South Milwaukee, WIS – A&J Environmental Pallet has grown from a small time operation to a big time pallet company in no time flat. And the driver of the company’s success has been automated nailing equipment, parts, service and nails from Viking Engineering & Development, Inc.
A&J added its first Viking in 2012 and ever since then its production capacity has taken off. Jack Santoro, president of A&J Environmental Pallet, said, “Our new pallet business has increased 50% since starting to work with Viking. With our old machines, we could produce barely one load per day whereas we can now produce 3-4 loads on the Viking Turbo alone plus the other production capacity we have.”
The company can produce up to 4-5 loads per day on its five automated lines plus hand nailing. About 50% of its new pallet production is 48x40s, although the company also makes a lot of odd-sized pallets. Santoro explained that his company bought the new pallet nailing machines to meet existing demand as well as prepare for the future. The only problem is that the plant is almost at capacity now.
Santoro stated, “If we don’t expand, we are at capacity right now with one shift. Our next move is to put on a second shift. But in order to do that, you must have the right people.”
A&J began in 1998, but it has always found ways to grow and has never looked back. Santoro, who previously worked in the produce industry, started A&J with his son-in-law Andy Christenson. The two co-own the business today, and Santoro credits its strong base in the food industry with giving the company a stable base to fuel growth.
Santoro said in an interview with The Milwaukee Business Journal, “Food always goes on. People have got to eat. We didn’t see any downturn. It was amazing.”
Before switching to Viking, A&J manually produced pallets as well as made them on a Rayco Edge and two Rayco Pallet Buddies. In 2012, A&J added a Viking Turbo, which gave its production capacity a big boost. Impressed by the Viking Turbo, A&J added a Viking Champion for smaller runs using low-grade lumber. The company has switched all its nail purchasing to Viking as well as service and parts. Santoro said, “The price is right, and the Viking nails perform better than other brands that we have purchased.”
Each of the Viking machines have specific strengths that give versatility to the A&J operation. The Viking Turbo can produce between 1,800-2,000 pallets in an 8-hour shift using 3-4 workers. Besides production speed, the Turbo is known for its ability to quickly adapt from producing one pallet specification to another. Santoro explained, “We go from one size pallet to another on the Turbo with the touch of a button. The Turbo stores hundreds of sizes in it. Each pallet has a customer behind it.”
The Turbo Pro Plus software not only allows fast loading of design specifications, it also provides detailed production tracking. This includes production numbers, errors, downtime, etc. All of this can be monitored remotely from a computer by management. For details on the Viking machine features, see the box on page 20.
By contrast, the Viking Champion allows A&J to efficiently manufacture pallets from recycled or #2 grade lumber. Santoro commented, “The Champion can use recycled lumber for top boards or #2 grade lumber. There is a demand out there for a pallet made with #2 lumber. This lumber may have a little bit more bark on it and stuff like that.”
Viking Champions can also produce mats and be used to produce parts of a block pallet.
A&J continues to run its Rayco machines and also makes smaller pallets by hand at six pallet builder stations.
Financing the Future
Adding equipment has cost some money, but A&J knows it wouldn’t be where it is today without the new machines. Santoro said, “The machinery has been expensive, but it is necessary to do the business. And I am sure that we will have it paid back in 5-7 years.” He added, “Without that Turbo, we couldn’t have increased our sales.”
Instead of buying used equipment, Santoro believes that new machinery allows a company to better predict its true cost and reduce its maintenance headaches. He said, “I buy only new machines. If you buy used equipment, you are buying somebody else’s problems.”
Obtaining financing was not as difficult as some might think according to Santoro. He explained, “Getting a loan from U.S. Bank was very easy for us because I have a good relationship with the bank. Also, Viking helped out a lot in making a pitch to the bank.”
Viking will work with customers to develop business plans that make banks more likely to approve loans, covering details such as return on investment and the typical payback period for a machine.
Besides the new Viking equipment, A&J has added a crosscut unit saw by Pacific Trail Manufacturing of Portland, Ore. Santoro anticipates that the saw will help save significant staff time in cutting bundles of lumber for producing specialty pallet sizes. This has been a production bottleneck point for the plant as well as a place where the operation could shave some costs.
Santoro said, “We are expecting a lot of labor savings by using the Pacific Trail saw. If you try to fill an order by cutting one or two pieces of lumber at a time, that can take four or five hours. With the bundle saw, you can cut the boards all at once.”
A&J selected Pacific Trail after seeing an ad for the company in the Pallet Enterprise magazine. He said, “I looked at all of the suppliers, and I heard only good things about Pacific Trail, and this saw was priced right.”
Recycled Pallets Too
Beyond new pallets, A&J also recycles pallets, which accounts for about half of its total production.
