Flying at Full Speed Forward

It may have been a welcome case of beginner’s luck at first, but 15 years after London, Ont.-based craft distillery Black Fly Beverage Company first sprang to life, its stunning success in the Canadian market for pre-made alcohol beverages is more reflective of noted American writer Amy Hempel’s deft observation that, “There is no such thing as luck. Luck is where preparation meets opportunity.”

So while being the first company in Ontario to be granted a distillery license in over 100 years back in 2005 was undoubtedly a stroke of good fortune of being in the right place a the right time, the company’s knack for making its own luck by turning opportunities into groundbreaking business masterstrokes has evolved into a formidable core competency for which even the calamitous COVID-19 pandemic proved to be no match.

Currently offering 27 different RTD (ready-to-drink) beverages produced and packaged under the flagship Black Fly brand label at its spanking new 60,000-square-foot production facility equipped with leading-edge, fully-automated beverage bottling and canning lines, the company has actually never been as busy as it has in the run-up and into the summer’s traditionally busy months.

Ironically, this hectic flat-out production schedule has in fact been accelerated this season due to additional pent-up consumer demand for products helping Canadians take all the dispiriting news related to the coronavirus outbreak in better stride—alcohol being a prime example.

“We have been extremely fortunate to be able to keep our large team working, have our plant fully operational, and to be able to produce and deliver our spirit beverages to retailers and customers in these very trying times thanks in part to the alcohol industry being deemed ‘essential’ to Ontario’s economy,” says Black Fly co-founder Cathy Siskind-Kelly, who met her husband and company’s other co-founder Rob Kelly while he attended the nearby University of Western Ontario in the late 1980s.

“Not only were we able to continue operating, we actually had to ramp up and scale up production,” Siskind-Kelly told the Canadian Packaging magazine in recent interview, crediting the company’s continuous investment in industrial automation technologies—including recent installation of a turnkey KHS canning line, along with a high-capacity pasteurizer and a state-of-the-art can sleever—for enabling Black Fly to handle soaring market demand and production volumes.

“From a health and safety perspective, Black Fly has implemented additional protocols and measures, ” Siskind-Kelly relates, “but the fact that our plant is fully automated has us well positioned to be running our facility 24 hours a day, seven-days-a-week, safely and efficiently.

“Everybody working in accounting, analytics, administration and sales-support roles were able to quickly transition to working from home,” she reveals, “while when it came to our sales force operating across the country, we dramatically altered our sales approach to adapt to the different local [social distancing] rules so that where sales reps were not permitted to call on stores, they could continue to serve our vast network of diverse retail customers.

“As a result, all of our 70 full-time staff have remained fully employed since the start of the pandemic,” says Siskind-Kelly, noting the company’s current number of employees has more than doubled in size from 33 full-time staff only two years ago.

“In sales, we have growing by 40 per cent a year for the last seven years,” says Siskind-Kelly, citing robust growth overall in the RTD category that is capturing market share from the highly established beer markets across Canada.

“Everybody in the spirits industry, and even the beer companies, are moving into the ready-to-drink drink segment,” says Kelly, “which has created a big market demand for contract manufacturing of RTD beverages that Black Fly has been able to tap into in a big way.”

In fact, nearly half of production at the Black Fly plant now revolves around co-manufacturing RTD drinks for other producers both in Canada and the U.S., according to Kelly.

“It was a natural area for us to expand to because we have a unique experience in the RTD industry having not only built a brand, but manufactured and managed all aspects of development, production supply chain, marketing and sales for our branded products for many years,” she relates.

“Fifteen years experience in manufacturing our own Black Fly RTDs for the largest independent buyer of beverage alcohol in the world (the LCBO) and for every Canadian government retailer and a plethora of private retailers provides assurance to our co-manufacturing customers that they are working with a company that will meet the very high standards required to co-manufacture.

“This includes operating a plant that is HACCP-, GMP- and kosher-compliant, and excels in the areas of quality assurance, food safety and lab testing.

“Most important, of course, are the passionate, experienced and dedicated people who work hard every day to make it all happen,” Siskind-Kelly states.

Along with diversifying Black Fly’s business,and building significant partnerships with other beverage alcohol brands, the best part, she relates, is that the growth in co-packing business has complemented the extraordinarily strong growth of its own flagship flavours and the Black Fly brand overall.

