HORTONVILLE, Wisconsin – Bob Luedtke took a risk when he walked away from a good job at a paper company to work for his own pallet company. It paid off, and now it is paying off for the next generation.
Skids, Crates & Pallets, Inc. (SCP) and its affiliated business, EverGreen Pallet, Inc., are now in the hands of Bob’s sons, Charlie and Joe. Under their leadership, they have greatly expanded and grown the company in only five years.
The company’s growth in recent years has been driven by its increased focus on the recycled pallet market. SCP now has two pallet recycling plants. Illinois-based Cresswood Shredding Machinery has become an important supplier, providing three grinders that enable SCP to process its growing volume of scrap wood material – and convert it into a revenue stream.
In 1994, Bob and another employee at Fox River Paper Co. started making skids for their employer in their spare time. They got a toehold in the business, and it quickly grew. They left their jobs to work in their own company full-time the following year and soon bought out a third partner. In 2000, Bob reported that the company, located in Hortonville, Wisconsin, was growing at an average of 40% per year and had reached about $5.5 million in sales.
Fast-forward to now. Charlie and Joe grew up in the business and now lead it.
Bob retired in 2017, and his sons have significantly expanded and grown the business since then. They opened a plant in Waldo, Wisconsin the following year, and last year they built their second plant in Hortonville.
Hortonville, the site of the company’s main plant and offices, is in North-Eastern Wisconsin, about 40 miles west of Green Bay. Plant 2 is in Hortonville and located nearby. Waldo, the location of the third facility, is almost 80 miles southeast, or about 45 miles due north of Milwaukee.
Cresswood Grinders Provide Efficient, All-Day Wood Processing
SCP has three Cresswood grinders, one at each plant, to process scrap wood. The most recent one was installed at Plant 2 in Hortonville about six months ago.
“With Cresswood low-RPM grinders, it’s a steady feed,” said Charlie. “It seems a lot more reliable process than larger, more powerful grinders. Cresswood grinders just keep going all day long.”
The Cresswood grinders are housed in the loading dock bays of the plants. Scrap material is collected in hoppers; when they are full, a forklift operator picks it up and dumps the contents into the grinder.
When the wood material exits the grinder, it falls into a conveyor. As the material goes up an incline, a large, magnetic belt removes nails and metal fragments and drops them into a hopper. The grindings are dropped into a system of tubes with a blower and expelled into a trailer van.
The wood grindings are sold by the truckload and supplied to other companies that color most of the wood fiber and use it for landscape mulch; some uncolored material is used for animal bedding. Each plant, according to Charlie, probably produces a trailer load of wood grindings every 3-4 days.
The newest Cresswood grinder at Plant 2 in Hortonville, installed in 2021, features a fully machined grooved bedplate, noted Cresswood president Ryan Butzman. “This value-added feature lowers the total cost of operation by preventing material and nails from migrating underneath the ram and jamming up the ram.” It also ensures strong linear alignment of the ram even with heavy side-loading. The system has a custom enclosed hopper designed for safe, efficient, clean loading of pallets and tipper waste material. The Cresswood grinder at Main Plant in Hortonville, installed in 2015, is similar. The Cresswood grinder at the Waldo facility, installed in 2014, additionally features a closed loop trailer loadout system.
The Cresswood grinders run 10 hours a day, 5 days per week. “They’re pretty busy,” said Charlie. The grinders have only required normal maintenance. “They’ve never been down for an extended period of time,” said Charlie. “That’s why I have so many of them, because of their reliability.”
Cresswood service is “top notch,” he added, if needed.
SCP employees maintain the grinders. The teeth usually get a visual inspection every couple of weeks along with other components. They can be rotated once before they need to be replaced.
SCP Plant & Operations Overview
SCP has about 95 employees. The company’s Main Plant has about 50 employees. Another 15 work at the Plant 2 in Hortonville, and another 30 are employed at the Waldo facility.
Charlie is the vice president of operations. Joe is vice president of sales and handles dealings with new and existing customers. Production manager Chris Schmalz oversees operations at the two plants in Hortonville, and Ken Dobas supervises production at the Waldo plant.
The company’s main plant manufactures new pallets. The scrap wood it generates is typically trim ends or end cuts of material. The other plants have pallet recycling operations, so most of the scrap material is in the form of whole junk pallets or damaged or broken pieces of used lumber from dismantled pallets and trim ends from reclaimed deck boards.
The main plant buys kiln-dried pine and SPF; that represents about 75% of its raw material. The other 25% is green hardwood cants or cut stock. SCP buys a lot of 2×4 and 2×6 softwood in various lengths.
The plant has two different lines for resawing material: a Pendu gang saw for resawing hardwood cants and a Brewco two-head bandsaw system for resawing 2x softwood lumber.
