HORIZON CITY, Texas – In 1992, before Felipe and Barbara Truax started Border Pallets in El Paso, Texas, they engaged in a planning process to decide what kind of business they wanted to launch.
Felipe was working as a restaurant manager at that time, and Barbara, then his girlfriend, was still in college and studying for an accounting degree.
Neither had any experience in the pallet industry.
After sorting through a number of possibilities for a new venture, pallet recycling emerged as an opportunity they chose to pursue. The young couple penciled in some numbers for picking up pallets, repairing them and selling them, and they decided that pallet recycling would be a good business opportunity.
Like many other successful pallet companies, the beginning of Border Pallets was marked by the hard work of its founders and their passion to succeed in their own business. Felipe would pick up unwanted pallets from businesses early in the morning and take them to a 1/3-acre plot that Barbara’s father let them use. He repaired up to about 100 pallets per day, working on a 20×30 concrete pad, and delivered them to customers at night. In addition, he continued to work at the restaurant. Barbara managed the books for the young company while finishing college.
Today, Border Pallets produces from 3,500 to 5,000 new and recycled pallets per day, a long way from its entrepreneurial start as a two-person business 15 years ago. The company purchased the surrounding property and expanded to
1-1/3 acres before outgrowing that location. It now operates from a 40,000-square-foot building on a 4.5-acre site in Horizon City, about 20 miles east of El Paso. The company and its 44 employees service customers in the El Paso area, southern New Mexico and Juarez, Mexico. Sales grew by 28% in 2006, and Felipe expects 2007 sales to exceed that growth rate.
Felipe, 40, was born in Chihuahua, Mexico, the ninth of 12 children. He moved to El Paso in 1975 and became a naturalized U.S. citizen. He spent nine years working at restaurants, starting out as a dishwasher; his last five years working in that industry he was a general manager. Barbara, 38, worked in her father’s heavy equipment and property sales businesses before starting Border Pallets with Felipe.
“We didn’t know much about the business at first,” recalled Felipe, who holds the corporate titles of president and treasurer while Barbara is vice president and secretary.
A key to the rapid growth of Border Pallets has been the complementary relationship between Felipe and Barbara. “We’ve been blessed,” Felipe said. “We make a wonderful team. She keeps me grounded, that’s for sure.”
“I’ve always seen myself as a people person,” Felipe added. “I do pretty well dealing with people. Barbara graduated with an accounting degree. She is
the numbers person and the science behind Border Pallets. We just work well together.”
Border Pallets recently added a new L-M Equipment Co. Ltd. (Canada) package saw. Felipe had it painted in the orange and blue colors of the University of El Paso Miners, his favorite college team.
“It is an awesome machine,” Felipe said. “It has a self-measuring system. Put the bundle on the machine, the operator sets it to what sizes he wants to cut, and it cuts it. It is unbelievable. It has cut my overtime by $3,000 a week.”
At Border Pallets, the orange and blue UTEP colors are found on other equipment and the company’s fleet of 70 trailers, which also feature the UTEP logo.
When it comes to UTEP athletics, especially basketball and football, Felipe is a self-proclaimed fanatic. “I first became a UTEP fan back in the 80s,” he said. “I learned a lot about our legendary basketball coach, Don Haskins. I was very intrigued by him and by what he brought to El Paso.”
Haskins and UTEP were catapulted into the national spotlight when his underdog team beat Kentucky for the NCAA championship in 1966; the same year, UTEP was the first major college basketball team to feature five starting players who were black. That season was the subject of the recent film, Glory Road. Haskins went on to a hugely successful career at UTEP that lasted until 1999.
“What he did back in 1966 revolutionized college sports, and sports in general,” said Felipe, who has UTEP season tickets for basketball. “That is one of the things that has inspired me.” When he’s not rooting for UTEP, Felipe also enjoys playing golf.
Border Pallets buys low-grade lumber and cants by the rail car. The company buys hardwood cants and SPF and aspen lumber from mills in the U.S. and Canada. Felipe buys mill-direct and through brokers. The company has a daily inventory of about 300,000 board feet of raw material.
After the cants or lumber is cut to length on the package saw, it is sent through one of the company’s resaws. Border Pallet is equipped with a Morgan Saw Co. three-head bandsaw system and a Baker Products three-head bandsaw system. The company has a Morgan double-head notching machine for making notched stringers; cutting heads for the notching machine are supplied by Econotool.
Pallets are assembled by hand with pneumatic nailing tools and also two Bronco Pallet Systems semi-automated nailing stations. Pallets are accumulated in Automated Machine Systems stackers.
Between new pallet construction, recycled and ‘combo’ pallets, Border Pallets produces about 70 different pallet sizes.
