western pallet · 2020. 1. 9. · sukhi brar baxter gladden scott gutierrez rod lucas steve mazza...
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Western Magazine for WPA Members Annual Meeting Issue 2018 MagazinePallet
2018 Annual Meeting Highlights
A
WPA EXECUTIVE
DIRECTORS
Sukhi BrarBaxter GladdenScott GutierrezRod LucasSteve MazzaRalph Rupert ASSOCIATE DIRECTORS
Ryan GreenwoodTod KintzDerek SampsonJason Saunders Please direct inquiries about the WPA toDavid Sweitzer, Executive Vice-PresidentP.O. Box 1095, Camas, WA 98607Ph. 360 335-0208Email:[email protected]:www.westernpallet.org
www.westernpallet.org
W P A M A G A Z I N E
PresidentVice-PresidentSecretary/TreasurerPast PresidentExecutive VP
Lindsey SheanAnnie MonteyBeatrice VasquezDave UppalDave Sweitzer
WesternPallet
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WPA New Members
The WPA is proud to introduce itslatest new members.
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A Passion for InclusionOur extensive 2018 Annual Meetingcoverage begins here.
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North American SoftwoodPrices
Softwood prices listed as of October24, courtesy of NRCAN.
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NWPCA ALC
NWPCA provides update informationon its upcoming ALC..
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Membership DriveThis year's membership drive isalready in motion.
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Cover Story:#WPA2018: A Passion forInclusion
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Other Features 17 New Fire Codes for Outside Storage 22 Upcoming Events
23 Easy Ways to Improve Productivity
28 The New Administration's First Year & Path Forward
34 Brent McClendon Appointed to NAM's Manufacturing Associations Board of Directors
35 Truck Rates Shot Up Again in December
36 Further Reading: Tree Brand, Propak, Grimmway, EPAL 39 New Tax Changes Offer Benefits to Pallet Businesses
37 CHEP Australia Sustainability Report Card
Advance LumberGo Fast ManufacturingNazareth PalletNorth American Forest ProductsNorthwest Hardwoods
Pallet Machinery GroupPRSRotochopperTimber Products InspectionViking Engineering & Development
Western Pallet Advertising Sponsors
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North AmericanSoftwood Prices Weekly softwood lumber prices to January 23, 2018 are shown below,sourced at http://www.nrcan.gc.ca/forests/industry/13309.
Lindsey Shean is thenew WPA President.Coverage of the 2018Annual Meeting startson Page 10.
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WPA New Members
The Western Pallet Association is pleased to announce the following newmembers:
Chase UngerClear Creek Forest Products1410 S Township RoadCanby, OR 97013Ph: (503)266-8668Email: [email protected]: Tyrone Konecny, Utah LumberCompany Eduardo MarquezAmerican Pallets Solutions, Inc.204 S 8th AveLa Puente, CA 91746Ph: (626)333-3995Email: [email protected]: Norm Normile, NW Norm Clint GeorgSaratoga Forest Management507 E Bridge StBox 1207Saratoga, WY 82331Ph: (307)326-3082Web: www.saratogafm.comEmail: [email protected]: Tyrone Konecny, Utah Lumber Co Chris WhitingCentury Pallets2911 Norton AvenueLynwood, CA 90262Ph: (310)605-0788Fax: (310)605-0787Web: www.centurypallets.comEmail: [email protected]: Roger Caruso
Johnny RuizWorldwide Crates & Pallets2317 E Montana DrTucson, AZ 85706Ph: (520)373-9727Email: [email protected]: Norm Normile, NW Norm Rick AuteyC&R Pallet Machinery Services15049 Little Lake RoadCenter City, MN 55012Ph: (651)212-8897Web: www.crpalletmach.comEmail: [email protected] – Rick Autey, C&R Pallet MachineryServices Ian LiddellDan HathcoatSummit Funding Group4680 Parkway DriveSuite 300Mason, OH 45040Ph: (513)605-1059Web: www.sfgvendorfinance.com Email: [email protected] [email protected] – Ian Liddell, Summit FundingGroup Eric AnderPacific Northwest Lumber Ltd#330 1275 Venables StVancouver, BC V6A 2E4Ph: (604)910-1348Web: www.pnwlumber.comEmail: [email protected]: Eric Ander, PNW Lumber
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NWPCA 2018 Annual LeadershipConference
NWPCA is excited to host its 2018 Annual Leadership Conference, entitledManufacturing in a Time of Mayhem, to be held March 7-9, 2017 in Fort Lauderdale,Florida. The keynote speaker will be Michael Abrashoff, a retired Navy Commanderand progressive leadership expert. At 36, he took command of a ship plagued by lowmorale, high turnover and low performance evaluations. A year later, it ranked #1 inperformance, with the same crew. The lesson was clear - leadership matters andculture is everything. His talk will prompt leaders at all levels to re-imagine theirleadership thinking and inspire new ways to elevate individual, team andorganizational performance. Other topics to be discussed at the ALC include workforce retention, drivinggrowth and innovation, succession planning, blockchain and lumber sales. REGISTRATION INFORMATION Click here for more information, including rates for non-members. NWPCA Members need to log-in to received the discounted rate. The host hotel is Fort Lauderdale Marriott Harbor Beach Resort & Spa. Thenegotiated room rate is $329/night + tax when booked before Monday, February12, 2018.