A&J has 18 pallet repair work stations. It also uses waste lumber to produce remanufactured pallets. Santoro commented, “Customers want pallets as cheaply as they can get them. And pallets from recycled lumber allow us to produce odd sizes at competitive prices.”
The recycling operation uses four Heartland dismantlers and two trim saws to cut recycled lumber down to various sizes. Santoro said he bought Heartland equipment because the company was located nearby and could easily supply parts and service.
Facing the same obstacles as other recyclers, Santoro said, “Cores have been really hard to get for the last couple of years. We buy all that we can get, but we have had to pay a bit more for cores. That is just part of the market today.”
The difficult used pallet market may be one of the reasons that manufacturers like A&J are very busy these days. There are fewer used pallets to be found, which is driving demand back toward new pallets for some markets and customers.
Quality Builds Loyal Customers
In addition to a good base of local customers and the Viking equipment, Santoro pointed to his company’s commitment to quality as a reason for its success. He believes that quality products are the key to word of mouth and repeat business.
Santoro said, “People who have visited our operation are amazed at how clean it is.” A&J has a practice of cleaning up work stations daily as well as checking quality throughout the process. Quality control is checked by supervisors. He added, “We do a lot of checking on quality before pallets are shipped so that there is no mold and they are clean from sawdust.”
Doing things right is just part of the A&J philosophy. Santoro said that is why his company pays employees an hourly rate instead of piece work. He stated, “Doing work on a piece rate basis drives down the quality because everyone looks to get the volume and the quality suffers. That is why we pay on an hourly basis.”
Quality starts with good raw materials. And A&J contracts with sawmills in Wisconsin and Michigan to buy precut material. It uses mostly hardwoods, especially maple, oak and aspen. It also buys some KD pine as well.
Some finished pallets are heat treated for export or phytosanitary purposes. A&J uses a heat treatment system produced by Kiln-direct. This chamber can treat up to 600 pallets at a time. A&J has had the Kiln-direct chamber for about four years. Santoro praised its performance. He said, “The Kiln-direct heat treatment has done a tremendous job. I bought a chamber from Kiln-direct because I saw ads in your magazine and asked around and heard only good things about them. It heats pallets efficiently and hasn’t given me any problems.”
A&J stores pallets inside as well as in closed trailers. The company owns about 100 trailers in its fleet. All of this work is done at A&J’s 43,000 sq. foot plant located on almost seven acres in South Milwaukee. The business started out in a small building in Waukesha, then moved to a larger facility in Muskego before moving to the current location.
Quality is only possible due to the dedication of the A&J staff. Santoro said, “We are successful because we try to sell as cheap as we can to make a profit, and we produce a high quality pallet.” He pointed to his staff as the ones who make this possible.
Santoro specifically pointed out key personnel. He mentioned Andy Christenson who co-owns the company and oversees the machinery end of the business and the daily warehouse operations and Joe Mitchell, who supervises the repair line and monitors quality. He also pointed to Don Zick, who handles transportation and loads trailers, as well as Carlos Marquez, who handles unloading pallets, and Austin Christenson, who oversees the Viking Turbo.
Currently, the company has about 40 employees. A&J is truly a success story because it has grown so fast in only a short period of time. Santoro credited his staff as well as the hard working Viking equipment and the people behind it. He said, “Viking Service on the machines is excellent. We have a service tech come out every six months to work on the machines. Maintenance is a key to maintaining proper performance of high-tech machines, such as the Viking Turbo. And the Viking team does a great job.”
Viking™ Champion QC306 Features
• Produces 500 – 600 pallets per shift with only one operator
• Can run used and reclaimed lumber
• English or Spanish operator interface
• Has the flexibility of producing mats and block pallets
• 2, 3, & 4 Stringer capability
• Save up to 40 pallet configurations in the Champion’s system for fast and easy changes
• Automated stacking
• Automatic pneumatic filter drains
• Compensating bulk nail chucks
• Programmable controller
• Quick change stringer rails
• 72" maximum and 20" minimum pallet length
• 60" maximum and 36" minimum pallet width
• 3.0" maximum and 1.5" minimum nail length
Viking™ Turbo 505 Features
• A 2-3 operator machine (depending on material layout)
• The capability of producing between 1,800 and 2,000 pallets with only 2-3 operators, per shift
• A new 12" color screen with multiple system language options for maximum flexibility
• Turbo Pro Plus system software + DATA:
• All the functions are easily controlled from a laptop
- Allows you to design and store hundreds of pallet configurations
- Allows you to see a diagram of the pallet you’re designing, no more guess work
- Monitors machine uptime/downtime and manages production data by shift
- Multiple Turbos can be connected using different IP addresses and accessed from one location
- Difficult pallets are made easier with simple adjustments and stored in your laptop
• 72" maximum and 28" minimum pallet length
• 60" maximum and 28" minimum pallet width
• 3.0" maximum and 1.5" minimum nail length
• Nail-up sensor standard
