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The Carlsberg Approach To Packaging Innovation

Nov 02, 2023

Facing a ‘mountain of technical challenges’ in its quest for a paper beer bottle, Carlsberg Group sees clearly that slow and steady wins the race.

“We understand that when making break-through innovations, we have a mountain of technical challenges facing us, so we’ve adopted a completely different way of moving a project forward. Our approach is to start with what we call the ‘minimum viable product.’”

This is how Marine Andre, packaging innovation director, sums up a relatively new approach to how break-through packaging innovation is driven at Carlsberg Group, the Danish multinational producer and supplier of beer, soft drinks, and other beverages. Headquartered in Copenhagen, the firm employs some 41,000 people, and in the fiscal year ending December 31 of 2020 it reported revenue of $7.8 billion US. Its flagship brand is Carlsberg beer, but other brands include Tuborg, Kronenbourg 1664, Somersby cider, and more than 500 local beers.

Getting back to the firm’s method of pushing innovation based on the principle of minimum viable product, it’s all about baby steps. In other words, build slowly but steadily without worrying about a fully optimized and scalable solution. Nowhere is this approach seen more clearly than in the firm’s long-standing efforts to develop a paper bottle capable of holding beer. It all started in 2015 at the World Economic Forum in Davos, Switzerland. That’s where Flemming Besenbacher, then Carlsberg Group CEO, held up a paper shell prototype and more or less challenged the entire world to join Carlsberg in taking this purely conceptual paper bottle concept from vision to reality.

“His message was that we needed help to make this happen because at the time all we had was a single supplier—innovative but small—working with us on molding a fiber shell,” says Simon Boas Hoffmeyer, senior director sustainability & ESG at Carlsberg Group. That supplier was ecoXpac, part of a development group with the Danish Technological Institute. “He emphasized that if we were going to make this happen, we needed to team up with others.”

By 2019 the vision came a big step closer to reality when BillerudKorsnäs and Alpla acquired the majority stake in ecoXpac. It was a match made in heaven because it combined the tremendous resources of Billerudkorsnas, a world leader in all things fiber and forestry, with the barrier application and plastic molding machine technology of Alpla.

At that point in time, Carlsberg was able to test a molded fiber outer shell with an inner container that was injection-stretch-blow-molded of Recycled PET (rPET). This was not a perfect, long-term, or scalable solution because it mixed a fossil fuel-based inner component with a renewably sourced outer shell. But it was a minimum viable product. So the Carlsberg team embraced it as such, knowing that by moving forward with this woefully imperfect Version 1.0, there would at least be something to test, something to put in the hands of consumers, something to optimize over time.

“The acquisition of ecoXpac by Billerudkorsnas and Alpla was a much needed next step for the fiber bottle development, and it enabled continued development,” says Hoffmeyer. “If in 2015 when the idea was first proposed at Davos we’d been narrowly focused on getting something scalable within two or three years, we would never have gotten to where we are now. Only by working step by step, by taking the time to wait for consumer feedback, by ticking boxes one at a time, could we have made this kind of progress. So much of it, too, depended on who could we partner with next.”

The partnering part has continued to be a strong priority when it comes to packaging innovation at Carlsberg, so much so that at this point Carlsberg and the newly formed company PABOCO (Paper Bottle Company) invited additional partners to join the development, including Coca-Cola, L’Oreal, Pernod Ricard, The Absolut Company, and Procter & Gamble in something called the Paboco Pioneer Community. “Pioneer Owners” of this effort are Billerudkorsnas and Alpla, while “Pioneer Experts” are Blue Ocean Closures, recycl3R, Avantium, and the Forest Stewardship Council. Here’s how PABOCO describes its mission: “Developing a paper bottle is a commitment with great opportunities but no guaranteed result. To succeed, we are building a community of partners that share our vision and understand the complexity of innovation and the crucial importance of introducing smarter and more sustainable packaging solutions. Together, all partners provide cutting edge expertise, from technology and design to marketing and brand development, covering all project areas and making investments in the form of capital, resources, and working hours.”

