MIAMI - In 20 years as a U.S. Foreign Service officer, Charles McKay bounced from post to post throughout the world, learning about business in each place. Then he retired from diplomacy and found a real job - selling turnkey soft drink bottling plants and industrial machinery for food processors in Latin America.
In the years that he has been president of International Equipment Services Inc., based in Miami, McKay has bought, sold, relocated and started up 190 bottling plants in 28 countries, including an increasing number of plastic bottling plants for emerging independent bottlers in countries such as Ecuador, Peru, Colombia, and many others.
``We have several plants that are carved out of the jungle in the Upper Amazon,'' McKay said during an interview at FoodPack of the Americas in Miami.
McKay hosted a seminar for participants in the show, which was geared toward connecting Latin American food processors and packagers with their counterparts in North America.
``The whole area of Latin America, from the Caribbean to Chile and Argentina, is expanding for packaging in general, and for independent bottlers,'' Mc-Kay said. ``To some degree the growth and acceptance of plastic bottles has spurred growth there. There is special interest in bottled water, as well as soft drinks.''
Like most everywhere else in the world, McKay said, the growth of PET use has led the way in bottling, and has coaxed Latin American independents away from traditional trust in glass containers. Making PET bottles is less expensive than glass in materials, transportation and equipment, even given the increases in resin prices during the past year, and thus more attractive to entrepreneurs in emerging countries.
McKay's is a complete door-to-door service that takes advantage of trends in the North American markets that favor the large-volume bottlers over smaller ones. In a typical transaction, he buys the complete bottling plant -machinery, controls and even the mats on the floors -of a North American independent bottler, and ships it to the site in Latin America. He oversees the equipment set-up, calibration and production. He retains ownership of the turnkey equipment, which, although used, is usually in good shape and capable of good volume production, and is much less expensive than buying new machinery piece by piece.
``We are not really in competition with the big glossy state-of-the art facilities of companies like Coca-Cola and Pepsi, which have a large presence there,'' he said.
``The ability to sell 25 million units a year is enough to justify a plant in some places. In Brazil, for example, most of the industry and the plants are concentrated in the major centers like Sao Paulo and Rio de Janeiro on the coasts, but there is a whole world of territory and people in the interior for my plants to serve.''
One problem for the smaller bottlers with whom McKay does much of his work is the supply of preforms for their containers.
``It's one thing to set up a bottle plant somewhere,'' he said, ``but there are almost no places in Latin America to get preforms, so they all have to be purchased from the U.S., which increases the costs of business.''
McKay said he expects the use of plastic to continue growing in the Andean region, Argentina, and the Amazon, as well as in the Caribbean, due to the increasing demand of the public in those areas for consumer products, and their relatively stable economies.
``PET is a natural to continue growing there,'' he said. ``In Argentina, there is even interest in returnable PET bottles, which is unusual elsewhere.''
