When Ocean Bio-Chem (OBCI) subsidiary Kinpak started planning its fourth facility expansion in 2019, a company official said it did not plan to break ground this quickly.
Montgomery, Alabama-based Kinpak and its sister company Star brite are RV, marine and outdoor performance chemical suppliers owned by OBCI. Kinpak and Starbrite operate as the same business. Star brite offers private labeling.
During the Covid pandemic, Star brite’s VP of Sales and Marketing Greg Dornau said the business was on fire, seeing a 32 percent sales growth increase that brought Star brite to $55.6 million. The spike prioritized additional production space, Dornau said, as the company’s products are made mostly in-house.
“It was a big whammy with everything that happened,” he said of the hurricanes following pandemic impacts. “So, the reason for the expansion is because the more floorspace we had, the more pre-inventory we had. We make our own models and everything in-house, so we rely less on outside partners. Throughout the pandemic, Star brite was still delivering about 90 percent through the year.”
The 69,000-square-foot expansion was planned before the pandemic hit, Dornau said, as the company anticipated a spike in outdoor recreation interest. The expansion increases Kinpak’s total facility space to more than 370,000 square feet.
“Star brite did good because we carry a lot of inventory,” Dornau said in regard to the pandemic’s impact on business. “Factories were struggling and shipping was disrupted, the pandemic closed down factories on the coast. It taught people about the supply chain. The guy with the inventory wins. We need inventory at healthy and higher levels.
“The first step is more warehouse space, more floorspace and more production,” he added.
This is the company’s second major expansion in less than five years. The first added 84,000 square feet in 2017. OBCI stated that since its Kinpak acquisition in 1996, the business has undergone four major expansions.
The facility contains a rail spur that receives bulk delivery of raw materials, the company added, along with an on-site tank farm with a 550,000-gallon capacity and expansion room.
One of OBCI’s biggest products this time of year is antifreeze, Dornau said. Shipments double business operations, he said, as customers winterize their RV and marine units.
“What is usually 300 truckloads becomes 600 or 700 truckloads,” Dornau said in regard to antifreeze sales. “You have to put 20 to 30 trucks on the floor when scheduling freight.”
Freight planning has been the worst in years, he said. The East Coast experienced multiple hurricanes last year that influenced product distribution. OBCI’s contract with the Federal Emergency Management Agency (FEMA) required a significant number of supplies to be redirected to emergency response efforts, Dornau said.
Although the company makes most products in-house, Dornau said it does rely on the plastic industry for items such as bottle sprayers. He said some of the company’s vendors are indicating 2022 deliveries, when deliveries typically take no more than 90 days to fulfill.
“Plastic prices are going through the roof, up maybe 30 (percent) to 40 percent,” he said. “I call it the ‘toilet paper effect,’ because every company is buying every sprayer they can find.”
Business is changing rapidly, Dornau said. Kinpak’s expansion will break ground in the next two to three weeks, he said, with a completion date planned in 12 to 16 months.
The company is looking at options, including remote warehouses, to produce high-volume products such as antifreeze during the winter season until the facility is finished. The product’s short shipping window makes production a priority, Dornau said.
“We have to do it in phases and cannot just turn the place off,” he added. “We will have to close [certain sectors] and shuffle things around.”
Kinpak nearly doubled its personnel in 2020, Dornau said, with its original 90 employees increasing to 145 full-time staff. This expansion likely will support another 30 to 35 jobs, he said.
“We are growing at such a crazy pace and figuring out how to account for all this new business,” Dornau said. “We are excited but plan on working some overtime.
“The whole industry will be excited, as vaccines roll out and normal life keeps outdoors on the mind,” he said. “We are just so excited to see kids out there camping and embracing the outdoors, and we are excited to be coming back into it. It is the perfect timing for new RVers.”
