SALEM, Oregon – Bryce and Carly Taylor are reaping the benefits of automating in their pallet recycling business with help from SMETCO. Automation to improve pallet sorting and repair has enabled the company to reduce labor, trim workers’ compensation insurance costs, and enhance data collection and analysis that have improved efficiencies in other areas.
Oregon Pallet, headquartered in Salem, is a leading pallet recycler in the state. Before starting his own business, Bryce ran pallet programs for a grocery distribution company. He launched Oregon Pallet in 1999 with his wife, Carly. When the Taylors started Oregon Pallet, they had one customer — a grocery distributor they both previously knew.
Besides the company’s main plant in Salem, it has two on-site pallet management programs in Oregon, in Wilsonville and Woodburn, plus a plant and an on-site program in Idaho, and another on-site presence in Arizona. The company employs 58 people in Salem, nine at its other Oregon operations, 30 in Idaho, and six in Arizona.
Planning to Succeed with SMETCO Automation
Oregon Pallet already had been a SMETCO customer for a number of years, having purchased pallet dismantlers, trim saws and notchers from the supplier. “The next progression,” said Bryce, was to consider automation for pallet sorting and repair operations.
Planning, developing and equipping the company’s new plant was a three-year process, and SMETCO personnel worked closely with Oregon Pallet to help pull it off, indicated Bryce.
He also got help from the Oregon Manufacturing Extension Partnership (OMEP), a nonprofit that provides consulting and planning services to assist manufacturing businesses. It was through OMEP that Bryce developed plans for a new facility. The planning process included monitoring forklift traffic at the former plant as well as having employees wear pedometers to count the number of steps they took while working. That information and more was used to design the plant to improve efficiency and minimize the number of ‘touches’ a pallet receives as it is processed.
A couple of reasons factored into his decision to continue relying on SMETCO as he weighed plans to introduce automation. “The heavy-duty construction of their equipment stands out,” he said. SMETCO stackers he bought 12 years ago work just as well as the newest ones, he added. “Overall, I think SMETCO builds a solid piece of equipment that is well fabricated and functionally seems to stand up to the cycling of thousands of pallets per day,” commented Bryce. The fact that SMETCO also is located in Oregon, a little less than 30 miles away, also made it easy to go with a local supplier.
Oregon Pallet’s previous plant, where it was located for 12 years, was on 7.5 acres and contained only 12,000 square feet under roof. Pallet repair operations were conducted outdoors under lean-tos and awnings. The new facility allowed the company to move pallet repair operations indoors as well as provide more indoor storage space. The new facility is 13.5 acres with 33,000 square feet under roof. The company moved into the new plant in November of 2016.
At the old plant, repair personnel worked with stacks of 20 pallets, manually removing a pallet, placing it on the repair table, refurbishing it, then stacking it according to grade. “Half of their time was spent carrying pallets and moving them or stacking them,” observed Bryce. That activity takes a lot of energy, he noted, and the fatigue and amount of time spent handling and moving pallets cut into production.
In developing plans for the new facility and automating, Bryce asked himself, “How do we get these people to stop lifting? I don’t want to pay someone to lift a pallet. I want to pay them to repair a pallet.”
In designing the new plant with automated systems, Bryce deliberately created smaller work areas for employees in order to minimize the amount of walking they do. That kind of planning, together with the automated systems, enabled the employees to focus more on their chief tasks: sorting or repairing pallets. It eliminated the manual labor of unstacking pallets, carrying and moving pallets, and stacking finished pallets. “By mechanizing the process, taking out the lifting and restacking of pallets, it lets them focus on the throughput,” said Bryce.
The automated systems have made the work easier for employees and also enabled the company to operate with fewer employees. It went from 22-24 pallet repair workers to 16. The automation and layout of the new plant also eliminated the need for two forklift drivers.
Trimming the number of workers turned out to be “a blessing in disguise,” said Bryce, because as the economy strengthened in 2016, more people were working, and it was tough to get labor. “It became very difficult to find employees,” said Bryce.
The plant has two eight-man repair lines. Stack height was reduced from 20 pallets to 14. They move via gravity rollers from the sorting station. Now, the repair workers do their tasks in an area about 5 feet by 4 feet. They use a scissors lift table to de-stack the pallets and lower them to a height from which they can be pushed onto the repair table. The finished pallet is slid onto a roller conveyor system to be carried away to the stackers.
