Wood pallet companies know all too well the lean margins and fierce competition that come with selling commodity products like 48x40s.
No surprise, a similar dynamic exists in corrugated, the extremely competitive “brown box” market. The good news is that a company can take strategic diversification moves that can soften the sting, as exemplified by Connecticut-based Nutmeg Container.
Unicorr Packaging Group’s Nutmeg Container Corporation provides an enlightening example of how companies can expand into new niches and generate profitable growth to enhance their commodity businesses. The leading New England protective packaging provider has made a series of lower-risk, well-timed investments that have led it into foam, technical crating and custom pallets.
Nutmeg delivers engineered protective systems where precision, testing and coordination matter as much as or more than price. Today, the company offers a single source for crates, foam, corrugated packaging, and pallets, making purchasing easier and more reliable for its customers in the Northeast.
Corporate Overview
Nutmeg Container operates as the protective packaging division within Unicorr, which consists of seven separate companies under common ownership. Before the Unicorr name was created roughly 25 years ago, each facility carried only its own local brand.
“Nobody really knew we were all under common ownership,” recalled Charlie Pious, Nutmeg president and a 40-year company veteran. “The marketplace didn’t see us as one big company.” Today, the unified Unicorr brand, shared fleet identity and coordinated selling have helped change that perception across a broad geography stretching from Montreal to Delaware.
Nutmeg itself operates two locations totaling 385,000 square feet, situated about eight miles apart.
Corrugated manufacturing and foam fabrication take place at Nutmeg Container, also home to its ISTA-certified packaging lab and a focused sales team, while another building houses technical crating, pallets and warehousing. The acquisition of the second building in 2017, formerly owned by a competing box company, was crucial in providing the space needed to grow. “Without that building, we certainly wouldn’t have been in the pallet business,” Pious said.
Nutmeg’s evolution into technical packaging dated back to the mid-1990s, when it acquired a small foam fabricator. That initial transaction allowed the company to move beyond brown boxes. Then, in the early 2000s, a major turning point occurred. A competitor accepted a buyout from a large paper company that really had no interest in its acquiree’s protective packaging division.
Nutmeg Container identified the move as an opportunity to recruit the critical tribal knowledge and expertise needed to begin a technical packaging operation. “With that decision they made, we picked up basically a division leader, two designers, three customer service people, and over two years, four sales reps,” Pious said. “That really thrust us into protective packaging big time.
“Anybody can make a four-sided crate with a cover on a pallet,” Pious noted. “We are building technical crates that have all kinds of hardware and interiors,” he said. The company has subsequently invested heavily in foam fabrication equipment, CNC routing capability and a full ISTA test lab.
That capability has unlocked custom packaging opportunities from demanding customers in industries ranging from medical and technical instrumentation to defense and aerospace. The work is complex and high-stakes. “If a customer ships diagnostic equipment to Europe that’s worth hundreds of thousands or millions of dollars, it better work when they plug it in,” he said.
Adding Pallets Where They Fit
Opportunities have tended to arrive through relationships. “Somebody who knew somebody,” Pious generalized. That pattern continued when Nutmeg learned of a retiring pallet company owner and purchased Coastal Pallet in 2017. It came with the company’s small facility, an older Viking Duomatic nailing machine, a near-new Pendu cut-up line and three key employees.
For a time, Nutmeg ran that pallet operation at the existing location, but the limitations were obvious. “He was making everything inside in a very small space,” Pious said. “In the wintertime, the doors were open all day. Those guys were just freezing to death.” Once Nutmeg purchased and renovated the second building eight miles from its headquarters, wood pallet operations were shifted there, allowing for indoor material storage and production.
While the company previously hand-nailed custom pallets, the pallet company acquisition allowed it to improve capacity and efficiency. The fit proved to be strategic. “Everything any one of our customers is shipping is most likely going out on a pallet,” Pious said, elaborating on their approach to growth, choosing opportunities that complement their existing offerings. “We focus on acquisitions that are a natural fit to our sales force. It’s not like building a rocket. We can plug it in and let it play right away. Although the company does produce some 48×40-inch pallets, it focuses on custom sizes, including heat-treated pallets.
Automation: Pendu and J&J Machinery
When Nutmeg acquired the pallet operation, the previous owner had already invested in a significant gangsaw line. “The Pendu saw system is a phenomenal piece of equipment,” Pious said. It features a powered infeed chain and descrambler, an automated chop saw and a multi-head gangsaw, with an inline Pendu double notcher, easily handling hardwood cants. A Pendu automated stacker takes the manual labor out of the equation at the end of the line.
The company also has a Baker notcher for longer custom pallets. Also, Nutmeg meets its HT requirements with a Kiln-direct kiln.