Carlsberg’s Version 1.0 paper bottle has now been replaced by 2.0, which began reaching consumers in a pilot launch in eight Western European markets this past June. 8,000 of the bottles are reaching local consumers, customers, and other stakeholders through select festivals and flagship events as well as targeted product samplings. Version 2.0 of Carlsberg’s paper bottle has an inner lining injection stretch blow molded of PEF, and it takes a steel crown. In development: an inner coating of PEF and a paper cap (opposite).

The chief difference in Version 2.0 is in the inner lining used to separate the beer from the fiber shell. Like its predecessor, it’s still injection-stretch-blow-molded, and its rigid neck finish still accepts a steel crown closure. But it now consists of an innovative new material. Replacing rPET is PEF, or Polyethylene Furanoate. It’s supplied by Avantium, a developer of innovative chemistry technologies aimed at producing materials based on renewable feedstock instead of fossil resources. An aromatic polyester from ethylene glycol, PEF is a chemical alternative to PET (Polyethylene Terephthalate) and PEN (Polyethylene Naphthalate). PEF has been described in patent literature since 1951, but it has gained renewed attention since the U.S. Department of Energy in 2004 identified its building block, furandicarboxylic acid (FDCA), as a potential bio-based replacement for the purified terephthalic acid (PTA) used to make PET. Since FDCA is bio-based while PTA is not, using PEF in place of rPET for the component that goes inside the fiber shell makes it possible to create a container that is one step closer to being 100% plant-based, recyclable, and degradable with no drop-off in performance or function.

Also notable is that PEF exhibits an intrinsically higher gas barrier for oxygen, carbon dioxide, and water vapor than PET. No wonder it’s being explored these days as an interesting alternative for PET in a variety of packaging applications, including films and food trays in addition to bottles.

While the Carlsberg team and its partners are certainly encouraged by Version 2.0, they already have their sights set on 3.0. The fiber outer shell will be essentially unchanged. But instead of using an inner component injection-stretch-blow-molded of PEF, Version 3.0 will have an inner coating of PEF. This will permit the use of less PEF, thus bringing a cost savings as well as environmental impact advantages. Further details on this coating are scarce because it’s in the early stage of development. But no one should doubt how serious Avantium is about making PEF a widespread marketplace solution. The Amsterdam-based firm has started constructing the world’s first commercial facility for the production of FDCA, that key building block of PEF. Located in Chemie Park Delfzijl in the north of the Netherlands, it will accelerate commercialization of the technology and make PEF widely available.

It’s important to note here once again Carlsberg’s role in moving all of this forward. On June 22, Carlsberg Group signed an offtake agreement with Avantium to secure a fixed volume of PEF from the flagship plant that Avantium aims to start up in 2024. Without such agreements, Avantium would have difficulty satisfying their investors, and without satisfied investors, building a new plant gets downright difficult.

In all the excitement over what Version 3.0 will offer, Andre says it’s important to remember a significant operational advancement that came about when Version 2.0 bottles reached the filling line. For the first time a regular brewery was adapted so that the containers could be filled on an actual bottling line as opposed to the manual process that was used previously. That may not seem like such a big deal until you think about how beer is traditionally bottled. Ordinarily, there’s a lot of water involved, from cleaning the bottles to washing down the conveyors. Subjecting a water-sensitive fiber bottle to such a manufacturing environment is not for the faint of heart. Blue Ocean Closures is the first to develop this innovative concept for fiber-based screw cap solutions in an industrial capacity.

“It was a huge step forward,” says Andre. “And to make it happen we had to engage with the employees at a number of levels. So it’s important to keep in mind that when it comes to packaging innovation, it’s not just about the material itself or the machinery adjustments that might be necessary to make the material run smoothly in production. It’s about employee engagement, too.”

