Performance review

Production and

Sustainable product solutions

Sustainable consumption is gaining importance in all areas. Particularly in the case of consumer products, consumers are paying a great deal of attention to packaging. The topic is correspondingly important for our customers. We strive to provide sustainable product solutions by offering all-round sustainable glass packaging. In this context, we see sustainable product solutions as the sum of all our efforts towards sustainability – in our own operations as well as in the upstream and downstream value chain.

Packaging is one aspect that is attracting much attention in the context of sustainability, given that packaging numbers among the triggers of resource and waste problems. Quite often, however, the focus on packaging aspects is at odds with the effective share of packaging in the environmental impact of the product as a whole. Be that as it may, consumers are becoming much more attentive to the packaging of the products they consume – and regulations in this area are also on the increase. This consumer demand for products with sustainable packaging is passed on to us via our customers, such as food and beverage producers. So that we can meet this need, we are reducing our greenhouse gas (GHG) emissions, increasing the share of cullet (recycled glass) in our production, lightweighting our glass packaging, and offering more refillable bottles. We are also contributing to an industry-wide transformation by participating in various research projects on new technologies that can be utilised to minimise GHG emissions in glass production. To take two examples: Vetropack is a member of the International Partners in Glass Research (IPGR) association, and we can also provide sound data on the environmental impact of our products according to the specifications of the European Container Glass Federation (FEVE).

Website International Partners in Glass Research (IPGR)Website The European Container Glass Federation (FEVE)

Glass containers can be refilled multiple times, and glass itself is infinitely recyclable. Thanks to these attributes, we are convinced that – with our products – we can encourage sustainable consumption patterns in line with the UN’s Sustainable Development Goal (SDG) 12: “Responsible Consumption and Production”.

Transparent practices

Our customers increasingly require information about the environmental footprint of the glass packaging they use. We want to meet this need with communication and transparency. We see it as important to provide correct evidence of our progress in limiting our negative impacts, and to ensure that they are properly communicated to our customers. For these purposes, we review the attainment of our environmental goals according to various indicators for which annual targets are defined. These indicators include data on energy consumption, greenhouse gas emissions, water consumption, and waste production. We evaluate our environmental management activities by conducting internal inspections and audits; where legally applicable, inspections are also undertaken by certified external institutions.

Sustainability along the entire value chain

Sustainable products represent the sum total of all our sustainability efforts – not only in our own operations, but also in the upstream and downstream value chain. You can find detailed information in the reporting on our material topics, each of which describes an element of sustainable business activity.

Chapter energy efficiency and lower GHG emissionsChapter circular economy and resource efficiencyChapter compliance

Progress and events in the reporting year

Echovai: pioneering glass technology

«Clearly Sustainable» is the strategic thrust that spearheads our Strategy 2030. We aim to position ourselves as an industry-wide leader in environment-friendly production. To achieve this objective, we intend to boost the share of cullet in our production to 70 percent and also to introduce lighter refillable glass containers to conserve natural resources: we are already advancing towards this goal with our Echovai solution, the world’s first returnable bottle made from tempered glass. Echovai is an exceptionally robust type of glass bottle that is also very economical on materials; it is up to 30 percent lighter than a conventional returnable bottle, and is also more resistant to abrasion. These advantages ultimately result in higher circulation rates that reduce the logistics effort and CO2 emissions per bottle. A first pilot of the product with Mohrenbrauerei, the Austrian brewery, has confirmed the practicality and future viability of this product concept.

More about Echovai

Continuous quality improvement along the value chain

Continuous improvement of processes along the value chain is a core element of Vetropack’s corporate philosophy, and one of the five strategic thrusts outlined in our Strategy 2030. Driven by the “Leader in Quality” vision, we aspire to meet rising customer expectations, increase our production efficiency, and secure long-term competitive advantage. We are pursuing these goals against the backdrop of growing consumer interest in sustainable products which, in turn, is increasingly causing our customers to prioritise the issue of sustainability. We respond by endeavouring to meet the demand for sustainable packaging solutions backed by transparent information about their environmental footprint.

We strive for comprehensive, continuous improvement of our products. Ensuring product quality always has top priority in this context but, going beyond this, we are also optimising all the processes along our value chain. This is essential if we are to satisfy our customers’ increasing requirements and constantly boost our efficiency.

