Vepak: Cut production costs of bagging firewood with 80% by making the process automated and removing manual labor
iCrowdNewswire -
Apr 8, 2015 10:39 AM ET
Vepak
Revolutionizing the firewood industry
We developed a solution that cut production costs of bagging firewood with 80% by making the process automated and removing manual labor. Take part in history in the making. Take part in Vepak.
Summary
Vepak consist of a team of 5 engineers with offices in Trondheim, Norway. We have developed a machine that packs firewood in bags, eliminating the bottleneck in industrial production of firewood. We have made a full scale working prototype, and we are now in the finishing end of setting up production partners and signing pilot customers, that will receive the first machines for testing this coming fall. We are looking for funding to execute the pilot project, reduce production cost from an early stage, and get the machines into the major machine retailers in Norway, Sweden and Finland within the next 3 years. From all of us in Vepak,We are very proud to be where we are today, and we are thankful for the opportunity to present for you. Happy funding!
Problem
The industrial production of firewood is automated to a certain degree, with forest harvesting machines for felling trees and firewood processors that cut the timber and split it into wood logs. But the packing is still done manually, causing a major bottleneck in the production line.
The cost for packing the wood is extremely high, and the producer has to handle a large group of employees to get the job done at the right time and at the same speed as of the splitting process. In addition the work task is repetitive with a lot of unfortunate bending to pick up logs from a pile and place them in the bag. A large producer can have several employees whose only task is to pack bags, each with several hundred bags to pack each day. We decided to do something about this.
Solution
We have developed a machine that reduce packing cost by 80 percent, byspeeding up the packing 5 times compared to manual packing. We call the machine Vepak V1.
Revolutionizing the industry
The machine allow the producer to bag the wood 5 times faster than before, which means he has more time available for felling trees and splitting wood. If we compare his production to what he had in the past, the owner of Vepak V1 now can produce over 3 times as much in the same amount of time as he did before!
Where are we in the process?
We have:
A machine with track record of high speed and easy operation, solving every main issue to how to get an unhomogetic product like wood logs packed in the correct volume and orientation into a standard container
A ready design for pilot machines with a lot of good feedback from a list of interested firewood producers
Orders placed for parts and labor to improve and rebuild prototype to pilot standard (replace 75%, refurbish some parts of prototype) in the period march-may 2015
Filed patent applications via Dehns patent and trademark attorneys for both the technical solutions for the machine and for a firewood bag that seals in just 1 second, both with good indication for patents being granted
We receive mails and phone calls from producers that are struggling with low profit, high employment, and are ready to invest in our product as soon as we can document trough testing:
Industrial quality in the built. We ensure this by outsourcing the construction work and the paint job to professional metal workers and painters. Everything is designed to a minimum cost and risk solution, involving using prefabricated standard parts and conveyors where we can.
Easy maintenance and availability for spare parts. We ensure this by using standard off-the-shelf parts. All fabricated parts are saved with project-numbers for future reference at our production partners.
We will sign 3 pilot customers to our pilot program, and we currently hold a list of20 producers who wish to be the first to test the machine. To ensure to the customers that we can deliver as promised, we are refurbishing the prototype to a pre-pilot machine this spring. The machine will be item for future development and representation at various retailers and agricultural exhibitions.
Market
Our initial market is Norway, Sweden and Finland, where firewood in small bags are common on the consumer market, wages are high and firewood production and consumption per capita is high. We will establish customer relations in all three countries within the next 3 years, beginning with Norway in 2016, and delivering 60 machines annually in 2018. A deeper study of the 9000 professional firewood producers in Norway indicate a target of 800 machines on the market in total, and the interest in the machine have been both intercontinental and from producers smaller than our initial target group. Industrial production of firewood is common in North- and South-America and throughout Europe, and we are determined to map out and enter new and larger markets as we grow.
Business model
Our core business in the future will be product improvement and production management. To avoid “reinventing the wheel” we will outsource production and sales. We work to achieve strong partnerships and good communication with excising machine producers and retailers, who are skilled in their trade and give Vepak as a brand recognition as a quality brand among the end-market from an early stage. Production of pilot machines are done in Norway and sales are done directly to the pilot customers from Vepak. In the future we will use local machine retailers to reach the buyers. These know the customer personally from a life-long relation as a service provider to the farms in their area. Machines will be sold trough a “made-to-order” agreement, where orders are gathered up throughout the year, and a large order is set in production so the machines are ready to be delivered before packing season in the fall. Machine production and assembly will be planned by Vepak and conducted by a partner placed in Europe. Delivery will go directly from the production plant to the buyer.
