The Packaging Therapist

Recapping PLMA 2024: Insights and Trends in Private Label Food Manufacturing, with Pamela Derus

• Jessie Schwartz • Season 1 • Episode 15

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Struggling to navigate the complexities of private label food manufacturing? Tune in as host Jessie Schwartz and special guest Pamela Derus, Director of R&D at Heavenly Hunks, recap PLMA 2024 and unlock industry secrets that could save you time, money, and headaches. In this conversation, you'll learn:

• How to identify and leverage co-packers to enhance your business's operational efficiency and capacity.
• The significance of better-for-you trends in private label food production and the growing demand for gluten-free and organic products.
• Inside tips on navigating the intricacies of contract manufacturing, from allergen considerations to production capacity challenges.
• The differences between European and American approaches to food manufacturing, and what unique opportunities each offers.
• Expert advice on the networking and strategic benefits of attending key industry shows like PLMA.

Join us for an enlightening discussion aimed at simplifying your journey in the world of food and beverage manufacturing.

Connect with Pamela on LinkedIn: https://www.linkedin.com/in/pamela-derus-a378786a/
Check out Heavenly Hunks : https://heavenlyhunks.com/

If you love our content and want to learn more about the packaging industry, hit SUBSCRIBE!

Connect with us: www.StrategicPackagingPartners.com
Jessie Schwartz - jessie@stratpackpartners.com

Jessie Schwartz:

Welcome to the Packaging Therapist Podcast. I am your host, Jessie Schwartz. I've been a packaging engineer for 20 years and currently the founder of Strategic Packaging Partners, where we are obsessed with creating strategic approaches to packaging to enable growth and cost savings in the CPG industry. My goal in this podcast is to discuss hot topics in the packaging space to enable you to make strategic decisions for your business that impact the bottom line and take the chaos out of manufacturing. Join us for technical discussions about packaging and let's make the world of manufacturing better together. Hey everybody, welcome to the show. Today I am joined by my friend Pam and we are going to recap PLMA 2024. We're going to talk about the show in general, the trends we saw, and help you get an idea of who the show is helpful for. So Pam, thanks for joining us today. Um,

Pamela Derus:

for having me.

Jessie Schwartz:

yeah, of course. Will you do a quick intro? Tell us about yourself.

Pamela Derus:

Sure. Um, so I am Pamela Derus and I am a director of R and D for a cookie company, Heavenly Hunks. Hopefully you've heard of us. If not, check us out. Um, we're a gluten free, uh, organic cookie, soft bake.

Jessie Schwartz:

Yeah, fantastic. And you have a ton of product R& D experience.

Pamela Derus:

Yes, so food science background, um, lots of commercialization projects, cost savings projects, uh, reverse engineering, you name it. I've done it. So in the past, I also consulted for three years, um, worked for big CPG companies and then smaller companies. So I have a wide experience. I'm very fortunate and I love what I do. I love it.

Jessie Schwartz:

That's fantastic. All right. So we went to PLMA together, which was very fun. I want to go to PLMA with you every time, forever. Um, and we were kind of looking for different things. So from a packaging standpoint, um, there is a lot of my clients looking for additional co packers or their, um, Comand looking to standardize what packaging they're using to increase efficiencies, increase capacity, things like that. So, um, that's why I went to the show. Uh, why did you go to the show?

Pamela Derus:

I've never been, first of all, but I go there to get the register also. Cause then you have this whole catalog of co manufacturers cause you never really know what's going to come up in the future. And when I was a consultant, that was huge. Um, because clients will come to you and ask for you to find a source of co manufacturing for their product. So that way you can. At least you have a place to start and you can cold call, um, cause things are categorized by product. But, um, I went for that reason. And then also, um, looking for potentially, you know, more gluten free cookie capabilities, um, and then I knew like any new products that are gluten free. Which is hard to find like you'd think it'd be easy. It's actually very challenging And so it's good to go there and be able to talk to the people to see What they are like on the website when you go to the website It's it's not everything that they do So it's good to just say you can walk past the booth and say oh you do cookies And then you stop in and say hey, do you do gluten free or do you have capacity? And start that quick conversation

Jessie Schwartz:

