Demand for Crates, Boxes Keeps Michiana Box & Crate Growing -- Michigan Firm Also Makes Pallets, Relies on Country Saw & Knife
Demand for crates, boxes keeps Michiana Box & Crate growing; Michigan company, which also makes pallets, relies on Country Saw & Knife for blades and blade service.
By Diane M. Calabrese
Date Posted: 1/1/2006
NILES, Michigan — Good products sell. Michiana Box & Crate Inc. is a manufacturer of quality wood products and has a root that dates back 50 years. Its sister company, Lake States Wholesale Lumber, is about 20 years old. Both Michigan companies are owned by Forest Lake Partners, a Willow Springs, Illinois-based business that bought the pair three years ago from Gary W. Cehovic, now a director at FLP.
Michiana supplies, among other things, pallets, wood containers built to military specifications and certified heat-treated wood packaging for export and compliance with ISPM-15, the international phytosanitary standard, along with packaging for industrial use. Lake States is a lumber remanufacturing business that also builds trusses and provides complete services for ripping, trimming, shaping and much more.
Louis Kovach became president of Michiana Box & Crate just nine weeks before he and several members of his management team talked with Pallet Enterprise in mid-November. He brings 27 years in the wood products industry to his position.
Louis is not the only wood products veteran at Michiana. The management team is a group of people with some 160 years of experience. Louis, Bill Elliott, manager of sales, and Bob Modlin, production supervisor, account for more than 100 of those years, all of them in wood-related businesses. Other members of the team who talked with Pallet Enterprise are Tom Zielinski, comptroller, Eric Dunham, plant manager, and Sarah Riblon, human resources.
Michiana Box and Crate has been a member of the National Wooden Pallet and Container Association for more than 40 years. The company is also part of the North American Wholesale Lumber Association and the Michigan Manufacturers Association.
Gary, the previous owner and current FLP director, has held many leadership positions in various trade organizations.
Louis got started in the wood products almost three decades ago after being recruited from the construction industry. He enjoys the forest products industry and likes the people in it, he said. He also appreciates "the challenges," he said. "It changes daily," he explained.
For eight years, Michiana has had two divisions. The older assembly facility is located in Niles, Mich., which is about 48 miles southwest of Kalamazoo in the southwest corner of the state. The other component is a mill in Reed City near the center of the Wolverine State. Each facility spans 20 acres, and most of the surface at Niles is improved.
Niles and Reed City are separated by 186 miles. Michiana transports material to the assembly plant from the mill via B-Train or tandem trailer. The B-Train holds as much as a double trailer that a tractor would pull, said Louis.
The mill processes hardwood and aspen cants purchased from local sawmills. Two shifts run five days per week and produce 100% of the pallet parts required by the assembly plant in Niles. "We consume 80 percent of the Reed City product here (in Niles) for pallets and crates," said Bill. The surplus pallet stock produced in Reed City mill is sold.
The Reed City mill is equipped with a complete Pendu Manufacturing cut-up line for remanufacturing cants, including a Pendu 4300 model gangsaw. The Pendu line was installed the year after the mill opened. "The line is typically a fully automated Pendu line," Bill explained.
Two years ago the Niles plant added truss assembly operations. Heat-treated, stamped Southern Yellow Pine (SYP) is purchased to make pre-assembled trusses as long as 18 feet.
The activities in the sister companies located at Niles are wide-ranging. On the assembly side, pallets, crates and boxes are made to customer requirements. On the wholesale side, products range from grade lumber to flooring, poles and pilings, studs, and specialty products, such as cross arms and highway stakes.
Twenty-four employees work in Reed City with 10 to 12 on each shift. There are three shifts staffed by another 90 employees, including office workers, at Niles.
The cut-up operations at the Reed City plant are so efficient that they have attracted the attention of Pendu, according to Bill. "We’ll process 20 million board feet in 2005," he explained. "Pendu is pretty amazed. It might be the highest (production for such a line) in the country."
In fact, the Pendu line was so productive that no one gave a thought to the possibility of giving it a further boost. A year ago, however, Michiana began to buy saw blades and contract for sharpening services with Country Saw & Knife Inc. in Salem, Ohio. The company initially began using Country Saw & Knife as a supplier because of better service and quality, according to Bob.
However, with Country Saw & Knife "we increased board footage with their blades," said Bob. That was a nice extra to the top-notch service that he knew he would get.
Country Saw & Knife has a fleet of trucks to pick up and deliver blades for customers. The route driver for Michigan is based about four hours from Niles and Reed City. He is onsite once each week to provide blade service. Michiana also buys all circular blades for its Pendu gangsaw from Country Saw & Knife.
