Clips/ Feature Article

Pine Belt Industrial Supply Co. brings its expertise to a new and growing industry

PINE BELT INDUSTRIAL SUPPLY CO. IS A DIVISION OF Gadsden, Ala.-based Gadsden Industrial Distributor. President John Hyde says each of Gadsden's three locations has its specialty. Pine Belt's is power transmission and bearings.

Pine Belt's name comes from its location deep in the Pine Belt region of Mississippi, which is known for its forest products. Branch manager Ted Taylor says there used to be sawmills within a stone's throw of each other all the way to the coast. Opened in 1987, Pine Belt was built on the logging and sawmill industry.

Based in Hattiesburg, Miss., Pine Belt is in a central location between Jackson and Meridian, Miss., Mobile, Ala. and New Orleans. The town was also an intersection of several railroad lines which gave Hattiesburg the nickname "hub city."

Much of the economic development of this region was tied to manufacturing industries, which utilized the railways, the logging industry, and a military base, Camp Shelby, located in Hattiesburg during WWI through WWII. Now the base is a National Guard training center and the whole region is changing from a manufacturing to a service economy.

The change has caused companies like Pine Belt to find new markets -- like the region's growing catfish industry. Despite such diversification, Pine Belt's manager says traditional business will always have its place.

"There will always be a logging industry here," says Taylor. "There are a lot of tree farmers working to make forest products a sustainable industry."

Taylor says the logging industry was strong throughout the 1990's but has been down this year. Even with a prospering industry, however, there are fewer and fewer sawmills. In industry, there is always a demand for greater efficiency and sawmills are no different.

"We help to modernize the industry," says Taylor. "This industry used to be very labor intensive. It now uses more and more automation, like the conveyor systems that we design, for higher levels of production."

Even in the current economic climate, where many competitors are struggling for sales in the shrinking industry, Pine Belt is experiencing considerable growth, posting $4 million in sales last year.

"The slowdown has been a challenge, but we have diversified over the last several years," says Taylor. "It hasn't been a real hindrance to us. We have even been able to add a new staff member." This latest hire brings the total to seven employees, with four outside salespeople.

"Qualified labor remains the greatest challenge," says Taylor. "We are not looking for salesmen. We need engineers. For this kind of business, it means on-the-job training over many years."

Taylor says the average employee at Pine Belt has 25 years in the business, but to remain current, Pine Belt employees receive industry training through vendor-sponsored programs.

"It is important to keep on top of new products and new ways of doing things," says Taylor. "We need to be leaders of innovation in our part of the industry."

Catching small manufacturers

Emerson Power Transmission Corp. is one of the vendors that provides training to its distributors. Chuck Hibbett, president of the sales and distribution division, says EPT values small distributors like Pine Belt.

"Today in the mechanical power transmission industry, there is a transition occurring," says Hibbett. "Many customers are turning to major distributors and there are fewer independents. That does not spell the end of the independent, however. We still do the greater part of our business through small independents."

Hibbett says small distributors are niche players that are experts in their business or their region.

"Rather than carrying the full range of products, independents tend to choose an industry and become experts in it," says Hibbett. "Pine Belt provides engineering services and consultative sales. Its methods provide efficient sales for us."

The company's blend of entrepreneurial spirit, consultative services and industry knowledge is valuable to EPT, he says.

"Small distributors may not be able to compete with the large nationals for large MRO contracts but when distributors specify our products to OEMs, we all share in the benefits," says Hibbett.

Pine Belt does a large part of its business with OEMs, says Taylor.

"OEM business below a certain level tends to get overlooked by most vendors and distributors," says Taylor. "There is a tremendous market out there in midsize OEM manufacturers."

Inventory control and management is key in supplying OEMs, Taylor says, and Pine Belt would not be able to conduct its current volume of sales without the modem systems and software available today.

"For instance, Pine Belt is online with some of its major vendors," he adds. "We are also looking to allow select customers to access our inventory online."

The lure of independents

After many years at a major national distributor, sales associate Jeff Plante recently joined Pine Belt. He says small independent distributors provide many opportunities and he enjoys the greater freedom and higher level of responsibility.

"At the large distributor, I had a small, strictly defined territory' Plante says. "Here I am not as limited."

He says the OEM business is different from MRO needs in many ways.

"This is so much better. Rather than running around for little return, we are meeting customers' needs."

The design work is sometimes demanding, but it is also rewarding, says Plante.

"It takes more time to provide solutions, but I enjoy the challenge. Rather than being just an order-taker and providing products, customers look to us for information and answers."