Jeff JensenCorali-USA9848 Redhill DriveCincinnati, OH 45242Ph: (513)588-3172Web: www.corali-usa.comEmail: [email protected] – Dave Uppal, Pioneer Pallet &Lumber
Alex GonzalezContinental Pallets Inc.11099 Delaware StRancho Cucamonga, CA 91701Ph: (909)376-7168Web: www.continentalpallets.comEmail: [email protected] – Norm Normile, NW Norm
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#WPA2018 Annual MeetingHighlights: A Passion for Inclusion
The 2018 Annual Meeting provided a nicebalance of business information,networking opportunities, ampleoccasions to connect with old friends. and,of course, some beautiful, sunny weatherfor golf. The business sessions featuredpractical business ideas that could be putinto action by attendees right away whenthey return home, along with a look intothe political landscape as well as what thefuture holds for wood technology andnew products anticipated to emerge overthe next decade.
Inclusiveness not only gainsus valuable new members,
but invaluable new ideas forthe future.
The meeting began with remarks fromDave Uppal Jr., the outgoing WPAPresident and owner of Pioneer Pallet andLumber. "After I joined the pallet businessin 1984, I attended my first WPA meetingin the late 80s, at the Biltmore Hotel inSanta Barbara,California," Dave recalled."I remember it fondly, because I was thiskid from Canada, new to the business, notknowing what to expect. I received sucha warm welcome that I kept coming back,watching our membership steadily grow,and seeing other new memberswelcomed like I was back in the day. "At first, I attended our annual meetingshere in Palm Springs because I enjoyed
spending time with old friends andcolleagues, and because it was the onlythree rounds of golf I attempted to playall year. But over time, I’ve come toappreciate an even deeper value of ourannual meeting: it is a time and a place forconstant renewal, where members sharenew ideas, revitalize and we all leavebetter equipped to run our businesses. "It is this passion for inclusion that hasgiven our organization not only the motiveto expand, but also to embrace change asour industry evolves. Inclusiveness notonly gains us valuable new members, butinvaluable new ideas for the future." Dave expressed thanks to WPA'sImmediate Past President, KathleenDietrich, for her many years of dedicationto our Board and the association. "It wasKathleen who encouraged me to join theBoard five years ago," Dave said. "Payingforward this warmth and enthusiasm, it ismy turn to say to all of you: please, putyour names forward, join the Board, andshare with everyone your ideas forcontinuing to improve the FriendliestAssociation in the West. "Next year’s young, dynamic ExecutiveTeam has made me very excited for theWPA’s future. Our Incoming President,Lindsey Shean, has assembled an excitinglineup of speakers who will help forge newpaths for us in everything from labor tolumber, and from technology to
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politics. I am sure there will be topics ofinterest for everyone to help with theirday to day business operations. OurIncoming Vice President, Annie Monty, isa third-generation pallet producer whohas already begun ushering the WPA intothe digital world of social media,including Facebook and Twitter." Annie moves to the role of Vice Presidentafter serving as Treasurer. WPA is pleasedto introduce Beatrice Vasquez of OxnardPallet as the Association's new Treasurer. "It seems like we keep saying this yearafter year, but we have had another recordturnout this year," Lindsey stated in heracceptance speech. "I will never forgetseveral years back when I attended myfirst WPA meeting, we were in a room thatwas half this size, and I walked in and took1 look in the room and I was in awe. I didn’tjust see networking happening, I sawfriendships between colleagues andcompetitors and at that moment, I
realized just how much I wanted to be apart of this industry and of the “friendliestassociation.” I was truly inspired tocontribute to an association that has givenso much to my company and to my family." Lindsey remarked that 2017 was notwithout its challenges for many WPAmembers, trying to find adequate labor,the Softwood Lumber Agreement, andtrucking shortages. The year also sawgreat strides, however, including theapproval of the new and very improvedICC and NFPA fire codes. "We saw the USDA classify wood palletsas a Bio Preferred product, proving woodpallets and packaging as a sustainablechoice, Lindsey said. We saw furtherdevelopment of Nature’s Packaging andall of the benefits it has to offer. And we Cont'd on Page 15.
Introducing WPA's newExecutive Team. (L-R)Beatrice Vasquez (OxnardPallet), Lindsey Shean(Valley Pallet), DaveUppal Jr. (Pioneer Pallet& Lumber), and AnnieMonty (American Pallet).
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saw a strengthening in our partnershipwith the NWPCA and CWPCA. Thispartnership has been invaluable infighting off the Oregon Corrugated Palletbill in 2016 and solidifying the WPA as aforce within the wood pallet andpackaging industry." "We have 5 WPA members that arecontributing to The Pallet Foundation,helping to fund projects that are directlyimpacting our industry andassociation," Lindsey continued. "Projects including the environmentalproduct declaration, which will quantifythe environmental benefit of woodpackaging. They are also working on a lifecycle assessment, which looks at real dataof wood pallets from cradle to grave,giving each and every one of us a truestory to tell to our customers andopponents alike and verifying our claimsthat “Wood Really Is Good” and it “Is theSustainable Way.”
The industry is also hoping to support theundertaking of an economic impact studyof how the wood products sectorpositively impacts the US economy, fromcreated revenue to the number of jobsprovided. Nature’s Packaging willcontinue to be at the forefront of industryefforts, including new video resources,new research, and new and improvedmarketing tools. "Nature’s Packaging hasbeen a vehicle for growth and change inour association, and we will continue toutilize it to be proactive in our quest toinform everyone that the wood productssector is most sustainable," sheconcluded. Bob Wenner, Chairman of the PalletFoundation, spoke briefly about theworthwhile work being done by thatgroup on behalf of the wooden palletindustry.
Dave Uppal Jr. (lieft)presenting the
Membership Awardto Tyrone Konecny,Membership Chair
and outgoingAssociate Director.
