Pallet Consultants Corp. Quickly Establishes National Presence

POMPANO BEACH, Florida — Name it, and Pallet Consultants Corp. probably does it, or soon will.

            The list includes pallet banking, pallet manufacturing, pallet recycling, pallet retrieval and pallet sorting, pallet repair, storing and shipping pallets, pallet brokering, and an authorized CHEP repair center. Yet the extensive combination of products and services that Pallet Consultants offers its clients only begins with that short list. New endeavors are continually being added.

            Gustavo Gutierrez is the CEO and sole owner of Pallet Consultants, a company he started in 1996 after working for southeastern-based Bromley Pallet Recyclers. Pallet Consultants is a certified minority owned and operated corporation.

            Not only did Gus get to know the pallet markets well before launching his own business, he also excelled at pallet sales. “I increased sales for Bromley 200 percent,” he said. Still, he wanted to do more. He realized he was “just wanting to be an entrepreneur.”

            Gus purchased Bromley’s Pompano Beach, Fla. facility, and it became the headquarters of Pallet Consultants. Then he launched a cold start in the Atlanta market. Since then, he has added facilities in two other Florida communities, Fort Myers and Haines City.

            Just about anything a customer requires related to pallets — from heat treatment and fumigation to advice about pallet design and pallet retrieval and recycling services – can be provided by Pallet Consultants.

            The company’s principal activity is pallet recycling. Each of its four facilities is configured differently, but all are set up and equipped to remanufacture pallets – building pallets from recycled lumber. Pallet Consultants also does a steady volume of combination or ‘combo’ pallets, which are made by combining components made of both new lumber and recycled lumber. In the lumber recovery areas, Pallet Consultants uses Smart Products bandsaw dismantlers and chop saws from Smart Products and other suppliers. Each plant also is equipped with Saw Service & Supply Trim Track saws for cutting reclaimed boards and stringers to length. Saw Service & Supply also provides Pallet Consultants with bandsaw and circular saw blades. “We are very pleased with their service,” John Gamez, vice president of operations for Pallet Consultants, said of Saw Service & Supply.

            “At corporate alone,” said Gus, “there are 50 repair tables.” Company-wide, Pallet Consultants has about 200 employees, including 60 at its headquarters and plant in Pompano Beach, where the company has a 50,000-square-foot warehouse and a 3,000-square-foot office.

            “Within all our facilities,” said Gus, “it’s not difficult to have over 1 million pallets in stock.

            The company’s Atlanta facility is set up for optimal ease of operation. A 40,000-square-foot building with 68 docks is situated on 14 acres. With so many docks, it is possible to be unloading trailers on one side, loading trailers on the other, and have a one-way path through the building.

            The company recently installed a West Salem 700 hp grinder at its Atlanta site to convert scrap wood material into mulch. Pallet Consultants is experimenting with the best way to market mulch. “We're thinking we might want to color it,” said Gus. At its other three locations, Pallet Consultants has arrangements with companies that remove scrap wood.

            Heat treating is provided upon request and is performed at Pompano Beach, where Pallet Consultants has a Pest Heat Thermal Pest Eradication System in place.

            The headquarters facility uses bar codes and the Innovative Data Systems Pallet Track system in its operations, and similar technology was recently installed and implemented at the Atlanta facility.

            Gus likes the Pallet Track system because it speeds up handling and inventorying of pallets. The system enhances quality control because it identifies the worker who built or repaired a pallet.

            Pallet Consultants also uses bar codes and portable scanning technology on its yards to capture information. Pallets stored in the yard are scanned as a stack, not individually.

            Pallet Consultants sold about 10 million pallets in 2003. Only about 5% of its business is  new pallets.

            In the course of its pallet recycling operations, it also collects and recycles a tremendous amount of ancillary material. “We recycle cardboard and shrink wrap,” said Gus, and it is sold to the highest bidder. About 40% of the additional recycled materials are recovered in the pallet pick-up and retrieval service the company offers.

            If a customer requires a certain type of service related to pallets or wood packaging, Pallet Consultants is willing to consider providing it. For example, in order to make things easier for some grocery businesses, Pallet Consultants goes on-site to provide pallet sorting, repair, and retrieval services.

            Sorting gets serious attention in the company’s recycling operations. “We sort five grades of A pallets,” said Gus, and three grades of B pallets. The company will provide custom sorting services, too. When unloading and sorting a van or pallets, the company focuses on separating out and repairing the grade of pallet that is in demand at that time.

            For manufacturing new pallets the company buys hardwood lumber or softwood, such as No. 3 and 4 Southern yellow pine. The material is cut to the appropriate length on chop saws supplied by Smart Products and Saw Service & Supply. New pallets are assembled by hand with Bostitch power nailing tools and fasteners.

            The Haines City facility is made up of three buildings on seven acres; the largest building has 12,000-square feet of space. The Haines City plant is equipped with a Bronco Pallet Systems nailing station for semi-automated pallet assembly.

