Southern Packaging Is Going Strong in Gulf Coast Region: Company Looks to Open Second Plant; Pendu-Cornell a Key Supplier
Louisiana pallet manufacturer is going strong on the Gulf Coast with Pendu-Cornell a key machinery supplier; company looking to add second plant in Mississippi.
By Tim Cox
Date Posted: 11/1/2005
PORT ALLEN, Louisiana — When Brad Tuminello and his brother, Ken, saw
However, they will be the first to tell you that the success their company, Southern Packaging, has enjoyed is due to much more than fortuitous timing. They attribute it to plenty of hard work, smart business practices, and good employees, suppliers and customers.
The brothers founded Southern Packaging in 1993, and the pallet manufacturing company has prospered and grown. Starting with just a small handful of employees and a few pieces of equipment, the company now operates its own scragg mill and sawmill, has extensive cut-up and automated pallet assembly operations, and also offers pallet recycling services. In addition, the company is on the verge of opening a second plant in neighboring Mississippi.
The company’s facilities are in Port Allen, which is about 70 miles west of New Orleans. The Tuminellos make their home in Baton Rouge while their plant is on the west side of the Mississippi River.
"Hurricane central," quipped Brad.
Both men graduated from Louisiana State University. Brad majored in finance and after graduating went to work for Mobile Oil company for several years in the Northeast. "I realized I didn’t want to work for a big corporation," he recalled, and desired to have his own business. He worked his way back to Louisiana, returning to LSU to get a Master’s in Business Administration degree. As part of the work for his MBA degree, Brad did research into the pallet industry and discovered that most pallets used in Louisiana were being manufactured by pallet companies in other states. He developed a business plan for pallet manufacturing as part of his degree requirements.
Ken majored in forestry as an undergraduate at LSU and then followed that up with a Master’s degree in wildlife management. He promptly went into the construction industry and for about 17 years worked as a contractor that provided sandblasting and painting for commercial buildings.
In the early 1990s, Ken was interested in exploring other business opportunities. He talked with Brad, who showed him the research he had done into the pallet industry. Brad also had identified a candidate pallet business that was for sale. Ken scrutinized the company but walked away after he determined it was not a viable business option to purchase. Later they decided to launch their own business from scratch and started Southern Packaging.
When they began the business, both men continued other jobs for a while, and their wives worked to help support their families. After a few years of putting ‘sweat equity’ into the new company, they could begin working for themselves full-time.
They started by hiring three employees, working out of a 12,000-square-foot warehouse on a four acre site. They bought a Baker Products chop saw, a Baker three-head horizontal band resaw, and a pair of Bronco Pallet Systems semi-automatic nailing stations. The company prospered, and within a few short years Brad and Ken were able to work in the business full-time, and they invested in their first nailing machine, a system from GBN Engineering.
Today the business covers 50 acres and has six warehouse buildings with 70,000 square feet under roof. The company specializes in hardwood pallets and uses every form of hardwood raw material – saw logs, scragg logs, cants and boards. The company’s operations employ about 90 workers. They produce 10-15,000 new pallets weekly, and the recycled pallet operations produce about another 10,000 used pallets per week. About 80% of revenues come from sales of new pallets, the remaining 20%, from recycled pallets.
In the new pallet market, the company manufactures 200-300 pallet sizes and specifications. However, it does not compete in the market for new GMA pallets. Common sizes the company manufactures are 42x42, 48x42, 52x42, 48x45 with five stringers, 62x45 and 45x45. It also produces pallets in the same size as the GMA (48x40) although they are a different specification. The company does strong business with customers in the petro-chemical industry.
The company started pallet recycling operations mainly as a service to customers to remove excess pallets and provide pallet repair services, but they have grown to become a significant player among pallet recyclers in the region. In the pallet recycling arena, the company’s primary focus is the GMA market.
Southern Packaging typically has bought new equipment when the time comes to invest in machinery. One reason it selected Baker as one of its first suppliers was the thin-kerf technology of the supplier’s horizontal band resaws. "We felt it paid good dividends," said Brad. "We’ll stick with the thin-kerf technology."
