Omnitech News

Making D&I truly scaleable

2/28/2006 8:00:00 AM

Making the two-piece D&I can accessible for all markets has been a dream for some time. A new system could now make it reality, as Daniel Foley discovered on a recent visit to Kian Joo in Malasyia. The idea of a flexible, truly scaleable D&I line is one that has been doing the rounds for years, as far back as Chris Olson, president of turnkey solutions company Omnitech International, can remember. “I certainly take no credit for starting this idea,” he explains. “It’s not a new concept and people have been talking about it for as long as I can remember.” However, now he is looking at the possibility of the dream being turned into reality. Omnitech has teamed up with Kian Joo, Malaysia’s major can maker and an innovator in the Asian market, to put the first MicroFlex™ System into operation. The two have set up a new 50/50 joint venture company called KJO to support the growth and development of this new system. “We’ll be addressing the market from a price point that doesn’t exist today,” Olson continues. “We are now capable of making a world-class thinwall D&I technological solution at a fraction of the cost of today’s conventional D&I lines. It’s all about expanding the base of two-piece cans.” The nickels and cents are one of the key points in this project. Certainly there is a desire to take D&I cans, especially for food, into more markets, but cost has so far proved prohibitive. Now, according to Olson, a complete line can be installed for $6-7 million. “The most extreme end for our system is probably for bottle cans, and that will typically be from $11-12 million,” says Olson. “Generally a MicroFlex™ System will cost under $10 million, with a nominal output of 150 million to 250 million cans a year for food and drink cans, aerosols or bottles.” It was Omnitech that developed the MicroFlex™ concept, but to take it to market it needed the backing of a respected can maker. “More than anything, the birth of this project relied on having a market ready for it,” says Olson. “We needed a customer of significance to deploy it and manufacturers buying into the idea of it.” The relationship with Kian Joo was something of a natural progression, as Olson, Teh Kok Lim, general manager of Kian Joo’s two-piece can division, and Kian Joo’s director Dato Anthony See, had a strong history together, and all were keen to take the project forward. “We were talking about regional rationalisation projects together,” says Teh. “We were looking at our transportation because the costs involved reduced our competitiveness. At the same time you can’t spend huge money on one line in one location. Also, why put all our eggs into one basket? There is more chance of success if you have a spread, which MicroFlex™ allows us to do.” The first of these lines will be made for Kian Joo – both Omnitech and Kian Joo are separate businesses to the new KJO, which will supply specialised equipment, product service and eventually regional sales for the MicroFlex™ line, but must survive by itself as a standalone company. The first line will produce cans for condensed milk, a commodity product in the Asian region and something of a safe bet for the first line of this type. “Ten years ago, condensed milk fillers owned their own can lines,” says Teh. “The only way for us to compete in this area is through the cost advantage of two-piece, and this way we can do that. We are looking at about a ten to 15 per cent cost reduction per can from three- to two-piece.”