Here we go again. If you thought 2013 was a bad year for industrial lumber availability, 2018 may make five years ago look downright mild.

Lumber Prices are Going Up

Crisis breeds opportunity, or so they say. Here are increases we've already seen in raw materials:
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• Softwood Composite
  Prices are up about 34% in the last 12 months
  
  
• Hardwood Pallet Cant Composite
  Prices are up 11% in the last 5 months

Right now, lead times for industrial lumber are extended and supplies are tight. This means wooden pallet and crate prices have to go up.
  

How to Save on Pallet and Crate Costs 

I'm being asked all the time if anything can be done to combat these price increases. The answer is, yes! Retrieval programs for pallets and crates can save your company 10-50%.
  

• Take Back Control of Costs
  A pallet and crate retrieval program transfers the cost control lever back to manufacturers and shippers. Start by looking at all operating costs with a focus on cost-per-use.
    
• Reuse Existing Packaging
  You might be surprised to learn that return programs do not have to be all inclusive to save money for the shipper. Existing packaging is almost always reusable in its current state.
  
  
• Reduce Packaging Waste
  It gets better. You'll help stop wood-based packaging from going into the landfill. Your company gets to reduce its carbon footprint while also saving money.

  

Change your Packaging from Expense to Depreciable Asset

Need even more reason to consider a packaging return program? The US economy is growing and so is demand for lumber. Logging and sawmill capacity has not yet caught up - and may not. Inflation is real and will grow as the economy grows. If there has ever been a time to get with a program and take control of packaging costs, this is it.

If a packaging return program isn't your best match, here are 3 other money-saving solutions to help with the rising cost of wooden pallets and crates.

As the cost of lumber continues to rise, how are you preparing your business for increased packaging costs? Share your strategies or ask questions in the comments below.

Post by: Rich Reiher, Vice President

Trees are a renewable natural resource.

Rather than produce all pallets from new lumber, the wooden pallet industry recycles hundreds of millions of pallets every year! The question is just how many trees are theoretically saved each year by recycling these pallets?

What we know ...

• Estimations from the Department of Forestry indicate that nearly 2 billion pallets are in service. 
• 400-450 million pallets are produced annually from new lumber. 
• 350+ million pallets each year are recovered and resold to pallet users. 
• Less than 1% of recovered pallets go into landfills, most recovered pallets are reused or turned into other products such as mulch.
  
  

To examine how many trees are saved each year, we need to determine how much lumber is used in a standard wooden pallet and how much lumber can be produced from a normal size log. For our calculations, we estimate that two 10’ logs can be harvested from one tree. With those figures we can then calculate how many trees are saved each year by recycling pallets.

The amount of lumber used in a standard 48 x 40 GMA pallet is 15.17 board feet of lumber on a gross scale.

For a 10’ log with a small end diameter of 14”, the board footage in that log is 63 BF.
 
If we take 63 feet of lumber from a log and divide it by 15.17 BF needed for the pallet we can build just over 4 pallets from each log.
 
By then taking the 350,000,000 pallets recovered each year and dividing it by 4 pallets per log, we see that around 87,000,000 logs that have been used to produce these pallets.  If we are able to get two logs from every tree, we would then save 43.5 million trees each year. 

By recycling 350 million pallets a year, we can save around 43.5 million trees that would be required to produce these pallets.  Without this recycling effort, raw material costs would greatly increase and the supply of available lumber would quickly diminish.

By recycling pallets each year, fewer trees are used for pallet production. Would a pallet recovery and return program work for your company to reduce costs and improve the performance of your pallets? Leave me a comment below with your ideas, I’d be glad to help.

Post by: Jonathan Haynes, Regional Sales Manager

Is reverse distribution right for your company?

In its most simple terms, reverse distribution is the recovery and reuse of packaging. You’ve heard it all before. Reduce. Reuse. Recycle.

But there’s got to be more to it, right? Exactly. It’s a full-service systematic process.  

Reclaim your Product. Close the Loop.

Reverse distribution can also be called a packaging recovery system. This systematic process offers a lot more than simply retrieving your packaging assets. Your pallets, boxes and related shipping materials are:

• Tracked
• Recovered
• Inspected
• Maintained
• Returned 

Each step above makes up the entire lifecycle of your packaging assets. Starting over at the end of this cycle closes the loop in the distribution chain. The only thing left is keeping track of the entire process. Online management systems like Nelson-ART make tracking assets easy.

Be Kind to the Environment. Get Rewarded.

There’s more to a packaging recovery system than corporate responsibility. Reverse distribution has three main goals: 

1. Reduce solid waste created by packaging
2. Reduce the volume of natural resources used
3. Reduce packaging costs

Reaching these reverse distribution goals results in:

• A better environment
  Demands on natural resources like wood and fuel are reduced when packaging is reused. In addition, we put less stress on landfills by recycling and using packaging materials multiple times.

 

• An improved bottom line
  Cost-effective advances in technology and reusable packaging materials make switching to a closed loop packaging system an easy choice. Why? The latest in logistics systems make managing reverse distribution a profitable alternative to current methods. Even the most nimble product distributors will find savings.

Think about the volume of solid waste your packaging creates in just a single truckload. Give us your best guess in the comments below. We bet it's more than you think. 

Post by: Paul Pascarella, Sales Manger

Saving money with sustainable asset management practices is easier than finding a four leaf clover.

In honor of St. Patrick’s Day, take a fresher, greener look at moving your product from supplier to customer. In the process you will:

• Increase your efficiency
• Reduce your costs
  

Sustainable Asset Management
Increase efficiency and save money with  initiatives tailored specifically to your company's requirements:

• Define Strategic Sustainability Goals
  
• Discover New or Improved Shipping Materials
• Develop Innovative Design Solutions
• Identify Supply Chain Synergies
  
• Review Waste Management
  
• Consider Reverse Distribution

Environmental Stewardship
You don't need the luck o' the Irish to improve your company's impact on the environment. That's good news for the Earth and your bottom line. Environmental responsibility is directly linked to your brand and reputation.

Start now by improving your company's carbon footprint.

It’s simple… Reduce, Reuse, Recycle. 

Reduce: The impact on landfills is reduced by unitizing solutions designed to decrease waste in transport packaging. By combining unitizing solutions with reusable pallets (wood or plastic), you lessen shipping waste and operate more efficiently. 

Reuse: Extensive pallet return programs enable customers to track pallets through the supply chain. By utilizing a return program that revolves around reusable wood or plastic pallets, you can reduce waste (and save money) by eliminating the cost of purchasing new pallets.

Recycle: Did you know that post-consumer and post-industrial waste lives a second life as a plastic pallet? Companies such as Nelson distribute plastic pallets that are environmentally friendly and made of 100% recycled plastics. These plastic pallets are designed for both multi or single trips. Once a pallet completes its life cycle, it is completely recyclable!

Have you found an improvement jackpot within your supply chain? Let us know by commenting below!

Post by: Kaitlin Manning, Creative Director