Pallet Enterprise February 2015
An AMS Automated Repair Line Has Big Benefits
Plant Efficiency: Automating the repair line process gives Pallet Consultants, Pompano Beach facility, a huge boost in productivity while maximizing space utilization.
When Gus Gutierrez, founder and CEO of Pallet Consultants in Pompano Beach, Florida, found the perfect building in the right location for the expansion and growth of his business, there was one big challenge. The 53,000-square-foot building was about half the size of the business’s existing facility.
That was the primary driver that led Pallet Consultants to turn to Automated Machine Systems (AMS) to automate its manual pallet repair line. However, the benefits have far exceeded that initial goal. By automating the repair process, Pallet Consultants has not only been able to operate in half the space, but it has greatly increased the company’s production capacity and return on investment (ROI), which was 15% in 2014.
The company went from processing about 1.3 million pallets a year at the facility to handling around 1.7 million. Production at the facility is about 80% GMAs, with custom pallets making up the other 20%. The business has also seen other benefits related to cost such as a 10% improvement in operating costs. Additionally, the changes have led to better worker morale and a flawless safety record in 2014.
“We’re producing almost 400,000 more pallets than previously with the same amount of builders,” said John Gamez, general manager.
Very satisfied with the changes the automation has made, the business is now considering automating a similar line at its Atlanta facility, which is now being supplemented with pallets from its newly more productive Pompano Beach plant. This plant is also helping to supply other customers in Florida and Georgia.
“We were looking for growth and expansion within our core business,” said Gamez. “Gus came up with a vision within the space we had, and AMS basically delivered a solution.”
Gutierrez said he initially considered AMS because he saw an advertisement for the company in Pallet Enterprise. The building he planned to purchase was in an ideal location in the area where he founded the business originally. It included four acres of land and the smaller building would also mean a smaller carbon footprint. Gutierrez knew that the building would require about $1.2 million in improvements to make it suitable for production and the company’s new corporate headquarters. He called Brian Groene, president of Pallet Consultants, and told him what he wanted to do.
“Brian has an operations background and he did a lot of the legwork and approved a lot of the plan,” said Gutierrez. “He has over 25 years in the pallet business and his input was essential in completing this operation.”
AMS asked questions such as “How many builders? What’s your plant output? And what do you want to accomplish?” said Gutierrez, and made recommendations based on the answers.
“We’re pretty used to working with small spaces,” said Kris Chayer, AMS president. His company took the Pallet Consultants’ building layout, converted it using AutoCad software, and then designed a system that would give the desired throughput and work within the available space. AMS works with all size companies, from small to large, said Chayer. “We try to meet them right where they’re at,” he said, whether they want to automate multiple lines, one line, or whether they have existing equipment that’s not working up to par that could benefit from integration.
The automation solution developed for Pallet Consultants met the company’s current needs, but also provides a setup so that it can continue to grow in the future, Chayer said. “We took two repair lines and used a transfer merge to send repaired pallets to one semi-automatic stacking zone. From there, we designed the stacking zone so that it could be converted to a fully automatic stacking system at a later time.” With this kind of automation, businesses usually begin to see a ROI within 18-24 months, he said. “That’s what we hear from customers consistently.”
“Their commitment to their product, knowledge and customer service is some of the best in the industry,” Gamez said of the AMS team. Pallet Consultants had never worked with AMS, which is based in Jenison, Michigan, prior to this; however, Groene had worked with them in the past through a different pallet company. The new automated line has stations for 16 builders, and includes a conveyor system and stackers at the end. It was installed in only three days just weeks prior to the new facility’s grand opening in October of 2013.
“The installation went like clockwork,” said Gamez. Kevan Grinwis, vice president, and Chayer, of AMS were both very involved in the project, and a project team was on hand during installation and for initial run-throughs to make sure everything was working properly.
“The exciting thing about this project is that we’d never worked with them before and they didn’t have automation in their repair processes,” said Grinwis. “Helping them to streamline their processes was one of the highlights for us, and the project came off very successfully.”
Pallet Consultants initially transitioned a handful of employees to the new facility from its old plant, which had been somewhat of a makeshift operation since a fire in 2006. “When everyone moved over, AMS sent out someone to go over the entire system with everyone,” said Gamez. AMS showed workers how to operate and troubleshoot the equipment, and also covered safety.
“Training is a huge piece of what we do,” said Chayer, explaining that it’s important that customers know how to operate the automated equipment for maximum efficiency, as well as how to maintain it for longevity and to keep production moving. Covering safety during operation is standard as well.
“We’ve only had two minor problems, and Kevan was spectacular in getting them solved,” said Gamez. “AMS has access to our system via the Internet to diagnose any problems that may come up rather than our mechanic trying to guess what might be wrong. It’s a great feature.”