The Viking Duomatic nailer was an entirely different story. It worked, and it ran daily, but it was an outdated piece of equipment. As demand expanded and COVID-era labor volatility hit, the company decided to upgrade. They looked at several options for new nailing. “At the time, the lead time was about a year and a half,” Pious said. Many shops were reinvesting PPP funds at that time, and brimming machinery provider order files were often out a year or two for delivery. Nutmeg Container contracted with J&J Machinery to find a Duomatic to rebuild. And it took them a while to find a solid donor machine due to the tight supply in the market.
Choosing to go with a Duomatic rebuild allowed the company to keep its existing comfort with Viking machinery while gaining significant performance enhancements. Pious pointed out, “The key to the new machine is that J&J put in a computer-control setup. That was the biggest improvement that significantly reduced our setup time.”
The significant production boost was worth the wait to find the right rebuilt unit. “Our old Duomatic was a three-runner machine. In a good shift we were getting five or six hundred pallets. We’re probably getting closer to fifteen hundred a shift now,” he explained. The Viking upgrade also added capability. “It’s a four-runner machine. We don’t have a lot of four-runner work, but it’s way faster. And it’s a lot quieter.”
With the increased speed, the company recently ran out of work on a Friday, allowing gleeful employees to get an early start on their weekend. “That’s never happened before,” he said. “It is a reflection of our increased capacity.”
Setup time gains were particularly impactful. “Our setup times went from maybe 35 or 40 minutes to maybe 10 or 12,” he said. “That itself is an extra couple of jobs a day.” Smaller runs and oversized pallets are hand nailed.
Disciplined Systems and Sustainability
The company has a sophisticated dust collection system. All the sawdust gets blown into two trailers and is sent to a livestock customer for bedding. Large waste wood is placed outside in a spot visible from the street. “We don’t say it’s free. We just put it out there,” he said. “We see nothing. It magically disappears every day.” Keeping it informal reduces liability issues.
Other sustainability highlights included a 374 kW solar installation and broad recycling efforts. “We’ve found a place for everything that used to go in the dumpster,” he said, aside from the unavoidable lunchroom waste stream. The company earned a Bronze EcoVadis rating for sustainability, reflecting disciplined progress in environmental, labor and ethics performance.
Compliance infrastructure has grown as a business requirement. Nutmeg operates as an ISO 9001:2015 certified manufacturer. “To operate a business as a true corporation, there’s a lot that goes into it,” Pious acknowledged.
Investing in People and Software
Workforce continuity is a point of pride at Nutmeg Container. “We have very low turnover,” Pious said. Long-tenured employees are celebrated in a display at the front entrance. “There are six people 30 (years) and above,” he said. “Our core group of employees is really strong.”
Retention, he believes, has as much to do with atmosphere as with the company’s attractive benefits and 401K package. “I’ve always said the company takes on the personality of leadership,” he said. “I like to have fun.” Keith Bianchi, the vice president of operations, takes a similar approach. “Our attitude in this building is, go be miserable somewhere else,” he said. “Don’t bring it here. You spend half your waking hours with the people you work with. You better enjoy it.”
Sales hiring reflects a long-term strategy. Unicorr has 32 salespeople across the organization, including seven technical packaging and crating specialists who work out of the Nutmeg division. Leads from the broader team are routed to that technical group for design and quoting support.
Industry experience matters less than initiative. “We have a specific profile that points us to somebody well-suited for sales,” Pious said. “We’ll teach you the product, but are you going to get up every day and hustle?” Several of the company’s top performers joined from unrelated industries, including teaching, printing, beer distribution, uniform services, and gym membership sales.
Nutmeg developed proprietary design software to address the complex process of creating technical packaging. “We don’t have a right-hand, left-hand problem,” he joked. “We have a right hand, left hand, right leg, left leg (problem).” The custom-built software addresses complexity by linking pallet, foam, crating, and corrugated requirements into a single coherent workflow.
The proprietary software approach also extends into estimating and procurement. Pious credits Bianchi for building the core platform. “He’s a bright guy,” he joked, noting that Bianchi reminds him of the accomplishment every review period. The system houses hundreds of materials and hardware specifications used in engineered protective packaging, while the estimating module helps ensure accuracy and repeatability for custom work. It has grown to encompass pallet quoting, packaging design inputs, and purchasing logic.
Developing people remains just as essential as developing systems. Supervisors are evaluated on their ability to grow future leaders. “If they leave, do they have somebody behind them who can take over? That’s part of the review,” he said.
Looking Ahead
Unicorr continues to seek acquisition opportunities that fit within its engineered protective systems model.
The logic remains consistent with how Nutmeg has shaped its protective and technical packaging business over two decades. Add capability and expertise. Make sure sales can sell it, and make sure operations can deliver it.
“I never dreamed there would be an article about our company in Pallet Enterprise,” Pious concluded with a smile. “I never expected to be in Harvard Business Review, so this will be like my Harvard Business Review. I’ll take it.”