For example, the company’s original Black Fly Vodka Cranberry mixed drink—the very first cooler flavor developed by Rob Kelly in 2005—grew by a staggering 23 per cent in sales last year, while still remaining the company’s bestselling flavor, followed by Black Fly Vodka Grapefruit and the Black Fly Tequila Margarita beverages.

“For a product that’s been in the market for 15 years, such buoyant growth is remarkable,” says Siskind-Kelly, quickly crediting the entire Black Fly team for contributing to the brand’s enduring success.

“I think that every entrepreneur starting up a new business believes they will be successful eventually,” she relates.

“Aside from a solid concept, much of Black Fly’s success comes down to a combination of timing, good luck, but most of all to tremendously passionate people dedicated to excellence,” Siskind-Kelly states.

“All Black Fly team members fit this description,” she proclaims. “We are also thrilled to have been able to promote internally, and have a significant number of people with seven to 10 years of service with Black Fly.

“Launching the original ‘not too sweet’ RTD and being a Canadian craft producer continues to resonate with customers,” Siskind-Kelly continues.

“We also credit Canadians’ love of local and supporting quality Canadian innovation and businesses for playing a significant role in building Black Fly as a Canadian brand that has managed to appeal to Canadians all across the country—thereby growing Black Fly into the fifth-largest RTD brand in Canada.

“Our experience is that Canadian retailers and customers are passionate about supporting Canadian brands,” says Siskind-Kelly, citing over 850 LCBO (Liquor Control Board of Ontario) stores and agency stores currently carrying Black Fly products, in both cans and bottles, along with every other government liquor board in Canada and private retail outlets in every Canadian province.

“I believe we have the most wonderful sales force on the planet, who have done a great job in building great relationships with our retail customers across Canada,” Siskind-Kelly proclaims, “and combined with the beautiful patriotic support that Canadian consumers have always displayed for Canadian business and Canadian brands, we fell very privileged to find ourselves in this market-leading position.”

So rather than trying a make a major concerted push into the U.S. or other export markets, she explains, “We made a conscious strategic decision a couple of years back to focus our time, energy and investment on the Canadian market.

“And so far, we have been very happy with that decision,” Siskind-Kelly says, acknowledging that the company’s status as the country’s largest micro-distiller and, more importantly, a real industry category pioneer, puts in into elite ranks of the domestic RTD market’s current pecking order.

“When we reflect on where we started 16 years ago, I am tremendously proud to say that we were, and still are, the original artisans of the craft RTD beverages in Canada,” she states, citing the company’s firm commitment to continuous product and packaging innovation tracing back to its first days in the business.

“When we started out, the vast majority of cooler/RTDs that were in the market were ready-to-drinks with very, sweet profiles and high sugar content,” Siskind-Kelly recalls.

“So when we launched out first craft RTD product in Ontario, not only was it made with quality ingredients in unique packaging, it was significantly less sweet than anything out there—about 60 per cent less sweet than all other coolers in the market at the time.

“And we have evolved enormously, in terms of offering a tremendous variety of products to choose from to satisfy the evolving and diverse tastes of consumers,” she points out.

“Today we have a line-up of diverse flavors and formats, from zero-sugar to full-flavor mixed drinks, from 2.8-percent low-alcohol ultra light beverages, at just 55 calories, to full-flavor at six-, seven- and right up to 17-percent alcohol-per-volume mixed drinks that deliver balanced authentic tastes that are not too sweet,” says Siskind-Kelly, explaining the origins of the company’s ‘Not too sweet’ tagline displayed on the packaging of its Black Fly brands.

“What are consistent are the quality ingredients Black Fly uses: pure juices and cane sugar that are
blended just right to either just touch of sweet or deliver full flavors without using the high-fructose corn syrup.”

Remarkably, the company’s insistence on using craft production incorporating quality ingredients like pure fruit and berry juices, to make its RTD products has enabled it to position itself firmly in the category’s premium-quality product range, while remaining extremely price-competitive with all other RTD brands.

On the packaging side too, the company has always effectively differentiated its product offerings by using unique large-sized, resealable and unbreakable 400-ml PET (plastic terephthalate) plastic bottles with a distinct wide-moth opening in which ice cubes can fit right in, and with an innovative designs that challenged the existing status quo of packaging and marketing, which at the time was geared exclusively to women.

