Positive Pouches

Positive Pouches

An innovative machinery company with a small niche in the packaging

industry has set its sights on some big targets: Beer and water.

by Mark Gordon | Managing Editor

When it comes to his company that makes pouches used to store everything from Spam to chocolate milk, R. Charles Murray dreams big.

So big that over the next decade he plans to take on the packaging practices of two of the most established industries in the world: Bottled water and beer.

Murray's avenue for this ambitious undertaking is PPi Technologies. The Sarasota-based company manufactures and sells storage pouches for dozens of food and beverages, as well as the machines that allow other companies to do the packaging. The company is global, with divisions in China, Germany, Japan, Korea and South Africa.

PPi, which stands for Pouch Pac Innovations, reported $20.95 million in 2007 revenues, a 77% increase over its $11.83 million in 2006 revenues. The company has 39 employees who work out of a two-building campus in a Sarasota industrial park that covers 65,000 square feet.

Despite the rapid growth and wide international presence, Murray believes his company, with its nearly 50 patents, is on the verge of breaking out much more.

"This is just a baby," Murray says of the family-run company he founded in 1996. "We are just getting started. I believe if we do this correctly, we can grow 10 times over."

The crux of the company lies in the machines Murray and his partners invented in the early 1990s. The machines were some of the first in the food and beverage industry to provide a seamless way to package goods in pouches that weren't made out of glass or plastic. Those machines were sold to companies such as Neslte, Keebler and Del Monte, which used them for packaging millions of products.

"Our aim," says Murray, "was to replace the glass bottle."

But a few years ago, after selling dozens of machines at prices ranging from $50,000 to $700,000, Murray decided to expand into new markets and products. The business of manufacturing machines for other companies, he realized, could only grow so much.

Murray and his son Stuart Murray, PPi's president, decided the alcohol and beverage industries were ripe for the taking, as the overwhelming majority of those companies use plastic or glass for packaging. Still, the duo realized cracking such an established market would be a colossal challenge.

"Everybody said it can't be done," the elder Murray said. "But we said yes it can and we'll show you how to do it."

The company's first step was to create what it now calls a StandUp pouch that can hold any type of beverage. That process took several years of testing, to get the right fit that didn't alter the taste or texture of the liquid. Now the company sells beer, alcoholic cocktails, water and juices in its patented pouches, all of which are made out of recycled materials.

After getting the pouches ready for the marketplace, PPi created another entity, the Beverage Pouch Group, to market the products and even come up with its own line of water and alcoholic beverages.

That division subsequently created a brand for the alcohol part of the line, called ShotPak - the shot without the glass. It also spawned a separate company, ShotPak Inc., which is publicly traded under the symbol SHTP in the over-the-counter market.

So far, ShotPak sales are small, but growing. For example, the company reported selling 2,539 ShotPak cases in the first quarter of 2008 after selling just 53 cases in the 2007 first quarter.

Murray, a native of South Africa who first moved to the U.S. in 1979 to attend Michigan State University, looks at numbers like that as proof there is a large market for PPi's products. And Murray has bigger plans past beer and water: He sees a future in manufacturing pouches for everything from lettuce to frozen foods to motor oil.

For now, though, Murray is concentrating on the billion-dollar bottled water packaging industry. "My aim is to replace bottled water," Murray says. "I have a mission to do that."

SUMMARY

Businesses. PPi Technologies

Industry. Packaging, manufacturing

Key. Company is transforming itself from a company that makes machines to one that packages dozens of foods and beverages.