One of the country’s largest paper suppliers is shipping its entire Los Angeles operation to its bigger and more modern La Palma warehouse.
Georgia-based Unisource Worldwide Inc. said it will be more efficient with its 420,000-square-foot La Palma building because much of its growth is happening within Orange County.
“We want to be a part of the growth in Orange County,” said Mitch Sagowitz, a vice president with the company, which had $5.8 billion in revenue in 2006 and runs some 20 warehouses in the state.
The expanding healthcare and education sectors have been a boon for the privately owned company’s business of shipping towels, toilet paper, tissue and garbage bags to hospitals and schools throughout Southern California, Sagowitz said.
When the move is completed by the end of the year, Unisource plans to have relocated 80 workers from its south Los Angeles building. It is also looking to add about seven people to its sales force. Some of the relocated workers already live in the county, Sagowitz said.
The company’s south Los Angeles site has about 140,000 square feet of industrial space and is only 18 miles from the La Palma location. But the 30-year old operation is considered outdated compared to the more sophisticated OC site, which was launched seven years ago, according to Sagowitz.
Unisource’s La Palma site uses a software-backed management system that improves order accuracy and service speed, he said.
It also offers more space and should improve all segments of its Southern California operations, he said.
“The La Palma location was underutilized,” Sagowitz said, so the company won’t have to build onto it to accommodate more workers.
New 30- and 80-foot trucks also will be added to the La Palma site.
La Palma site: $17M
Unisource bought the La Palma site in 2000 for $17 million.
It was attracted to the site because of its proximity to the Santa Ana (I-5) Freeway and Artesia (91) Freeway, Sagowitz said.
The company’s biggest problem has been finding qualified people to hire, he said.
“Enthusiasm, persistence and product knowledge are what we want from people,” Sagowitz said.
Companywide, Unisource employs 4,500 people in the U.S. and 1,500 in Canada. It operates three main divisions: paper, packaging and facility supplies.
Sagowitz also said the company is making an effort to be more environmentally friendly and sees Southern California as a leader in that area.
Its products are made by major industrial names such as Atlanta-based Georgia-Pacific Corp., Minnesota-based 3M Co. and Dallas-based Kimberly-Clark Corp.
The company sells to office buildings, hotels and stadiums.
Unisource is owned by Boston-based Bain Capital LLC, which has a 60% stake, and Kansas-based Koch Industries Inc., which owns the other 40%.
Unisource began as a number of small companies, including National Sanitary Supply in Los Angeles that was founded in 1929.
The businesses were rolled into one in the mid-1990s.
In 1999, Georgia-Pacific bought all of Unisource’s publicly traded stock for $1.5 billion, taking the company private.
In 2002 Bain bought its share of Unisource from Georgia-Pacific for $850 million.
Then in 2005, when Koch bought Georgia-Pacific for $21 billion, it also acquired its share of Unisource.
The deal made Koch the largest privately held company in the U.S.
Competitors
Competitors of Unisource are Indiana-based Grainger Industrial Supply Inc. and Ohio-based Xpedx.
In 2003, Unisource bought Aliso Viejo-based paper broker Graphic Communications Inc., which at the time had $500 million in yearly revenue.
Graphic Communications became part of the company’s Websource paper brokering division, and no longer exists in the county.
