Tom Kandris makes boxes. And his company, PackageOne Inc., better known as American River Packaging, can also fill them.
PackageOne has been growing despite the recession, and with about 150 people on the payroll, it ranks among the larger manufacturers in the Capitol Region.
It’s a second career for Kandris, who first spent 20 years working for semiconductor companies. “I was around the world every three weeks, a different country every day, and my kids were growing up without me,” he says. Returning home to Sacramento, Kandris and partner Eric Portela started PackageOne in 2000 as a distribution company.
Kandris had a vision of bundling several companies and becoming the main supply chain integrator for packaging in Northern California. But Portela didn’t share that vision, so in 2005 Kandris bought him out and also acquired American River Packaging, a 25-year-old, $20 million company.
PackageOne was a $17 million company by that time, and Kandris managed to build revenue to nearly $45 million before the recession hit. When the economy sagged, he sold off the distribution arm, deleveraged and paid off debt. Afterward, he started expanding again.
“We were able to produce more profits on less revenue as a result of managing expenses,” he says.
PackageOne acquired an interest in supplier Northern Sheets and last summer bought All West Container Co. in South San Francisco. The latter company’s operations were discontinued, and the equipment was moved to Madera.
So, why stay in Sacramento?
“Frankly the quality of life in Sacramento is good, the labor base is good, the housing is affordable. It’s a small metropolis where you have culture and good schools,” Kandris says.
Workers often come out of junior college programs.
“We are not the kind of company that looks at competition for our labor. We grow our own,” Kandris says. The machine operators average 16 years of experience on American River Packaging equipment.
A growing demand for green packaging has generated interest in the company among prospective employees, Kandris says.
“The interesting thing is that, opposed to five or eight years ago, we are finding it a little easier to find skilled labor that wants to work,” he says.
PackageOne recently broke ground for an anaerobic digester to convert waste material into energy. Aside from being environmentally sound, it will allow PackageOne to use carbon credits to defray any penalties that might be imposed on some of its customers.
“You need a box to get your product to market,” Kandris says. “So we enable commerce and save the planet, one box at a time.”
As Sacramento attempts to forge a regional economic development strategy, manufacturing is being touted as a potential breadwinner, but rebuilding the industry piecemeal could take time.
If a local economy is thriving and healthy, it may have the manufacturing industry to thank. If things aren’t so good, it’s probably because manufacturing jobs are leaving.