So to your point, like the whole show is laid out, um, in Chicago at the Donald E. Stevens Convention Center. So it's not that large of a venue. Um, if you plan on drinking Starbucks, you should bring it with you because the line is always like 150 people long. Um, And so it's, it's a nice walkable show and they do have the booth kind of organized. And so there was a section where there was a lot of international and then there was a section, um, with bakery and then, I don't know, it's just organized from different areas of the world. I would say I didn't notice much organization beyond that. Like dairy wasn't separate from bakery. Like it was mostly international versus domestic. Um, so you register for the show. Um, I think. You know, it's in Rosemont, so if you can get a place close to the venue, otherwise there's a lot of Ubering, um, and then when you go and you get your badge, they also give you this, um, store brand book that Pam, you were mentioning. So this has like, it's like a giant directory. Of

Pamela Derus:

resourceful.

Jessie Schwartz:

yeah, and so like you can look it up by company name, you can look up like, let's say you're looking for, um, granola, you can look it up by product category, um, and just be able to reference all of the commands that were there, um, and I'd say 99 percent of the people there were product producers. We walked past one logistics company.

Pamela Derus:

Yep.

Jessie Schwartz:

Otherwise, it was all private label food manufacturers. Um, And what else? So tell, say a little bit about what you noticed in terms of trends at the show this year.

Pamela Derus:

there was a lot of waffles like Belgian waffles and there was a lot of pizzas. Um, I noticed there wasn't a whole lot of frozen meals or, or stuff like that, which was kind of surprising. It was more shelf stable, uh, goods. And, um, that's the coolest thing I saw if you want to go there is, um, they had these quail eggs, which was really interesting. So from a product development standpoint, um, Eggs, especially in the past couple of years since COVID really has been really volatile, uh, chicken eggs. And if we had an alternate source that could still label as eggs, that would be huge, like, obviously they're smaller and we'd have to use more of them. Um, but it's just an interesting idea that, uh, I saw that captured my attention, so that was fun. Yeah.

Jessie Schwartz:

eggs are really cute. They kind of look like dollhouse food. It like looks,

Pamela Derus:

Well, we, because

Jessie Schwartz:

mean, it's an egg, but it's just really small.

Pamela Derus:

teeny tiny eggs, like, what the heck?

Jessie Schwartz:

I know.

Pamela Derus:

So that was fun.

Jessie Schwartz:

Yeah, um, and where do you see, like, in terms of private label food manufacturing in general, what trends are you noticing from, like, a product R& D standpoint? Because, you know, way back when, I guess maybe 10 years ago, there wasn't a lot of diversity in private label food manufacturing. Um, I just think of, like, that gray and white striped Flavorite mac and cheese box and where private label is. Now, um, what are you noticing from a product standpoint in, um, the evolution of private label and food offerings?

Pamela Derus:

I think it's trending more towards better for you. I would say it still has a long way to go. But I mean, 10 years ago, getting a gluten free or organic option, it wasn't available. So people need the time to build gluten free manufacturing facilities that takes years. And you have to be at the forefront of that industry to have the innovation to be able to put in it. So people, it's kind of like build it and they will come, but you just, you hope it shows up. And so I do notice. That's where people may have some more capacity. Um, also different allergens, not just gluten, but dairy or, or peanut free facilities, like that's huge. Um, so I do notice an organic, you have to be organic certified to run in an organic facility. Um, so that, that to me is where it's going. I don't, you're always going to have the, the big, the big brands, but the versatility is what people are looking for, especially from a smaller business standpoint or startups. We don't have the volume to just automatically go on this giant line. And, and so it's this chicken and egg scenario, which what's going to come first. And you have to be able to, to get there and get that versatility going, um, and to have the smaller volume to start. So I think, um, co manufacturers are definitely seeing that and they want to grow. With a small company, they're not going to just get a big win and have somebody come in and drop all this volume. They see that that's not feasible. Um, so that's, that's been really, really great to see.

