Material handling: Making China "palletable"

My first full week back from ProMat 2009, the showcase of state of the art materials handling technology, and what’s on my mind? Pallets. 

How boring, you might think. How unimaginative, especially after all the high-tech equipment I saw in Chicago. But consider this: the most sophisticated automated storage and retrieval system can be stopped in its tracks by a poorly specified pallet—whether wood, plastic or paperboard. Some experts I’m speaking to for an article on pallets (for our March issue) just told me of their ProMat experiences too. It’s heartening to hear that at this year’s show, they finally got a feeling that systems integrators and systems users are getting it—that they must be precise in how they specify the pallets used in a system or else doom themselves to re-learning the age-old lesson that pallets can determine the quantity and quality of materials moved in a day.

This is the kind of MH 101 that’s resonating in China. Many companies in developing sections of this country are on a fast track to competing with domestic and global companies, and there are plenty of materials handling specialists from the US who see that hunger for MH basics as a golden opportunity to grow their own competitive position. Jim Tompkins, president of Tompkins Associates, an international consulting firm, told me he’s bringing his core business to China next year. He’s working with Steve Ganster, Senior VP with Technomic Asia (a division of Tompkins Associates), to learn more about business strategy, strategic sourcing and competitive intelligence in China. What’s this got to do with pallets? Pallets are just an example of the level of informational detail needed to establish supply chain excellence, and many companies, whether based in China or establishing a presence there, need to get these details right.

Ganster told me there’s a wide spectrum of warehousing in China, from dirt floors to state of the art. In fact China represents what the US was like at several stages between World War II and up to the 90s.

“They need to take it to the next level of technology with equipment, process and strategy,” he said. “The government will ensure there’s a good 8% GDP growth one way or the other this year. There’s huge investment in infrastructure. The difference is they have the cash in their bank account.” 

Just as you can’t just “be” in China and expect to flourish, you can’t just “be” a materials handling expert anywhere in the world without understanding the importance of details like matching the correct pallets to the correct loads and the correct equipment. Agree or disagree?