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Illinois Recycler’s Focus Is Maximizing Recovery, Value
Trace Equipment Key Supplier of Disassemblers to Pallet Solution Inc.
By Jack Petree
Date Posted: 2/3/2003
ALBION, Illinois -- Randall Kimbrell and his wife, Julie, have degrees from Western Illinois University. But Randall will tell you that they received their real education when he went to work nearly 10 years ago for Jack and Peg Thornton of Woodthorn Corporation, a former pallet machinery supplier.
"I didn't major in pallets when I went to the university," Randall said, laughing, "but I sure did at Woodthorn. The experience there was like an AA degree in pallets, and it stood Julie and me in good stead as we've built our own business."
The business Randall and Julie have built is Pallet Solution Inc., a pallet manufacturing and recycling company. Using the knowledge gained at Woodthorn and machinery supplied by Trace Equipment Corporation, the two have developed a business in seven years that produces about 150,000 pallets per year.
More impressive than that production number is the system that Randall and Julie have developed to maximize lumber and pallet recovery from recycled pallets and enhance the value of finished pallets. They pay close attention to process control and maintain a range of equipment that allows each incoming pallet to be recycled for its highest and best use. These entrepreneurs have learned how to recover every usable piece of wood from scrap pallets that are beyond repair, reduce the number of pallet cores that are disassembled instead of remanufactured, and control labor costs associated with repairing pallets. They also maximize the opportunity to build high value ‘new’ pallets out of recycled wood.
Randall, Julie, and a friend established Pallet Solution in early 1995. They prepared for the start-up by collecting excess pallets for about three months. Then, using a Solo pallet disassembler and a 12-inch radial arm saw, they went to work repairing and selling reconditioned pallets.
The partners selected a location in the vicinity of several manufacturing plants that could provide them with a consistent supply of pallet cores and other manufacturing businesses that were potential customers for quality reconditioned pallets. With that kind of research, the company began to grow within six to eight months. Soon they added a second Trace Equipment machine, a band saw disassembler.
Randall and Julie bought out their partner after two years and then expanded by acquiring the equipment and accounts of a nearby company, Blair Pallets. The acquisition added a third Trace Equipment machine -- a Trio three-head disassembler -- to the operations of Pallet Solution.
Within a couple of years, then, Pallet Solution had the basic equipment to develop and grow into what is now a thriving company. They have gone well beyond the norm for a pallet recycler in identifying opportunities to maximize yield and profitability.
Further expansion and refinement of the company’s operations led to additional investments in equipment and the system for handling pallets that is in place at the company today. As the company considers a move to a new facility, its core equipment consists of six machines supported by Trace Equipment Corporation: a Solo disassembler, a Trio disassembler, two band saw disassemblers, a Trim-Trac end trim saw, and a 10-foot revolving accumulator turntable.
Pallet Solution serves customers within about a 100-mile radius although it sometimes ships to customers further away. The company has customers in automotive, plastics, and agriculture industries. Pallet Solution obtains pallet cores from a radius of about 75 miles.
Most of the company’s pallets are specialty pallets built to customer specification. The company collects and reconditions pallets for customers. However, most of its business comes from providing pallet collection and removal services, and then using the pallet cores it recovers to manufacture pallets for other customers.
The key to success is processing the scrap lumber, broken pallets and other waste material in such a way to recover the maximum value for products it can supply to customers, according to Randall. Anyone can take a couple of old pallets apart and then use the pieces to manufacture a low-value pallet, he said, but that would mean a missed opportunity. The opportunity -- and added profit -- comes in converting a pallet core to a usable pallet that brings $2-3 more than it would as disassembled pallet parts.
Randall has four pallet disassembling machines because he wants to fully realize the potential of each piece of wood that can be recycled. Trace Equipment has been the supplier of choice because it provides strong support to help ensure that the equipment runs smoothly with minimal downtime, he said.
Incoming pallets are inspected and sorted, and pallets to be disassembled are routed to the machine for which they are best suited. For example, four-stringer pallets go through the Solo while block pallets are disassembled on one of the band saw machines.