Bryce used the same approach when it came to designing the sorting station as well as the pallet dismantling area, which is equipped with three SMETCO bandsaw machines, each operated by a team of two men. SMETCO tippers are used to singulate the pallets and ease them onto a table and the bandsaw machine. The only lifting the workers do is turning the pallets over to dismantle the other face. “We get the 45-pound pallet out of their hand, and they put their energy into doing the dismantling task,” said Bryce.
The plant sorts 5,000-6,000 pallets daily. Sorting is done at a station ahead of the pallet repair line. Two tippers break down stacks of pallets, and two men do the sorting. They are sent to stackers as ‘ready to go’ pallets that do not need repairs, pallets that need refurbishing, pallets that will be dismantled to recycle lumber, and pallets that are scrap and will be processed by grinding.
The automated systems have “substantially” reduced the company’s workers’ compensation insurance costs, said Bryce. In the past, doing so much of the pallet lifting and handling by hand, employees suffered strains and sprains that impacted their performance and production. “It takes a lot of time to get a guy back to regular duty,” noted Bryce.
Automation Improves Data Capturing Capabilities
One of the key reasons for deciding to implement automation was in order to collect accurate data related to incoming pallets and pallet production, said Bryce. “We wanted to maintain a good data platform to understand what is really going through our plant.”
Relying on repair workers to make tally marks on pallets and then having other workers count pallets and record the information on paper leaves too much room for errors. It is also a bone of contention for repair workers when they believe their production has been mistakenly under-counted. By putting a barcode on each pallet and scanning the barcode, and capturing that data with PalMate computer software, “we find there is no room for error,” explained Bryce.
“We get accurate numbers, accurate inventory. That was one of the driving pieces” in his decision to automate.
Without controls in place, it is difficult for a pallet recycler to know what they have received when they pick up a trailer of used pallets, noted Bryce. Sampling individual loads provides information, but a different employee may be evaluating or sorting pallets on a given day. “I don’t know any other way you can get a solid stream of data for each load…without dissecting them load by load,” said Bryce. “And that takes time. And there’s a cost to it.”
The company collects data on all the pallets in each trailer-load via the sorting process, and it is entered into PalMate. When a stacker for any sort category is full and ejected by the machine, the sorters enter the number from the stacker counter into the PalMate Plant Floor module and reset the stacker counter.
“It takes the guesswork out of your accounting,” said Bryce. The company knows exactly how many pallets in each category it has received in the load from a given customer. It is one of the key benefits of automation, noted Bryce, besides making work easier for employees and reducing labor. The data collected on incoming used pallets is itemized per load and helps the company determine which customers are the most profitable. The data also is shared with the customer that supplied the pallets.
PalMate, process management software for the pallet and timber processing industries, is marketed and sold by the PalMate Group, a unit of Automated Machine Systems, which manufactures automated pallet recycling equipment.
Bryce initially purchased PalMate to improve efficiency in managing trucking operations. The software eliminated the need for redundant processes performed on paper in duplicate and triplicate. The company has expanded its use of the program and continues to do so. “We’re working right now on dumping data into QuickBooks to automate billing processes,” said Bryce. PalMate has made administrative functions easier, faster, and more efficient, and it’s also enabled the company to capture data about pallet production and to analyze that data.
Salem Plant Overview
Bryce and Carly purchased the current Salem building in 2015. The company spent just under a year making various improvements to the building and equipping it, paving 6.5 acres, adding grade level docks, moving some interior walls and removing some doors and adding new doors. The new plant was complete and fully equipped by SMETCO from the day it began operating.
All of the company’s machinery and equipment, automated sorting system, automated repair line, pallet handling and conveying equipment, and stackers were supplied by SMETCO, which customized trim saws to accommodate a limited footprint requirement. The plant is equipped with three SMETCO bandsaw dismantlers, two custom trim saws, two custom chop saws, and a SMETCO notching machine. The only exception is a PRS Group trim saw.
Oregon Pallet has customers in the grocery manufacturing and distribution industries, food processing, plastics manufacturing, storage, and other industries.
Roughly 90% of the company’s pallet product at the Salem plant is reconditioned GMA pallets. The remaining 10-15% consists of odd-size pallets, corrugated pallets, and custom spec pallets. Odd-size pallets may be recycled, ‘combo’ or combination pallets, or new pallets. New pallets only account for about 2% of production and are outsourced to manufacturers of new pallets. The plant repairs about 7,000 48×40 pallets per day. (The volume does not include ‘ready to go’ pallets.) Beside repairing pallets, the company makes ‘new’ or remanufactured pallets from 100% recycled lumber. Pallets are repaired and assembled using Stanley-Bostitch pneumatic nailing tools and fasteners. Used lumber for repair stock is supplemented with new cut stock as needed from mills in Oregon and Washington.
