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Pallet recyclers partner with nonprofit organizations and a millwork company in a program that remanufactures used pallet lumber to make other products.
By Tim Cox
Date Posted: 7/6/2001
ST. PAUL, Minn.- Pallet recyclers are participating in a program involving several nonprofit organizations and a millwork company in which used pallet lumber is remanufactured and assembled into lawn and garden products.
The program provides several benefits- and revenues - to the nonprofit groups. The leading pallet recycler that participates in the program benefits, too, albeit in a more indirect fashion. The millwork company participates solely as a contribution to the community.
The project is the brainchild of a program called WoodWins, a nonprofit venture of the St. Paul Neighborhood Energy Consortium (NEC). The consortium has operated a curb-side recycling program in St. Paul for about 15 years. The group also has operated a recycling telephone hot line that, over the years, has frequently generated calls from people and small businesses looking for ways to recycle or dispose of perhaps two or three pallets. The NEC has conducted other programs, too; one program sponsors native landscape workshops and another provides residential energy audits to homeowners.
NEC spent three years in research and planning before launching WoodWins in 1998 with a three-year grant that enabled it to hire a staff person, Alex Danovitch, to get the program up and running. An advisory panel was established and comprised of leaders in business, other nonprofit organizations, and state government.
WoodWins has several aspects to its mission. It seeks to reduce waste wood going to landfills and to conserve natural resources. It set out to explore and develop ways to use recycled wood materials to produce value-added products that could be sold to generate revenues for NEC and its programs. (NEC leaders wanted WoodWins to become self-sufficient and to generate additional revenues that could be used to fund its other programs.) Other program objectives included creating jobs and opportunities for job training.
A recent study by the Minnesota Office of Environmental Assistance identified wood pallets as the primary contributor to wood waste in landfills, and pallets were targeted specifically by the WoodWins program."There are about 30 pallet recyclers in the metropolitan area," said Alex, now program manager, "but it’s not feasible for them to pick up small accumulations of pallets. We realized we could serve those businesses without competing with them."
The WoodWins program of manufacturing products from recycled wood is in its second year of operation and is seasonal in nature. WoodWins recycled about 18,482 pounds of wood in the first year. Next year it expects to recycle over 200,000 pounds, according to Alex- including about 2,500 pallets. This year the products sold from the program are expected to generate about $100,000 in revenues; the figure is expected to jump to $200,000 next year. The program will continue to rely on recycled pallet lumber and other wood now going to landfills but will expand to produce other products for new markets, such as interior furniture for commercial use. NEC already has won awards in recognition of its recycling and public outreach efforts.
The key to the program’s initial success, according to Alex, has been the contributing roles of the participating businesses and other nonprofits."We realized that we didn’t have the expertise internally," he said, "so we looked for like-minded companies that could help us out...That’s the strength of the program - those relationships and the support of the Neighborhood Energy Consortium."
Two businesses in the forest products industry have played key roles in WoodWins’ success- Gruber Pallet and Colonial Craft, a leading manufacturer of hardwood millwork.
Gruber, the leading pallet recycling company involved in the program, is a family-built business owned and operated by Dale Gruber, who had an extensive background in trucking before starting the company. With 45 employees, Gruber supplies mainly recycled pallets although it also makes some pallets of new lumber. Gruber also grinds scrap material to produce mulch.
"Our strong focus is finding nontraditional uses for wood," said Gruber sales representative Victor Finizio - uses other than grinding wood fiber for such conventional markets as mulch, livestock bedding and boiler fuel. The company has worked with other nonprofit organizations that have provided job training and opportunities for the handicapped, he said.
Colonial Craft, which has a representative on the WoodWins advisory panel, makes door and widow grilles, and component parts. Colonial Craft has four locations, including two in Minnesota, one in Wisconsin and one in Alabama, and employs about 300 people.
The program basically functions this way. Gruber provides lumber recovery services, using its pallet recycling equipment to disassemble pallets, trim usable deck boards to size, and collect the lumber for WoodWins. The pallet lumber is remanufactured at Colonial Craft by clients of Midway Training Services, a nonprofit organization that provides job training for mentally and physically handicapped people; Midway, which also has a representative on the WoodWins advisory panel, provides several trainers, too. The remanufactured components are sent to a second Colonial Craft plant where prison inmates, working under a job training program sponsored by another nonprofit organization, assemble the finished products.
The finished products include benches, window boxes, bird houses, bird feeders, herb boxes, patio chairs, and other lawn-and-garden items."They are high quality," said Alex. They feature mortise and tenon or other joints for the corners, tops that are mitered, and slats that are nailed and glued. Some items are left natural and others are treated with a wood sealer.
"We’re trying to achieve the highest and best value you can get from the reclaimed materials," said Alex. The products produced by WoodWins are worth significantly more than if the pallets were simply processed by a grinder into mulch or boiler fuel, he noted.