Established in 1981, Country Saw & Knife stocks a wide range of cutting tools for the primary and secondary wood products industries. Its products and services include custom welding of bandsaw blades to length for all the thin-kerf pallet resaw systems and grade lumber resaw systems, and bandsaw blades for any application can be cut to length and welded. The company manufactures and services carbide tipped saw blades, such as gang saws and cut-off saws. All service work on carbide tipped saw blades is performed on CNC (computer numerical control) machines to ensure precision grinding of tooth geometry and a sharp cutting edge. Saw blades for any application can be manufactured to customer specification. Country Saw & Knife provides regular weekly service to customers; a company representative will stop at a customer’s plant to pick up dull blades and return sharp blades.
The pallet stock from the Reed City plant arrives at Niles in two or three B-Trains daily. "We put out approximately 5,000 to 6,000 pallets per day," said Bill. In addition, the company manufactures custom crates. The demand for custom crates and specialty wood boxes "spurred the need for lumber," he explained, and the plant was added in Reed City to supply it.
The Niles plant also is equipped for lumber remanufacturing operations. "We can rip, trim, bundle cut, resaw, notch or machine any kind of lumber," said Louis. "Basically, we can do anything out of a piece of wood." The Niles plant is equipped with a Pacific Trail package cross-cut saw with a bundle bumper, a Newman KM-16 multi-trim saw, and a West Plains Resaw Systems Inc. double-head notcher and two-head horizontal band resaw. The Newman K-M 16 and Pacific Trail package saw are used heavily for cutting lumber to length.
Production from the Niles plant is used at the same plant for assembling pallets or containers or it is shipped to Lake States for eventual sale.
All wood waste from the Reed City and Niles plants is sold to a company that hauls it away and processes it into mulch.
Focusing on new, quality products is a strategy that has worked well for Michiana and Lake States. Michiana is not involved in pallet recycling, and, as noted above, the company prefers to work with a vendor instead of processing residual material.
The Niles plant produces both custom and standard pallets, but the most common size is the 48x40 GMA pallet. GMA pallets are assembled automatically on a Viking 505 Turbo nailing machine, which is also used to build 20-30 different pallet sizes. The company also assembles a large quantity of pallets by hand with the aid of jigs. The plant has eight work stations for assembling custom pallets; four to five are used during the day shift and three to four are used on the night shift.
The company produces a wide range of pallet sizes. "We’ve done 20 footers and 12-inch by 12-inch," said Bill.
Michiana maintains a ‘library’ of pallet designs with upwards of 600 active designs. "About a week ago, we built a pallet that wasn’t built since 1954," said Louis. The customer asked for it, and Michiana had the specifications in its library system.
Soon after Louis arrived at Michiana, he got an e-mail from a customer. Michiana had retrieved a pallet specification in its library for the customer and filled an order for that type of pallet. The customer wrote, "you guys are so awesome," said Louis.
Michiana has used the Pallet Design System computer software program "since its inception," said Bill. It underpins the information technology functions of the company. The computer program, developed by Virginia Tech and licensed for use by the National Wooden Pallet and Container Association, is used for designing pallets.
Package Resource Laboratory is the auditing service that Michiana uses for certifying its heat treatment process. Michiana is equipped with a pallet kiln from Kiln-Direct to heat-treat a truckload of pallets at one time. The kiln, which was purchased three years ago, is fueled by natural gas.
For deliveries within 150 miles of Niles, Michiana relies on a lease arrangement that encompasses five tractors and an array of flatbeds and vans. Beyond that radius, contract haulers are used.
Michiana has a varied base of customers, including manufacturing businesses in automotive, agricultural, refrigeration and other industries in an ever-expanding area.
"We try to be innovative," said Tom. "We’re trying to avail ourselves to a lot of markets."
"We also supply specialty products for freight flooring," Louis added. "We’re a very diverse company. We import hardwood for the cargo industry."
In its truss manufacturing operations, Michiana uses a truss press from Pacific Automation. Custom trusses are made from grade-stamped lumber and heat-treated SYP bought from other suppliers.
Several vendors supply nails to Michiana. The company purchases bulk nails for the Viking machine both from Viking and Mid-Continent Nail Corp. Collated nails for the Stanley-Bostitch and Stan-Tech power nailing tools are supplied by Stanley-Bostitch, Stan-Tech and New Supplies.
More than 60 percent of the workers at Niles and Reed City are native speakers of Spanish. Foremen are bilingual.
A focus on a safe work environment is part of the routine. Ear plugs and eyeglasses are worn by employees, and no one goes onto the plant floor until they have completed safety training.
To maximize both productivity and worker satisfaction, two different kinds of pay systems are in use. Workers who assemble pallets or containers by hand are paid by the piece; the piece rate varies, depending on the product being assembled. Employees who run automated equipment earn an hourly wage. Michiana and Lake States offer employees a 401k savings plan and health insurance benefits that include eye care.
The diversity of products aside, a unifying philosophy brings cohesion to the company. "We do what we say—under-promise, over-achieve," explained Louis.
"It’s a customer-driven company," said Louis, so it’s important to be able to respond quickly to a need. "We do what it takes to get the job done," he explained.
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