In the future we also see potential in selling machine service plans. Connecting the machines to the internet will allow the distributor to offer tailored service-plans to the producers based on hours of use or bags packed, securing a smoother operation on a daily basis for the producers. It also opens up for the posibillity to implement a user-friendly interface for managing statistcs and logistic trough applications on the customers phone.
Timeline
We are in route to meet the market with machines in late september 2015. Pilot program in 2015 will prepare us for launch of machine sales via retailers in the second half of 2016. We are in initial dialouge with two of Norways largest retailers for agriculture equipment, and will round up negotiations on a retail deal before launching the commersial version of Vepak V1. The business model with sales trough partnering retailers will be copied in Sweden and Finlad from 2017 and onwards.
Vepak: a team set-up for success
Our company consist of a team of 5 engineers. Vepak was established in january 2014, as a result of confirming the customer need trough market research, and the production of an early mock-up on a device for packing wood by co-founders and fellow alumnis from the Norwegian University of Science and Technology, Ole Holtet (CEO) and Jørgen Møinichen (Chairman of the Board). Video presentation from co-founders of Vepak in Norwegian (please turn on English subtitles by pressing the subtitle-logo in the downright corner):
Our team is educated and dedicated to make our company succeed by any means necessary. The co-founders have been a part of the whole value-chain, with production and distribution of firewood since childhood, and the curiosity and admiration of the honest labor of making firewood have followed us into our company DNA and made us focus our values on the customers needs.
We are located at the Norwegian University of Science and Technology in Trondheim, which has grown to be the entrepreneurial capitol of Norway. Over the last year we have been a recognized contributor in the national start-up scene and taken part in a local exhibition for forest equipment, with good response and recognition from the audience.
With our office at the university, we are surrounded by knowledge. We also have a substantial contributing effort from 7 talented students this spring, who all write their final thesis with Vepak and contribute on finalizing the production planning for the pilot machines. Last summer we employed Lars Martin as a full time member of the team after delivering his diploma, and we are keeping the possibilities open to do the same this year.
Our company has been recognized by media and in the entrepreneurial environment in Norway during the ride:
Grab the opportunity!
We wish the best future for our company, and a strong economy is a key factor on our road to success. Therefor we are offering 30% of the company shares to investors who want to join in. We have put a 1.9M NOK discount on the pre-money valuation, and hope to please investors with our offer. We are not looking to fund more before we turn a profit.The funding will allow us to employ another skilled full-time team member, making us better equipped to reduce production costs fast and meet customer expectations, starting with 3 pilot machines this fall and an estimate of 120 machines within the following 3 years.
We are planning for just one investment round before break even (est. 2017)
Ole launched 2 successful companies while finishing his degree in structural engineering. His communicator and motivational skills come from many years practice as a successful car salesman, firewood producer/distributor and leading of various construction projects. He is determined to never work a day in his life by creating the employer that he love.
Jørgen finished his degree in industrial economics being voted the technology student of the year by E24 (Norwegian online business paper). He knows the value chain of the industry well and is a go-getter, letting nothing come in the way between us and success.
Peter has vast experience in putting steelwork into production. He is systemized and routined in production planning, management, and creative when it come down to simplifying without compromising. He is also a dirtbike enthusiast and afraid of being hit by lightning (again).
Lars Martin holds a bachelor degree in mechanical engineering, and his practical experience from the workshop as well as his good communicator skills makes him invaluable in representation, customer feedback and product development. Lars Martin has no problem hauling long shifts to make our team progress.
Johannes has broad experience as a certified CNC-operator and holds a bachelors degree in mechanical engineering. His contributions to the team are invaluable, besides giving him the opportunity to put theory into practice while finishing his masters at NTNU.
Jan has a lot of experience from product development, research and introducing new technology to the market from many years of employment, including position as Director of Research in Statoil ASA and as CEO of the Norwegian Paper Research Institute. 76 years of age don’t stop him from dropping by the Vepak office to share his thoughts and experience.
Halvor is CEO in the successful start-up Assitech AS, who develop and sell stair aid kits for elder. He has been a part of Vepak since 2013, giving us guiding and a helping hand when we need it.
M.Sc. Ole Jansen Holtet, CEO, board member and Co-founder
M.Sc. Jørgen Møinichen, Chairman of the board and Co-founder
BEng Hons Peter Richard Britton, Chief Production Officer