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Membership campaign runners up included L to R: Dave Uppal, Pioneer Pallet; RickLeBlanc, WPA Magazine; Rick Autey, C&R Pallet Machinery Services; Ken Hess, SmartProducts; Norm Normile, NW Norm; Greg Vipond, Girard Wood Products; Eric Ander,Pacific NW Lumber Ltd. Not pictured: Tyrone Konecny, Utah Lumber; Randy Panko,Wood-Mizer; Trace Sutter, Spokane Forest Products; Greg Wine, Pallet MachineryGroup; Ian Liddell, Summit Funding Group; Roger Caruso, Century Pallets
The speaker program includedpresentations from Dr. World Nieh of theU.S. Forest Service (Bioeconomy - AnExciting Future for Forest Products), PaulKanitra (The New Administration's FirstYear and Path Forward), Khaled Mabrouk(Sustainable Productivity), ChailleBrindley (Five Key Trends That WillChange Everything in the Pallet Industry),
and Dr. Brad Gething (New Fire Codes forOutdoor Pallet Storage and What TheyMean for Your Business). In this issue wereport on the Kanitra, Mabrouk andGething sessions. Check back next monthfor our coverage on Brindley and Nieh.
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Brad Gething, director of science andtechnology integration for the NationalWooden Pallet and ContainerAssociation, discussed a manual theassociation developed to enable palletcompanies to comply with new fire codesthat regulate outdoor storage of pallets. The “NWPCA Fire Code ComplianceManual for the Outdoor Storage ofWood Pallets,” now available throughthe NWPCA website (www.palletcentral.com) both to members andnonmembers, was two years indevelopment. It is intended to help
pallet manufacturing and palletrecycling businesses understand andcomply with fire codes of both theInternational Code Council (ICC) and theNational Fire Protection Association(NFPA). The pallet industry was faced with achoice, Brad noted at the outset of hisremarks. It could voluntarily develop bestpractices for fire prevention andimplement them, or face moreprescriptive provisions in the future. Weput our best foot forward,” he said.
New Fire Codes for Outdoor PalletStorage and What They Mean for Your
Business
Brad Gething, NWPCA
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The compliance manual was developedwith fire code experts, using theknowledge and expertise that NWPCAmembers already were using to preventfires, emphasized Brad. It was not a top-down approach. “We incorporated all best practices thatNWPCA members already were using intheir businesses,” he said. The efforts todevelop the manual included the work ofan NWPCA task force and informationBrad collected by surveying members.There are four components to fireprevention, he said: a site plan, a fireprevention plan, a fire emergencyresponse plan, and a security plan. A site plan primarily delineates suchthings as lot lines and the location ofwhere any hazardous materials may bestored, fire alarms, and designatedsmoking areas.A fire prevention plan should include awalk-through inspection, safeguards for“hot works” processes, regularpreventive maintenance, and outdoorstorage requirements. “Most palletmanufacturing and recycling facilitieshave guidelines for insurance purposes”said Brad. While these guidelines arespecific for insurance purposes, the fireprevention plan may compliment thesepractices. A key aspect of a fire prevention plan isdaily housekeeping, emphasized Brad.That includes proper clean-up andstorage of dirt and dust and scrap material,including sawdust.
The compliance manual wasdeveloped with fire code
experts, using the knowledgeand expertise that NWPCA
members already were usingto prevent fires. It was not a
top-down approach. The importance of good dailyhousekeeping was driven home during asurvey of pallet companies that hadsuffered fires over decades of operation.“Fires caused by wood debris or sawdustwas more prevalent than expected,” saidBrad . A fire can begin after a spark orburning ember comes into contact withsawdust, and slowly smoldering hourslater, even after the business was closed.“Proper clean-up could have preventedthese fires from starting,” said Brad. Fire code officials are going to be taking acloser look at operating conditions duringtheir inspection. “Being proactive andestablishing a positive relationship withyour local/state fire marshal will, in mostcases, result in a cooperative exchange ofideas and information,” said Brad. Havinga clean operation effectivelycommunicates to your official that youtake fire safety seriously. A fire emergencyresponse plan should include proceduresas to how to respond to a fire, howemployees are trained to respond to a fire,evacuation procedures, and fire drills.
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Being proactive andestablishing a positiverelationship with your local/state fire marshal will, inmost cases, result in acooperative exchange ofideas and information Security plans are going to vary fromcompany to company based on a numberof factors, including location. “If yourfacility is isolated from other businessesor residences, you might have a certainlevel of security,” observed Brad.However, if a business is located in anurban area with buildings located nearbyon abutting property, the implications ofa fire are much more significant, and fireofficials are “probably going to want tosee a higher level of security.” Theimportant thing, he added, is to documentsecurity measures. Brad urged companies to find out whatcode applies to them, then invite a codeor fire inspector to review the company’splant and operations, and get intocompliance as quickly as possible. He alsoasked companies to consider being anadvocate for fire safety. He also pointed to the importance ofdeveloping a favorable relationship withcode inspectors, not an adversarial one.“Most fire marshals want to work with
building owners, especially those thatshow a desire to operate their business ina fire safe manner,” he noted. Fires at palletcompanies get noticeable attention in thenews media because they can be severe.Code and fire officials are aware of them,said Brad.
Security plans are going tovary from company tocompany based on a numberof factors, including location “Three years ago, the NWPCA made a long-term commitment to enhance fire codesafety within the industry, and we’re doingour best to educate the industry on bestfire code safety practices. Following theguidelines contained in the “NWPCA FireCode Compliance Manual” allows ourindustry to build safety programs thatprevent fires from starting, mitigateagainst their spread, and protect the lifesafety of workers, first responders and ourcommunities.” The industry’s success inimproving fire safety and reducing fires“hinges on all of us coming together andworking toward a common goal,” saidBrad. “Good stewardship of fire safety atyour facility helps the entire industry.”Proactively obtaining buy-in andcooperation throughout the entireindustry was the single most importantpoint Brad said he wanted to stress.