When Brad and Ken have a successful experience with a sawmill machinery manufacturer, they like to stay with the same supplier, they indicated. Using the same supplier and machinery reduces the training curve for employees and allows for some standardization in inventorying and installation of replacement parts. They began doing business with Cornell six years ago and have continued that relationship when Cornell was acquired by Pendu in 2004.
"We’re very pleased" with the new Pendu model 4600BS stacker, said Brad. "It does a great job." The company previously had four employees stacking lumber in that area; now, one employee oversees the machine. "It’s been a good investment," Brad added.
The mill operations are equipped with a number of key machines bearing the Cornell name plate, particularly for slab recovery. The company has two Cornell Circular Linebar Resaws (CLB) as well as two Cornell five-head multi-trim saws and a Cornell edger.
The Cornell CLB is a versatile, multi-saw, double-arbor machine that is capable of performing three different functions. It can automatically self-center and split edged boards or cants up to 8-inch cross-section with one to three saws. It also can resaw single boards thicker than 3/8-inch and cants up to 8x8 in cross-section, using a maximum of three blades per arbor. It can reclaim from one to three boards per pass from edged, heavy slabs typical of those produced from a scragg mill.
Southern Packaging added sawmill operations in 1999. The sawmill has a Helle head rig with three-knee carriage for cutting logs larger than 13-14 inches in diameter. Smaller logs are processed on a Tipton scragg mill.
Tree-length hardwood logs are purchased for the sawmill, and the logs are merchandised and bucked in the yard and debarked.
The Helle circular mill breaks the log down into a 4x6 or 4x8 cant or takes
Lumber is recovered from slabs in an in-line slab recovery system supplied entirely by Cornell. The edged slabs go to a Cornell five-head multi-trimmer to be cut to length, and the three-sided pieces then are fed to a Cornell Circular Line Bar (CLB) to be sawn into as many as two or three boards.
The Tipton scragg mill is a quad-arbor mill running four circular blades, two top-and-bottom on both sides. It normally is fed 48-inch bolts that are cut into two-sided bolts, and then the piece is under-trimmed to produce a four-sided block. The block is trimmed on a Tipton double-end trimmer, then is resawn on one of several Baker bandsaw lines.
The scragg mill also is integrated with an edger. The Tipton edger produces a three-sided slab that is trimmed to length on a Morgan Saw Co. double-end trim saw. The trimmed, three-sided slabs are then resawn on another Cornell CLB to produce boards.
In the cut-up shop, in order to be able to process all forms of hardwood material, the company installed a Cornell board line. This line is used to process 5/4 and 4/4 material purchased from sawmills. It begins with a Cornell edger to edge random width lumber into boards that are 3-3/4 or 5-3/4 inches wide. After edging, the material goes to a Cornell five-head multi-trimmer to be cut to the appropriate length.
Cants produced in the company’s mill or purchased from other sawmills are processed in one of two ways. One line begins with a Cornell five-head multi-trimmer to cut the cants to length. The sized cant material then goes through a Baker sizer to cut them to a uniform height, then they are resawn on either a Baker two-head, three-head or seven-head horizontal band resaw line. Behind the Baker seven-head resaw is a Baker de-duster and the new Pendu board stacker.
In another building, a Baker cut-up system also processes cants. This line remanufactures the cants primarily into stringers. A Baker two-head cut-off saw cuts the cants to length, and then they pass through a Baker sizer. The material then runs through a Baker three-head resaw line and continues in-line to a double-head notcher equipped with Econotool notching heads.
For odd or culled material, another small line is set up to recover a board. It consists of a Morgan double-end trim saw followed by a Baker single-head bandsaw.
The sawmill cuts 20,000 board feet per day; 30% of that volume is finished cut stock and the remainder is in the form of cants. In addition, the cut-up operations process about another 30-40,000 board feet daily.
The company relies on local suppliers for sawmill blades, blade service and industrial components. The company buys Lennox band blades from Smith Sawmill Supply for its Baker resaws. Circular blades are purchased from Poole’s Sawmill Supply and resharpened by Byrnes Sawmill Sharpening. Bearings and other parts are purchased from Russton Mill Supply.
