Monroe Pallet Enjoys Steady Growth in the GMA Market
Kentucky pallet manufacturer has been on growth track since Kenny Smallwood acquired the company
By Tim Cox
Date Posted: 9/1/2000
EUBANK, Kty. — Monroe Pallet has been on a growth track since Kenny Smallwood acquired the company in 1991. Kenny has steadily expanded the pallet manufacturing business. Under his leadership, the company has doubled production capacity.
Monroe Pallet is based in Eubank, about 60 miles south of Lexington, and was started by Rudy Monroe in 1960. Kenny grew to know Rudy and his business while Kenny was a sales representative for Bostitch. Kenny bought the business when Rudy retired.
At the time that he bought Monroe, the company was building about 12 to 15 truck-loads of pallets per week, according to Kenny. The business employed about 25 workers and had three trucks and rented a trailer van. Monroe Pallet now has the capacity to build about 35 truck-loads of pallets per week and employs about 70 workers in its operations.
Kenny attended Eastern Kentucky University, Gadsden College in Alabama, and the Kentucky School of Mortuary Science. He has several other businesses: Oran’s Truck Stop, Somerset Wilbert Vault Co., Buyers Paradise Furniture, and Silent Guard Security Systems.
At the time when the company changed hands, Monroe Pallet was buying logs and 4x6 cants for raw material and operated one sawmill. The expanded business now buys standing timber, hires contract loggers to harvest the wood, continues to purchase hardwood cants, and also buys pre-cut material.
The company processes about 155,000 feet of logs weekly; it uses logs 8 to 30 inches in diameter and in lengths of 8 to 16 feet. Monroe buys six loads of 4x6 cants per week and also about five truck-loads of pre-cut per week, both deck boards and stringers.
Kenny expanded production by adding a sawmill, and the company also added a completely new, all-Brewer Inc. cut-up line in July.
Monroe’s sawmills and pallet operations are situated in two locations about six miles apart.
At the company’s original sawmill, a rosserhead-type debarker removes bark to prepare the logs for break-down by a two-blade Frick top saw. Slabs and lumber are removed in order to square up the log to a 4x6 or 4x8 cant. The top saw is followed by an edger to finish the board-making process.
The second sawmill, installed in 1996, consists of a Corley two-blade circular saw that is also followed by an edger. The cants it produces are fed directly from the green chain to a single-swing cut-off saw and then into a Cornell gang saw. The production line is dedicated to producing deck boards.
The two sawmills are operated by eight workers combined and process about 8 million feet of logs annually.
All pallet assembly is done at the original mill, where the new Brewer cut-up line was recently installed. The new cut-up line supplied by Brewer is used to manufacture both deck boards and stringers. Cants are cut to size on a Brewer Twin Select cut-off saw that feeds directly into a Brewer thin-kerf, double-bay gang saw. The two bays on the gang saw enable the machine to be set up to saw both deck boards and stringers at the same time; the operator decides which side to send the sized cant through and controls the process.
The new Brewer thin-kerf gang saw has enabled the company to reduce saw kerf from 0.200 to 0.135. When material exits the gang saw, one worker removes shims or other defective material. Deck boards continue straight to a Brewer stacker, while stringer material is diverted to a Brewer double-head notching machine and a second stacker.
The company had one additional piece of equipment custom-made to operate in conjunction with the Brewer Twin-Select. It contracted with a local machine shop to build what Kenny called a "block separator." It separates large blocks from small ones; both are conveyed by a belt under the Twin-Select. Small ones go to a dust pile, and big ones go to a bucket and eventually are sold for firewood.
Since the company is heavily into the GMA market, it takes a 14-foot cant or flitch and cuts out three 40-inch sections for deck boards; the remaining 48-inch piece is used for stringers. (The Brewer Twin-Select can cut up to six different lengths without requiring any operator adjustments.)
The new Brewer line improved the company’s yield and efficiency. "We’re trying to get our yield up where it needs to be," said Randy Curry, plant superintendent. Kenny expects the yield to run up to 95%. He also anticipates recovering more usable lumber from wood that previously would have been considered waste material — lumber that will be suitable for making smaller pallets.