Jessie Schwartz:

From your viewpoint, how do you think private label is going in general in terms of capacity and volume? And I know that the area of contract manufacturing that you look at is, you know, it's not the, it's not overarching, but. Any trends that you've noticed even with your work in the past

Pamela Derus:

as far as a trend, a trend, I'm not sure, but it's, it's It's growing pains. That is a trend. When a small company starts to become a larger company, but you only have so much capacity, but you have a customer that's like, we need this and we need it now. Um, finding that capacity Is like, okay, now we have the volume now. What do we do? And so then you try and figure out this growth growth plan So that as your company grows You can withhold that Desire to like have your product

Jessie Schwartz:

Yeah Well into that point we've had many conversations about how Um, the contract manufacturing world is very, it's almost like secretive. Like you need to

Pamela Derus:

How do you find somebody I don't

Jessie Schwartz:

that's the thing, like the, and even when you Google these contract manufacturers, um, like if you get somebody's business card or whatever, they don't have their capacities all listed out. And I suppose some of that's, um, from a proprietary standpoint, they don't, you know, they can't share and things like that, but it's just, I think that's one of the values to the show is that you can't, you can't figure out by Googling what you can. Going to the show and talking to people and figuring out like what capacity they have or what they're willing to work with you to install because there's um, there is this um entrepreneurial spirit in contract manufacturing of Like you said earlier We will, there's this interest in growing with successful brands. And of course, contract manufacturers don't want a thousand, running a thousand different things every day. Like that's not ideal. Um, and also there's this understanding that a lot of businesses that are coming into contract manufacturing, um, they, they may have already an established, um, business, but they may not. And they may be growing and somehow they need more capacity. So they're looking to you, um, you, the contract manufacturer to help fill Um, but I heard a lot of conversations about like, well, what if we did this or what if we did that? Or would you be interested? Could we put a bagger in here if we need a, you know, a specific style of bag or whatever? And it's just, they're open to having the conversations and talking about it versus like, we have fixed assets. We will not flex.

Pamela Derus:

Yep.

Jessie Schwartz:

and there's, there's value in having those conversations at the show too.

Pamela Derus:

there are some co manufacturers that are willing to be more scrappy, um, than others. It's, it's just how badly do you need the business, um, and, and that volume? And what makes sense, you know? Um. And it starts with the allergenicity is what I found. Like you can't just go build a gluten free facility overnight, but you could potentially buy a new piece of equipment and put it in that facility. That's huge. And that'll get you there a lot faster. So you're right.

Jessie Schwartz:

Yeah. And I think to your point, it takes a while to build a facility to create capacity. And then it's also this sort of anticipating future trends that takes place too. So what allergens are you going to allow into your facility? Gluten free is a large and is a growing market, but it's still not the biggest market. And so there's some critical business decisions to make. Um, around what you're going to allow in, you know?

Pamela Derus:

Or how to find that, um, balance of What kind of allergens are we going to allow because I have found certain co manufacturers they do allow all the allergens But they'll have segregated rooms within that facility or they'll do the same line, but they'll do allergen cleans So you have to fix that in to your costing, um, and your downtime and your production, you know, but then you're able to have more versatility. And that is a trend that I saw is that co mans are willing to be more versatile these days than say 10 years ago.

Jessie Schwartz:

So maybe they'll have, like, a line they converted to gluten free, for example.

Pamela Derus:

Right.

Jessie Schwartz:

And I'd say that that would be a pre, that would be a preferred to, um, the may contain, or not may contain, but processed in a

Pamela Derus:

Yeah.

Jessie Schwartz:

Yeah.

Pamela Derus:

Cause the may contain statement. Yeah. The may contain statement is tricky. Um, Not

Jessie Schwartz:

then if they so is it basically then that they could create almost like a I don't want to say a clean room But it's a completely segregated separated production line For gluten free and that could be a certified line.

Pamela Derus:

Yep. Mm hmm. Gluten is a little tougher than, uh, the other allergens, um, but that's, that's the idea and that's what I've seen is that they're able to do that. Yep.

Jessie Schwartz:

Um, Oh, I thought another Interesting booth that I or booths that we saw actually were european. Um, You There were a lot of frozen layered desserts

Pamela Derus:

Yeah.

Jessie Schwartz:

were super detailed and complex, but they weren't handmade. Yeah. So, like, if you think about, like, a French patisserie, it was, like, all those really delicate desserts, and I was talking to them about, like, how they manufacture, and a lot of them are molds. The product is made in a mold, and then it's stacked onto another product, so potentially a manual. Yeah. But there were all different types of textures, Crunchy, um, almost like a, uh, a mousse and, Like, puddings and cakes and Um, different colors too, and little tarts, and I mean it was, yeah,

Pamela Derus:

that was fun.