In designing its signature bottle, for example, Black Fly sought to introduce convenient, non-breakable, and versatile packaging that would appeal to all—and it turns out it does.

Says Siskind-Kelly: “Being an independent Canadian start-up in the uber competitive world of global alcohol brands,required us to come up with a unique quality and value proposition and offer more to consumers on every level—ingredients, innovative packaging and quality mixed drinks over 60-percent less sweet.

“We looked to the craft beer industry for inspiration,” Siskind-Kelly confides.

“To this day, Black Fly’s mixed drinks are craft produced, local (Canadian) and made with quality ingredients.

“Introducing a unique bottle that was 20-percent bigger by volume than existing cooler containers captured consumers attention, and then it was up to us to deliver great taste,” she relates.

“With seven-percent alcohol content, and bright and colorful packaging that really stands out on the shelf, our four-bottle packs offer consumers great value for the price-point, and our retail customers are quick to recognize that.

“From concept, to ingredients, innovative bottles, cans and packaging, to operating the largest wholly dedicated RTD plant in Canada, there are many things about Black Fly that remain unique to our company today,” Siskind-Kelly says.

“We are the only RTD producer in Canada that makes its own preforms and blows its own bottles inhouse,” she point out. “Since acquiring an injection molder earlier this year, Black Fly now literally produces its mixed drinks from pellet to pallet.”

Running both the custom PET fully-automated Fimer bottling line and the spanking-new KHS canning line enables Black Fly’s new $10-million London facility to turn out 4.5 million cases of 24 beverages (equivalent to nine liters per case) annually, according to Siskind-Kelly, while also offering consumers the broader choice of cans, including the standard 333-ml, the sleek 355-ml and the Tallboy-style 473-ml aluminum containers, in both direct-printed and shrinksleeved versions.

“As everyone in the industry knows, cans are in extremely high demand these days,” Siskind-Kelly, “which is why we have worked hard to ensure a reliable supply of cans and lids not only for our own needs, but to ensure a reliable supply to our co-pack customers as a value-added service.

“For canning, the Black Fly plant is equipped with state-of-the-art equipment from depalleitizer to pasteurizer, from filler to sleever, carton erectors, wavegrips, and right through to palletizers for every configuration.”

When it comes to the bottling line, Black Fly’s equipment is highly customized. According to Black Fly, the plant’s fully-automated Fimer bottling line fills eight 7,000-liter batches (equivalent of 120,000 bottles) of beverage products per day, using four 7,500-liter bright tanks to chill the blends and an inline carbocooler to carbonate perfectly to each product’s specs.

Once the 40-gram bottle preforms are blown from plastic resin pellets on the high-performance SIPA rotary injection molding machinery, they are swiftly carried via bucket elevators inside the inline heat tunnel, which places them into six-cavity molds injected with high air pressure (580-psi) to blow the preforms into finished bottles.

The containers are then conveyed through a rotary rinsing station to be thoroughly rinsed with purified water, and a linear air conveyor for drying off, before proceeding to the line’s high-speed, counter-pressure rotary filler that fills the bottles with the exact amount of finished beverage, and caps them inline at speeds of 133 bottles per minute.

The capped bottles then travel through an inline labeler that quickly applies waterproof poly labels around the neck of each passing container with unerring placement precision, using a range of on-board cameras to ensure proper label alignment.

From there, the containers travel past a small-character Videojet inkjet coder that codes each labeler with a batch date and other variable information for full product traceability.

All stages of the process are closely monitored by a variety of inline quality assurance systems checking and verifying container integrity, fill levels, torque strength of the applied caps, and other critical product quality checkpoints.

Once date-coded, the containers travel in a single row to the fully-automatic four-pack cartoner that places the bottles sideways, four at a time, inside decorative four-pack corrugated carriers boasting a special open-side design that uses 30-percent less corrugate that the traditional fully-closed corrugated carrier boxes, according to Black Fly.

After passing through a conveyorized checkweigher to ensure that each four-pack contains exactly 1,600 milliliters of product, the fished four-packs merge with a high-speed case erector that forms, tapes and conveys the pre-printed corrugated shipping cases on to the case-packing station, which places the finished four-packs inside the cases in the desired multi-case configurations, usually six four-packs to a case.

After the finished cases have their top flaps securely taped, they are conveyed on to a heavy-duty TopTier palletizer, which builds a palletized load of cases, up to six layers high, on top of a signature-blue wooden CHEP shipping pallet.