Even as Carlsberg continues working on a bio-based inner coating to replace the injection-stretch-blow-molded inner container used for Version 2.0, the team recognizes that there’s work to be done where the closure is concerned. And that’s where PABOCO’s collaboration with Blue Ocean Closures and its fiber closure comes in. In what is referred to as a “groundbreaking development,” PABOCO and its partners are prototyping a recyclable paper closure that will fit the paper threaded neck of the PABOCO bottle. Blue Ocean Closures is the first to develop this innovative concept for fiber-based screw cap solutions in an industrial capacity. Still in the prototype stage, the caps are produced in Blue Ocean Closures’ proprietary vacuum press forming technology, which was developed during 2022. To enable rapid scalability of the production, the machine base is taken from an industry outside of packaging and adopted to the needs of closure-making. Essentially, it’s a sintering process that causes material to coalesce into a solid or porous mass and then presses it into a shape with high strength and definition. According to Blue Ocean Closures’ Florian Heider, the technology has been developed specifically to meet the high demands in the closure business. “The real magic,” he adds, “is in the tooling.” When it comes to introducing a barrier layer, which will be needed if the closure is to be used one day for a carbonated beverage like beer, for now a top seal liner of unnamed plastic is used. But coatings are being explored.

One more observation on the paper bottle before moving on to Carlsberg initiatives involving other packaging materials. From a Life Cycle Analysis perspective, Version 2.0 already performs better than single-use glass bottles. But Carlsberg has high hopes for Version 3.0, which is projected to achieve up to 80% less emissions than current single-use glass bottles. Ultimately, Carlsberg is aiming for the paper bottle to achieve the same low carbon footprint as the refillable glass bottle, which is generally recognized as the best-performing primary package when collected and reused in efficient systems. Worth noting, too, is that when the paper bottle is commercialized at scale, it will complement rather than replace existing packaging like glass bottles and aluminum cans.

Carlsberg has also made significant strides on packaging materials other than paper. Take multipacking, for instance, where Carlsberg has been active in commercializing three different sustainable packaging technologies. Let’s start with shrink wrapping. The development of 100% recycled PE content for shrink film took a lot of effort on the part of Carlsberg and a key supplier.

Like plenty of other beverage producers, Carlsberg breweries take in a lot of LDPE since incoming bottles or caps need to arrive in a hygienic state. Picture a hood of LDPE over glass bottles as they arrive at a brewery for filling. As Carlsberg people started talking with an innovative French film supplier called Ceisa Packaging (which recently underwent a name change and now goes by the name of Reborn group), it became clear that a lot of that LDPE could be collected and sent back to Reborn in a closed-loop fashion. Because that material has a lot of value if you go to the trouble of collecting it.

Reborn is definitely going to the trouble of collecting it. “I believe we are the only ones producing a 100% recycled shrink film,” says Maciej Szysz, regional sales manager at Reborn. “We even invested in our own recycling facilities. Two are in France and plans are in place to quadruple our capacity. This single-source approach means we don’t have to rely on outside suppliers of recycled and granulated LDPE. Everything is done by us. We collect from manufacturers like Carlsberg, from retailers, and from logistics centers, too. But we also collect post-household waste.”

According to Szysz, the material is in the same 50-micron range as the virgin materials used previously by Carlsberg, and no new shrink wrapping equipment was required. All of which pleases Carlsberg’s Hoffmeyer. He’s also impressed with how “it creates a link between our internal supply chain and our consumers. Reborn has really thrown themselves into this, and though producing 100% recycled shrink film may sound easy, it took a lot of focus and effort by us and by Reborn. It’s really quite amazing.” Getting the adhesive formulation right was one of the challenges that had to be met as Carlsberg optimized this snap-pack format.

Another multipacking technology that has been commercialized by Carlsberg is one known as the Innopack Nature MultiPack™ from KHS. This format replaces plastic ring carriers with an adhesive that holds four or six cans together. Sometimes it’s accompanied by a thin handle enabling easy consumer handling. This has been most successful in the UK market, where something like 70% of Carlsberg’s cans in four- or six-packs are in this format. Other markets where it’s in use include Latvia, Germany, and France.

“We worked with KHS for three years on optimizing this snap-pack format,” says Hoffmeyer. “Integrating the specialized machinery into a high-capacity brewery that has limited space is a big undertaking. And then there’s the challenge of getting the adhesive formulations right. Too strong an adhesion frustrates consumers because they can’t separate a can from the pack, but too weak an adhesion means the multipacks break up during transportation or distribution.”