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The NWPCA compliance manual isorganized with a brief introduction, aguide for supervisors, examples, and anextensive appendix. The guide providesthe ‘meat’ of what a supervisor needs toknow to come into compliance. Although the NWPCA could sell thepublication, it is making it available forfree. It also is taking the unusual step ofmaking it available for nonmembers --also at no charge. “Nothing is more important than thesafety of employees, people in thecommunity, and first responders,” saidBrad. “Our goal is to reduce fires in orderto show the fire safety community thatthe industry is doing its part.” The NWPCA has a campaign andcommunications effort to reachnonmembers and share the manual withthem through email, website promotion,social media and direct mail.The association has received over 200requests from the manual already. “Wefeel enthused about the response we’regetting,” said Brad. Fire officials are monitoring the NWPCA’sprogress, he suggested, because theassociation is reporting its progress to thecode community. The NWPCA’s work developing themanual was commended by theInternational Code Council, noted Brad.
Nothing is more importantthan the safety of employees,
people in the community,and first responders
The NWPCA has tabulated 2,000 uniquewebsite page views -- which wouldrepresent about 2,000 differentindividuals -- related to the manual,“which is fantastic,” said Brad. “This is agreat number to me. It’s very promising...The industry is taking this seriously. I’mvery optimistic about the initialresponse.” During a question-and-answer period,Brad reiterated that the biggest ignitionsource of fires at pallet plants is debris.“This is an area where the manual can help.There are checklists inside to downloadfor your safety managers/plantsupervisors, to start implementing rightaway.” A member of the audience whorepresented an insurance agencysuggested that pallet company ownersand managers get their insurancecompany involved in fire safety and codecompliance. They will provide freeservices to help a company developpolicies and procedures specific to theirlocation, he said.
WPA Annual Meeting sponsors included Mid-Continent Steel and Wire, Corali-USA,Viking Engineering and Pioneer Pallet & Lumber.
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Upcoming Events 3/7/2018 - 3/9/2018 NWPCA Annual Leadership Conference, FortLauderdale, Florida. www.palletcentral.com. 4/4/2018 - 4/5/2018 Industrial Pack 2018, Atlanta, Georgia.www.easyfairs.com. 4/9/2018 - 4/12/2017. MODEX 2018, Atlanta, Georgia.www.modexshow.com. 9/18/2018 - 9/20/2018. INTERPAL, Minneapolis, Minnesota. www.palletcentral.com.
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Easy Ways to Improve Productivity
Khaled Mabrouk, founder of SustainableProductivity Solutions, discussed theevolution of industrial engineering andgave listeners four tools they could takehome and easily apply in their businessesto improve productivity. His company does a lot of consulting inthe produce industry, working withgrowers, harvesters, and shippers. It’sprimary focus is increasing productivityin operations, although the company alsoprovides services to facilitateimprovement projects.
...when employees areinvolved, they will takeownership of the solution,and it will stick “Our approach is somewhat unique,” saidKhaled, because it includes quite a bit offocus on the people in a business,particularly the rank-and-file employeeswho do the work. “You really have toinclude people, not just processes, whenyou’re trying to improve productivity,” hesaid. By contrast, many managers in thebusiness world simply focus on aparticular process or processes in orderto improve productivity. Another reason that engaging people isimportant in developing solutions is thatwhen employees are involved, they willtake ownership of the solution, and it will
“stick.” Solutions from a top-down-drivenapproach will not last, he suggested. The four principles he shares were:--see the process--determine the root cause--engage employees in solving a problem--be lean and focus on zero waste When industrial engineering principleswere introduced in the early 1900s, thefocus was on scientific management, timestudies of jobs and tasks, breaking jobsdown into steps, and figuring out how workcould be done more efficiently. However,people were essentially treated likeequipment, observed Khaled. It wasn’tuntil the 1950s that industrial engineeringbegan to focus more on workers andunderstanding factors that impacted theirperformance and productivity. As the profession advanced, the nextphase was the study and development ofproduction systems. Khaled singled outJapanese manufacturers. Products fromJapan used to be derided as junk, he noted.“But these people made a commitmentthat they wanted to own manufacturinggoing forward after World War II,” and theyset about to develop more efficientmanufacturing methods. As a result, they overtook the U.S. first inthe production of televisions and otherelectronics, and eventually theautomotive industry. The latter was sucha cosmic shift that U.S. automakers tried
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a cosmic shift that U.S. automakers triedto emulate Japanese methods. The next development was Six Sigma, aset of techniques and tools for processimprovement. It was introduced by anengineer at Motorola in the mid-1980s.As Khaled noted, “Today Motorola isgone.” The company lost billions ofdollars from 2007-2009 and was split intotwo independent public companies. Six Sigma also was embraced by JackWelch, former chairman and CEO ofGeneral Electric. Welch came to believethat GE leaders “were making decisionsbased on the loudest voice in the room,who had the most clout,” said Khaled.Welch wanted the best decisions for thebusiness. He pushed executives to collectand use data to determine the root causeof problems instead of applying “bandaid” solutions. However, today Sigma Six is a “certificategenerating machine,” said Khaled, notingits value today is mainly for marketing. The next step forward in industrialengineering was lean manufacturingprinciples, which focus on minimizingwaste. “Start with lean,” suggested Khaled. “Itgoes after low-hanging fruit, and it’s easyto implement.” It also makes work easierfor front line employees. The latest advance in industrial
Start with lean. It goes afterlow-hanging fruit, and it’s
easy to implement."- Mabrouk
engineering is Continuous ProcessImprovement (CPI) culture, creating anenvironment in the workplace in whichfront line employees -- not managers inan office -- own and drive improvementefforts. “They are the ones who look atwhat we’re doing, what can we be doingdifferently, and trying to figure out howto do it better,” said Khaled. CPI is “not easy to do,” he added. “Noteverybody reaches that. It requires a verysignificant change in leadershipbehavior.” He ended his remarks with a discussion ofthe four tools he wanted to share with theaudience -- tools they could take homeand apply in their businessesimmediately. “Be process-driven,” he said. By contrast,most business leaders observe theiroperations after work has beencompleted, and they want to know howthe employees did. Did they do the workright? Did they make mistakes? And theygive their employees feedback.