“We have dedicated customer service reps,” said Chayer. “We also design our control panels to have the ability to get online to access our systems.” With their equipment used in Canada, Mexico, New Zealand, parts of Asia, and the United States, this allows AMS to quickly troubleshoot and address any issues that arise regardless of distance.
With the automated repair lines at Pallet Consultants, forklift operators now only have to stage pallets one time, and then the pallet is moved through the system on the conveyor. This prevents repairmen from having to stack each pallet, which they used to have to stack as much as 20-pallets high, explained Gutierrez.
“It’s a lot less physically demanding with the automation system,” he said, explaining that the table is now almost level with the conveyor. Employee morale has not only improved since the automation was added, but the facility’s safety record also improved, with no recordable accidents in 2014, Gamez and Gutierrez said. Contributing to worker satisfaction were a new break room at the facility and some new additional employee benefits. The company has 44 team members at the new plant, and 300 total at all its facilities.
Pallet Consultants grew its combined revenue at all its facilities from about 23.2 million in 2013 to $28 million in 2014, said Gutierrez, and the new automation is totally in line with the business’s reputation in the industry for getting things done. “Our reputation in the business is probably the top two or three,” he said. “When a customer calls, we’re saying ‘Yes, it’s going to happen.’”
Gutierrez is also proud of the fact that Pallet Consultants strives to be environmentally conscious by eliminating waste at its plants. In fact, he said, “It’s one of the reasons I started the business.” All wood is used right down to the chips, which are taken off-site to be mulched, but eliminating waste at Pallet Consultants is not limited to forest products. “Because of efficiency and the way we’re set up, we use or recycle every piece of material that comes in here…from the box of nails, to the shrink wrap, to the paper we use in the office,” Gutierrez explained.
Pallet Consultants collects cardboard, slipsheets, shrink wrap and similar packaging materials, bales them and sends them to appropriate recycling facilities in the Southeast. The company also recycles all of the nails that come out as a byproduct of mulching and sells them to a metal recycler. “We keep as much as possible out of the landfills,” said Gutierrez.
Automated Machine Systems (AMS) Provides Equipment and Systems Solutions in the United States and Beyond
Automated Machine Systems (AMS), based in Jenison, Michigan, near Grand Rapids, is a full-service engineering firm with its own manufacturing facility. The business specializes in the wooden pallet, lumber and material handling industries, in addition to end users and other manufacturers. Designed especially for the pallet industry, AMS offers PalMate Software Solutions for inventory management, piece rate and compensation tracking, the tracking of purchasing, production and logistics, and more. AMS also offers PLC programming, UL-listed control panels, and fabrication and controls integration for other manufacturers.
The business has grown tremendously since it was founded by Kris Chayer, who now serves as president of the company. He said his family was very active in the pallet industry and he had a background in the automotive industry and tool and die. He began working with specialty equipment for the pallet industry in 1992 and started AMS five years later.
AMS currently manufactures, assembles and installs equipment and systems throughout the United States, in parts of Asia, and in Canada, Mexico and New Zealand. Regardless of where their customers are, the AMS team can troubleshoot and provide customer support remotely through an Internet-based, monitoring system. AMS works with customers closely to provide them with automation solutions for entire lines, single processes, or to provide integration solutions for existing equipment, regardless of who made the equipment.
“We have dedicated customer service reps and provide complete training on both software and equipment,” Chayer said. The business also places a big focus on providing quick turnaround times to its customers, and can often go from the concept to the design of a solution within 30 days.
“We have turned around a complete repair line concept in less than 30 days although the fabrication took longer,” said Kevan Grinwis, vice president of AMS. The process usually begins with a conversation with a customer, who then sends a building layout, which AMS converts using AutoCad software, and from there designs a system which meets their needs and works within their building layout.
“When a customer calls us, our goal is to figure out what they’re doing and worked with them to figure out how to do it better,” Grinwis said. AMS works with all size customers, from small pallet shops to major food and soft drink companies, and on small and large projects, Chayer stressed. A lot of companies believe AMS only works on big or expensive projects, or with larger companies, he said, but that’s not the case.
With two facilities in Michigan, AMS has plans to move into a new larger, state-of-the-art facility later this year. Already underway, the new 40,000-square-foot building will provide larger offices and manufacturing space for its staff which includes electrical, mechanical and software engineers as well as fabrication and assembly. The larger space will also allow for greater efficiency, with the ability to perform more work at the same time, and this is expected to shorten AMS’s lead times for even faster delivery to customers.
Chayer and Grinwis said that many pallet businesses still do things the “old-fashioned way,” but usually see terrific benefits when they do automate. These benefits include increased productivity, reduction in labor costs and a strong return on their equipment investment.