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

Paying an arm and a leg for pallet freight these days? What if you could get 3 truckloads of rackable pallets delivered for the price of one traditional load?

Make the Most of your Freight and Floor Space

Traditional rackable pallets only fit about 500 per 53' truck. The same 500 pallets take up valuable space on your warehouse floor as they only stack 17-18 pallets high. The new RackNest plastic pallet fits 1,800 per truckload and 60 pallets per stack.

• ​Save BIG $$$ on freight
  Say you're paying $1,000 freight for a load of traditional rackable pallets and you can only fit 500 per truck. That's $2.00 freight per pallet. Now consider the RackNest... $1,000 freight / 1,800 per truck = $0.55 per pallet. It would cost you $3,600 to get 1,800 traditional rackable pallets delivered. You just saved $2,600 in freight!
     
• Fit 3 times as many pallets on the floor
  Instead of having 30 stacks, 16-17 pallets high, with the RackNest you will have 30 stacks, 60 pallets high. That's around 1,300 more pallets in the same space!
    
• Order less often and always be ready for a spike in production
  We all wish we could have multiple truckloads of rackable pallets on hand just in case production picks up unexpectedly. With the RackNest, when you order one load you'll get 3X more than you currently get. That's plenty for normal usage as well as any surge that may come down the line.

No one likes getting caught in a jam. If you're wondering if you can just wait out rising freight rates and increasing lead times, check out this article on a nationwide shortage of trucks from the Wall Street Journal.
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​In previous discussions about pallets, I touched on the nature of the load that a pallet might be expected to handle. If you are a pallet geek like me, the term “unit load” is often used to describe the goods that are configured in such a way as to be easily handled by that pallet.

​So, I guess the unit load is and has always been associated with pallets, right? Well, not exactly. Although we can trace the use of pallets all the way back to ancient times, the common use of pallets to handle the unit load did not get going until World War II.

​Why is my 2x4 lumber not 2 inches by 4 inches?

Many decades ago, lumber purchased from a sawmill physically matched the common dimensions we use today. So why does that pine or spruce 2x4 from your local lumber yard now come up short? The short answer is modern surfacing and shrinkage.

Over time we've come to accept these nominal (approximate) dimensions as standard. But there's still a catch. Shrinkage can be highly variable. This makes it very difficult to manage and regulate dimensional accuracy.

Rules for Calculating Dimensions

​So now you know that 1x3, 2x4 are 4x8 are really just names or nominal dimensions. But... it gets even more complicated. Dimensions change based on the width or the thickness. Here are the general "rules" for calculating softwood dimensions:
 
Nominal vs Actual Dimension Rules

​Dimensional Lumber

Softwoods (pine, spruce, fir, etc.) are generally known as framing or dimensional lumber. This wood is commonly used for framing walls and floors in our homes and regularly used for building wooded crates and pallets. Since no one likes unexpected dimensional errors, the handy chart below outlines the changes in dimensions you can expect:
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Dimensional vs Actual Lumber Chart for Dried Softwoods

Regulating Lumber Dimensions

​The US Department of Commerce standardized softwood dimensions for green and finished lumber back in 1969.

Today, regulating dimensional accuracy in the US falls under the responsibility of the National Institute of Standards and Technology (NIST). The current standards are published by the government in a document titled the American Softwood Lumber Standard (PS 20). The latest version is labeled the Voluntary Product Standard PS 20-15.

Why is regulation so difficult?

State and local inspectors spot check lumber dimensions at mills and retail locations but determining if softwood boards are within limits is complicated. Here's why:​
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1. Shrinkage
   Green lumber has higher moisture content. As the wood dries (either in an oven or air dried) the dimensions reduce. Depending on wood species - and specifically wood grain direction - shrinkage can range from 2% to 15%. This equals anywhere from 0.012” to 0.6" for a 4 inch board.
    
2. Surfacing
   Boards with smooth sides are said to have a dressed surfaced. The process of smoothing out board surfaces further reduces the original width or thickness. Dimensional lumber is commonly labeled S4S. The designation stands for "surfaced 4 sides".
     
3. Inconsistent Testing
   Inspectors do not have nationally agreed-upon testing procedures. Everything from an individual inspector's sampling protocol to the device used for measuring can muddy the results. That's about to change.

 
If you're wondering about hardwoods, thickness measurements are slightly different, but most hardwood widths follow the softwood standard. As an example, a 6 inch hardwood board is actually 5.5".


New Testing Procedures Under Review

The Office of Weights and Measures (OWM) at the NIST has been working with the American Lumber Standards Committee (ALSC) since 2016 to develop new testing procedures for dimensional accuracy. The next big step in moving the new procedures forward is expected by summer 2018 when the proposal goes to a vote.

Have you ever wondered about about the impact of lumber's dimensional accuracy on wooden pallets and crates? Have your own wrong-size lumber story? Talk to me in the comments below.

Post by: Kent Longardner, Technical Sales Manager

Will a return program transform your expendable packaging expenses into reusable packaging assets?

Start by asking yourself four key questions about your packaging usage and distribution system.

4 Questions to Ask about Reverse Distribution

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:
  

1. 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.
      
2. 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.
     
3. 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.
     
4. 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

Plastic lumber offers captive pallets a new future.

Captive pallets are designed to save money by being reusable. Plastic lumber is repairable and durable. Plus, it can be custom made to fit your specific requirements. Sounds pretty good so far. But will it work for you?

Below we explore the benefits and drawbacks to plastic lumber pallets.

Comparison to Traditional Wooden and Plastic Pallets

Captive pallets are pallets designed to last in a warehouse environment for repetitive use. Both traditional wooden pallets and plastic pallets are used in these applications.