On a typical day, 150-200 pallets will be disassembled on the Solo, 500-700 by the Trio, and another 150-200 on a band saw. The second band saw machine is used mainly to prep repairable pallets.
The decision-making for every pallet occurs in the sorting process or at the disassembling machine. "All we want our builders to have to do is attach the proper pieces necessary to produce a finished pallet," Randall said. "We've found that to be the most efficient way to maximize productivity."
Repairing a damaged pallet by plating a cracked stringer instead of replacing the defective stringer has become an important – and profitable -- aspect of the company’s operations. Randall explained. "With the plater you can make a pallet with a broken stringer into a marketable product with little time, effort, or expense. If you have to remove a stringer and put a new one in, you might have $2 invested. With a plater, you've got 11 cents per plate plus labor. You end up with an equivalent pallet for about one-third the cost."
"If I were starting out again, one of the first machines I'd get is a plater," Randall said. "We have two PRS platers, and I'd say they paid for themselves in the first six months of operation."
From the pallet disassemblers, recycled lumber flows in two directions. Recovered deck boards go onto the 10-foot revolving accumulator table where it is easily accessible by the worker who runs the Trim-Trac trim saw. Reclaimed stringers are stacked in sets, with the stringers from a disassembled pallet kept in the same set. Repairable pallets, prepped and with nail stubble compressed, go to workers who attach the repair stock.
According to Trace Equipment, production on the Trim-Trac trim saw can reach 15,000 boards in an eight-hour shift. Production at Pallet Solution is considerably lower because the company puts more emphasis on maximizing the recovery potential of each board than production speed. Pallet Solution's Trim-Trac provides a selection of eight stops. Boards are also separated by hardwood and softwood, so the operator may be producing up to 16 types of deck boards.
Stringers are handled separately. Whenever possible, stringers that are recovered from a used pallet are kept together so that the same stringers may be used together again to manufacture another pallet. "You'd be amazed how much difference that makes in the quality of the finished product as well as in the ease of construction," said Randall. "When you're breaking pallets down, you'll get all sorts of variation in size. If you keep the stringers together, everything fits better in the finished piece so the customer gets a better quality product."
The need to recover stringers intact and reduce damage to pallet parts in the disassembly process is another reason that Randall has relied on Trace Equipment's machinery over the years. "They've designed their equipment to minimize damage to the wood in disassembly," he said. "That is very important to the success of our operation."
Pallet Solution uses Stanley-Bostitch power nailing tools and jigs for assembling and repairing pallets. The company makes four types of pallets. A very small part of the plant's production consists of new pallets. In the recycling arena, the company supplies three types of pallets: ‘new’ pallets built of recycled lumber, remanufactured pallets, and recycled pallets that have been repaired.
As an example of remanufacturing, Randall described what Pallet Solution does with four-stringer pallets. The company recovers a large number of four-stringer pallets that are in good condition but of little use to its pallet customers. Instead of disassembling these pallets to recover lumber, the company removes one stringer and relocates another to make a three-stringer pallet. With minimal effort, it can produce a high-grade three-stringer pallet that brings a good price instead of taking a pallet that could not be resold and investing the time and labor in disassembling it to recover the used lumber. "We try to look at everything we do with that kind of value recovery in mind," said Randall.
Pallet Solution has been using a contractor to grind its wood waste material. However, the company is scheduled to add a grinder of its own in February. Once again it turned to Trace Equipment to supply the machine it needed, in this case a used horizontal grinder. It will be installed by the manufacturer. Randall plans to market the grindings for boiler fuel and mulch.
While growing a company from scratch to the level of producing 2,500-3,000 pallets a week is a significant accomplishment, Randall and Julie are prouder that their business supports 25 full-time employees and six part-time in an industry that benefits the environment.
"A lot of people look at the piles of old pallets we have around here without realizing how important those pallets are in improving the environment and in keeping people working," he said. "In a rural area, 31 jobs are a big deal. We provide those jobs by making something useful out of something other people throw away."
Pallet Solution is an example of how the pallet recycling industry has grown up and become more professional in recent years. As Randall pointed out, a pallet supplier can improve his business not only by building and selling more pallets, but also by managing production operations in order to reduce costs and increase efficiency.