Angling for success

Pine Belt continually looks for opportunities to diversify, Taylor says. The company supplies manufacturers of sawmills, winches for the fishing industry, feedmills, the food processing industry, drives for aerators and many other applications.

"We offer a complete package so OEMs don't need to go to multiple distributors," says Taylor. "Most competitors can provide part of what they need but we can design the system and supply all of the parts."

Taylor points out that a distributor who can supply the OEM with these services is uniquely qualified to serve as an MRO distributor.

"If we have all the parts and design knowledge to build something, well, we've certainly got what it takes to repair it," he adds.

The OEM service gives Pine Belt a nationwide body of clients, but one of the company's fastest growing customer bases, the catfish industry, is strong in Pine Belt's local region.

"It started growing in the last ten years, and now 70 percent of commercial catfish are from Mississippi' says Taylor. "It's spreading rapidly in this region."

Even with millions of pounds processed, there is not enough product to support the restaurant industry's demand.

"It is mind-boggling," says Plante. "Farmers are digging up perfectly good fields and making catfish ponds."
Many smaller farmers are entering into this new industry in Alabama and across the South because the entry costs are relatively low, adds Plante

"It is like cotton was in the 1800's." says Plante. 'They are also farming with shrimp on the coast. It's an incredible opportunity."

Taylor says Pine Belt is seeing increasing demand for feed mills and conveyor systems, aerators and processing conveyors, which all require power transmission components and bearings, so it is a trend that Pine Belt hopes will continue.

"The catfish industry is in its infancy' says Taylor. "As it grows, we are growing with it."

Of Gadsen Industrial's three locations, Hyde says Pine Belt has the brightest outlook. With its diversification and its presence in strong market segments, he expects Pine Belt to keep growing.

Measuring up

Scooba, Miss.-based Primeline Catfish Inc. is a manufacturer of electric aerators used in catfish ponds. According to aeration division manager David Castleberry, Primeline sells 600 units annually.

"We buy a lot of our gear boxes and drive systems from Pine Belt," says Castleberry. "We also take advantage of their product and engineering knowledge."

Primeline is not just a manufacturer, however. It has 2,200 acres of catfish ponds and is planning to double that amount over the next five years, according to Castleberry.

"We have our own processing plants," he says. "We process 18 million pounds a year. A lot of it goes to Chicago."
Primeline also manufactures its own feeders and processing equipment. It turns to Pine Belt for many of the components in these applications, as well as filling MRO needs to keep the equipment online.

"The biggest challenge in the catfish industry is imported catfish from Vietnam, which has gained 18 percent of the market," he says. "They drove down prices but consumption is still up."

Another strong business is the shrimp and fish boat building industry. McElroy/Catchot Winch Co. Inc. of Biloxi, Miss., is a manufacturer of winches and deck machinery for shrimp and fish boats.

President Harold S. Catchot says he looked to Pine Belt when he wanted to pursue leaner manufacturing.

"Pine Belt is a good outfit. They provide high quality, dependable service," he says. "They go out of their way to service us, which means a lot in any business."

Catchot says Pine Belt provides the products as well as the technical information and support he needs to manufacture his winch products. "When they don't have the answer, they get engineering support for us directly from the manufacturer," he says.

Pierce Construction, Inc. of North Petal, Miss., manufactures saw mills. Head of Purchasing Stanley Pierce says the company relies on Pine Belt's expertise for many of its needs.

"They work to our individual specifications and provide our preferred components," says Pierce. "Pine Belt also has a great technical staff to give us the information we need to face the challenges of the modem lumber industry."

With sawmills now computerized, automated and expected to produce four times the volume handled 15 years ago, Pierce says it can be challenging producing such high-tech machinery, but Pine Belt provides the necessary expertise.

"We have a close working relationship with Pine Belt," he says. "They have been supportive of our business and helped to get us where we are. We have also contributed to their success and we've grown stronger together."

COMPANY SNAPSHOT

PINE BELT INDUSTRIAL SUPPLY CO.

A DIVISION OF GADSDEN INDUSTRIAL DISTRIBUTOR

Manager: Ted Taylor
Headquarters: Hattiesburg, Miss.
Founded: 1987
Annual sales: $4 million
Employees: 7
Primary products: Power transmission and bearings
Territory: Mississippi and Southern Alabama
Email address: pinebelt@netdoor.com

COPYRIGHT 2001 Cahners Business Information in association with The Gale Group and LookSmart.