“I talk to some people outside this business, and they ask me ‘What is a pallet?’” said Rigoberto Lesteiro Jr., owner and CEO of Tropical Pallets Inc., standing in his 20,000-square-foot warehouse and headquarters in Allapattah.
He was surrounded by tens of thousands of wooden pallets stacked against the warehouse walls that reflected the sound of his carpenters, who were tearing apart, hammering and refurbishing used pallets that Tropical will put on the market again.
“Most people don’t realize that the apple you have for lunch or the shampoo you use to wash your hair arrived at your store on pallets,” Lesteiro said. “This little wooden item carries the weight of the world on its back.”
Pallets — which usually are built from wood but can also be made from plastic and other materials — are portable platforms that companies use to stack and support merchandise and heavy equipment for storage or shipment. Merchandise is often wrapped in plastic or secured by straps, and the pallet design allows them to be lifted and moved by forklifts, pallet jacks and other equipment.
They are an essential piece in the enormous transportation network that moves goods and equipment from manufacturers and farms to warehouses, distributors and finally to neighborhood retail stores here and across the globe. They are used by all the players in Miami’s international trade industry — warehouses, freight forwarders, importers and logistics companies as well as land, sea and air carriers.
Tropical Pallets, one of many local companies in this business, deals primarily in used wooden pallets. These typically are stacked up in the back lots of large retail stores or distribution centers for retail chains after the merchandise is unloaded.
“We are big recyclers,” Lesteiro said. “We buy the pallets, bring them here and our employees inspect each one and make whatever repairs are necessary to restore them.” Wooden pallets can be made from yellow pine, oak or cypress, and Tropical restores them to maintain their integrity and to ensure that they are structurally sound, sometimes using new wood for custom orders. There are different grades of recycled pallets, ranging from those that need no repairs or very minor ones to the lowest grade, which has had several parts replaced. Tropical also uses a heat-treatment process to eliminate insect pests.
A pallet has a life cycle, and at some point, it becomes unrepairable and is broken down into parts for rebuilding other pallets or used for mulch.
Rigoberto Lesteiro Jr., owner and CEO of Tropical Pallets Inc.
Most pallets sold by Tropical are a standard size — 48 inches by 40 inches — but the company also handles larger and smaller sizes. They can weigh from about 15 to 25 pounds each. In its workshop, Tropical rebuilds standard-size pallets and makes custom sizes for customers, sometimes using new wood from lumber yards.
The company also sells plastic pallets and other types, depending on customer needs.
The price Tropical charges depends on the quality of the pallets and the quantity ordered. The company picks up and delivers pallets with its own fleet of trucks. While some companies buy new pallets, the recycled/refurbished pallets sold by Tropical are considerably less expensive.
“When we started out in the 1980s, about 90 percent of businesses bought new pallets, put them aside and often didn’t use them again,” Lesteiro said. Then recycling became popular and many companies realized that refurbished pallets cut costs and were good for the environment.
“A pallet has a life cycle, and at some point, it becomes unrepairable and is broken down into parts for rebuilding other pallets or used for mulch,” he said.
Tropical sometimes buys used pallets from a client who receives raw materials or merchandise at one point, and later sells refurbished units (not the same pallets) to the same customer when they are needed for shipping finished products. In many cases, a client doesn’t have room to store thousands of unloaded pallets and wants to get rid of them.
Tropical Pallets got its start in 1984 after the Lesteiro family immigrated from Cuba. “In 1984, I was working as a driver for another pallet vendor in Miami,” Lesteiro said, a job that allowed him to learn how the business worked.
“My father was an entrepreneur and a businessman in Cuba, and he always was able to see a good opportunity.” Rigoberto Jr. and his father, Rigoberto Lesteiro, that same year came up with the idea of selling pallets and started a small business — Lesteiro Used Pallets — in the backyard of their home in Allapattah. “We used our own savings, plus loans from friends and family to get started,” Lesteiro said.
There were four other established pallet companies in Miami and Lesteiro realized that they weren’t selling much of their product due to a lack of customers. So after lining up the fledgling company’s first customer, juice company Tropicana, Lesteiro began buying pallets from his competitors and sold them to Tropicana and other customers.
Lesteiro worked hard to attract new customers, began recycling pallets and grew the company, changing its name to Tropical Pallets in 1989.
Today, Tropical serves more than 400 clients, owns its main headquarters and warehouse and has two distribution centers in Miami. It has a fleet of box trucks and 10 forklifts moving pallets around its work areas.
Some big regional pallet users — like the Coca-Cola and Pepsi bottlers — make their own pallets, and very few companies buy new ones, among them the pharmaceutical companies, Lesteiro said. His clients include produce packers, citrus growers, grocery warehouses, flower distributors, furniture manufacturers and others, mostly in the tri-county area. But Tropical also sells pallets in other parts of Florida and other states and exports about 10 percent of sales to Central America and the Caribbean.
Despite economic ups and downs, Lesteiro sees a bright future for his business. “The population in South Florida is growing, and people always need water, coffee, fruit and other products,” Lesteiro said. “And they’ll need pallets.”
Business: Tropical Pallets Inc. sells exactly what its name suggests — pallets. These are portable platforms supporting merchandise and equipment that is packaged and moved by forklifts, pallet jacks front loaders or cranes. Most of Tropical’s sales are made up of used wooden pallets that the company recycles. The company buys used pallets and its team of specialized carpenters rebuilds or repairs them, producing standard and custom sizes. Pallets carry all types of merchandise, sometimes in boxes or crates, usually wrapped in plastic or secured by straps for shipment. They are essential for efficiently storing and transporting goods and equipment.
Headquarters: 1500 NW 23rd St., Allapattah, plus two distribution centers in Miami.
Owner and CEO: Rigoberto Lesteiro Jr.
Customers: Produce packers, citrus growers, grocery warehouses, flower distributors, furniture manufacturers and others working in trade and commerce.
Source: Tropical Pallets