Coastal Container

What would your corrugated box or packaging company look like if you had the opportunity to build it from the ground up?

That’s the question that Coastal Container’s founders asked in 2007, when they came together to create the Holland, Mich.-based company. Owner Brent Patterson was the former co-owner of Shoreline Container, a nearby company his father had started that he and his brother eventually bought out.

Then in 2005, Patterson split from his brother and Shoreline, and hired Bill Baumgartner. Together, the two of them hatched the plan to come up with Coastal Container, starting with buying a landmark 235,000-square-foot building in Holland, the old Sligh Furniture building.

“We were starting from scratch; we had zero customers when we started up,” says Baumgartner, president of Coastal Container. “We had a blank canvas to work with in this facility. I had been in packaging my whole career, just as Brent had. We said, ‘If we could start from scratch, what would a very efficient operation look like from a product flow standpoint? Secondly, how could we build a culture that would attract the best employees, that we could be really proud of?”

From an industrial standpoint, he says the West Michigan region offered a lot of growth opportunity. It was growing, and it allowed Coastal Container to also grow swiftly. Most of their customers are in West Michigan, though they also ship as far north as Cadillac and east into Detroit, and have a customer over the border in Indiana. Most of their customers are office furniture and automotive manufacturers, though they also serve building construction and sports and leisure, and have several food producer and agriculture accounts.

Baumgartner says they also recycle nearly everything, with very little going to the landfill. All their paper scrap goes back to the paper mill, and they recycle their office waste. They’ve upgraded all their space lighting to high-efficiency fluorescent bulbs. Their machinery has energy-efficient variable-frequency drives. They even explored creating their own electricity, but to date the expense associated with that has been prohibitive.

“I think we fell into [our sustainability practices] as much as anything,” Baumgartner says. “We moved into this facility, and it was the former Sligh Furniture facility. It was a manufacturer of wood furniture, and they had a really robust fire boiler that they would use to get rid of all their scrap.”

The wood-fired-biofuel boiler allowed them to heat their entire building by burning the wood scrap and dust that they create and that their largest customer, Haworth Furniture, creates. Haworth used to ship its scrap and dust across the state to a place in Flint where it would be burned. Now, when they donate it to Coastal Container, it provides a boost to both of their bottom lines.

“We go over and pick up the scrap they create in making their desktop,” says Baumgartner. “We have a boiler, and that’s what we run in the cold weather months to heat our building. From that standpoint, we are pretty self-sufficient.”

He says before they even made a box, they were looking at the boiler and trying to figure out what to do with it. When they learned what Haworth was doing with their dust, things began to click on a better way to do things for themselves and their customer.

“We put two and two together—we could heat our building for free, in essence; it is going to cut down on the use of natural gas, and it is going to save Haworth from trucking scrap across the state. It seemed to make sense.”

Coastal Container is also dedicated to living out its core values and purpose every day. Baumgartner says that is something they talk about all the time with their employees, their managers, and their customers.

“We guarantee the integrity of our customer’s product from dock to destination,” he says. “Not only do we have to provide them with a quality product on time, but by doing so, it is going to help their reputation with their customers.”

He says they live by their core values where all their stakeholders are concerned:

• Teamwork
• Achievement
• People Matter
• Partnership

“That is the backbone of the company,” Baumgartner says.

In practical terms, this gets applied by having a plant with a great number of different types of equipment so that they can do large or really small runs. They’ve invested in their design team and their service platform. As part of their service platform, they’ve set aside 80,000 square feet for their customers’ finished goods that they can deliver just in time with their fleet of 21 semi-trailers.

Baumgartner also says the way Coastal Container goes about strategic planning stands out from others in the industry.

“In our industry, we have a lot of entrepreneurs who call all the shots. In a lot of companies of our size in our industry, it is more one guy running the whole thing and telling people what to do. We’ve got a management team of about six people, and we meet routinely,” Baumgartner says. “We huddle every day. We have a very inclusive strategic planning process.”

Now, 11 years after their founding and after experiencing a decade of rapid growth, Baumgartner predicts the growth, now under the leadership of CEO Paul Doyle, will continue with the company being double its current size in five years and potentially expanding into a new location.

Increasing Efficiency With 5S

Having powerful, state-of-the-art equipment is important in the corrugated industry, but so is having the right processes in place.

At Coastal Container, team members from operators to executives have been working to reduce setup time and create more efficient processes.

“An area we’re really proud of is that we’ve reduced our setup on our rotary die cutters by about 100 percent—and we did it over the course of two months,” says Bill Baumgartner, president of Coastal Container.

The commitment they’ve made has even included letting go of some of their advanced technology machines. They once had one of the largest flexo folder gluers with inline rotary die cutters in Michigan. They recently sold it because the setup time was an hour and 45 minutes.

“We went with something more nimble that had more flexibility,” says Baumgartner.

The focus on the rotary die cutters was a strategic approach that allowed them to break down every step in the process to find more efficient and better ways of setting up the machines. Coastal has two rotary die cutters that are right next to each other, and the team was determined to standardize the product and have everything in the same spot.

To find increased efficiency, they used the 5S process, an organization system that translates into:

• Sort
• Set in order
• Shine
• Standardize
• Sustain

The system was developed in Japan and was considered one of the precursors of just-in-time manufacturing, something that Coastal prides itself on. The 5S steps are a process that organizes the work space for efficiency by cleaning an area, maintaining all the equipment, removing things that don’t belong, and properly storing everything that is used. While the goal is standardization, that goal is achieved through dialogue among all employees about how they should do the work.

“The idea is basically that if you don’t have a clean area, then you’re going to have waste,” Baumgartner says. “We started there, and we would hold weekly meetings with the teams. They would have daily huddles, and then they would report on a weekly basis how their development was taking pace. I would in turn ask questions. We played that kind of touch ball for a few weeks.”

He says at first the operators were getting frustrated because they were spending so much time cleaning their areas and not seeing any gain in efficiencies. He says it took about a month before they started seeing improvements and two months before the numbers really started looking good.

“We’ve been able to sustain it since then,” says Baumgartner. “I’m looking at our smaller die cutter, and for the first quarter of last year, we averaged 43 minutes per setup. This past quarter, we averaged 14.8 minutes per setup. So, it’s been a drastic improvement.”

Now their plan is to take that same methodology and apply it across the floor to other pieces of equipment.

Virginia Humphrey is director of membership and marketing at AICC. She can be reached at 703-535-1383 or vhumphrey@aiccbox.org.