Another obvious goal of the new Brewer line is to increase production. Kenny expects the new Brewer line to produce about 180,000 board feet of lumber per week.
At the time that Kenny was interviewed for this article, the Brewer machines had only been installed the previous week, and the company was still in the process of making adjustments and getting acclimated to the equipment. "We’ve gained a lot of ground since last week," Kenny said, "and we’re gaining ground daily. The Brewer machinery is built good and heavy, and I am very pleased with the Brewer staff. They did an excellent job working with Monroe employees to install the new line and get it up and running."
Monroe was equipped with a duo-line Campbell nailing machine, which the company continues to run. Kenny also upgraded the company’s automated pallet assembly capacity with a Viking Engineering Champion nailing machine. It also added a Viking Turbo 505 in 1998.
The company has a few other pieces of machinery. A Morgan Saw Co. single-head bandsaw is used for resawing some material. The company also has two chamfering machines.
Monroe provides pallet repair services, although these activities represent only a small portion of its business. Monroe ships about a couple of loads per week of reconditioned pallets. The company has not invested in any pallet repair machinery to handle the volume; workers remove broken or damaged deck boards with hand tools and replace them with power nailing tools. For repair stock the company uses no. 2 material manufactured in its own mills.
The company has found outlets for all of its waste wood. Slabs and other suitable material are processed in a Morbark chipper and sold to a paper company. Trim ends and blocks go to the firewood market. Bark is sold to a business that processes it into mulch. Monroe’s sawdust serves as raw material for manufacturing charcoal briquettes.
Monroe has customers in Tennessee, Kentucky, Ohio, Michigan, Missouri and Indiana. "We have a wide variety of customers, many of whom are in food or grocery-related industries," said Kenny. "We like smaller customers," he said. One big reason: less competition. Customers that represent large accounts draw a lot of pallet suppliers vying for the business. "Peggy Withrow and Ray Caldwell make up our sales staff," said Kenny," and they do a great job of working to accommodate our customers."
Monroe will inventory pallets for a customer so they can be delivered within 24 hours. Just-in-time production schedules adopted by many manufacturing businesses put the burden on pallet suppliers to respond quickly and to have pallets inventoried for some customers. Short lead times make it difficult to schedule production. Building orders ahead and inventorying pallets for customers evens out production and makes the pallets available for quick delivery, although the pallet manufacturer must carry the cost of that inventory.
Monroe delivers only truck-load quantities; its rural location makes it more cost-effective for the company and its customers. The average order is two loads per week.
The company also provides a service to fumigate pallets. Fumigation is done with fogging equipment in trailer vans with a chemical that is approved by the federal Food and Drug Administration.
Another change Kenny brought to the business was expanding its trucking operation. The company has a fleet of late-model trucks and trailers. "We take pride in our trucks because they represent us out there," said Kenny. Monroe owns seven tractors, seven van trailers and eight flatbed trailers, and the company has its own garage and maintenance staff to service them.
More importantly, the trucking division operates as its own authority to contract for back-hauling. "It’s more cost-efficient and it allows us to sell pallets cheaper," Kenny explained.
Monroe also has its own machinery maintenance staff. For example, Monroe employees installed all the wiring for the new Brewer line. They also have been maintaining the company’s Viking Turbo 505 nailing machine. In two years of running the Viking Turbo 505, technicians from Viking have only been summoned once to assist the Monroe staff.
In an effort to keep employee morale high, this past summer Kenny initiated a four-day work week; employees work four 10-hour days and then have off a three-day weekend. If the company loses production time during the regular work week, employees may be needed to work Friday. The workers at Monroe seem to like the arrangement. "We’re trying to do anything we can to keep our employees happy," said Kenny. "Hiring and keeping good workers is a challenge. By contrast, the machinery is here every day."
"By continually updating our machinery, we can provide our customers with the best quality pallets available," said Kenny. "We’ve made a lot of progress in the last nine years and continue to look forward to the future."
Monroe Pallet has a Web site at www.monroepallet.com; the company also may be reached at (877) 805-2500 or (606) 379-2632.
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