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‘Four reasons to not compromise on security’

‘No compromise on bottle security’

As alcobev brands go premium, there is an increasing need for highly reliable closures to avert duplication and loss of business. Mr O.P. Pandey, CFO and Business Head of Hyderabad-based AGI Clozures, tells Dhananjay Sardeshpande why.

What is the importance of high-security closures for the alcobev industry?

There is an undeniable trend towards premiumisation of alcoholic beverages across segments and geographies in recent years. The liquid inside each bottle is of greater value, so the packaging and dispensing mechanism to attract the right customers becomes important too.

But what is crucial is the need to protect the high-value beverages from leakage, pilferage, adulteration and duplication. For that to happen, AGI Clozures has a range of high-security products in the Indian market, manufactured since 2017.

What are the consequences of pilferage, adulteration and duplication in alcoholic beverages?

First, there is the reality that brand value suffers on account of any of these malpractices. Consequently, not only the brand value but business of any company suffers immensely. Building brands and customer trust is no mean task; and regaining customer confidence is even more difficult.

Third, there is the issue of public health – we hear only too often of counterfeit liquor poisoning its consumers and harming their health in many ways. The cost to the public and to governments in terms of deaths and medical expenses cannot be easily quantified.

Fourth, the trade and consumption of such spurious liquor deprives the government of revenue in the form of excise. A loss of a registered company’s business is a loss to the exchequer too.

Can you give us a brief introduction to AGI Clozures?

AGI Glaspac (the packaging products division of HSIL Ltd.) has been manufacturing glass and PET containers for more than 30 years now, catering to the food, pharmaceutical, soft drinks and alcoholic beverage industries.

It made sense, therefore, to offer full-fledged solutions to its customers by including food-safe and reliable closures. AGI Clozures started the design and development of security closure solutions in 2015 and started manufacturing in 2017, with a capacity of 900 million caps per year.

We developed these closures with assistance from leading product designers in Europe, and we now own worldwide patents for these products. You can say we are fully committed to deliver what we promise. The fact that our annual revenues are increasing 50% year after year also says a lot about our customer satisfaction levels.

What is the USP of your closures?

Injection moulding is the heart of the manufacturing process at AGI Clozures. The attention to detail in the design ensures the stability and functionality of AGI Clozures under adverse situations.

Our product designs are technologically advanced. Our closures offer a double tamper evidence system, along with high pull-out force, which prevents the components from being reused or copied.

We use high-end extrusion technology and precision moulds, which make it very difficult for any counterfeiter to duplicate our products, even on a small scale.

To improve shelf life, we use high-performance pigments that comply with global food standards, in our injection moulding. Besides, the development of unique inks and tags for higher level of security closures is an on-going process.

It is these safety features that have led many state governments to recommend our products to distilleries in their respective jurisdictions.

What are your main products in the India market?

Voila is a tamper evident closure for 180 ml and 375 ml glass and PET bottles. Schutz (750-ml and 1-litre pack sizes) has been specially designed to suit the requirements of the Indian market and provide superior security features.

These are premium, patented products. Advance technology of moulds and side embossing makes it impossible for counterfeiters to copy these closures.

We also represent some top-notch European manufacturers of cork closures for spirits and wines. Premium materials are selected and designed in customised options – genuine design masterpieces that make any bottle stand out in a crowd!

These products are recyclable, come in different sizes, have robust insertion and extraction mechanisms, and are offered by us with custom printing options for both corks and cork caps.

In 2020, AGI Glaspac introduced its Greendrop Glassware in the retail (business-to-consumer) segment, consisting of clear and frosted, coloured and printed water bottles and food jars. These products are also available on all e-commerce platforms now.

In India, who are your main customers?

It is well known that several bottled-in-India spirits from reputed manufacturers such as Diageo, Radico, Tilaknagar Modi Group, Kals Group, SNJ Group and Accord Group use AGI Clozures products.

What about exports?

Our closures have a strong demand in African and South-East Asian countries due to higher level of security features in our products. About 20% of our annual revenue comes from our exports to more than seven countries in Europe and on the African continent.

In a highly competitive market, what can you tells us about the finishing of your products?

Good design and quality printing on closures not only increases the brand value but also boosts its popularity among customers. AGI Clozures has several printing options – and offers highly customised solutions – to fit a brand’s identity.

The opening and dispensing system of our bottles and closures is also consumer-friendly and provides buyers the confidence of the brand’s originality.

We use state-of-the-art equipment for high-speed, five-colour, UV offset printing. High-performance ink and lacquers are used for special effects, such as high gloss on the artwork. It also makes the print resistant to abrasion and environmental changes.

Hot-foil printing is generally opted by the entry-level premium segment of brands. We offer hot-foiling in gold, silver, red, blue, green, metallic brown and matt finishes.

Silk-screen printing is one of the premium printing processes at AGI Clozures, which is employed for premium closures in bright and metallic shades on base colours.

Two-colour pad printing is used to print on the top part of a closure. Brands use this space to print their corporate logos or intricate artwork. Customers can also choose to emboss or de-boss the closure top.

We have added a 12-colour digital printing facility that can be highly customised, including for limited edition and festival packs. We also offer laser printing of brand protection codes inside the caps.

Your closures are plastic polymers: what about their eco-footprint?

Sustainability is at the core of AGI Clozures policy. Our closures are of sustainable design and can easily be recycled. We are working very closely with some of our customers on extended producer responsibility projects for collection and responsible recycling.

However, you must note that Indian regulations do not permit recycled plastic to be re-used in any food-grade materials.

That said, our Hyderabad factory has been granted Platinum certification by the World Green Building Council. We generate more than 20% of our electricity requirements through solar panels; and we utilise only natural light on the shop floor in daytime.

We are a forward-looking company that will invest in reducing our eco-footprint wherever and whenever we are required to do so.