“Go see the process when they’re doingthe work,” said Khaled. “Watch howdifferent people do it. Some workers aregoing to figure out a trick to make it gofaster. You see that, and you say, ‘Okay, isthat something I can teach to my otherpeople?’ ” Maybe it was one lessmovement that speeds up the task. “Thinkabout that,” he added, in the setting ofworkers building, repairing, ordismantling pallets all day. “It adds up.” “Being able to see a process is a skill initself,” he said, and suggested building upthe “process-seeing muscle” by makingobservations while waiting in line forevery day tasks -- in a check-out line at astore, for example, or at a doctor’s officeor a fast-food restaurant. “What are theydoing, how are they doing it, and is itdifferent from another?” “Get in the habit of seeing the processwhen you’re out there,” said Khaled. When people come together to solveproblems, he noted, they try to offersolutions. “That’s what they’re trained todo...Shoot from the hip...Here’s onesolution, here’s another solution. They’rejust throwing solutions out.” They do not spend time to learn andunderstand the true cause of the problem,he continued. “Most people start withsolutions and just go and apply them...Thereality is you should take time tounderstand the problem and collect alittle bit of data, try to get at what is the
"Get in the habit of seeingthe process..."
root cause of the problem,” instead of thesuperficial cause. “When you do that,” continued Khaled,“ you come up with solutions that sticklong after you walk out of the room.” Thealternative is “solutions that are more likeband aids that fall apart after a month ortwo.” “Have the discipline to take the time toget to the root cause of a problem...Whatis the process that we go through? That’sthe minimum...Even if you’re only tryingto solve a problem in one hour, use thesame approach.” Using an example from his consultingexperience, Khaled described a cerealmanufacturing company that was forcedto consider buying more storage tanks foringredients or simply discarding them.The problem was any given bottleneck inthe production process -- such as anequipment breakdown -- that would causethe accumulation of ingredients in variousearlier stages of production until thebottleneck could be alleviated. Thecompany’s initial solution was: buy morestorage tanks. The solution he developedwas to slow down other processes asbuffers before storage capacity was filled.
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When things go wrong, whatthe first question we ask?
Who did it?” In other words,who are we going to blame?
Most companies in North America have a“blame and shame” culture, said Khaled,not a culture focused on continuousimprovement. He cited the example of asteel company executive, who, in ameeting with other company leaders, gotup and stood on the table, walked over toone person, and began screaming andyelling at him. In a culture like that, heobserved, employees learn not to takerisks. “When things go wrong, what's the firstquestion we ask? Who did it?” In otherwords, who are we going to blame? “When you start with a blame and shameculture...you’re telling everybody: coveryour butt, be careful what you tell me...You wind up not getting sufficientinformation from your team to make gooddecisions.” A business culture should be process-driven,” said Khaled. Ask, “How did ourprocesses fail?” And not, “Who did it?” The process-driven approach will “get thewhole team behind you.” Employees willrealize you are not going to blame
someone, and they are going to help solvethe problem and move on. “They’re goingto be more comfortable sharinginformation, which will enable you to fixproblems faster.” Front line employees should own theprocess improvement efforts, he said.They should keep track of the metrics andbe looking at how to improve. “They helpcompanies build a lean culture.” Lean is about eliminating waste, and thereare six or seven kinds of waste. When workhas to be re-done, that’s waste. Whenworkers move around more thannecessary to do their job, that’s waste.When processes are at a halt andproduction is stopped, that’s waste. Three Examples of Lean Principles He cited three examples of lean principlesthat can be implemented quickly andeasily. One is 5S, a method of organizing workspace for efficiency and effectiveness.When Khaled applied it to a maintenancetechnicians truck and the materials andtools that kept on the truck, he discovered$6,000 worth of items the techniciandidn’t need. Besides reducing loss, othersteps to organize the tools and materials,make the truck storage area cleaner andeasier to find things, increasedproductivity and improved safety.
Another is visual management. Think:stop sign. Using signage, graphics,orother visual cues to improveproductivity. In another example drawnfrom his consulting experience, Khaleddescribed a problem at a company thatsold radicchios, a cultivated form of leafchicory. They were sorted into two grades,because the better grade radicchiosfetched a better price at markets in Japan.The problem was that many of theradicchios that should have been sortedfor sale to markets in Japan instead werebeing sold to markets in the U.S. Thesolution was signage located near theworker who did the sorting -- signageshowing radicchios that had the qualityfor the Japanese markets and those thatwere not good enough. The worker couldeasily take a moment to compare thevisual cues of the signage as he sorted.That simple solution more than doubledthe number of radicchios the companysold to markets in Japan. “That’s what I like about lean,” saidKhaled. “Lean is all about simple tools.” The third example, about collecting data,was not as simple but was equally
impactful. Keep track of two types of datawhen it comes to repairing equipment, he
Lean is all about simple tools suggested: labor, and what parts or fluidsor other materials that are used. Track thedata, analyze it, and interpret it. “You’ll figure out which equipmentshould I keep buying, and whichequipment should I stop buying,” saidKhaled. “You’ll see the maintenance costsfor both.” The data also will enable the predictionof parts or component failure. Maybearound 5,000 hours, a compressor breaksdown. At 4,500 hours, you examine it forsigns of failure. “That comes out ofcollecting the data and analyzing it andinterpreting it.” He summed up his four points. Be drivenby process. Collect some data to helpunderstand a problem better. Work ondeveloping more employee engagement.Use lean to focus on zero waste.
