Start by asking yourself four key questions about your packaging usage and distribution system.
Reverse distribution is the process of managing the tracking, return and refurbishment of assets from your distribution chain. Put simply, you save money by returning pallets, crates and other packaging to be used again. As an added benefit, return programs reduce the disposal burden for your customers.
Is it for you? Let's find out:
- Do I have enough volume?
The more assets (pallets and crates) that pass through your system each year, the better. While there is not a minimum, more assets typically mean greater economies of scale and more savings. That said, smaller volumes can offer benefits too. Read on.
- Can I ship enough each trip?
Plain and simple fitting more returned packaging on each truckload reduces your per-unit freight costs. While returning a full truckload of packaging assets often works best, returning 20 crates in a trip can make sense too. The next questions explain further.
- Is my return distance close enough?
Again, freight costs come into play here. Obviously, the less distance your assets travel, the better savings opportunities you have. But, it's not as simple as distance. Even returning assets from another country can produce benefits. That brings us to the last question.
- Is my asset valuable enough?
High-value custom pallets and crates offer some of the best opportunities for a successful return program. However, assets of any value have the potential to work if other factors from above also work in your favor.
Finding Cost Savings
As you can see, the decision to implement a pallet return program is not straightforward. Not to worry. A reverse distribution expert can easily show you the unique opportunities your system has to save.
In many cases, the savings comes from places you haven't yet considered. Return programs can include a variety of transport products including pallets, skids, crates, packaging, parts, u-channels, straps and more.
Should you be returning assets? Finding out is easy. Start by telling us about your system or ask us a question for free.
Post by: Kent Longardner, Technical Sales Manager