The entire load is then quickly secured to the skid with several layers of anti-skid stretchwrap film and rolled out onto the floor to be picked up by a stand-up electric lift-truck operator and whisked away to the storage area to await shipment to customer.

All in all, the fully automated process produces 88 fully finished pallet loads of bottled product per day, according to Black Fly.

For its part, the new KHS canning line features the same high level of automation, according to Siskind-Kelly.

The new canning line is equipped the new KHS Innisfill Can C filler and seamer at the heart of the line to produce up to 15,000 cans per hour, using its 21 filling stations, three seamers, valve manifold, cladding and control cabinet to enable seamless production of different-sized cans with minimal changeover times.

Designed specifically for smaller craft brewers and distillers with low to medium output requirements, the Innisfill Can C system features a highly hygienic design that includes a gapless bell guide with PTFE expansion joints (Teflon) and bells, which are lifted and positioned fully electropneumatically to seal the cans—without any mechanical action from cams and rollers. According to KHS, this eliminates the need for water lubrication, simplifies cleaning, and ensures an extended service life.

Immediately after seaming, the filled cans enter the high-capacity Blendtech 45M2 pasteurizer, manufactured in Italy by TMCI Padovan SPA and disrubuted in Canada through conveyor manufacturer Storcan—where they spend 12 minutes being heated up 72°C, before proceeding down the line to be cooled down by water and dried down to room temperature.

“This Blendtech pasteurizer is a key piece of equipment that ensures exceptionally high quality of all of our canned products,” says Black Fly’s plant manager Dave Jamrozinski, who joined the company six years ago.

“It is a world-class, state-of-the-art machine that is far superior to anything we have worked with up to now,” Jamrozinski states.

“It’s been running problem-free for a full year now,” he adds, “and I couldn’t really ask for much more.

“It is a very reliable workhorse with exceptional performance levels and state-of-the-art control systems and safety features,” says Jamrozinski, complimenting the Blendtech 45M2 for smooth operation and gentle product handling—posing no quality issues for the direct-printed cans that run through it alongside the naked silver bullets, depending on product selection.

After the cooled cans are picked up from the Palmer accumulation table, they are formed into a single file that passes by a high-speed Videojet continuous inkjet coder that swiftly applies all the pertinent product codes and batch lot numbers to the bottom of each passing can.

While the direct-printed cans continue on to the case-packing station, the naked cans are transferred inside a giant shrinklsleeve labeling machine manufactured by PDC International Corp. of Norwalk, Conn.

Running at speeds of about 260 cans per minute, the model PDC R-300-TSERT Shrink Labeler with dual servo label feed can run two different can sizes, along with oval and square containers, and consists of two dual-zone KST 80-712 steam shrink tunnels with proprietary control system for minimal steam usage, according to PDC.

To make the whole canning line run like clockwork, Black Fly relied on leading Canadian systems integrator PLAN Automation of Orangeville, Ont., to select the proper auxiliary and end-of-line packaging equipment to optimize the line’s performance.

“PLAN Automation did the line layout and multiple revisions the make the equipment fit just right,” says PLAN Automation’s associate partner Greg Willsie.

“The biggest challenges were making the layout work with the space and Black Fly’s specific requirements,” Willsie recalls, noting the sheer imposing size of equipment such as the Blendtech pasteurizer and the PDC shrinksleever.

“We developed the layout in AutoCAD, including making the components fit in the space pillars and existing equipment to meet Black Fly’s needs and accommodate all of their restrictions on space,” recalls Willsie, adding this was the second major line integration project which he has headed at the Black Fly facility.

As Willsie relates, some of the key line equipment selected and installed on the new Black Fly canning line under PLAN Automation’s guidance included:

• A depalletizer for empty cans;
• A twist-rinser to ensure the cans are clean and empty prior to filling;
• A Filtec fill-level detector for catching misseamed or underfilled cans;
• Palmer conveyors, including accumulation and can inverting conveyors, and central control panel for conveyors;
• A Douglas Contour case-packer for top-sealing the loaded 24-can corrugated shipping trays with stretch film, along with the integrated AFA Systems cartoning machinery feeding the case-packer.
• TopTier palletizer with an integrated stretchwrapper to secure the pallet loads to the pallets for forklift pick-up, storage and transport.

