Alberta’s North Star Shows the Way As Top Pallet Maker in Province
North Star Pallet: Alberta's North Star Pallet is the top producer in the province; father-and-son team built a successful manufacturing business after originally focusing on recycling.
By Diane Calabrese
Date Posted: 3/1/1999
EDMONTON, Alberta — Reliability by any other name might be the North Star, which appears fixed in the night sky. The dependable celestial body has guided navigators for millennia.
North Star Pallets, the namesake of the heavenly luminary, also can be counted on when it is needed. "We pride ourselves on just-in-time delivery," said Bill Luscombe, co-owner of North Star Pallets. "When we ship a load, we immediately rebuild the pallets so they are ready when the customer wants more."
Bill and David Luscombe, Bill’s son and co-owner, started North Star Pallets, a division of 361247 Alberta, in 1987. Until then, Bill and two partners owned North Star Cold Storage, a venture they had launched in 1978. (Before entering the cold storage business, Bill worked 27 years as a regional credit manager for Swift Canadian, the company he went to work for after graduating from high school in 1949.)
When a competitor bought out the cold storage operation, Bill and David were able to retain the name North Star for their new business. Father and son did not just leap into pallets, however. They brought considerable expertise with them.
Because pallets at the cold storage facility often required repairs, Bill took on the challenge of rehabilitating them. Soon he was repairing so many pallets that he accumulated extras to sell. David worked with his father at the cold storage facility, part-time during high school days and then full-time.
Their "side-line" experience made a pallet operation a logical choice for them. Because they had ample experience in the repair side, they aimed at first for a pallet recycling operation. Business plan aside, the market for recycled pallets proved too small in Alberta, a province of just over 2 million people. North Star shifted gears to pallet manufacturing. The company now makes 85% new pallets — about half of which are reusable block pallets — and about 15% recycled pallets. North Star also manufactures shipping skids, pipeline skids and containers. Pallets reign though, comprising 90% of the company’s output.
North Star produces, on average, about 6,000 new pallets per week and 1,500 recycled pallets. Thirty full-time employees keep the production lines moving and make North Star Alberta’s number one pallet maker. Average yearly sales continue to increase.
Although it is a moderate to high volume producer, North Star’s pallet assembly operations are not automated. The company does it all with hand-held nailing tools. Stanley-Bostitch nailing tools are the equipment of choice. Five two-person teams staff the assembly tables. Bill likes the manual approach to nailing. "At the moment," he said, "we can make quick changes for smaller amounts of production more easily." Automation could be in the future for North Star, however. Dave has looked closely at the various nailing machinery.
Besides the quick changeovers, hand nailing adds another big plus. "Our pallet (assembly) teams are trained to pick out bad wood," said Bill. "We pride ourselves in doing what’s right for our customers."
Quality control does not stop only with components. Every 20th pallet is subjected to a careful quality control inspection. "We also give customers a report on quality, some of them by fax each day," said Bill.
Petro-chemical, plastics, food and agricultural companies are among the customers North Star serves. Many of them are ISO 9000 certified, a standardization that facilitates communication and commitment in international trade.
A year ago, an L-M Equipment package saw began to propel North Star’s production of pallet lumber. With the installation of the L-M package saw, North Star now cuts 10,000 to 15,000 board feet more each day and is doing it with two fewer employees. "The L-M is an excellent machine," said Bill. "We wanted to be more efficient, and we are."
L-M did not just provide a package saw. The company helped North Star put it in place with a system to thump a bundle of material so the ends are flush. The system needed to be able to handle repeated thumping. The solution called for serious anchoring, and L-M had the answer. "We built a cement base to hold the package system," said Bill. "Six pylons, each 18 inches in diameter, went down 32 feet. It took 7½ truckloads of cement to fill the base and the pylons."
Another feature is the ability to close the door to the 16,000-square-foot plant between cuts to keep out the Edmonton winters. Edmonton lies about dead center in Alberta. Along its southern border, Alberta meets Montana. Although Alberta’s capital city boasts more sunlight in an average year than any other Canadian city, Edmonton is still subject to the wrath of polar cold fronts.
