Standing out from competitors can be difficult. As long as a pallet is built properly, ‘a pallet is just a pallet’ to most customers. With this in mind, CALco Pallets takes a different approach to separate itself from other providers.
“Really, there is nothing much in our product that differentiates us,” emphasized Greg Calhoun, co-founder and COO of CALco. “But we know, however, that with pallets you are not selling a product. You’re selling a service.” He noted that pallets may sometimes be the last thing on a customer’s mind until they run out. That’s when they can shut down production and disrupt operations. CALco takes pride in offering flexible delivery options to best meet customer needs.
As CALco has grown in size and complexity, meeting the unique requirements of each account has become more challenging. “With the way that we have scaled, it requires a lot of energy and good leadership to be able to manage every customer’s individual needs,” Greg Calhoun said.
That high level of service has been the engine powering CALco’s success. It has enabled the company to build a profitable business and solid bank relationships. This has given the company access to the capital it has needed to expand to its current three locations as well as to purchase new machinery. The company continues to invest in new equipment. The most recent additions include a Go Fast Twin NXL notcher, Viking nailing equipment, and a new Rotochopper grinder.
Go Fast Equipment Fits CALco’s Safety Approach
One recent addition to CALco has been its Twin NXL notcher from Go Fast Manufacturing. The company has been so pleased with it that it has a second unit on order, and is considering placing an order for a third machine.
“Go Fast makes an excellent product not only for high production numbers but for safety as well,” Greg stated. The Twin NXL features dual safety hand controls, while pop-up safety gates never expose cutters. Greg noted that as the company grows, it is bringing more new employees aboard, underscoring the need for safety and ease of use.
The Twin NXL is a heavy-duty double-head pneumatic manual notcher designed to fill the gap between today’s entry-level single-head pneumatic notchers and high-end, high-production, and expensive, auto-feed double-head notchers. Go Fast also offers a high-production 2NX model as well as a single-head NXL. It has also very recently launched the XNL-M manual single-head notcher. All models offer advanced safety features and are built to provide years of trouble-free service.
CALco likes the fact that the Twin NXL can notch extra-long stringers as well as recycled material.
According to Kevin Wieser, managing member and machine designer at Go Fast, CALco came to own the first Twin NXL quite unexpectedly. Greg and Daren Konecny, the company’s maintenance manager, were on a visit to Go Fast, when Konecny pointed at the single-head NXL and asked why the supplier didn’t offer one with two heads. As it turned out, one was already under development.
“We were trying to keep this project secret, but we had to show it to them,” Weiser recalled. “We walked to the far corner of the building where the Twin NXL was under tarps. It was about 60% of the way assembled. They liked what they saw, and they ended up buying it.”
“The great thing about CALco is they just keep giving more feedback and more feedback, which is exactly what we need to help make the machine even better,” he continued. “They’re nice machines. They’re doing exactly what they’re supposed to do, and people are happy with them.”
Customer Service and Growth Focus Leads to Risk Taking
Co-founded by brothers Matt Calhoun, President, and Greg Calhoun in 2007, CALco Pallets has established itself as a leading full-service pallet provider. The Richmond, Illinois-based company is strategically positioned to offer new and recycled pallets to a diverse customer base across the Midwest. In recent years, it acquired a hardwood cut stock sawmill in northern Wisconsin it has rebranded as Sawco, launched a profitable and rapidly growing wood waste and mulch business called Grindco, and established a satellite recycling location in Chicago. While the company is located only 70 miles from the heart of the city, the satellite location allows it to better serve customers in the congested Chicagoland area.
When they began the company, Matt had been working at another pallet company for about three years, while Greg was a carpenter. Greg sold his truck and they pooled their resources. Matt had one pallet account brokered that he managed, while a salesman for a local contractor. “2007 was a terrible time to start a business,” Greg recalled, “but we fought through it.” The early days were not without missteps. They quickly found themselves saddled with a bad, high-interest lease for a forklift, but they learned on the fly. They soon negotiated a creative property lease deal that included the landlord also financing some trailers.
Success came through hard work and smart business decisions. Greg suggested, “For years, we rolled every dollar we made back into the company to purchase equipment and expand our capabilities and capacity. When our lender saw this within our financials, they immediately understood the commitment we had to the business, making it easier for us to receive loans.” Greg and Matt brought on long-time friend, Jeff Elser to produce sales. Jeff left his handsome corporate job and inherited risk side by side with the 2-year-old company.
“It was just creative financing and an entrepreneurial spirit,” he said. “We were young and in our 20s. We put our necks on the line and, even today, we have no intention of slowing down.” This interview was conducted just after Greg returned from a trip to evaluate a possible business acquisition.
Greg explained, “We plan to grow our business through acquisition or greenfield operations in new markets. Although we love the Chicago pallet market, it is probably one of the toughest and most competitive in the country. It keeps us on our toes and sharp at what we do. If we can make it here, we may have some value to bring to other markets.”
As the company looks to scale up even more, data and technology has become critical to its future. The company started out with a dry erase board to manage key indicators. It then moved to a custom-developed basic software program. Over the last four years, CALco has relied on the PalMate® enterprise resource planning software.
In-depth Look at CALco’s Production Setup
Pallet production at its 130,000-square-foot flagship site features a Viking 606 as well as a Viking Champion 306 and an older Viking Duomatic that is scheduled for replacement. A second 606 is on order. The 306 is used for new pallets as well as combos manufactured from reclaimed stringers and new softwood deck boards. “I can’t see myself parting ways with the 306,” Greg said. “I love that machine.”
The company sources a variety of material, including 100% of the production from its captive sawmill, as well as a variety of cut stock, cants and random length and KD material. It runs a 4-head Baker resaw with inline deduster and notcher and also has a Pacific Trail package saw.
On the recycling side, CALco runs five Smart Products 52" capacity single-operator pallet dismantlers. Recovered boards are conveyed to an accumulation table and then sorted by length. One Smart Products trim saw cuts exclusively to 40" while another one cuts custom sizes to order as required.
CALco also has created a profitable wood waste business called Grindco. Volume is up 50% over last year. It handles all of the pallet company’s wood waste, as well as material from other sources. It wholesales truckload quantities of colored fiber to nurseries, landscaping companies and others. It also offers a premium bark product produced from material brought in from Sawco.
It runs three Morbark tub grinders and a new Rotochopper, which will allow Grindco to pursue more off-site grinding opportunities.
Greg attributes the success of Grindco in no small part to its manager, Jason O’Brien. “We brought on a very talented guy as a partner, and he has taken the operation to a level far beyond our imagination.”
CALCO has had a remarkable growth trajectory since its inception in 2007, now with almost 200 employees and with an appetite for further growth. A combination of entrepreneurial passion and a relentless focus on service has created a strong foundation for profitability and future growth.