“There were a number of corrections and revisions to the layout to accommodate changes in product matrixes, including an addition of a new can format, and a temporary layout to bridge the gap of equipment that was not going to be delivered in time for the line start-up,” Willsie recalls.

“None of these were major stumbling blocks because we caught them in time and were able to work with the vendors to implement the changes and still meet the timeline,” he states.

As Siskind-Kelly observes, “From the moment the filling begins down to the stretchwrapping stage, everything is fully automated.

“It feels like everything is running all the time, and in fact that’s how it is with our plant nowadays.

“Automating our production process has had a great ripple effect on our business growth, process improvement, productivity levels, and on reducing waste and our environmental impact,” Siskind-Kelly points out.

“We make all our capital investment decisions with an eye on improving our green practices and decreasing our environmental footprint, and automation is a great tool for reducing waste through all stages of the manufacturing process,” she adds.

It also frees up valuable time to keep the company focusing on continuous innovation, R&D and product development activities that are all essential to driving future growth in a category that craves and appreciates new products and inspired experimentation, Siskind-Kelly agrees.

Most recently, the company’s penchant for packaging and product innovation was vividly reinforced with the highly successful late-2018 launch of one-of-a-kind Black Fly Tequila Shaker Shots packaged in 50-ml test tube containers that are actually bottle preforms used by Black Fly to produce its own PET bottles in-house, which in itself provides significant carbon footprint reduction by not having to transport finished bottles or preforms from outside suppliers to the facility.

Made with pure lime juice, packing 17-percent Tequila and a hint of sweetness, the carbonated Mexican inspired ‘tequila poppers’ shaker shots actually fizz up when shaken, just like a classic Mexican tequila popper. They retail in attractive high-color paperboard sleeve tray four-packs, which come in a six-unit retail selling case often seen at the cash registers.

The Black Fly Tequila Shaker Shots were an instant hit with the Canadian consumers, Siskind-Kelly recalls, while pushing the boundaries of what imaginative packaging can do for brands in the RTD industry.

“Consumer response massively exceeded both our own and our retail customers’ expectations,” Siskind-Kelly extols, adding the new product achieved LCBO’s minimal annual sales quota within the first three months of its introduction to the market.

“Retailers in our category love innovation and the excitement it generates with consumers,” she says, “and this product delivers 17-percent tequila and 100-percent fun,” she quips. “It really captured that spirit of innovation in a unique package that consumers love.

“Black Fly Shaker Shots that have a lot of market longevity built into it,” she adds. “In 2020 we lunched it in second flavor with a spicy Jalapeno Tequila Shaker shot. Consumer response to new flavor has generated lots of suggestions, so stay tuned, Canada, for what’s up next.”

As Siskind-Kelly reiterates, “COVID-19 has changed the way people shop for their beverage alcohol.

“With people spending less time and buying more than usual when visiting their local liquor stores, Black Fly has seen a surge in sales for its classic flavors in bottles,” she says, citing strong sales for the Black Fly Long Island Iced Tea and Vodka Crushed Orange bottles; as well as for the Black Fly Sour Raspberry and Black Fly Sour Grape 473-ml cans.

Moreover, and 12 can mixer-pack sales of Grapefruit Gin and Lemon Vodka Soda Fizz, “have both already tripled the forecast sales for 2020,” Siskind-Kelly enthuses.

“With consumers in and out of stores more quickly, it is taking consumers a bit longer than usual to discover new 2020 products,” Siskind-Kelly notes, “but Black Fly has a hit with its Black Fly LOCAL 55 Vodka Soda in Lemon and Raspberry.

“At just 55 calories per 355-ml sleek can, it has the lowest calorie count of any vodka soda on the market.

Says Siskind-Kelly: “After 15 years, Black Fly is still an independent Canadian company built on innovation, quality, craft production and with true passion for the industry.

“Not only is Black Fly today an iconic Canadian brand sold in every province and territory in Canada,” she sums up, “but a diversified business that is poised for rapid growth well into the future.

“And as we continue to evolve with the RTD market, we will remain focused on innovation, excellence in all we do and growing our proudly Canadian brand so we can deliver diverse and delicious spirit beverages—tequila, rum, gin, vodka and whisky mixed drinks—for Canadians to enjoy for all kinds of occasion, at any time of the year, making sure every season is Black Fly season.”