SMITHVILLE, Ontario – Creating the perfect pallet recycling plant, that’s what Fred Vrugteveen has set out to achieve. He is the company visionary and general manager of Niagara Pallet in Smithville, Ontario. He envisions designing a facility that eliminates touches wherever possible, automates as many functions as possible while still staying nimble and develops better data to manage operations and sales. Oh, and he wants to do this while eliminating waste and conveniently conveying waste material to turn into other products.
Designing the Perfect Plant Design
The interesting thing is that until this most recent automation effort, Niagara Pallet has been run as mostly a manual operation. Fred Vrugteveen admitted, “We always wanted to do automation, but we just could never afford it or justify the expense because the solutions we wanted weren’t really there. I think we really have some critical things figured out now.”
Niagara Pallet is the first pallet company in North America to install the IVISYS pallet inspection system that has been used to run pools and pallet plants in Europe. This technology is being supported and sold by Alliance Automation in North America. The first several installations in the United States have taken place at distribution centers focused on managing pallet quality.
Alliance Automation worked with Niagara Pallet to design the entire system based on its innovative product line and the custom requirements desired by Fred Vrugteveen and his team. In addition to the IVISYS PALLETAI inspection system, Niagara Pallet is running a Robotic Pallet Dismantler, Urban Sawmill, and an automated repair line from Alliance Automation.
Two years ago, the company added to its building to have space for the Robotic Pallet Dismantler, the first piece of Alliance Equipment installed at the facility. Labor challenges were the real impetus that led to the company installing a Robotic Pallet Dismantler.
Fred said, “During COVID we struggled to staff our tear down line. On a good day, we had two out of four saws running. And there were even days where we had nobody show up for an afternoon shift. The whole process was very labor intensive. Out of necessity, we were taking a lot of the good tear down material and putting it through the shredder. So, the Robotic Pallet Dismantler was a no-brainer. We should have put it in a long time ago.”
Adding to the complexity during Covid, the company started a second shift that increased management stress and labor requirements. The Robotic Pallet Dismantler boosted production while reducing the wear and tear on workers. A year ago, the company installed an Urban Sawmill trim saw to process recycled boards coming out of the Robotic Pallet Dismantler. Fred admitted, “The Robotic Pallet Dismantler was easily justified because the labor savings were very significant. Teardown has always been an area of our plant that we struggled in.”
Niagara Pallet still runs a Smart Products bandsaw dismantler for oversized, damaged or wet pallets that may not easily go through the robot. About 5% of the total production won’t efficiently process through the Robotic Pallet Dismantler. Fred explained, “Anything that’s oversized doesn’t fit through the robot; I think 60 by 60 is the max size it will handle.” One operator runs the Robotic Pallet Dismantler deciding what pallets need to be manually processed or scrapped.
While Niagara Pallet always had a fairly efficient process to sort and cut down boards, Fred and his team wanted to automate as much as possible knowing that staffing manual processes is becoming increasingly difficult. He noted, “I wanted everything to be running in conjunction with each other in a linear process where you put mixed pallet loads in the front and out comes fully ready-to-go pallets at the end of the process.” That’s why Niagara Pallet decided to add an Urban Sawmill about a year ago. And this past Christmas it added a twelve station repair and sort line from Alliance Automation as well as an IVISYS’ PalletAI inspection system.
Fred projected, “When this system is fully running to capacity, we will double the productivity per person in our facility. This automation is not about reducing head count but increasing efficiency and capacity.”
Niagara Pallet has spooled up the number of incoming cores to feed the appetite of the Urban Sawmill. This optimized trim saw is capable of 12 category sorts and is run by two operators. It can produce 60,000 board feet per shift per week.
Why Go with Automated Pallet Inspection?
The process starts with a tipper that is operated by one person who singulates the pallets. Currently, this person is inspecting each pallet and deciding what happens to every pallet coming through the line. Eventually, this inspection process will be handled by the IVISYS PALLETAI 2-D pallet inspection system and AI-assisted analysis software.
Pallets that can be repaired are conveyed to the 12 repair stations. Pallets that are good to go are conveyed underneath to the main stacking area. If it’s a tear down or scrap, it gets swept off to the side to the Robotic Dismantler. Odd sizes are conveyed to the end of the line and hand stacked into different sizes. Initially, Niagara Pallet only expects to have eight out of 12 repair stations running based on the current level of production. At the end of the line are eight Alliance Automation stackers. Niagara Pallet sorts between 16 and 20 different categories between automated and manual stacking.