In the recycling operations, Border Pallet sorts many cores off-site at a sorting station or at customer locations, so incoming cores typically arrive at the plant already sorted. Pallets for repair are placed on a belt conveyor and moved to three work stations. After they are repaired, the pallets are placed on another conveyor behind the work stations. They are moved to another area where an employee sorts them by grade and feeds them to the appropriate automated stacker. Felipe designed the conveyor system configuration based on another company that he read about in Pallet Enterprise.
Pallets to be disassembled go to the dismantling area. Border Pallets operates four dismantling machines – a Pallet Repair Systems (PRS) bandsaw dismantler, a PRS disc-type dismantler, and bandsaw dismantlers supplied by Smart Products and Heartland Fabrication. Sorting of recycled lumber is aided by the use of automatic round tables. Four chop saws (two Heartland Fabrication machines and two supplied by Morgan Saw Co.) and two Heartland Fabrication end-trim saws are used to cut used lumber to length, and a Pallet Repair Systems nail de-stubber is used to compress nail stubble on any board needing it.
Other suppliers include Carlson Systems for collated nails, Max Tools pneumatic nailing tools, and Texas Saw for saw blades and sharpening.
Finished pallets are stored outside. They can be loaded onto trucks at one of five trailer docks.
The company has two Kiln-Direct kilns for heat-treating pallets. “We treat about 2,400 pallets a day,” Felipe said. “Heat-treatment is very big in El Paso because it is a border town.” Pallets must meet ISPM-15 phytosanitary requirements in order to be shipped between the U.S. and Mexico. The company’s heat-treating process is certified by West Coast Lumber Inspection Bureau.
Scrap wood is burned in a McPherson Systems Inc. incinerator. “McPherson is a state-of-the-art incinerator,” Felipe said. “It is my pride and joy. Without that machine we would probably spend about $500 daily in tipping fees at the landfill.” Scrap wood is collected in hoppers placed around the plant and dropped into the incinerator, which is located in the yard.
Border Pallets participates in a safety program offered by OSHA and the National Association of Occupational Safety and Health Consultation Programs (OSHCON). “OSHCON has worked great for us,” Felipe said.
OSHCON is a consulting service that works hand in hand with OSHA. “They come into your facility and inspect it just like OSHA would and identify any areas of concern,” Felipe explained.
Border Pallets has been successful in achieving safety in the workplace and recently was invited by OSHA to pursue participation in OSHCON’s elite SHARP program, which defers OSHA inspections for participants. “We have implemented a lot of changes to make our plant as safe as possible,” said Felipe. “I think OSHCON has helped us a lot to keep our plant safe.”
All machinery at Border Pallets is equipped with proper guards. Workers are trained to be aware of their surroundings at all times, including risks and hazards, and to wear appropriate safety equipment.
“We have a zero tolerance for not wearing required safety equipment,” said Felipe. “I am an employee-driven person. I want them to be happy. But at the same time, I want them to respect what it is that I want them to do, both performance-wise and safety-wise.” Safety training is provided when employees are initially hired and on a monthly basis thereafter.
Border Pallets enjoys very low employee turnover, according to Felipe. All employees are Hispanic. All written information — rules, policies, handbooks, applications and other documents – is provided in English and Spanish. “Since most of the employees are bi-lingual, there are no language barrier problems,” said Felipe.
Employees earn hourly wages, except workers assembling or repairing pallets earn piece rate wages.
Border Pallets is a member of the National Wooden Pallet and Container Association (NWPCA) and the Hispanic Chamber of Commerce, which has been a big help in networking.
Felipe markets the company in part by advertising in the Yellow Pages. “It has thrown a lot of business our way,” he said.
One of the biggest marketing tools for Border Pallets has been the Pallet Design System computer program, which is available from the NWPCA. “PDS is an unbelievable tool,” Felipe commented. “It is not just for us as a pallet builder, but it is a tool for the end user to really learn what is entailed in a pallet.” It also has helped the company achieve efficiency and profitability. “You can do things a little differently and save money,” he said. “If a customer is trying to cut costs, the first thing I do is input their specs on the PDS and see if the pallet is over-engineered.”
Other services that customers appreciate include storage of finished pallets on-site for prompt delivery as well as supplying Border Pallets van trailers at customer locations. “One of the last things customers want to see is unwanted pallets accumulating on their facility,” said Felipe, “so we offer them van trailers. It has worked great and I use it for about 70 percent of my customers.”
Border Pallets has come a long way from when it was just a business plan for a young couple starting out, but Felipe and Barbara have managed the employees and company well and developed it into a successful pallet supplier.