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The New Administration’s First Year& Path Forward
Paul Kanitra, founder and president ofLobbyit.com, a Washington, D.C. lobbyingfirm, talked about the first year ofPresident Donald Trump’s administrationand what could be expected in year two. Paul, whose firm lobbies for the NationalWooden Pallet and Container Association,set out founding his company to set itapart from other lobbyists, he said, to“take the negatives and turn them intopositives.” Thousands of organizations --corporations, local governments,nonprofits -- needed a voice inWashington and couldn’t afford one orthought it was too difficult to have one,he said. “Our firm focuses on transparency anddeliverables and mainly letting thestories of our client carry the day,” saidPaul. His firm represents about 40 clients,mostly associations and nonprofitorganizations -- not billion-dollar,multinational corporations. “We find thattelling the stories and standing on thosemerits are what really carry the day.” “We’ve been able to have a lot of successup on Capitol Hill by going in and talkingabout the players involved and talkingabout their involvement in thecommunity and the effect that it couldhave on Main Street U.S.A.,” added Paul,if over-burdensome legislation orregulations are implemented. His team’s
focus is making federal lawmakers andofficials aware of the potential impacts onthe clients they represent.
We find that telling thestories and standing on
those merits are what reallycarry the day
The Trump administration is in the newsregularly, he noted. Last year was a yearof fighting among Republicans and evenamong White House staff and advisers.Democrats are having a field day with thenegative spotlight on their foes, “and it’screated a lot of chaos,” said Paul. Despite all the negative media attentionon Trump and Republicans, however,2017 “was a very good year for business,”he noted. A Republican president and aRepublican-controlled Congress -- “That’salways conducive to good business,” saidPaul. Businesses are healthy. The stock markethas risen and unemployment is down. Sofar the Trump administration has “createda great environment for business,” headded. Federal agencies are focused oncollaborating with the private sector,“which is always a good thing.” The WhiteHouse has undertaken a number of policy
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Paul Kanitra, founder and president of Lobbyit.com
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moves to ensure that government doesnot impede progress by industry.
In 2018, the single mostimportant thing that will
impact federal legislation isthe fact that it is an election
year “New regulations...essentially haveground to a halt,” noted Paul, for severalreasons. One is that a lot of positions atfederal agencies are yet to be filled bypresidential appointment becauseDemocrats have taken the maximumamount of time for the approval process.Another reason, of course, are the policiesbeing put into place by the White House.“Overall, there’s been an aggressivepursuit to identify outdated, duplicative,and just unnecessary regulations...andthen roll back these differentrulemakings,” said Paul. “And that’s beengood for business.” Obamacare, and Republican efforts anddebate to scuttle the signature of formerPresident Barack Obama, consumed muchof last year’s session of Congress notedPaul -- time that could have been spentproductively working on otherlegislation. What Congress likely will beremembered for in 2017 was passage oftax reform that reduced taxes forbusinesses and individuals.
In 2018, the single most important thingthat will impact federal legislation is thefact that it is an election year. All seats arein the House of Representatives are up forelection as well as a good number in theSenate. All the action Congress takes thisyear will be made with an eye on theNovember elections, said Paul. There already are signs the Novemberelections may not treat Republicans verykindly. There has been infighting in theGOP, and a number of sitting members ofCongress have announced theirretirement. “That’s going to create morecompetitive seats,” said Paul. Some recentprojections have 40 seats in the Housebeing flipped to Democrats. “We could belooking at a drastically different 2019,”said Paul. Republicans and Democratsalike will base their decisions on how theycan position themselves to theirconstituents and the media to get elected. One of the disheartening things about thelegislative process, and for lobbyists, isthe petty politics that thwarts legislation,said Paul. Democrats try to maneuver toblock Republican initiatives because theydon’t want to hand the GOP a victory.Republicans engage in the same behaviorbecause they don’t want Democrats to getthe spotlight. When you consider the large volume oflegislation that is introduced, and the fewpieces that Congress passes, “Thenumbers are staggering,” said Paul. Theaverage bill that passes is nothing more
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average bill that passes is nothing morethan naming a post office, he said. “Nothing’s really ever new,” said Paul. Thefew pieces of legislation that do pass areconsent resolutions, mammoth bills thatincorporate language from other, smallerbills that failed. “Often it’s a really longgame,” he observed. Despite the news that dominates theheadlines, a lot of legislative work is donebehind the scenes. It’s the job of lobbyiststo find out what is happening and reportback to their clients and identifyopportunities for engagement withfederal lawmakers and officials. February will be dominated by the federalbudget, he predicted. Republicans wantto avoid a government shutdown becauseit would be viewed unfavorably in theNovember elections. Federal funding for infrastructure is goingto be an important issue early this year,he predicted. Trump has promised tospend $550 billion on infrastructureimprovements, he noted, and the nationhas crumbling bridges, roads, and otherinfrastructure that need repair orreplacement. It likely will be the firstmajor piece of legislation that Congressconsiders, he suggested. Other biglegislative issues will be the WaterResources Development Act, the farm bill,reauthorization of the Higher EducationAct, and legislation regarding the FederalAviation Administration, which is making
a transition from ground-based radar tosatellite-based as well as undertakingother improvements.
It’s the job of lobbyists tofind out what is happeningand report back to theirclients and identifyopportunities forengagement with federallawmakers and officials Congress avoided a lot of worker safetyissues in 2017, said Paul, in part becauseit was embroiled in other issues, likeObamacare. However, it likely will take upworker safety in 2018. “I expect Congressis going to work hard on directives to rollback regulations but also keep workerssafe,” said Paul. “That’s going to be abalancing act for them.” The federal Occupational Safety andHealth Administration will be issuing astrategic plan in a few months, he added,which should give some indication ofwhat the agency’s approach will be underthe Trump administration. The focusprobably will be more on assistingcompanies with compliance and fosteringa more collaborative approach withbusiness rather than relying oninspections and enforcement.