Andre agrees that getting the adhesive formulations right continues to be a challenge. “You need to find something that works in whatever temperature and humidity conditions exist in that particular market,” she points out. “So even though we’ve successfully introduced it into a number of regions, we’re still working on optimizing it.”

In addition to the 100% recycled content shrink wrap and the snap-pack formats, Carlsberg is also paving the way with another innovative multipacking technology. Called LitePac, it replaces plastic rings with paperboard for multipacking cans. Hoffmeyer and Andre point out that LitePac entered the Carlsberg universe when Carlsberg UK and Marston’s brewery merged in 2020. The deal involved Marston’s six breweries and distribution depots, but not its 1,400 pubs. The new brewing company is headquartered in the UK town of Wolverhampton and is known as Carlsberg Marston’s Brewing Company. At the time of the merger, Marston’s had already begun the use of LitePac, which is how it became an offering of Carlsberg Group.

Developed jointly by paperboard expert Karl Knauer and packaging machinery manufacturer Krones, the machinery involved is an expansion of the proven Krones Variopac Pro modular packers. “It’s definitely an interesting option in the overall drive toward a more circular economy,” says Andre.

Two final examples of innovative approaches to packaging that Carlsberg Group has come up with come from two very different markets. We begin with Malaysia, where returnable glass bottles are as common as they are in Germany. Consumers in Malaysia made it clear that the scuffed look the bottles take on after going through 10 or 15 cycles of being filled, returned, cleaned, and refilled was not something they were fond of. The solution? The application of Kercoat and Opticoat protective and masking coatings from Arkema. “It was a way of making sure consumers have the good experience they expect without reducing the number of cycles our glass bottles can withstand,” says Andre.

Shift now to Norway, where the Imsdal water brand was for a time being filled into bottles that were injection-stretch-blow-molded of 100% recycled PET. What Hoffmeyer and his colleagues discovered, however, is that once the percentage of 100% rPET goes above a certain level in the overall system, the quality of the material starts to deteriorate, especially where clarity is concerned. A certain amount of yellowing begins to appear, and even the gas barrier properties can begin to degrade. This happened due to the effectiveness of the deposit-driven recycling system in the Norwegian market, a system run by Infinitum. In other markets where the material is not collected, recycled, and sent back into new bottles quite as efficiently, the problem would not surface. The solution for Carlsberg Group in Norway? To reduce the rPET content to 80%. “Just because we have the technical capability of using 100% rPET, that doesn’t mean it’s the most circular thing to do,” says Hoffmeyer. “Even though using 100% rPET might seem desirable, for Norway it would mean that the quality of the recycled PET would deteriorate over time, causing less viable recycled material rather than more.” Eventuallly, he adds, it will be possible to achieve 90% recycled content. This proportion limits how much recycled content can be used in the production of new bottles without destroying the balance in the system.

Both Hoffmeyer and Andre emphasize that at the end of the day, packaging at Carlsberg Group is viewed as a key value add—not a nice-to-have but a must-have. “The challenge lies in dealing with an environment that changes incredibly fast,” notes Andre. “A few years ago who would have thought that plastic in packaging would be viewed the way it is. We as a company have little choice but to react quickly.” That’s one reason why, she adds, packaging is such a central pillar in Carlsberg’s TTZAB strategy (see sidebar below).

“It all comes down to adding something to the consumer experience,” says Hoffmeyer. “Whether it’s shrink wrap made from 100% recycled content or a fiber bottle and cap, our packaging innovation agenda is central to our business.”

Last August Carlsberg Group launched an updated Environmental, Social, and Governance (ESG) program called Together Towards ZERO and Beyond (TTZAB). It contains updated targets and new focus areas and it includes a roadmap to achieve net zero carbon emissions across the entire value chain by 2040. As the graphic shown here clearly demonstrates, reducing packaging waste is a key component of TTZAB. Click here to visit Carlsberg's website and learn more on this ambitious program.