As well as positively impacting our products, however, continuous quality improvement along the value chain can also have a positive influence on occupational safety and reduce environmental pollution. Seen in this light, improvements of this sort contribute actively to sustainable industrialisation in keeping with the UN’s Sustainable Development Goal (SDG) 9: Industries, Innovation and Infrastructure.

Quality enhancement task force

Our management team is responsible for continuous quality improvement – with support from the entire workforce to accomplish this mission. Implementation is facilitated by the lean management approach in line with the Six Sigma model, which is well established at our plants. In keeping with our “Leader in Quality” strategic thrust, a cross-sectoral specialist group – Technical Performance, Technology and Quality – is responsible for enhancing quality (and therefore product quality). However, several internal specialist groups at various facilities also work on projects to promote occupational safety, environmental protection, and quality assurance.

Progress and events in the reporting year

Step-by-step rollout of our lean management approach

In order to minimise waste and propel continuous improvements, we have introduced a lean approach to quality management: the «Vetropack Production System» (VPPS). The rollout of VPPS has already led to adjustments in project positions and project assignments. For example, Lean engineers have already been recruited in several plants.. The reorganised Technology and Production division coordinates ongoing improvement activities such as Lean and Six Sigma at Group level.

Additional resources for performance projects

To encourage a more uniform approach to performance projects throughout the Group, we have created a dedicated position for this purpose in the Performance division. This will allow us to step up knowledge exchange across the boundaries of our organisational units.

Improved defect detection thanks to higher-performance testing equipment

In the 2022 reporting year, we replaced testing devices – for example at our facility in Trezzano (Italy) – with alternatives that deliver higher performance and enable better detection of defects.

Improved traceability

To improve traceability, we made further investments in laser marking machines in our plants at Pöchlarn (Austria) and Hum na Sutli (Croatia).

Digitalisation and automation

«Drive Innovation» is one of the five strategic thrusts in our Strategy 2030. We intend to exploit the opportunities offered by new technologies to continue developing our processes, and we aim to achieve efficiency gains by implementing automation solutions. Developments along these lines are entirely in keeping with sustainable business development.

Ongoing development of information technology combined with the digitalisation of business processes are essential elements of our Strategy 2030. Automation and digitalisation are crucially important issues for us as we continue to develop our production operations and the related upstream and downstream processes. Digitalisation of our entire business processes opens up the possibility of processing the acquired data rapidly and transparently. This puts us in a position to evaluate or optimise process flows – or even to redesign them completely. Intelligent automation concepts allow us to generate and evaluate data in real time – including data from production processes in particular.

We aim to make consistent use of the opportunities afforded by digitalisation and automation so as to boost quality and productivity while cutting our costs. This approach yields even more advantages: employees are relieved of routine activities and physically demanding work, occupational safety is enhanced, and efficient data exchange with suppliers and customers is guaranteed.

Responsibility for driving digitalisation and automation projects ahead is assigned to the Heads of Finance, Controlling, Procurement and Sales, together with the Head of Technology & Production in collaboration with IT. We are realising potential for process optimisations by launching investment projects in those cases where an adequate return on investment (ROI) can be expected. Key factors in successful implementation are Group-wide harmonisation of work and process flows in conjunction with continuous basic and advanced training of employees whose requirement profiles change substantially due to digitalisation.

The gains we expect from our automation and digitalisation efforts are not limited to a medium-to-long-term contribution towards securing our market position and business success: we also anticipate direct improvements to production. By defining specific performance indicators closely linked to our production and our customers, and by assessing and reporting on them at regular intervals, we can evaluate the performance of our plants and central functions in relation to internal and external competition; this enables us to intervene as necessary to exercise control. Relevant indicators to assess our process efficiency include the customer complaint rate, the customer satisfaction level, production losses, critical defects identified internally, and the occupational accident rate.

Progress and events in the reporting year

Realignment of our own business processes

During the year under review, our principal focus has been on the realignment of our own business processes. To drive this initiative ahead, we established three units to advance digitalisation at Vetropack, with effect from May 2022: Digital Enterprise addresses office-related functions; Digital Factory brings together the IT functions for production-related processes; and Digital Infrastructure combines the processes linked to digitalisation and IT. We have also appointed IT Product Managers for each business process and some additional central functions. The Product Managers collaborate closely with the specialist areas.