            The biggest customer for the Haines City plant is located in the same community, but the plant is otherwise strategically located. “It's a unique facility,” said Gus, “because it's in the center of the state.” With its central location, the Haines City plant, which is managed by Eddie Dyess, can easily service customers throughout Florida. It is particularly well situated to service growers and shippers in the agricultural industry.

            Having facilities in key geographic locations is a business strategy of Gus, and he makes the most of them. The Pompano Beach headquarters is just north of Fort Lauderdale and only 30 miles north of Miami. Fort Myers is on the Gulf Coast, about 120 miles northwest of Miami.

            Pompano Beach is at the heart of a region known for truck farms and citrus fruit. The town has 72,000 residents. Prior to 1928, Pompano Beach was located on an island along the Atlantic Coast. The townspeople moved inland after being hit by a hurricane in 1928.

            The Atlanta and Florida facilities, along with business relationships with affiliated pallet suppliers, enable Pallet Consultants to get pallets to customers quickly throughout the entire U.S. “We deliver to any place in the U.S. within 24 hours,” said Gus.

            Pallet Consultants also does considerable business in Central America. It ships pallets to the region and also has operations in Central America to repair pallets. “We export 200,000 pallets per year to Central America,” said Gus, who hinted at other exciting business prospects beyond the U. S.

            Pallet Consultants uses its own fleet of trucks for shipping within 150 miles of each of its facilities. It has a ratio of 20 trailers to one tractor – about 400 trailers in all — and offers customers ‘drop and hook’ service to retrieve used pallets. A well-planned circuit for each tractor minimizes miles covered, even as it keeps pick-ups going at a brisk clip. Also, the company has the highest limits on liability and carries cargo insurance. “Strong liability coverage on our equipment and facilities protects our customers,” said Gus.

            “We do various trucking for other companies,” added Gus. In Florida, for example, Pallet Consultants provides trucking services for CHEP pallets. High priority is placed on safety in the trucking operations. Each truck gets a safety inspection before a trip begins.

            Pallet Consultants has six full-time sales representatives and a national sales manager. In addition to John, vice president of operations, other key staff members include Frank Gutierrez, operations director. “Our executive operations staff has 35 years experience” in the pallet industry, said Gus.

            Putting all the components of a business together in a viable way to fuel growth is a challenge that intrigues Gus. Gus has a good education for it. He earned both an undergraduate and a graduate degree in business at the University of Puerto Rico in San Juan.

            As a newly minted MBA, Gus went to work for a pallet company. He began to verify his theories about the connection between sales and logistics. “I saw the need to have companies near customers,” he said.

            With four facilities and a growing list of affiliated pallet suppliers, Pallet Consultants can quickly meet the needs of customers throughout the U.S. Gus has made arrangements with 16 other pallet companies across the U.S. to give Pallet Consultants the ability to retrieve and supply pallets in any state.

            Companies that choose to become affiliates of Pallet Consultants must sign non-compete agreements. “They can't solicit our customers,” said Gus, adding that it is “basically a broker arrangement.”

            Gus carefully screens prospective affiliates. It is not enough simply for a pallet supplier to be located near a customer that Pallet Consultants wants to serve. The affiliate must have a good reputation in the pallet industry. “We make a contract with a pallet company that meets our caliber,” he explained.

            In equipping plants, one thing that Pallet Consultants focuses on is reliability and durability in machinery. Besides that, Gus looks for suppliers that will provide strong support and service. Beyond the machinery, he noted, there are “the people that stand behind it.” Smart Products has been a notable supplier, he said. “I like Smart because of their service.”

            “If there's a type of equipment that's out there, I've run it,” said Gus. “I've inherited a lot of equipment…with buying companies.”

            The three Florida facilities are equipped with power washing equipment and provide services to wash and clean CHEP pallets. All four facilities also distribute plastic pallets.

            “We sell nails, too,” said Gus. “We're looking into selling blades. With our buying power, we are able to buy in bulk.”

            Given the operations already in place and ventures on the drawing board, Gus has little leisure time. “It's very difficult to take time off,” he said. “My focus is on growing our market share.”

            Gus keeps a careful eye on trends in the pallet industry. “A lot of pallet companies are selling pallets lower than five years ago,” he observed. “We're trying to figure out why.”

            Two things motivate Gus each day. One, he said, is “being able to give my customer an opportunity to save money.” He does that by tailoring programs to their specific requirements.

            He is also motivated to improve the environment, which is a major focus of the business. The concept of recycling and reusing in order to reduce waste is an important aspect of Pallet Consultants.

            Gaining strength through diversity is a long-held notion in business. Build multiple paths and if one route slows down, another one can be taken. It's the keeping all options open idea. And it's a concept that works very well for Pallet Consultants.

            (Editor’s Note: To contact Pallet Consultants, call (888) 782-2909.)