Shamrock Farms rewrites the school rules

Shamrock Farms, the largest dairy in the Southwest, is known for its leadership in bringing innovative new products to market. In February 2005, it introduced an 8-oz plastic bottle of milk for Arizona schools participating in the National School Lunch Program. The new package marks a dramatic shift in thinking. In a segment where achieving the lowest cost has always been the rule, Shamrock Farms considered the bigger picture and introduced a higher-quality package. To produce the package while containing costs, the company used a B&H Labeling Systems (www.bhlabeling.com) BH1600 in-line roll-fed labeler.

"Plastic bottle component packaging costs significantly more than gabletop cartons, and the schools can't increase the cost of the entire tray lunch to offset that difference," explains Wendy Patterson, director of product development at Shamrock Farms. "But if a school converts to plastic bottles, they have a better offering, and more kids will buy the tray lunch, so the volume of the entire program increases.

"Studies show that offering the right product and package creates excitement in milk, and you'll get an increase in lunch participation that more than offsets the added cost. It's a classic example of 'if you build it, they will come.'"

Shamrock Farms' new 8-oz milk bottle is made of high-density polyethylene and is labeled with an eight-color oriented polypropylene label using the BH1600. The high-quality label material and the label applicator produce an attractive container.

"Compared to sleeve labeling or rotary labeling, in-line roll-fed labeling is the most economical," notes Jeff Patterson, vp of operations at Shamrock Farms. "In choosing a supplier, we considered the capital cost of the equipment, as well as the quality of the equipment and the ability of the supplier to provide technical support. We also considered the flexibility of the system to handle a wide range of container sizes. When we measured all those factors, we felt confident that B&H offered the best option."

The BH1600 labeler is designed to handle containers ranging in size from 8 oz to 2 L at speeds up to 350 bottles/min. Featuring B&H's Rapid Changeover (RCO(R)) capability and lightweight, color-coded changeparts, the BH1600 can be changed over by one operator in as little as 15 minutes. On the new line, Shamrock Farms handles 8-, 16- and 32-oz containers, averaging two or three changeovers a day, packaging milk destined for schools participating in the School Lunch Program, as well as retail packages of orange juice, buttermilk and other products.

But it's the 8-oz HDPE milk bottle that's so unusual, given the historical reliance of the School Lunch Program on gabletop cartons. "Due to pricing pressures and the competitive nature of school bids, the paperboard used for gabletop cartons has gotten thinner and thinner, making it harder to open. And it's like licking cardboard," says Wendy Patterson. "Consumers prefer milk in plastic bottles, and teachers will appreciate being able to spend their lunch periods doing something other than opening cartons for the younger children."

Within the National School Lunch Program, schools are reimbursed by the federal government to the tune of 17 cents per 8-oz unit of milk. When a school spends more than 17 cents to purchase that milk, they need to consider the cost differential very carefully. "Studies conducted by the milk industry indicate that when you improve the milk offering, either with a better container or with new flavors, you'll increase the volume of tray lunches sold and the units of milk by up to twenty-four percent," explains Patterson. "That increase in average daily participation in the School Lunch Program can cover the cost difference of the milk by spreading the fixed costs over more units.

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"In the studies, the biggest jump in volume came when schools moved from offering plain milk in cartons to offering multiple flavors of milk in plastic bottles."

Studies show that offering the right product and package creates excitement in milk.

School children can be very demanding consumers. They're used to seeing attractive containers on market shelves, and their standards for visual appeal are high, Wendy Patterson explains. She adds that they want colorful graphics, containers that are easy to open and products that feel good and taste good. They perceive products packed in bottles as being better-quality than those packed in cartons. And these preferences influence their behavior within the school lunch environment.

"Another industry study found that kids' preference for milk goes down with each year they attend school," Patterson says. "The School Lunch Program has historically rewarded dairies that provide the least-expensive product in the least-expensive package [gabletop cartons], which has greatly contributed to this decline. We think it is time for people to 'think outside the carton.' Fortunately, the trend is now moving toward more consumer-friendly packages that will increase kids' preference and consumption of milk as opposed to decreasing it."