The L-M machine is used to size bundles of cants. North Star buys cants from suppliers in northern Alberta and British Columbia. "Until about five years ago, we were using SPF [spruce-pine-fir mix]," said Bill. "But it became difficult to get good SPF, and we started to look at our native hardwood, poplar [aspen]. Until then, we treated poplar as just something wild in the bush." The native hardwood got a favorable review and not just because of a shortage of SPF. "By then," said Bill, "companies were designing thin kerf saws so that we could cut the cants."
North Star buys 4x6 cants in lengths ranging from 8 to 14 feet. The L-M system sizes them to typical lengths of 40 inches or 48 inches. From there they are taken by forklift to one of two horizontal bandsaw systems supplied by Morgan Saw Company. The bandsaws are used to cut deck boards and stringer material. North Star bought its first Morgan bandsaw, a 2-head, five years ago. It added its second Morgan, a 6-head, three years ago.
"We learned about Morgan through the NWPCA [National Wooden Pallet and Container Association]," said Bill. "Dave and I take pride in attending meetings across North America. We talk to pallet people, pick up pointers, and that is how we learned about Morgan." Bill and David also are actively involved in the Canadian Wooden Pallet and Container Association; David recently completed a two-year term as the youngest president in the history of the CWPCA.
North Star’s plant is equipped with a Hazledine chamfering machine, which they bought used and is estimated to be about 12 years old, a West Plains notcher, bought new 10 years ago, and a KPV block-cutting machine. (Blocks for Euro-type pallets are cut, piled and stretch-wrapped for transport to the assembly team that typically devotes itself to building block pallets.) The company relies on three Toyota forklifts that are on a three-month rotation for preventative maintenance. Maintenance work at North Star is done both in-house and out-sourced, depending on the machinery and the tasks.
The breakdown of teams among the five tables is fluid as it must be to meet order demands, with employees switching roles to meet orders. On most days, one station is used by a team that works on recycled pallets. "We generally do 48x40 pallets," said Bill. "We rebuild them and replace stringer parts."
Whether it is working on new or recycled pallets, each team is given a daily quota. Team members are free to go when their quota is achieved. They usually finish in six to seven hours and are paid for a full day. What happens if a team does not meet its quota in an eight-hour shift? "I have a talk with them," said Bill. "Pallets must be done correctly," he added.
The quota system apparently has helped retain employees, many of whom have been with North Star for most of the company’s life. North Star runs one shift, five days each week. Employees start at $8 per hour and earn an average of $11 to $12.50 per hour. "Other businesses tell us we must be doing something right to keep our employees here so long," said Bill. "One gentleman has never been late and never missed a day of work in the 10 years he has been with us. Our total workforce here is dedicated, and Dave and I respect each one’s individual talents and abilities."
North Star also employs a pair of forklift drivers and a certified truck driver; Bill labeled all of them "excellent" workers. "The truck driver is ‘Mr. North Star’ on the road," said Bill. He represents the company to its customers, and their impressions of him are important. North Star ships most orders — about 90% — on its own rig, a Kenworth tractor pulling a 48-foot flatdeck trailer. Most deliveries are to customers within a 100-mile radius of Edmonton. On its 8-acre paved yard, North Star inventories about 40,000 pallets ready to ship. Pallets usually can be delivered within hours of an order.
The company gives away waste wood for firewood to those who will pick it up. Saw dust is sold for horse bedding and to poultry farms.
Bill and his wife, Dorothy, have seven children. Their youngest daughter, Cheryl Luscombe, joined North Star in 1995 and works as the office manager. Cheryl is involved with the singles ministry at Sherwood Park Alliance Church and volunteers at a battered women’s shelter. (Edmonton has one of the highest rates of volunteerism in Canada.)
Looking to the next millennium, David acquired the Pallet Design System software about three years ago. Running it on a laptop computer, he uses the program to help customers sort out racking and stacking possibilities and more.
David is active in the Young Entrepreneurs Organization and currently serves as the chairman of its education committee. He also finds time to participate in a hockey league and plays once or twice a week. He and his wife, Cathy, have two young daughters.
Bill has no hobbies, but he likes to travel, particularly to such cities as Las Vegas, San Diego and Phoenix. He is "trying to wind down" his involvement in the company so that he and Dorothy can travel more often.
Despite the desire to do more trekking, Bill is committed to North Star. "I like making sure we are doing excellent work," he said. "Pride" is a word that came up many times as Bill discussed the company. There is no doubt that he plans to keep North Star Pallets the deserving namesake of its celestial counterpart — constant and vigorous.
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