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Onion packer bags a niche market

LAS CRUCES - Bagging onions is big business for Shane Pittman.

The Las Cruces businessman designed the world's first electric-run automatic onion bagger in 2004, and the machines have been selling like hotcakes ever since.

The machines cost $20,000 each, but the mere idea of a portable, electric-run onion packer brought in half a dozen orders from growers before the first prototype was even built, Pittman said. His new company, Produce Bagger Inc., sold 14 machines in its first year in 2004, bringing in $280,000 in revenue, and last year sales grew to $720,000.

"I'll easily top $1 million in sales this year," Pittman said. "I've already got more than 30 new orders, and we haven't even hit the busy part of the growing season. Producers from Mexico all the way up to Idaho and Oregon are buying them."

Pittman didn't invent automatic onion baggers. Pneumatic, or air-operated, packers have been available for years from manufacturers in Australia and New Zealand, and most large onion growers use them.

But pneumatic machines cost more because they require expensive air compressors and filters to operate. They also need constant maintenance to keep them clean and running smoothly, and the extra equipment usually means the bagger must remain stationary, said Wesley Eaton, a design engineer at New Mexico State University's Manufacturing Technology and Engineering Center (M-TEC).

"Pittman's electric bagger is smaller and a lot easier to operate," Eaton said. "You just plug it into a power outlet and place it wherever you want in the onion shed."

To perfect the machine, Pittman sought help from M-TEC, which provides consulting and engineering services to local businesses. In response, M-TEC redesigned Pittman's original prototype into a standardized model ready for mass production, said Eaton, who managed the project.

"Pittman had a basic working model, but none of the measurements were standardized and each machine was coming out different," Eaton said. "We simplified the construction design and created drawings with precise measurements to make it easier, quicker and cheaper to manufacture."

The overhaul eliminated 15 parts from the original design, reducing manufacturing costs by at least $1,800 for each machine. In addition, M-TEC designed a second machine to automatically box onions, which will allow growers to manage contracts with retailers like Wal-Mart that prefer onions in cartons rather than sacks, Eaton said.

M-TEC provided its engineering services under the Space Alliance Technology Outreach Program (SATOP), a nationwide initiative sponsored by NASA that provides a vehicle for NASA contractors to offer free engineering, technical assistance and other consulting services to small businesses. Under the program, NMSU has assisted over 150 companies since 2002, making it one of SATOP's top partners nationwide, said Manuel Durán, program engineer for SATOP-New Mexico.

This year, SATOP decided to showcase the onion bagger at its annual appreciation event May 16 in Washington, D.C., Durán said.

"This project generated such positive results that we want to highlight it as a success story in Washington," he said.

Pittman is now on the road showing his onion bagger to growers in California and the Southwest. He's sold 20 machines so far in southern New Mexico, where most local growers are concentrated.

"We really like them," said Larry Barker of Las Cruces-based Barker Produce, which contracts with local farmers to grow about 600 acres of onions annually. "We bought six of Pittman's baggers to replace our pneumatic machines. These are much more convenient because they don't need all that air equipment and I can move them around anywhere I want."

Scott Adams of Hatch-based Adams Produce, which harvests about 800,000 bags of onions annually on 700 acres, said he expects the electric machines to save money.

"We've spent at least $1,200 every year just to keep the old air baggers running," Adams said. "Water always builds up in the pneumatic machines and corrodes the metal in the air cylinders and valves. All that maintenance can really nickel and dime you."

Adams is leasing two of Pittman's machines for $8,000 over the next two years under a rental program Pittman launched this season. If the electric baggers prove reliable, Adams will buy the machines.

"The cost-savings and lease options on Pittman's bagger could help many smaller growers mechanize production," Adams said. "Many still pack by hand, or they use old mechanical sacking wheels that are rotated manually. If the electric bagger lives up to expectations, it will be the future of bagging onions, for sure."