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The new policies will be slow to come tofruition, suggested Paul. Some likely willbe challenged in court. The U.S. is a“litigious society,” he noted, and federalagencies are prone to be sued by variousinterest groups. “That really stymies a lotof what can be done.” There will still be some focus onObamacare and healthcare, he said. “Thethreat of repeal and replace bills has beengreatly diminished but are not completelyoff the table.” Representing the NWPCA, Paul said hisfirm’s focus will be on legislation that islikely to pass and relationship building inorder to favorably impact legislation thatis likely to have an affect on the palletindustry. The NWPCA’s legislative agenda for 2018includes workforce development, saidPaul, who noted the White House hasestablished a task force to create moreapprenticeship opportunities. It is one ofof the more bipartisan issues facingCongress, he noted. There is a clear needfor more career technical education, andthere are multiple bills pending beforeCongress dealing with the issue. “There’sa lot of opportunity,” said Paul. In addition, engaging overall will be animportant component of the work that hisfirm does in representing the NWPCA. Forest management also will be a bigpriority, particularly for Western
lawmakers, in light of major forest fireslast year. Multiple bills already have beenintroduced, and Paul’s firm is scrutinizingthem and monitoring what componentsare likely to be advanced.
Forest management also willbe a big priority, particularly
for Western lawmakers, inlight of major forest fires last
year.
Although his firm ordinarily does not tracklegislation at the state level, Paul notedthat Republican-led states likely will taketheir cue from the federal government androll back regulations, while Democrat-ledstates probably will step in to fill in whatthey perceive as gaps in federalregulations and oversight. For much of the year, Republicans will betouting the success of the tax cuts theypassed in 2017 and continuing to advancebusiness-friendly bills and regulations.Paul predicted the first six months “aregoing to be very fast-paced.” Issues likeworkforce development, regulatoryreform, and long term fixes to forestmanagement will be tackled behind thescenes. Paul offered suggestions for whatindividuals and their business can do toimpact the legislative or regulatoryprocess. “It is very important to
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communicate your experience,” he said,to members of Congress and federalregulators. He urged the audience toreach out to their elected Representativeand Senator, particularly, and tocommunicate with them and try toestablish rapport with them. And it makesno difference if their representatives areRepublican or Democrat.
It is very important tocommunicate yourexperience to members ofCongress and federalregulators. Elected officials are always looking foropportunities to meet and mix withconstituents, he noted, and to obtainfavorable media coverage of visits tobusinesses. Those visits are anopportunity for a company to explainwhat it does and how it positively affectsthe community. In a question and answer period, the firstquestion posed to Paul was aboutimmigration. “It’s going to continue to bea fight,” said Paul. Trump has “dug hisheels in” on a lot of immigration matters,he noted, but the president also has flip-flopped on issues. “It’s really tough toread the tea leaves,” said Paul. Trump haslearned, however, that he needs supportfrom both Republicans and Democrats toachieve accomplishments.Another factor in the elections will be
current events and media coverageimmediately prior to the elections.“People have such short memories,” saidPaul. Both political parties have theirbases, but the independent swing votersgenerally are influenced at election timeby the news of the day. “Whatever isdominating the news cycle at that time...that will be the biggest thing that impactsthe election,” he said. The political environment -- and theupcoming election -- is quite different,according to Paul. A lot of it has to do withthe rise of social media, and he noted evenTrump personally uses social media likeTwitter to weigh in on an issue or make astatement. People constantly check theircell phone for the latest social mediaupdates, he noted. In addition, there hasbeen a rise in blogs and other opinion-based content on social media. The proliferation of social media “hascaused individual voters to feel like theyhave their own brand,” said Paul. “Theycreate silos,” insulating themselves byadding and following social mediaaccounts based on their beliefs and‘unfriending’ people with contrary views.Their social media influencers andsources of information are people withlike-minded ideas and opinions. The effect has been to create an electoratethat votes based on their emotions, saidPaul. In 2017, many Republicans whosupported Trump didn’t vote in state orlocal elections, and energized Democrats
vote in state or local elections, andenergized Democrats made gains, pickingup seats in some elections that they hadnot won in 20 to 30 years. He made a comparison to how the newscycle will affect the outcome of theelection. “So much of the agenda in2018...is going to be driven by whathappens in the world.” Whether there isa terrorist attack, an oil shortage, anenvironmental catastrophe, or someother dilemma. “Congress will reactbecause they know they have somethingthat resonates” with their constituents. The final question was about whether thepallet industry should establish a politicalaction committee to donate to politicalcandidates. There are two schools of
thoughts, said Paul. Candidates for publicoffice will ask political action committeesfor campaign contributions. If acommittee does not contribute to acandidate, it could generate hurt feelings,and the lawmaker may be less willing towork with them. However, Paul suggestedthat contributions may be in order tocampaigns of influential lawmakers whochair committees or hold similar positions His advice was, “Make sure you’re notoffending some lawmakers, but it is a dooropener if we’re being realistic.”
Brent McClendon to Serve on theNAM’s Council of ManufacturingAssociations Board of Directors
Brent McClendon, CAE, National WoodenPallet and Container Association (NWPCA)President and CEO, has been elected toserve on the National Association ofManufacturers’ (NAM) Council ofManufacturing Associations (CMA) Boardof Directors.
