Bassi Distributing Explores New Dimension with Chep
When George Bassi Distributing became a supplier to Chep USA, its production, sales and work force doubled within the span of a week.
By Staff Writer
Date Posted: 4/1/1999
WATSONVILLE, Calif. When Chep entered the U.S. pallet market with its pallet rental program, many pallet manufacturers were wary. Others, however, have seen the entry of big blue as an opportunity to bring stability to their business, to even out the ups and downs of sales.
George Bassi Distributing is one of those companies that saw an opportunity and has become a producer for Chep USA. Company president Dean Bassi said the relationship with Chep has added a new dimension to Bassis business.
When Chep needed a manufacturer on the West Coast, they recognized Bassis reputation for building quality pallets. It was David Fullington at Express Lumber, one of Bassi Distributings lumber suppliers, who convinced Dean and his brother, Michael, chief financial officer, that partnering with Chep would benefit their company.
When Bassi signed on to build Chep pallets last spring, many changes were in store. Before Chep became its biggest customer, Bassi ran one eight-hour shift five days per week. In order to meet the requirements of the Chep account, the company increased the work force at its Watsonville location from 60 to 100 in the span of one week and went to two 10-hour shifts, seven days per week.
There were "a lot of growing pains," admits Dean, but he credited a "real good team of employees who knew what they were doing" with making the successful transition. Experienced workers trained new employees until they were able to work alone. It took about a month, Dean said, for the new workers and the added production capacity to begin functioning in a routine fashion.
George Bassi Distributing is located south of San Francisco between Santa Cruz and Monterey along the coast of Monterey Bay. Named for its founder and original owner, George Bassi launched a trucking business in the 1940s with one truck and a single trailer. He hauled produce from the central valley of California to Oregon. As a back haul, he took lumber from mills in Oregon and northern California. After World War II and the onset of the pallet industry, George quickly saw a need and figured he could fill it. There were no companies in the Pajaro and Salinas valleys that manufactured pallets. George decided to capitalize on his connections in the lumber business and began building pallets for local canneries and frozen food companies. In those early days he and his workers used hatchets instead of hammers. The canneries made up the bulk of the companys volume until the 1970s, when it developed accounts in agribusiness.
Dean and Mike returned to the family business about three years ago. Although they had grown up around the company, Dean, Mike and their older brother, George Jr., had careers outside of Bassi Distributing. Dean, 31, had his pallet recycling business, Mike 45, was a farmer who grew specialty vegetables for restaurants in Monterey, and George Jr., 50, was an electrician until he recently retired. George gave his sons a couple of options: the family could get out of the business or the sons could return and take responsibility for managing it. Dean brought his pallet recycling business into the company and became president. As chief financial officer, Mikes duties include buying lumber; he also continues to have a hand in his organic farming business. George Jr. is preparing to return to the business to supervise maintenance. (Their father, retired from the business for some time, died last summer at age 82.)
Today, Bassi Distributing supplies pallets from its Watsonville location it has grown from one acre to 10 to customers throughout California and in Nevada and Oregon. It has a second facility in Holtville, Calif., located about 60 miles west of Yuma, Ariz. that employs about 30 workers and serves customers in southern California and Arizona.
In addition to the increased manpower it needed to handle the Chep account, Bassi also had to increase its nailing capacity substantially. The company added two Viking Explorer pallet assembly machines to build Chep block pallets. The two new Viking nailing machines were installed just after the first of this year. Besides the two new Viking Explorers, Bassi is equipped with four other Viking nailers three Duo-Matics and a Turbo-Max and five FMC nailing machines.
Since the company buys cut stock, it has minimal lumber manufacturing or remanufacturing operations. Nearly all material comes already sized for assembly deck boards, stringer, and blocks, although some bundles of material are cut on an LM Equipment Company package saw. Bassi manufactures some of its own blocks, sawing them from 4x6 cants on six Whirlwind chop saws. Stringer material that has not been notched goes to Hazledine and Bob Hanna notching machines, and some deck boards are processed on a Hazledine chamfering machine. "We try to stay away from having to do any milling," said Mike.
The company also added a paint booth at Watsonville to coat the Chep pallets in their characteristic blue color. Two men feed stacks of pallets into the booth for painting, and two more stencil the Chep name and logo onto the blue pallets. Before putting in the paint booth, the Chep pallets were painted in a secluded spot of the yard "on a very calm day," Mike said with a laugh.
The Viking Explorer can assemble both block and stringer pallets. The Explorer has an aluminum jig frame designed for the Chep block configuration. To change over to a stringer configuration, the jig is replaced with another, and the correct nailing scheme is entered into the Explorers computer controls. Changing between the two can be done in as little as 30 to 45 minutes. Bassi intends to keep the two Explorers set up almost exclusively for the Chep block pallet configuration. Chep stringer pallets require a staggered nailing pattern. For Chep stringer pallets, Bassi uses the Turbo-Max and, to a lesser degree, one of the Duo-Matics. If the company receives a large order for Chep stringer pallets, it can change over an Explorer.
Chep stringer pallets generally require more lumber, have tighter tolerances and different nailing configurations than a GMA pallet. Accordingly, they take longer to build and require more attention during the manufacturing process. For example, the Turbo-Max can produce from 1,500 to 1,800 GMA pallets per shift but only 900 to 1,000 Chep pallets. The difference is due to the staggered nailing pattern and partly to the increased number of nails. In addition, since Chep pallets require stricter tolerances, the machine is operated at a slower pace to ensure they are met.
Factors that persuaded Mike and Dean to deal with Viking included the companys reputation and experience, the availability of the machines, the capabilities of the Explorer, and price. Viking personnel spent considerable time at Bassi setting up the new Explorers so they would consistently produce block pallets to meet Cheps tolerance limits. The Viking team was "wonderful to work with," said Dean.
Bassis pallet production varies throughout the year because of the seasonal nature of its accounts. The company produced 1.2 million pallets in 1998, using 30 million board feet of lumber. About 80% to 90% of its volume is the 48x40 footprint, although it also makes a number of specialty pallets, including a small number that are manufactured by hand at nailing tables. Bassi supplies customers with about 50 other types of pallets, including Euro designs, block and SPEQ pallets.
Bassi does a small volume of recycled pallets. They are handled by Pacific Pallet Recyclers, a company Dean started in 1993 and is now part of Bassi Distributing. Pacific has four employees and is mainly a pallet repair operation. Located just a few blocks from the Bassi main office, it contributes about 5% of the companys overall revenues.
Service like just-in-time delivery is standard, according to Dean. The company provides a trucking service to customers that sets it apart from other pallet manufacturers. It has a fleet of seven trucks and 12 double trailers. If an agribusiness customer needs to move equipment from one site to another, for example, Bassi will provide that service. The double trailers also come in handy when a customer needs a load of new pallets and a load of recycled pallets; one load is put on each of the double trailers for easy delivery.
Most of the companys employees are Hispanic. They are paid a piece rate. The region has suffered from high unemployment as much as 25 percent since the frozen food companies moved their operations overseas and many factories closed. The high jobless rate made it easy for the company to hire labor when it came time to beef up production for the Chep account.
With its growing pains behind it, George Bassi Distributing is equipped, capable, and focused on supplying Chep in a partnership it hopes will prove fruitful for both and on continuing to serve its customers in the agribusiness industry.
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