Equipment Buying Guide: Pallet buy considerations
By Tom Andel, Contributing Editor -- Modern Materials Handling, 3/1/2009
Wood, plastic or paperboard aren't your only decisions. Where pallets are concerned, you have to balance the price of your pallets with the demands of your customers.
Few industries are as competitive as the produce industry, where profit margins often ride on how many pennies can be shaved off a materials handling process. It's not enough, however, to just save money: In today's economy, companies must balance their cost concerns against quality and sustainability demands.
Few understand that reality as well as Brian Thure, vice president of processing and distribution at River Ranch Foods, a premium produce grower/shipper and fresh cut processor based in Salinas, Calif. Thure's company ships to 500 locations, from terminal markets to Wal-Mart and Costco. Today, Thure says, it's not enough to ship a quality product. How he ships his product is also important. “Wal-Mart, via our partnership with CH Robinson (952-937-8500, www.chrobinson.com), is one of our largest customers,” Thure says. “When it comes to sustainability, they keep our feet to the fire.”
River Ranch Foods must be doing something right, because business from Wal-Mart is on the rise. According to Thure, it's not just sustainability that's attracting them, it's a whole package of things, including the pallets on which the produce travels.
In the past, River Ranch shipped its product on expendable wooden pallets that were disposed of by the customer. The up-front cost of one-way pallets was cheaper than permanent pallets, but productivity and administrative problems added to the cost. River Ranch Foods tried using plastic pallets but determined that they didn't really fit the company's materials handing needs. Instead, they turned to a pallet and container pooling service (CHEP, 407-370-2437, www.chep.com).
By using a pooled wooden pallet that may stay in the supply chain for several years, River Ranch estimates that it is reducing solid waste generation by more than 2.8 million pounds per year—the equivalent of about 125 dump trucks of waste. River Ranch is also reducing energy usage enough to power 233 homes with electricity for a year, and is contributing a 58% reduction of CO2 emissions-greenhouse gas. That is equivalent to taking more than 133 cars off the road for one year. The energy cost savings, plus the elimination of customer complaints and lost pallets, have helped broaden River Ranch's profit margin.
An added benefit: By using pooled pallets from one supplier, River Ranch gets pallets of consistent size and quality every time, eliminating the possibility of scraps of wood ending up in the produce. “With many pallet producers we've worked with, we never knew what we would get,” he adds. “Now we know it's consistently sized and has a consistent board strength.”
Thure has not given up on the idea of some day using plastic pallets in his operations, and he's hoping CHEP will help him on that account—as well as providing the traceability he'll need as dictated by new food regulations.
“We'll be looking at the whole RFID piece tied to plastic pallets,” he says. “CHEP will be a partner with us in that.
| Company | Web site | Telephone number |
| Wood | ||
| Most wooden pallet manufacturers and recyclers are regional companies. Check with the National Wooden Pallet and Container Assoc. (www.nwpca.org) for a listing of manufacturers in your area. | ||
| Plastic | ||
| Airdex | airdex.com | 702-270-6004 |
| Allied Plastics | alliedplastic.com | 262-877-4700 |
| American Pallet and Packaging | ampallet.com | 877-725-5388 |
| Buckhorn | buckhorninc.com | 800-543-4454 |
| CABKA | cabka.com | 877-462-2252 |
| Decade Products | decadeproducts.com | 877-365-2887 |
| Fabri-Form | fabri-form.com | 800-837-2574 |
| Flexcon Container | flexcontainer.com | 973-467-3323 |
| Formall | formall.com | 800-643-3676 |
| Georg Utz | georgutz.com | 812-372-2790 |
| Granville | granville.cc | 800-350-4660 |
| International Contract Molding | icmolding.com | 800-399-6886 |
| JenMar Manufacturing | jenmarmfg.com | 866-351-5373 |
| LINPAC Allibert | linpacallibert.com | +44 (0)1922 726060 |
| Monoflo International | miworldwide.com | 800-446-6693 |
| Norseman Plastics | norsemanplastics.com | 888-675-2878 |