Brewco custom designed the system for processing 2×4 and 2×6 lumber. A Brewco trim saw cuts the lumber to length before it goes through the two bandsaws. The boards go through a de-duster and then are stacked by an AIT M2L stacker supplied by Pallet Machinery Group.
The Pendu gang saw was purchased at an auction. “They can cut so fast,” observed Charlie. The gang saw may be set up to cut stringers or deck boards all day long.
The main plant is equipped with several nailing machines for assembling standard-sized pallets: two Woodpecker machines, a Viking Turbo 505 and a Rayco Edge.
“We invested in the Woodpecker nailing machines because they are relatively easy to maintain and repair,” said Charlie. The machines do not have programmable logic controllers, and the operators can maintain and repair them. “With the Woodpeckers, the operator a lot of the time can take care of any minor fixes and keep it going,” he added.
SCP Specializes in Custom Pallets and Has Grown Its Recycling Business
SCP also builds a lot of custom specialty pallets, so it has a large area of worktables and employees building pallets with pneumatic nailing tools. The company will do orders for as few as five pallets; many orders are only five to twenty. “We do a lot of that,” said Charlie. “Our niche is sort of that specialty product.” He added that doing small orders for custom pallets has “gotten us in the door” with customers who later will begin giving SCP its larger orders for standard-sized pallets.
Most of the growth in recent years has been driven by pallet recycling. The main plant, with 75,000 square feet, mainly built new pallets until Bob retired, and around that time, a few customers began requesting recycled pallets, so the brothers started recycling operations at the main plant. “It steadily got bigger and bigger,” recalled Charlie, and soon they needed more space.
They built the second plant in Hortonville, with 20,000 square feet, for pallet recycling operations. It has been operating for about six months. The plant is equipped with four PRS dismantlers, each operated by two workers and configured with a conveyor belt to carry reclaimed lumber to a trim saw. A PRS repair line with two repair stations processes pallets that need refurbishing. Finished pallets are conveyed to PRS stackers and are routed via barcode labels to the correct stacker. The stackers have eliminated the lifting that goes with manually stacking pallets. Also, the system “really helps us to get accurate counts of what exactly is coming off a truck,” noted Charlie.
Trailer vans are staged at customer relocations to be filled with used pallets. Some customers return cores that will be repaired as needed. Some customers fill the trailers with scrap pallets that will be dismantled, and some trailers are a mix of cores and junk pallets.
On the unloading dock, a forklift driver removes stacks of pallets from the trailers and places them in an area where they will be dismantled or processed on the repair line. Another forklift driver keeps supplying used pallets to the dismantling area and the repair line.
The company can expand the pallet repair operations by adding more repair stations, but it is currently experiencing a shortage of cores. “It’s getting harder and harder to get (48×40) cores,” recognized Charlie.
The company has ordered an Urban Sawmill machine from Alliance Automation. The Urban Sawmill takes recycled lumber of any thickness, scans the material, optimizes the board for length, trims it, and drops it in a bay for lumber of the same length and thickness.
The Waldo plant has three dismantling machines and two trim saws for generating recycled lumber and a couple of pallet repair stations. The plant recycles 48×40 pallets as well as other sizes. SCP buys some pre-cut stringers and deck boards to supplement the production of recycled components.
The plant is also equipped with nailing machines capable of assembling pallets made with recycled lumber. It has two Master Recycler nailing machines from Midwest Machinery & Automation. “We like those,” said Charlie. “They’re made for recycled lumber, and they do a good job.” A Viking Champion machine is usually devoted to nailing ‘combo’ or combination pallets made of new stringers and recycled deck boards.
What Makes SCP Different
SCP strives to differentiate itself from other pallet suppliers when it comes to customer service, explained Charlie. “We will always be there for the customer, and we will try to build a long-term relationship with them.”
When lumber prices increase and SCP has to raise pallet prices, they provide third-party sources (from Pallet Profile Weekly, and Random Lengths Index for example) to document the rising costs. “We always show our customers supporting documentation why prices are going up,” said Charlie. SCP also gives customers price reductions when lumber prices fall. “It works both ways,” said Charlie. “It builds relationships.”
One of the biggest challenges the company currently faces is labor – finding new employees. “Finding reliable people who will come and work hard for us,” admitted Charlie. There are a lot of other businesses competing for the same workers, he noted. “It’s a hard labor market.”
SCP teams new workers with veteran employees to help them learn their tasks and become acclimated. The company also pays bonuses to employees who refer them to people who come on board as new hires and stay.
Through all of its growth, SCP has relied on quality suppliers and tried to develop sustainable processes that can be executed over and over again.
