In the eastern United States, raw material costs for pallets have increased by 15% - 20% in the past year. This equates to pallet price increases of 10% - 15%. So what can users of wooden pallets do to offset these increases?
- Don’t be afraid to look beyond the pallet
The pallet is just one part of the packaging and distribution system. Find a packaging expert that understands the interactions between pallets, packaging, and material handling equipment and work with your key suppliers to reduce total costs. Spending a little more money on a pallet by increasing its strength and stiffness can potentially lead to significant cost savings in other areas
- Befriend your logistics team
The size, weight, and stackability of pallets and packaging have a direct impact on transportation costs. For loads that are only shipped one high, what would be the logistics cost impact for switching to a stackable crate or some other type of transport packaging? It is likely that the improvement in transportation costs would offset the increased packaging costs. Not to mention the other benefits that could be achieved through a reduction in product damage.
- Look to your customers
Many companies that receive products on pallets are faced with a disposal issue. It is becoming harder and harder to dispose of solid wood materials, so why not talk to your customers about pallet returns. Most wooden pallets are designed to survive multiple trips, and when properly maintained and repaired, wooden pallets can last for years. There are many companies that can assist in developing and managing pallet return programs. This could be a great way of not only improving the environment but also improving the bottom line!
Want more information? Leave your questions or concerns below and I will help you solve your pallet cost issues.
Post by: Rich Reiher, Vice President