The last twelve years we have been very lucky to call ourselves a customer system supplier. When people come to us the machine is just part of the service. We are offering them the opportunity to co-pack. We are offering the chance for them to have their own shape of the pouch. We are offering them the ability to go in a tray or pouch or a single dose unit. We are using the pouch as the medium, and the machine is included in the sale.


CEOCFO: What is your geographic range today?

Mr. Murray: We sell throughout the United States, Canada and Mexico. In Korea we are very strong as well as in Japan. We have South African and German partners.


CEOCFO: What surprised you as the company has grown and developed?

Mr. Murray: I think that customers visit us and ask about systems rather than a machine. They walk in the door and they are discussing the package nonstop. They do not see us at all as being just a machinery supplier.


CEOCFO: PPI has been recognized on the Inc 5000 list, so clearly business is good. What might be different a year or two a now for you? What is ahead?

Mr. Murray: I think the growth of the Penta 5 Contract Packaging division; I am finding tremendous interest from small American companies that no one is interested in helping expand. These are entrepreneurs that I really like to work with, because no one has time for them. Our plan is to take them to the international market. My feeling is that in the next five years, Penta 5 will become an incredible company for taking interesting products overseas. I am looking at this international area as a growth segment for us.


CEOCFO: Your enthusiasm for PPi TG really comes through!

Mr. Murray: You are right. This is actually my fifty third year of working and I have often wondered where all of the years went! I come to work every day with a great sense of pride. I really enjoy meeting people. Their problems can always be solved. It might not be the solution they want, but I take a look at things in a very, very black and white nature. It is “Yes or No” and “Can I help you”. If you have that attitude most adversities can be overcome. My theme in life and to my staff and family has always been, “Look around the corner, make sure you do not get caught flat footed, make sure that you are prepared for the worst disaster and that way you are going to be able to handle anything, because you are prepared for it.” About ninety percent of the stuff that we do is successful, but there is ten percent that needs attention and we spend time looking at how to fix and finish those events successfully.



“We are not a machine supplier, rather, a custom system developer.” - R. Charles Murray


PPI Technologies Group



R. Charles Murray









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