Introduction of Group-wide «performance reviews»

To optimise our production processes and control investments in line with our goals, we have introduced regular "performance reviews" with the plants. Based on key technical indicators that are defined and standardised throughout the Group, we evaluate the performance of our production plants and develop action plans to improve operative performance in collaboration with the plants. With the help of these key figures, we are able to single out differences between the various plants' production processes and identify «best in class» processes. Standardisation of production processes following the identification of these «best in class» processes plays a particularly important part here. The aim is to combine the technical improvement measures in one Group-wide «Performance Improvement Programme» that will transfer improvements in our production processes onto the Group's balance sheet. In future years, the cost savings identified by the «Performance Improvement Programme» will become a fixed component of the budgeting process for the plants.

MES project redimensioned

In 2021, we decided to introduce a Manufacturing Execution System (MES) that would harmonise our production data across all facilities, thus ensuring comparability of the data. As a consequence of the crisis-related events in Ukraine during the reporting year, it was decided that only some elements of an MES would be implemented as the first step, in the form of pilot projects.

Customer-specific products

We aim to create added value and firmly establish our brands by offering our customers glass packaging that is innovative, distinctive, and sustainable. Ensuring a high level of customer satisfaction is crucial if we are to maintain our leading position in our European core markets and achieve steady, profitable growth.

Packaging gives the food and beverage industry a way of differentiating its products to consumers. By offering innovative glass packaging that is both distinctive and sustainable, we support our customers with their product design. The success of these efforts must be reflected in a high level of customer satisfaction – because this is the key to constant, profitable growth. Our sales team is responsible for developing a customer-oriented sales and marketing strategy that will achieve this aim. Information needed for this purpose is acquired from market research and daily interaction with customers, and also from regular customer surveys: one key finding from these sources is that many of our customers attach growing importance to ecological issues. For us, offering customer-oriented products therefore means that we must provide products that include a contribution to more responsible consumption and sustainable production. In this respect, we – and our customers – are supporting the objectives of UN Sustainable Development Goal 12: “Ensure sustainable consumption and production patterns”.

Product innovation

We are convinced that joint development of new products through collaboration with our customers is one of the keys to long-term success. As well as allowing products to be adapted to specific customer needs, this approach enables both parties to improve their skills and know-how on a mutual basis. In doing so, we do not focus exclusively on the development of new products. With a view to our long-term success, the comprehensive improvement of the product mix is a strategic focus for us. If possible, we develop low-margin products until they become economically viable. Ongoing development work of this kind can be undertaken in collaboration with customers so as to improve value creation for both parties.

Progress and events in the reporting year

Product presentation at fairs and exhibitions

Drinktec is the world's largest trade fair for the beverage and liquid food industry. It takes place every four years – most recently in September 2022. Our presence there offered a good opportunity to present our Echovai innovation and – at long last – to make face-to-face contact with customers again.

«Proof of Concept» with Mohrenbrauerei

We have high expectations for our innovative Echovai product. The pilot project with the Mohrenbrauerei brewery of Vorarlberg (Austria) is now delivering impressive proof of the sustainability of tempered lightweight glass.

Over the past three years, millions of these bottles have been delivered to Mohrenbrauerei, the pilot customer. Following extensive testing and after the Echovai bottles have already been reused twelve times, Mohrenbrauerei gives them an excellent report card – especially in terms of sustainability. Not only are the new bottles more robust: they also reduce logistics effort and costs, so CO2 emissions per bottle are substantially lower. Even though the Echovai bottles have been reused as many as twelve times, their contact surfaces are still showing virtually no signs of wear. Many of these bottles can still be classified in ‘as new’ condition – which would no longer be the case for standard bottles after so many filling cycles.

The Echovai project can now move into its second phase for us: this involves exploring which additional Vetropack plants are suitable for Echovai production, and how they can be made ready for this purpose as quickly as possible. Because: we anticipate a rapid rise in demand. Then in the third phase of the project, the aim is to share the technology and know-how with third parties.

Customer survey postponed

Due to rapid inflation and supply disruptions caused by the war in Ukraine, we had to postpone the customer satisfaction survey planned for the reporting year until next year.