The move from gabletop cartons to plastic bottles creates a win-win situation for kids, schools and dairies. Increasing milk consumption, which reduces the consumption of soda and juice, means school children benefit from a more nutritious diet. An increase in the number of tray lunches sold means school districts benefit from increased revenues and enhanced profitability. And Shamrock Farms benefits by creating a positive experience with milk in general and the Shamrock Farms brand in particular.

"At Shamrock Farms, there isn't a lot of immediate economic incentive to move more school milk because our margins in this program are razor-thin," says Patterson. "It's really more of a long-term investment in our brand. By giving school kids milk in gabletop cartons, we are, in effect, driving milk-drinking customers away, potentially for life. If kids are learning every year that they don't like milk, they won't drink milk as adults or grow up to encourage their kids to drink it. Improving kids' experiences with milk in the School Lunch Program is an important long-term investment."

In addition to the 8-oz plastic bottles of milk that are part of the National School Lunch Program, Shamrock Farms provides 12-oz plastic bottles of milk with a larger portfolio of flavors for schools' a la cart menus and vending machines. "The American School Food Service Association is talking about how to encourage kids to make healthy choices," says Patterson. "We expect to see more schools requesting more flavors, including strawberry milk and vanilla milk. We also expect to see wider acceptance of premium packages within the School Lunch Program."

Based on the belief that the thinking within the School Lunch Program was shifting and on their dedication to being a leader within the dairy industry, Shamrock Farms decided to install a new line to meet the anticipated demand. "We could have invested in a new higher-volume carton-filling line, but we didn't want to invest in a package that wasn't the package of the future," says Wendy Patterson. "We see the market increasingly going to plastic bottles. We wanted to invest in the future of our brand and in the future of the School Lunch Program, so we replaced a gabletop filling line with a bottling line."

Shamrock Farms analyzed different types of labelers for the new line and considered a variety of suppliers, looking for an affordable way to produce an attractive package. The company looked for robust equipment that would maximize production efficiencies and for equipment that was easy to operate and maintain. Shamrock Farms worked with Statco Engineering and Fabricators, Inc. (www.statco-engineering.com), a distributor of B&H Labeling Systems, and selected the BH1600 labeler. Only six weeks from the date they placed the order, the new labeler was installed and running.

The BH1600 is a roll-fed labeler designed specifically for packaging operations with moderate production-capacity requirements, providing performance and reliability at an economical price. Compared to sleeve labeling technology, roll-fed systems reduce label material costs and improve line efficiencies, explains B&H. It also adds that compared to complex rotary roll-fed labeling, in-line roll-fed labeling systems offer greatly simplified operation and maintenance with fewer moving parts and faster changeovers.

The B&H labeler features a patented Computer Registration System (CRS(R)) that virtually eliminates the out-of-tolerance labels common to mechanical labeling systems. An on-board computer coordinates the advanced electromechanical system, offering finite label-registration control. Sensors detect variances within the label parameters, and the necessary adjustments are made automatically, without slowing or stopping the line. The CRS ensures that labels are cut to the correct length and in the correct location.

"We're very satisfied with the B&H labeler," explains Jeff Peterson. "We're happy with the performance in terms of labeling accuracy, equipment efficiency and the speed with which our operators were able to catch on. The equipment does what we ask it to do without being overly complicated. It's easy to clean, and it's easy to maintain."

The B&H labeler gives Shamrock Farms the ability to handle its current production needs and the flexibility to make changes in the future. The labeler accommodates a variety of container types and handles a wide array of label substrates, including PE, PP, polyvinyl chloride and clear polystyrene. Currently, Shamrock Farms applies 24 different labels on one line. With an optional second label stand, Shamrock Farms is also able to speed label changeover and minimize the downtime to less than one minute.

To speed container-size changes, the BH1600 features a computerized operating system that can be preprogrammed for different products. With few changeparts and few mechanical adjustments, the operator need only mount the components in place and select the appropriate container program description from the machine's memory on the touchscreen control panel. The ability to preprogram machine timing positions via the on-board computer reduces the skill level required to achieve changeovers and ensures the labeler operates at optimum performance, notes B&H.

Shamrock Farms knows that maintaining well-adjusted equipment helps it produce consistently labeled containers and operate at maximum efficiency. With heavy-duty construction and quality components that produce dependable labelers, reliability is field-proven and backed by what B&H says is the largest force of factory-trained technicians in the industry. "The B&H technology and the B&H team have met all our expectations," Jeff Patterson concludes.

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