In its pallet assembly operations, Southern Packaging is equipped with three Viking nailing machines. It has two Duo-Matics that have been completely upgraded by Macon Machine, including new computerization, and a Viking 504 that has been converted to assemble five-stringer pallets. All the Vikings machines use bulk nails supplied by Garnett Co.
Small quantities of pallets, particularly specialty and custom pallets, continue to be assembled by hand with pneumatic nailing tools; the company uses Paslode tools.
Southern Packaging added pallet heat-treating capacity three years ago to supply heat-treated pallets for customers. The company has a Brunner-Hildebrand system with a Hurst boiler capable of heat-treating two truck-loads of pallets at a time. It is heat-treating six to eight truck-loads daily for customers.
Brad, 42, and Ken, 52, said their business growth and success was the result of "a lot of hard work." They also were quick to credit their staff as well as their approach to dealing with people. "We have a lot of very good and dedicated employees," said Brad, "and an excellent office staff that takes care of our customers. We’re a very service-oriented company. We treat employees, suppliers and customers the way we want to be treated." The office staff is comprised of office manager Kaki Scott, who provides customer service and dispatching, Betty Reed, who is responsible for accounts payable, and administrative assistant Rita Sumas.
Prudent, sound management has helped, as well as good banking
"We pay our lumber suppliers every week," Ken added.
Key employees include plant manager Blaine Bergeron, another LSU graduate; Blaine helped earn his way through college by working at Southern Packaging and continued to work for the company after earning his degree. Chad Bonnette, who has worked for the company about 10 years, manages the pallet assembly operations. Russell Jewel and Dale Beaubouef operate the sawmill, Rodney Craig supervising the night shift, and Bruce McClemens and Sean Sullivan oversee the pallet recycling plant. Kenny Saucier and Lance Newman take care of maintenance and the log yard.
The recycling plant is equipped with a pair of Smart Products bandsaw dismantlers and a Smart trim saw for cutting recycled material to length.
The company produces a considerable volume of ‘combo’ pallets — constructed from a combination of new lumber and recycled lumber — in its pallet recycling department, which is focused heavily on the GMA market. The company supplies its recycling plant with No. 2 lumber that is cut into new 48-inch stringers that are combined with recycled deck boards. The recycling department, with about 15 workers and using Paslode pneumatic nailing tools, also has pallet repair operations.
As for residuals, two Fulghum 48-inch chippers process scrap material into chips that are sold to a paper mill; the company also is in the process of adding a Precision 58-inch chipper. Bark is sold for boiler fuel. In the recycling department, a tub grinder is used to grind scrap pallets and other wood waste into boiler fuel material.
Southern Packaging employs a number of Hispanic workers. The company, which is a member of the National Wooden Pallet and Container Association, has workers watch safety and training videos that are bi-lingual. Forklift training is provided by a local company to enable Southern Packaging employees to become OSHA certified. Workers are required to use safety glasses, hearing protection, steel toe work boots, and to wear pants with shirts tucked in. Prospective employees must submit to a drug test, and additional drug tests are performed as a standard procedure after an accident and also on a random basis. Southern Packaging offers its employees a 401-K savings plan, and the company matches worker contributions. The company also pays bonuses – based mainly on overall plant safety performance and efficiency – annually or semi-annually.
There is an office staff of three. In addition, Brad oversees the company’s finances and handles sales — the company also uses two manufacturer’s representatives to sell its pallets — and Ken oversees all round wood procurement and construction projects.
Brad and Ken are planning to start up another plant in Woodville, Mississippi, and expect it to be operating by the second quarter of 2006. The new plant, which will produce pallet parts for Southern Packaging and also for sale to other pallet suppliers, will employ about 20-30 workers. It will process pallet logs into cut stock and also remanufacture rough lumber into pallet pre-cut stock. Brad and Ken already have made some tentative decisions about equipment for the plant. It will be equipped with a Timberland Machinery Big Jake scragg mill. Brad and Ken are considering a number of suppliers for other key machines.
The recent hurricanes have not directly impacted the company’s operations much although Hurricane Katrina knocked out some customers along the Gulf Coast. On the other hand, Hurricane Rita caused power outages and other damage in east Texas, interrupting the operations of some pallet companies there; Southern Packaging picked up business as the result of the down time incurred by those pallet companies.
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