Pallets: Industry introduces a new pallet pool
July 03, 2012 - MMH Editorial
9BLOC, a new pallet pool run by members of the pallet industry, may soon be in the offing.
Created as a response to third party pallet pools operated by CHEP, PECO and iGPS, the pool from Pallet Logistics & Unit-Load Solutions will offer a block pallet designed to meet the Costco specification in a rent, lease or purchase model. That means that pallet users can choose from a variety of models, ranging from a per trip rental to outright ownership of their own managed pool.
The benefit to pallet producers, recyclers and distributors is an opportunity to retain current customers using stringer pallets who may be considering a shift to a block or leased pallet as a result of the Costco specification or the shortage of cores.
The benefit to pallet users, according to John Swenby, a member of the 9BLOC, development team, is “the power of choice. Now, you can choose to rent, lease or purchase your own pallet inventory, based on your needs, from the 9BLOC participating pallet maker you select.”
According to Swenby, the National Wooden Pallet & Container Association had been discussing the idea of a national pallet pool for years. “Within the industry, we have been asking what can we do to compete with the big pallet pooling guys,” Swenby says. “If you look around the globe, Europe has EPAL and Canada has the CPC. We don’t have anything like this in the US.”
While the concept was initially just industry chatter, Swenby says a group of leaders began to investigate what it would take to put together a pool managed by pallet producers in October of 2010, about the time Costco announced its plans to convert to a block pallet. The reason: although CHEP and PECO offer block pallets in their pools, most US pallet manufacturers make stringer pallets, which would no longer be accepted by Costco. To stay in that game, would require an industry response. “I think there are other major retailers out there who are looking at the Costco model but have not switched to a block pallet because there wasn’t a pooling business model that worked for them,” Swenby says. “We decided to spend a few months to see what the industry is thinking.”
Out of those discussions came the formation of Pallet Logistics & Unit Load Solutions, Inc., a not-for-profit organization that will oversee the operation of the pool, about a year ago. A collaboration of companies that represent the entire product supply chain, the group will work together to provide a pool of high-quality wood block pallets that are manufactured and repaired to an industry-wide standard along with a software asset-tracking solution to manage the pool. An independent third party inspection service will conduct routine inspections of participating suppliers to assess quality standards.
“There are several thousand pallet manufacturers located around the US,” says Swenby. “If there are 500 of them with 100 trailers and 100 employees to manufacture, distribute and repair pallets, that’s a lot of scale. We can use our network to serve customers who are already working with us, but have a need to go to a block pallet.”