Jessie Schwartz:

those in the past, um, but creating sort of that freezer to refrigerator, type of experience.

Pamela Derus:

I noticed that when we went into that section, like the, the domestic versus the European, it was a very different vibe. And it noticed, like, the food, the food just was, seemed, I hate to say it, but like higher quality, like the care that went into it, like that's something the domestic, like you talk about these many layers and, and intense processing to it. Um, I mean, that's something domestic would not even really consider. And I don't know why that is. Um, I mean, you don't, you're not as profitable, but you could potentially charge more for the product because it, it took more care. So,

Jessie Schwartz:

Yeah?

Pamela Derus:

in domestic it's like crank it out and let's make some money. Let's get some volume whereas European culture is not really like that. It's like let's spend a lot of time and make this perfect thing Um, but it's going to be really special And so that was unique um to see

Jessie Schwartz:

well, and eating in America versus eating abroad is, I don't know, it almost feels like different intentions, right? Like, it's not the same type of, um, experience.

Pamela Derus:

not at all

Jessie Schwartz:

I mean, America is like, and I don't know, maybe Europe is more on the go now than before too, but The times I've been to Europe, like you don't see people walking down the street eating very often, like most people stop and eat, right? And then they focus on their food and then they're done and then you've got America's like rah rah rah, like cookie monster all day, right? Like, yes!

Pamela Derus:

Convenience is huge in

Jessie Schwartz:

Like, how can I eat all day?

Pamela Derus:

Yeah. Snacks.

Jessie Schwartz:

Yeah, yes, snacks are like, snacks are it. Yeah.

Pamela Derus:

as much.

Jessie Schwartz:

Mm mm. Nope. What else, what else would you say about the show in general? Who do you think should go?

Pamela Derus:

In general.

Jessie Schwartz:

value?

Pamela Derus:

Anyone really, it just depends, like an engineer could go learn different capabilities that are out there. Uh, product developers could go out there to see how stuff is actually made. Um, operations, obviously, if you're looking for a co manufacturer, um, if you're looking for capacity, if you're looking for a capability, um, and, and yeah, this, this finding a co manufacturer is such a black box. And you need a network to build a network and that's a great network to know because they, they might not be the person, but they can find it for you because. They know their competition. Um, so I think. Anyone in the industry would benefit from going. Just depends on what you're looking for. Yeah.

Jessie Schwartz:

of back to why I go, it's always good to understand trends and to understand the marketplace in general. And then I always have clients who are like, Hey, would you look for this? Or would you look for that? I can't go this year. And that gives me an opportunity to get to know new people. And food and beverage is a really small world. I mean, the stuff the industry cranks out is there's massive volume, but, um, it's a small world. So some of these shows like this one is a little bit of a reunion too, because like everybody

Pamela Derus:

Yeah. Yeah.

Jessie Schwartz:

and goes, so it's fun.

Pamela Derus:

you run into people in the industry that you haven't seen in a while and you just strike up a conversation that happened a couple of times. So it's, it's fun to network there. It's a really different, different group than if you were to go to like an ingredient supplier group or something like, you know, a show like that. Um, it kind of puts all the pieces together for

Jessie Schwartz:

yeah, food people are fun, right?

Pamela Derus:

Yeah,

Jessie Schwartz:

yeah, it's

Pamela Derus:

try.

Jessie Schwartz:

it's a good vibe. It's a good vibe. Um, so yeah. Cool. Well, thanks. Uh, thanks for joining for the show today. It's amazing to

Pamela Derus:

Thank you for having me

Jessie Schwartz:

Absolutely. And, uh, yeah. Thanks for joining us, everyone. Thank you so much for tuning into today's episode. If you found the content helpful, please be sure to share your comments with me by leaving a review so that I can keep the topics coming your way. If you haven't already followed me, click subscribe on your podcast app. So you get notified the next time we release a show. If you have packaging issues, you want to talk about contact us via our website at www.strategicpackagingpartners.com and click on the contact us page. Thanks everyone.