Made up of more than 260 industry-specific manufacturing associations, theCMA is a powerful assembly ofmanufacturers and a vital arm of the NAM.The CMA’s mission is focused onbolstering the industry’s nationwidegrassroots mobilization efforts andimproving the competitiveness of
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manufacturers in the United States. CMAmembers work with the NAM to unite themanufacturing community, andultimately the broader businesscommunity, around strategies forincreased manufacturing job creation,investment and innovation in America. “I am honored to serve on the NAM’sCouncil of Manufacturing AssociationsBoard of Directors and am eager to workwith fellow association leaders tostrengthen the manufacturing army herein Washington, D.C., and across thecountry," said McClendon.“Manufacturing remains in the nationalspotlight, and we have manyopportunities to continue workingtogether to enhance manufacturers’competitiveness and create even morewell-paying jobs.” “The CMA is ready to make 2018 anotherhistoric year for manufacturers,” said NAMPresident and CEO Jay Timmons. “At a time
of disruptive change in Washington andin our industry, the role of this powerhousealliance of manufacturing associations ismore consequential than ever. Americansare eager to see even more manufacturinggrowth in this country, and the CMA’s workis essential to achieving that goal—bymobilizing manufacturing supporters andproviding associations the innovativetools needed for success in a constantlyevolving political environment. I’mlooking forward to working with NWPCAto secure more progress in 2018,particularly on core issues likeinfrastructure investment, furtherregulatory reforms and workforcedevelopment.” The CMA represents every part ofmanufacturing in the United States andplaces high value on the community ofmanufacturing association executives. Tolearn more about the CMA, click here.
Truck Rates Shot Up Again inDecember
Per-mile rates shot upwards again inDecember, according to monthly ratesdata from Truckstop.com. The numberof available loads on the spot marketwell exceeded the number of availabletrucks, with that imbalance driving rates
to multi-year highs in all three majortruckload segments, including flatbed,reefer and dry van. Read more atoverdriveonline.com.
JANUARY 2018
Propak to operate new CHEP service center inIdaho Propak is opening a new service center for CHEP pallets in Caldwell, Idaho,according to a news report. The facility will create around 30 new jobs at the60,000 square foot facility. The facility will open the first week of March. Read more.
Wood pallet, crating manufacturer to invest$1.3 million, create 28 jobs at Holly Hill plant A manufacturer of wood pallets, skids and specialty crating is locating operationsin Holly Hill, South Carolina. Charlotte-based Tree Brand Packaging Inc. announcedit is investing $1.3 million and creating 28 new jobs. Many of the jobs areexpected to be above the county's average manufacturing wage of $15 an hour. Read more.
Buckeye Diamond Logistics Rebrands as BDLSupply Buckeye Diamond Logistics Inc., one of the nation’s largest, full-service providersof pallets, packaging and custom logistics solutions, has changed its name to BDLSupply. Read more.
Further Reading
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JANUARY 2018
Brambles Sells CHEP Recycled to GreyMountain Partners Brambles has announced that it has entered into an agreement to sell the CHEPRecycled business to Grey Mountain Partners for an enterprise value of US$115million. The cash proceeds will be subject to final adjustments on closing forbalance sheet items. Read more.
EPAL Records 115.8 Million EPAL PalletsProduced and Repaired in 2017 The European Pallet Association (EPAL) has announced a record result for 2017 of115.8 million EPAL quality load carriers produced and repaired. Compared to theprevious year, this is an increase of nearly 10%. Read more.
Grimmway Farms Partners with CHEP to BoostSustainability and Improve Operations When Grimmway Farms, the world’s largest carrot producer, and CHEP, the globalleader in pooling and supply chain management solutions, work together, theresults are measurable and clear: improved sustainable practices and increasedoperations efficiency. Read more.
Recently we had the most radical tax planchange since 1986 . There has been a lotof media coverage focusing on thepotential impact on our national debt andhow it favors the wealthy at the expenseof the middle class and poor. One thingcan’t be debated, however, is it it will freeup capital to potentially reinvest for thesmall business owner . Here are the key changes that will impactbusiness owners in the pallet business: Section 179 - Beginning in 2018 anincrease in Section 179 - same year writeup goes to $ 1 million ( $ 500k more thanbefore ) with a $ 2.5 million thresholdraised from 2.03 million . Bonus Depreciation - The new tax lawallows 100% bonus depreciation (upfrom 50%) for five years for qualifyingpersonal property acquired or placed intoservice after September 27th, 2017.Additional 5-year depreciation is thenreduced until fully eliminated in 2017.Significantly, the new tax law appliesbonus depreciation to used property, notjust new property. Lower individual income tax bracketsacross the board - Many businesses in thepallet industry are taxed as soleproprietorships, partnerships, or SCorporations. This means business ispassed through to the owners, who paytaxes based upon individual income taxrates. Starting in 2018, the new law lowersindividual income taxes across the board.Graduated rates that apply to ordinary
income are 10%, 12% (down from 15% ),22% (down from 25%), 24% (down from28%), 32% (down from 33%) 35 and 37%(down from 39.6%). The new law leavesthe maximum tax rates on net capital gainsand qualified dividends the same asbefore. Significant reduction in Corporate taxrate - The maximum corporate tax rate ispermanently lowered from 35 to 21%beginning in 2018. The corporate tax rateis transformed from a graduated systemto flat rate for all income levels. Lowers tax rates for pass-throughbusiness income - From 2018 to 2025,individuals receiving income from a passthrough business - including soleproprietorship, S Corp or partnership -take a new Section 199A deduction. These owners can generally deduct 20%of qualified business income defined asnet amount of income gain, deduction andloss attributable to a domestic trade orbusiness, from their taxable income. A1099A deduction is generally limited to50% of W-2 wages paid . Wage limitationapplies only to individuals with taxableincome greater than $315,000 or$157,500 for individuals . For more information, contact Ian Liddellat Summit Funding Group. Email:[email protected] or phone (513)605-1059.
New Tax Changes Offer Benefits By Ian Liddell
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