PALLETAI has been extensively used in Europe to manage a variety of pallet pools to monitor quality, grade pallets and manage control standards. Alliance Automation has signed an exclusive contract to sell the PALLETAI inspection systems and software in North America for the pallet industry.
A key to the IVISYS approach is the artificial intelligence (AI) software behind the analysis. PALLETAI functions like a human-like inspector, thoroughly examining the pallet for defects, conforming to quality standards, size, etc. The system runs no less than 26 neural networks and 2D cameras are combined to achieve maximum effect.
As the new line gets fully ramped up at Niagara Pallet, PALLETAI is just gathering data on each pallet. Although it will eventually inspect pallets for size, condition, repair requirements and more, Niagara Pallet hopes to tie repair stations in with the PALLETAI inspection solution.
PALLETAI can identify pallet size, color, condition, specific damage to individual components, compliance with established standards, etc. See Sidebar on page 30 for an entire list of what the system can inspect and sort for.
Why go with automated vs manual inspection? Fred suggested, “The challenge is that without PALLETAI you are putting the decision making into people’s hands. You get greater throughput and consistency with AI-assisted technology.”
Operators get tired and struggle to stick to a consistent standard. Various personnel will grade and see things differently. Plus, the PALLETAI software automatically tallies results and can inspect for a wide variety of criteria. Looking at throughput, Niagara Pallet hopes to process one million pallets per year on the line per shift when the system is operating at full capacity. Greater accuracy also means fewer pallets go to the grinder. Fred forecasted, “A 2% increase in the yield is going to be $50,000 to $100,000 a year in pallets at five bucks a piece. I also think that we’re going to upgrade the quality of our pallets 5% to 10%.”
Niagara Pallet expects to have PALLETAI making sortation decisions by the end of March. Fred was the person who made the introduction between Alliance Automation and IVISYS. He said, “Doug Wenninger of Alliance Automation and I went to Sweden. We looked at PALLETAI there, and we believe it’s the best inspection technology for our industry at this point. We believe it’s going to change the way our industry works.”
Government Funding Helps Expansion and Automation Efforts
In this complete overhaul of its process, Niagara Pallet is spending millions to grow the company’s capacity and revolutionize its approach. This investment covers the equipment, building, land and infrastructure. It will triple pallet production, increase the company’s sales by 46% and create 30 new jobs according to a recent press release by the Ontario provincial government.
Both Canadian federal and Ontario grants are being utilized to help cover part of the costs of the automation efforts. The Government of Ontario is investing $1.8 million to help Niagara Pallet expand by adding 60,000 square feet of production space and installing automated sorting, measurement and lumber-cutting equipment.
Expanded production at Niagara Pallet will also strengthen the province’s forest sector supply chain – the company will increase its purchases of Ontario lumber by 60%, providing greater opportunity for lumber harvesters, sawmills and trucking.
Vic Fedeli, Ontario’s minister of economic development, job creation and trade, commented, “Niagara Pallet’s project will build on what our government is doing to make sure people across our province have good-paying jobs, while also growing the manufacturing sector and strengthening our province’s forest sector supply chain.”
Funding for this project is being provided by the Forest Sector Investment and Innovation Program, a business support program designed to improve productivity and innovation, enhance competitiveness, support new market access and strengthen regional economies. Fred explained that the funding programs by the provincial and Canadian governments basically provide interest free loans for targeted projects. He added, “These Canadian government programs are a good avenue to get money, but you have to make sure you get access to capital elsewhere because the government doesn’t help you until you’ve helped yourself.”
When it comes to the payback period, Fred estimates a two to four year return based on two shifts that are not operating at full capacity.
Automated Scrap Handling
Niagara Pallet has used a Vecoplan grinder for five years. Fred commented, “Vecoplan builds a tank of a machine. The Vecoplan grinder works beautifully, and they’ve got a great team.”
The recycler used to sell colored mulch. Now all of its waste goes for boiler fuel because the company wants to be solely a B2B enterprise. Niagara Pallet prefers low-RPM grinders because they “don’t beat up the wood as much and produce better waste product and less sawdust.”
A focus for the Niagara Pallet team is to keep the production facility as clean as possible. Limiting sawdust is a big benefit of low-RPM technology. As part of this facility upgrade, conveyors will be added in the near future to take scrap from the Urban Sawmill and repair stations directly to the grinder. If the shredder goes down, the line is reversible and the material can be transported outside of the wall and into a walking floor trailer.
Fred stated, “I don’t want to touch things multiple times. Once I determine what I’m doing with something, I want that action to take place, and I want the material to go to the right spot to be handled correctly.”