Another company, Aveda Corp., also plays an important role. A multi-national cosmetics company world renowned for its use of environmentally sound products and packaging, Aveda provides financial and technical support on marketing and design issues. WoodWins’ first products were designed by volunteer woodworkers and selected through a series of focus groups.
WoodWins has a truck it uses to pick up and collect sized pieces from Gruber and other pallet recyclers that have retrieved some odd-size pallets which cannot use in their operations. The pallets are then taken to Gruber Pallet.
Since its inception, WoodWins has worked with 40-50 different businesses or recyclers to recover pallets but now works mainly with Gruber and a handful of other pallet recyclers. Gruber supplies WoodWins with most of the specified cut stock it needs.
As they process incoming pallets, Gruber staff determine what pallets can be dismantled for its own operations and which can be dismantled to supply WoodWins."It’s not scrap," explained Victor. Most of the stock is recovered from used pallet deck boards and 3x9 material from paper skids. Gruber supplies only a small volume of used stock to WoodWins although the potential exists to increase the volume to a few pallet loads per month, according to Victor.
Gruber incurs costs in supplying WoodWins because of the additional steps of sorting and making a second cut, and selling the used stock to WoodWins does not generate a profit for Gruber."But the whole relationship does," added Victor, because the relationship with WoodWins has helped Gruber develop new business. Partnering with WoodWins has brought Gruber referrals and helped the pallet recycler penetrate new markets. In fact, Gruber and WoodWins share some accounts, Gruber supplying the customers with its products and WoodWins selling its planters and other lawn and garden items.
What drives the relationship with WoodWins is the long-term benefits the company will reap."A lot of what Dale Gruber does is based on principle and long-term value," said Victor. At times Dale has made decisions to improve service or product quality for a customer - decisions that have resulted in less profit, he said. "It’s part of his vision," said Victor. "Dale is driven by more than profit."
Colonial Craft’s participation in WoodWins has strictly been a gesture of goodwill to the community; it receives no revenues from the program. Colonial Craft has been involved in other WoodWins projects in addition to supporting the operations to remanufacture used pallet lumber.
"We gave them some equipment, modified it," and contributed the space, said Colonial Craft’s David ‘Bo’ Peterson. "We pretty much showed them how to do the process and trained them." The WoodWins program "almost" runs on its own, without ongoing assistance from Colonial Craft, said Bo. "When they ask for help, we give it to them." The program is in the process of moving to a different Colonial Craft building where it will be allocated about 500 to 1,000 square feet.
When the used pallet lumber arrives at Colonial Craft, the WoodWins workers sort it by thickness. They remove any nail stubble with a basic hydraulic punch that Colonial Craft employees modified for the task, then trim the stock to size on an undercut or pop-up saw. They finish one side of the material by putting it through a sander. Depending on the day, two to five program workers are involved in these activities at Colonial Craft.
The WoodWins products are assembled at Colonial Craft’s plant in Hanover by prison inmates participating in work training sponsored by Minncor, another nonprofit group. WoodWins also contracts with a few higher skilled laborers to assemble some other products. Most of the products are sold to about 30 independent lawn and garden centers.
Colonial Craft is"always...constantly" researching wood products, according to Bo. It’s research and development efforts led to its supplying Char-Broil with wood components for its barbecue grills. The Colonial Craft plant in Alabama has been supplying Char-Broil for about three years with wood components for grill handles and side trays.
Colonial Craft is not currently involved in any other products that utilize recycled wood. They were previously involved in a one-time project with MTS involving recycling wood flooring from an old gymnasium.
Gruber Pallet’s relationship with WoodWins is quite strong, said Victor."It’s nice to have someone to bounce ideas off," he said. "It’s like having a consulting company that understands the subtleties of your business but they’re an impartial observer. It’s a good relationship."
In talking to a potential customer recently, Gruber, WoodWins and the business had a three-way conversation about partnering together. The company has a strong interest in the environment, and the role of WoodWins in Gruber’s operations was appealing."Landing new business is a real good benefit of the relationship," said Victor.
Asked about the feasibility of pallet recyclers adding operations to use reclaimed lumber to make products as WoodWins is doing, Victor had mixed views."We’ll be a great pallet company," he said, "but we’re not a good garden center or a manufacturer of retail product. But we can help them (WoodWins) do it." It may be worth exploring for other pallet recyclers, he indicated. "It has definitely opened our eyes...It continually broadens our vision." Pallet recyclers may become locked into thinking repetitively, he suggested, grinding wood for either mulch or boiler fuel. "WoodWins has shown us a new way."
The relationship with WoodWins has proven so valuable that Victor recommended partnering arrangements to other pallet recyclers."Absolutely," he said.
"We’re stronger" as a result of working with WoodWins, he added. "Especially in tough times...it’s your friends that stick by you."
(Editor’s Note: For more information on WoodWins, see the program’s Web site at www.woodwins.org.)