Timbermenís Integrated, Diversified Operations Are a Recipe for Success
The Timbermen: Few pallet companies, like The Timbermen in Georgia, are large enough and diversified to the extent that they can control their raw material supply
By Jack Petree
Date Posted: 6/1/1999
CAMAK, Ga. ó Few pallet companies are large enough and diversified to the extent that they can control their raw material supply. An exception that others in the industry may want to emulate is The Timbermen Inc., a pallet manufacturer located in the east-central Georgia timberlands, some 100 miles from Atlanta, its major market.
The Timbermen is a vertically integrated company producing about 5,000 pallets per day, nearly all of them custom-built. The company owns timberlands and also contracts for timber on other lands. Timber harvested under contract is milled at The Timbermenís facilities and is used to produce the pallets it manufactures in its modern plant. The company controls the entire process.
The Timbermen was founded in Thomson in 1972 by James Hicks Sr., who started buying and selling timber growing on the immense tracts of forested land in the region. In 1978 he bought Lokey Manufacturing, a business that made pallets and crates, and pallet manufacturing was added to The Timbermen. Almost immediately after the acquisition, he saw the opportunity for milling logs for his pallet plant and for other businesses, and he began building a hardwood sawmill in nearby Warrenton. The sawmill began operating in 1979.
"There were some empty sawmill buildings available, so we decided to put in a sawmill to saw for the pallet plant," said Jim Hicks Jr., the founderís son. "We already knew how to buy and sell timber, and now we had an end use for the lumber. It seemed sensible to saw for our own use."
Only a few years later, they seized another opportunity to expand. A 40-acre site that had been used by ITT Rayonier came available in Camak, only a few miles from the Warrenton mill. The Timbermen bought the site in 1984 and relocated its main offices and the pallet plant to Camak. At about the same time, the younger Hicks, whoíd been working for Westinghouse as an engineer, joined his father in managing The Timbermen.
The Timbermen has experienced tremendous growth since then. Its four divisions now employ 160 people. The company mills more than 22 million board feet of lumber per year. The lumber is sold in the marketplace and also used in its own pallet plant, which ships to customers more than 100 miles from the mill.
The Timbermenís vertical integration sets it apart from most pallet manufacturers. Its four divisions encompass a timberland and log-buying operation with the companyís own forestry staff, three sawmill lines (two mills manufacture hardwood lumber and supply cants for the pallet operation, and the third mill produces mainly pallet lumber), a pine lumber air-drying operation, a resaw line, and a modern pallet plant.
The companyís sawmilling strategy, according to Jim Hicks Jr., begins with buying woods-run, tree-length hardwood logs. The wood goes through a log yard merchandising system to separate pallet logs and grade logs by species. The logs then are debarked and forwarded to the appropriate break-down system.
The Timbermen relies heavily on modern equipment designed to maximize efficiency, yield and quality, and the pallet mill is no exception. Pallet logs begin the break-down process on a scragg mill. The logs are cut into bolts of 40 to 50 inches and then sawn on the first Cooper Yield Champ scragg mill ever built, producing three-sided cants. The cants are trimmed to final length and then processed into deck boards using either a three-head or a five-head Brewer thin kerf band saw system. Deck boards are cleaned by a West Plains de-dusting system and then piled neatly by a Pendu stacker. Production through the scragg mill amounts to about 6 million board feet per year ó all hardwood. In addition, cants recovered from the grade operation go to the pallet plant. They are used mainly to manufacture stringers on a cut-up line with a Pendu thin kerf gang saw, a Brewer notcher, and a Campbell Redi-Stack stacker. The Timbermenís own pallet plant uses the bulk of the pallet lumber the company manufactures, and surplus cut stock is sold to other pallet companies in the region.
Most of The Timbermenís pallets are made by machine. The company has three Viking nailing machines, two Turbo-Max models and a Champion.
Virtually all pallets are designed for individual customers. "We build very few GMA pallets," said Jim. "Our customers have specialized needs, so almost every pallet is specific to a customer. We use the Pallet Design System program if the customer wants help designing a pallet or we build to specs their engineers give us."
The Timbermen also is authorized by the National Wooden Pallet and Container Association to supply SPEQ pallets. "The SPEQ program has worked out well for some customers, and others are not drawn to it," Jim said. "If a customer requires pallets built under a quality assurance program, the SPEQ program is what we recommend. Others are less concerned. The customer decides based on their needs. We are sure we have the ability to build a quality pallet to those needs."
The Timbermen sells mainly to manufacturing customers in the region with Atlanta being its major market. While the distance is longer than some pallet companies prefer to ship, it is not an insurmountable obstacle for The Timbermen. Its vertical integration and control from raw material supply to finished product give the company significant advantages over other pallet companies that depend on outside suppliers for lumber.
The Timbermen is not involved significantly in pallet recycling. "We looked at recycling and tried making it work," said Jim, "but the distance from our major markets simply doesnít allow us to effectively recycle. The Atlanta area is well serviced by recyclers so, when our customers have a need, we help put them in touch with a recycler who can provide that service to them."
The Timbermen has invested a considerable amount of effort and capital in a modern plant equipped for efficiency and yield. Some businesses are reluctant to make such extensive capital investments, but Jim believes the benefits are worth it, especially in the lumber industry. "Weíve seen a lot of the smaller companies getting out of the new pallet business and moving into recycling," he said. "Successful new pallet manufacturers are spending big money on their mills and doing well. We love to compete and have invested heavily on improving yield and efficiency. That requires a continuing program of modernization."
The Timbermen is an example of what it takes to position a business for success. It took steps early to control the entire manufacturing process, from raw material to finished pallets. It made a commitment to modern equipment in order to maximize yield and efficiency. And it diversified. Most of all, the company has achieved the flexibility it needs to meet the new challenges of a changing marketplace.
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