Conveyance eliminates the need for operators and helps keep waste flowing through the plant to the grinder. Fred suggested, “Even if I spend $150,000 to $200,000 on conveyors to make this all continuous, the payback will be super-fast and super-efficient. It needs to be integrated. Waste has to move without a person being involved in the process.”
When it comes to performance, Fred described the Vecoplan grinder as “very energy efficient requiring low electric consumption and little maintenance.”
Niagara Pallet’s waste process produces a thousand yards of chips per week.
Data Is Critical for Success
A key benefit of the new automated line is better data. Niagara Pallet has developed its own Enterprise Resource Planning (ERP) software by partnering with a Toronto-based software developer, Exogen. This software will integrate with PALLETAI to help determine core quality for mixed loads coming from various sources. A key feature of this new ERP is the ability to automatically get data out of the Pallet Design System™ (PDS). The ERP can generate a cut list and production queue for the nailing department to create the new design.
EOS Brought Necessary Change
Over the last few years, Niagara Pallet has instituted the Entrepreneurial Operating Systems (EOS) business management philosophy that has been successfully used by a number of major pallet companies. EOS focuses on developing the right goals and systems to monitor progress as well as ensuring that company leaders are in the right seats on the bus. Usually, EOS requires visionaries to cast vision and think about the long-term success of the company while integrators focus on operational duties and success. Fred is the visionary at the company and his brother Mike is the integrator who ensures operational success.
EOS has had a profound impact on Niagara Pallet. Fred admitted, “EOS has made us better at making decisions and having difficult conversations. For example, we rolled out a series of core values last summer. Then we spent some time working on them together as a team to really figure out who we are and what we’re doing.”
As a result, management discovered that some long-term employees didn’t really fit with those values. Fred said, “When you are measuring your team by attendance, productivity, attitude, and other key factors, you realize that some people just are not meeting the requirements and don’t really want to change.” In a two-week period, Niagara Pallet cut about 8-9 people, and immediately the company’s production went up.
Fred clarified, “Now it doesn’t mean that everybody here is perfect and doesn’t mean we don’t have challenges. But it was one of those glaring things that we just couldn’t seem to pinpoint. EOS just made us aware that we’ve got to be intentional; we’ve got to put the effort in. We’ve got to make sure we have the right people because the right people are the key to success.”
For more information on how you can incorporate EOS into your business visit https://www.eosworldwide.com/ or check out these articles from Pallet Enterprise (https://tinyurl.com/45a2h4wr), (https://tinyurl.com/muuuf4a5).
Backyard Business Becomes Major Pallet Recycler, Looks to Future
Niagara Pallet began in 1993 as a small pallet repair operation running out of the backyard of Fred and Mike’s parents’ house. Today, it is a major recycler in the Toronto area with 65 full-time employees. It manufactures new, custom and refurbished pallets, as well as wooden bins, crates and mulch. The goal of the new plant is to have everything handled in one single process from inspection to sort to repair to tear down to lumber recovery.
Fred believes that a revolution is coming in the pallet industry. He predicted, “Vision inspection equipment is being installed by pallet users. And it’s going to reduce the amount of pallets that we see unnecessarily that don’t require inspection and repair. It’s going to increase the productivity of our staff for our operation.”
Fred further suggested, “I think we’re going to see smaller facilities with this automation, or we’re going to see a lot of things moving into our customer’s facilities to reduce the transportation factor. I think transportation concerns and the green movement are going to lead to more efforts to take trucks off the road. Customers want to eliminate the unnecessary movement of empty wood pallets. So, I think as pallet recyclers and manufacturers, we’ve got to get efficient. We’ve got to figure out how to take pallets out of our suppliers’ facilities and move them directly to the consumers again instead of bringing them back to our facility and then out again.”
Check back in 2024 to see exciting new projects and innovations brought to you by Niagara Pallet and the Federal Economic Development Agency of Southern Ontario.
Please follow the link below to learn more about what is to come: http://tinyurl.com/yckhxs5a
To find out more about the Federal Economic Development Agency of Southern Ontario, please visit https://feddev-ontario.canada.ca/en
PALLETAI can Scan, Analyze and Sort for the Following:
• Length and width
• Length and width individual board
• Material loss
• Gaps between boards
• Protruding material or nails
• Component alignment
• Cracks on boards or stringers
• Skewness and planarity
• Discoloration and foreign material
• Stamps and marks
• Plastic wrap/threads
• Perimeter blocks and stringers
• Missing component
• Broken or damaged blocks
• Mold and discoloration