| ORBIS | orbiscorporation.com | 800-890-7292 |
| PDQ Plastics | pdqplastics.com | 800-447-7141 |
| PrimePal | primepal.net | 316-263-1900 |
| Rehrig Pacific | rehrigpacific.com | 800-421-6244 |
| Robinson Industries | robinsonind.com | 989-465-6111 |
| Schaefer Systems International | ssi.schaefer-us.com | 704-944-4500 |
| Schoeller Arca Systems | schoellerarcasystems.com | 248-355-3000 |
| SolPlast | solplastics.com | 888-765-7527 |
| Thermodynamics | okpallets.com | 800-627-9037 |
| Wilbert Plastic Services | wilbertplasticservices.com | 866-273-1810 |
| Metal | ||
| ALX Pallet Systems | alxpallet.com | 888-424-4901 |
| Atlas Material Handling | atlaswire.com | 847-678-3450 |
| Cargotainer | cargotainer.com | 800-221-3794 |
| Jarke | jarke.com | 847-541-6500 |
| LM Containers | lmcontainers.com | 573-359-2286 |
| Streator Dependable Mfg. | streatordependable.com | 800-795-0551 |
| Worthington Steelpac | worthingtonsteelpac.com | 717-851-0333 |
| In addition, many regional metal fabrication shops manufacture custom pallets. | ||
| Paperboard | ||
| CorrPallet | corrpalletinc.com | 281-998-9855 |
| Corrugated Pallets | corrugatedpallets.com | 800-760-0003 |
| Corrupal | corrupal.com | 888-856-2222 |
| EcoDuro | ecoduro.com | 888-330-6646 |
| Farmers Corrugated Solutions | farmerscorrugatedsolutions.com | 888-293-8930 |
| In addition, many regional corrugated converting plants manufacture custom paperboard pallets. | ||
| Specialized wood | ||
| Litco International | litco.com | 877-284-5043 |
| In addition, many regional lumber mills make specialized wood pallets. Check with the Engineered Wood Assoc. (www.plywoodpallets.com) for a listing of manufacturers in your area. | ||
| Pallet rental services | ||
| CHEP | chep.com | 407-370-2437 |
| IFCO | ifco.com | 713-332-6145 |
| iGPS | igps.net | 800-884-0225 |
| Ongweoweh | ongweoweh.com | 607-266-7070 |
Pallet basics
Wooden pallets
The vast majority of pallets in use today are made of wooden boards held together by metal fasteners. Wood is the favored material for pallets because, in most places, it is readily available and relatively inexpensive. (A typical wooden pallet costs about $9 in the United States today.) In addition, wooden pallets are easy to assemble, and wood is easily adaptable to the many different pallet designs demanded by industry.
Plastic
Plastic is the most popular alternative material for making pallets. The exact characteristics of plastic pallets vary depending on the type of resin and the molding technique. In general, however, plastic pallets are lighter and more durable than wooden ones. They are also more uniform in size, shape and weight. The major disadvantage of most plastic pallets is their higher cost (although some less durable, low-cost options are available).
Metal
Metal pallets are available in aluminum and steel. Aluminum pallets are much lighter than steel pallets but usually cost more, too. Like plastic, metal is more expensive but also more durable, uniform and sanitary than wood. Because of their strength, metal pallets are often used for exceptionally heavy loads. They are also used in high-temperature environments where other pallets would burn or melt.
Corrugated paperboard
Corrugated pallets are often used in exporting goods because they're lightweight, they aren't subject to phytosanitary regulations and nearly every country in the world has a means of recycling them. Their weight makes them especially attractive for air freight. An obvious disadvantage of paperboard pallets is their susceptibility to moisture.
The pallet lifecycle
When a customer receives a pallet-load of goods, what happens to the pallet? Sometimes, the receiver simply throws the pallet away along with the packaging material. Many pallet receivers have contracts with wooden pallet recyclers. Pallets that aren't fit for reuse can be broken down for scrap or mulched. Some suppliers invest in durable pallets which they intend to reuse in a closed loop, and they make arrangements with customers to return empty pallets.
Other manufacturers rent pallets. Customers return empty pallets to the rental company, which repairs the pallets and reissues them to other customers. Other companies participate in pallet pools and send unneeded pallets to other pool members for reuse.
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