Ginseng Up, a Massachusetts-based producer of ginseng beverages, has invested $2 million into upgrading and expanding its co-packing facilities, including the launch of a new product development arm intended to provide turnkey services for beverage startups.
Speaking with BevNET, Ginseng Up president Keith Whitestone said that while the company has long offered co-packing services across multiple beverage categories, its contract manufacturing arm had been secondary to its own line of branded ginseng beverages. However, after a company review showed a need to increase revenue, Ginseng Up felt its co-packing services needed to play a more integral role in its overall strategy.
“There’s a certain mix we have to achieve to meet and exceed our plan and our goals,” Whitestone told BevNET. “Contract manufacturing is just one platform of the business, but we felt as though we needed to prop our margins up and make it contribute to the overall enterprise in a meaningful way. So, to do that we needed to improve our capabilities and that basically meant a full recapitalization of the plant.”
Ginseng Up now offers full product development and production services for beverage companies, with support from an in-house team of chemists, food scientists, and nutritionists who are able to develop new or alter existing product formulations.
“Newcomers usually have to get formulation done at one place, packaging at another,” said Gustavo Fayad, VP of sales, marketing, and business development. “To simplify the process for our customers, we now have a comprehensive plan if they need it. We can offer formulation, ingredients experts, we can help with specifications. We can help with packaging if they need it and finally we are able to produce for them.”
For private label partners, Ginseng Up currently has about 200 stock formulations across categories, including still and sparkling tea, craft soda, coffee, drinking vinegars, and CBD beverages, Fayad said.
“We can help with the concept, we can create the concept, the formulation, we can source the materials and ingredients, we can source the packaging, [and] we can work with you on the line,” he said. “We can help all through the process of developing and getting ready for market.”
Whitesone said the company has long differentiated itself among co-packers by offering new clients first runs that can go as low as 500 cases per SKU. The increased capacity will allow it to work with more brands.
“We do other things other packers won’t do, but what allows us to do those kinds of things is because we’re a multi-platform business, we’re not just a contract manufacturer,” Whitestone said.
According to Fayad, the company spent two years planning upgrades, with installation beginning at the end of 2018. Prior to the changes, Ginseng Up was only able to produce 24-pack sized cases; However, the new equipment can supply smaller case sizes, including 6- and 12-packs, that Fayad said can help the company keep up with changing demands in retail.
While the upgraded facilities are now up and running, Ginseng Up is still manufacturing exclusively in glass packaging, but it will pursue additional lines for aluminum cans in order to keep pace with industry trends, according to Fayad.
“This is still the initial process.” he said.