Core quality has improved in recent years, according to Bryce. However, that perception may be affected by the way the company does business. The ability to capture precise data on incoming cores has allowed the company to identify and cultivate profitable accounts and step away from those that are not as profitable — businesses that supply a lot of low-grade pallets. Pallets that require more repairs require more time. “There is an opportunity cost when you lose out on producing 1,000 pallets a day because you’re handling junk,” stated Bryce.
Company Overcomes Arson Fire
Oregon Pallet’s Salem operation suffered a fire on the yard in 2019. Firefighters saturated the plant building, office, and stacks of pallets with water. The only damage to the buildings were some windows and roof shingles melting. The main loss from the fire was the company’s grinder, part of its truck fleet, and the excavator used to feed it, as well as 110,000 pallets in inventory plus lumber and piles of chips.
The blaze was started by an arsonist, and local authorities are seeking tips that could lead to an arrest.
Carly Taylor, co-owner of Oregon Pallet, explained, “We were fortunate; the damage could have been much worse. Proper pallet, lumber, equipment and truck placement on your yard is crucial to limiting the damage.”
Having adequate spacing between pallet piles, lumber and buildings can limit the spread of a fire. It also assists firefighters in have the adequate space to combat any incident that arises.
The company was up and running the next day although it only had a few thousand pallets left in inventory and had to rely heavily on new incoming loads of used pallets from customers. The biggest handicap was working around and then cleaning up 2.5 acres of rubble in the middle of the company’s yard.
In the process of designing and planning the new plant, Bryce and Carly worked with city officials to comply with fire safety regulations — such as providing access for firefighting vehicles, designating where pallets would be stacked outdoors and creating space between inventory and the building. At the time, “I didn’t put a lot of stock or value in it,” Bryce recalled.
Oregon Pallet also worked with the fire marshal after operations began to manage the wood waste and chipping operations to comply with fire safety regulations. The time spent with the fire marshal “saved my plant,” Bryce said. He also credited the response by firefighters from Salem and five other cities.
Now, the excavator and grinder are moved at the end of the day to keep them a safe distance from the chips. The company replaced its grinder with a new machine from Peterson Pacific. The grinding operations generate 80-100 tons of hog fuel per day for cogeneration plants.
Trucking Benefits, Challenges and Growth Strategy
Operating its own fleet of trucks has been integral to the company’s success, too, suggested Bryce. Having adequate trucking capacity enables the company to be on time when it comes to picking up trailers of used pallets and delivering pallets. Company truck drivers are home every night. The company has some customers as far as 300-500 miles away, but uses common carriers for those hauls.
The market has been strong. “Sales aren’t my biggest challenge,” said Bryce. “Our biggest challenge has been maintaining production with labor. The automation has been extremely helpful in that process.”
The principals grew the company deliberately and strategically. “Having Carly in control of finances and the office side working together, we were able to pace our growth and not get in trouble along the way,” said Bryce. They managed their growth and cash flow very carefully, avoiding taking on more business that they could not supply and service properly. “Timing plays a big role in that,” added Bryce. “We’ve always had a pride in the quality of work we try to give to our customers and are committed to quality in a GMA standard pallet. We try to make sure the first load and every load have the same consistency.”
One thing that helped the company grow was the fact that the market for recycled pallets was still emerging at the time, noted Bryce. It had not matured. “Pallets and wood waste were still finding a home for stable recycling solutions.”
Oregon Pallet has benefitted from some key long-term employees now in management positions. “We have a lot of real talent that has been with us for years,” said Bryce. “They worked their way into the positions from the bottom up.”
Bryce is still looking to improve efficiency in his company’s operations. “I want to work on automation for my odd-size and remanufactured pallets. We’re still nailing them by hand. There’s a better way to do it. I need to find that pathway.”
There is room to grow and add more indoor floor space. Bryce would like to add another building in the future along with automated nailing machines to build pallets.
The company’s plant in Idaho is not automated. “That’s the next wave,” projected Bryce.
Editor’s Note: For more information on SMETCO and its engineered solutions for pallet handling, manufacturing and recycling, visit www.smetco.com or call 800-253-5400.
