Synlait halts production of award winning reusable stainless steel milk bottle

Nov 21, 2023

Synlait Milk's award-winning reusable stainless steel milk bottle trial has ended after the company decided not to commit resources to a nationwide roll-out.

Synlait launched Swappa Bottle in October 2021 at New World's Ilam and Fendalton supermarkets in Christchurch. Shoppers could buy the 1.5 litre stainless steel bottles of homogenised milk for $15.29, with subsequent purchases costing just $5.29 when they returned the bottle to store for washing and refilling.

An alternative to plastic milk bottles, Swappa Bottle won a gold award for Beverage Packaging Design of the Year at last year's Australasian Packaging Innovation & Design Awards.

And although Synlait said the 12-month trial was very successful, it said it had made the difficult decision to cease production of Swappa Bottle.

READ MORE: * Synlait Milk posts $28m first-half profit * Synlait launches stainless steel milk bottles in South Island supermarkets * Synlait to sell reusable stainless steel milk bottles through New World in South Island

"A significant investment was needed to take Swappa Bottle from a pilot product to a nationwide proposition, and the economics to do this did not stack up," the company noted in its latest sustainability report.

Chief executive Grant Watson said they had really good feedback from consumers but the project had been put on hold for now while Synlait focused on stabilising its business.

The Dunsandel, Canterbury-based milk processor has had a rough ride during the pandemic, posting its largest ever loss, as it was caught up in the turmoil of its largest customer, The a2 Milk Company, when orders from the key Chinese market initially surged as families stocked up on infant formula, then slumped when pantries were full, resulting in surplus stock.

"Right now, our focus is on stabilising the business," Watson said. "When we looked at the Swappa Bottle, which is an amazing piece of innovation, we thought right now it's too much of a distraction for our business."

The project would be considered again at the company next strategic review where it would be weighed up against other investment opportunities, he said.

"It's on hold, it's not a definite no," Watson said. "We’ve got to make sure we've got the resource and the focus to do it justice and then if we scale it up we know it's the right thing for the consumers. Otherwise, we'll put a whole programme into the market and there's a potential we could pull it - we don't want to do that."

Still, he said the Swappa Bottle trial was definitely worthwhile.

"It is a really neat piece of innovation and we've got to challenge ourselves. It's in our DNA to innovate, and it was a great sustainability initiative.

"We've got to keep doing more and more of this stuff. Some of it won't work. Hopefully, a majority of it does, but we've got to keep doing it."

Synlait is branching out from being a manufacturer of products for other companies to developing its own consumer brands after acquiring Dairyworks in 2019, which supplies supermarkets with Dairyworks, Rolling Meadow and Alpine products.

Swappa Bottle was Synlait's first product launched under its own brand. It already supplies Foodstuffs South Island with fresh milk and cream under the supermarket group's Pams and Value labels.

Consumers who bought Swappa bottles had been offered a refund and the bottles were now in storage. Some pieces of machinery used for bottle cleaning had been mothballed, while other machinery used for filling was utilised elsewhere in the business, Watson said.