CHAPTER 18

COMMERCIALIZATION

18.1 The total picture

A successful juice manufacturing business/facility is strongly dependant upon the existing national infrastructure and the integration of all steps from fruit breeding, cultivation and procurement though warehousing, sales and distribution of finished products. Developing country visitors to an industrialized country's major juice processing facilities are often impressed by the efficient, automatic manner in which raw fruits are seemingly effortlessly transformed into juice and by-product streams in a continuous flow from fruit supplier to processed product consumers. Observers may not be aware of the decades of research and development invested in such operations or the infrastructure necessary to sustain it, let alone the exhaustive, detailed planning and enormous capital costs involved.

There is a myriad of important considerations inherent in juice processing, stretching from cultivation to the consumer. The metaphor "A chain is no stronger than its weakest link" has important relevance (Table 18.1) as does the dictate, "Forge Strong, Avoid/Strengthen Weak Links". Some of these connections are worth mentioning:

• A reliable source of quality raw material representing the appropriate variety, available over a reasonable season at a fair cost is essential. Ideally, a processing operation should be extended over as long a season as possible. Firm commitments by growers based upon mutually developed specifications are a must. A versatile organization can process different cultivars and crops sequentially to spread capital costs,
• Harvesting, transportation and storage scheduling are important to an integrated operation. Seasonal peaks and valleys must be buffered by adequate storage or ripening facilities combined with trained labour to perform necessary operations,
• Total production logistics must be considered well in advance of groundbreaking (Table 18.2). Any planning deficiencies may result in unpleasant surprises later on.

Table 18.1: Links in the FPD chain.

Some of the comprehensive references cited have valuable sections dealing with facilities, equipment and related matters (Ashurst, 1995; Arthy and Ashurst, 1996; Ashurst, 1998; Nagy, et al., 1993; Tressler and Joslyn, 1961; Dauthy, 1995; Fellows and Hamptonnes, 1992; Fellows, et al., 1996; Fellows, 1996; Fellows, 1997; Richter, et al., 1996). In addition, specific chapters in these and other texts cited describe quite well operational equipment and alternatives.

Note the inclusion of texts from 80 to 40 years old and a reference from the 1930s. Popenoe, 1920; Tressler and Joslyn (1961) and Walsh, 1934, deal comprehensively with basic topics that are excluded or greatly condensed in newer texts. Also, equipment and processes are closer to the practical limitations and needs of some developing countries.

Although a much more recent FAO text is highly relevant to limited resource regions (Fellows, 1997), as are ITDG's Food cycle technology source books (UNIFAM, 1993 and 1996) and their Website (ITDG, 2000).

Adequate information and understanding of pertinent subject matter and dedication to the task doesn't insure commercial success. Truly a lack of data practically guarantees failure or at least a costly boondoggle. We hope to help you avoid these negative outcomes.

18.2 The outsourcing and co-packing option

Before making a lengthy, expensive commitment to an independent juice processing operation, it may be beneficial to consider these alternatives. The entrepreneur and small processor are not completely shut out by size and capital limitations. In some regions of the world there are many companies with expertise and manufacturing facilities that welcome the opportunity to conduct research and development (R and D), product development, even production activities for others.

The simplest arrangement is when the outside firm or individual has a reasonably viable product and a well-developed business plan, needing only a co-packer to manufacture the product to specifications. In turn, the co-packer has underutilized facilities, production capacity and most importantly, experience with similar products. The co-packing agreement can be nothing more than placing the client's label on a standard production run of product. Or the client can require certain modifications in ingredients, process or package to meet distinct quality criteria.

A more complex, arrangement is where the client does not have a final product and requires additional product development, analyses, regulatory advise, etc. In which case, the outsource company plays a more central, integral role in many phases of manufacture. Outsourcing can also be highly targeted having outsiders develop a specific formulation, use specialized processing equipment, provide the package technology, or supply a key ingredient. The proper outsource match can dramatically speed up and simplify some processing and manufacturing steps, but at a price. The advantages and disadvantages of outsourcing must be carefully weighed (Table 18.3).

Table 18.2: Juice process planning.

Table 18.3: Pros and cons of outsourcing.