• Heavy duty plastic pallets have become popular as a captive pallet in many industries. Unfortunately, they do not fit the needs of all customers because custom sizes and designs can be cost prohibitive.
    
• Wooden pallets are less expensive to produce and can be repaired when minor damage has occurred. Even though wood is often used for captive pallets, they can be easily damaged, require mold prevention treatment and can’t be easily sanitized.

Is Plastic Lumber Right for You?

The biggest advantage of a plastic lumber captive pallet is custom design. Custom designs are often worth looking at because they can uncover hidden savings.

A design team is critical to the this process. In addition to drafting a new design, the team reviews all supply chain systems to make sure the pallet will work with all material handling equipment. Utilizing a service such as the Nelson Tech Center provides expertise for reducing total cost of ownership and improved sustainability.

Here are some pros and cons to consider:

Benefits of Plastic Lumber Board

• Durable
• No moisture problems (reduces mold and decay)
• Cleanliness
• Can be nailed using the same equipment as wood pallets

Drawbacks of Plastic Lumber Board

• Higher initial cost
• Boards must be nailed or screwed together using metal fasteners
• Weight (plastic lumber can be heavier than most wood species)

    
Captive pallets have undergone many changes in the last 50 years - especially with the introduction of plastic pallets. While plastic pallets do not fit every need, the introduction of plastic lumber provides a new option for a custom-sized captive pallet.  

In what ways could a captive pallet made from plastic lumber work for you? Share your thoughts in the comments below.

Post by: Jonathan Haynes, Regional Sales Manager

​What makes a pallet rackable? Well, we've been spending some time on that question including getting into pallet structure, material stiffness and the seven racking systems we most commonly find in industry. 

Part of the discussion included assigned load ratings. In most cases, rackability ratings assume the pallet can safely bridge a span between supporting structures. The ability to dependably and securely bridge that span is what makes a pallet rackable.

Nature of the Load

A common standard for rackability is 2200 pounds or about one metric ton. But what about that ton? Is a ton of feathers the same as a ton of lead? Well, we know they both weigh the same but their nature is very different. And it is the nature of the load that also needs to be considered when determining the suitability of any pallet for its intended use.

A Stiff Load can Increase Functional Racking

If we were to make a stack of 40x48 sheets of 3/4 inch plywood on a pallet, it might end up being very heavy. Think about the last time you got an unassembled piece of furniture from IKEA. Holy smokes that stuff can be heavy! But, because our stack is stiff and spreads the load over the entire surface of our pallet, the load actually helps impart stiffness to the pallet. So even though it is very heavy, this type of load increases the functional racking load rather than challenging it!

By contrast, if the load is not in of itself stiff, it can cause a problem. Yep, even if we evenly spread the load across the surface of a pallet. Now what? Well, unitizing a load with stretch wrap can take a challenging load and make it less so. The stretch wrap makes the load stiffer, more like our stack of plywood. But, no matter what, our stack of plywood will always be stiffer than say, small bottles shrink wrapped in bundles and stacked on a pallet.

Challenging Loads

In addition to our example of stacked bottles in stretch wrap, here are some of the more common challenging loads for rackable pallets:

• 5 gallon pails
• Steel or poly drums
• Bulk bags
• Smaller bags of seeds or beans
• Any single heavy item placed in the center of the pallet
  see my story below on this one...

Story time... I was once shown a 3,500 lb lift truck counterweight and asked to propose a pallet to handle it. I had a GREAT solution. Of course, the picture in my mind is the weight laying flat on its back and spread out over the surface of the pallet. I sent over a sample pallet and was mortified when I got an email showing the pallet in total failure! What happened? The counterweight was placed upside down with only three 4x4" points of contact on the pallet. Heaven knows what the PSI must have been on those three points, but I can tell you the highly-rated pallet folded like a cheap camera!

Getting it Right the First Time

To recap, the nature of the load must be considered when determining the suitability of a pallet for any given application - especially if it is said to be "rackable".

Load rating will generally assume the loads will be:

1. Unitized
2. Distributed evenly over the surface of the pallet

But even then you need to ask yourself the right questions. For example, will we be moving a ton of feathers or a ton of lead? The answers will help you get it right the first time.

If you want help with your load questions, ask a pallet professional or please post them below. And watch for my next post on the history of the unit load and how we got here in the first place.

Post by: Hartson Poland, Business Development - Plastic
Use of metal racking photo used with permission from our friends at Warehouse Rack & Shelf, LLC.
Use of  Forklifts in Warehouse photo by Mdornseif licensed under the Creative Commons Attribution 3.0 Unported license.

​So what does the cost of my wooden pallets and packaging have to do with an improved economy and greater new housing starts? 

The wood packaging industry depends on many of the same lumber producers that supply the housing industry. Lumber prices (especially softwood dimensional lumber) go up with increased housing demand. Those higher prices trickle down to the housing industry's by-product lumber that we use for building pallets and wood packaging.

Signs of an Improving Economy
The US economy continues to improve, albeit at a very slow pace.

• Unemployment is down and consumer confidence is on the rise.
• New home starts are up 7% from 2016 and are predicted to be between 1.2 to 1.3 million for 2017.
• US lumber consumption is up and expected to be almost 50 Billion BDFT in 2017 and 52 Billion BDFT in 2018.

Speculation Driving Lumber Costs
The US is the world's largest consumer of wood products and the second largest producer. We depend heavily on Canada to make up the difference. The US and Canada need to finalize a lumber trade agreement amid the rise in lumber costs. Canadian imports could be subject to a 25% tax starting in mid-2017. Speculators are driving up wood prices in the US in anticipation of this looming tax.

Preparing for Increased Wood Prices
Growth and a strong economy are good for businesses and consumers, right? Yes and no. More jobs create a higher demand for housing and greater production creates more demand for wood packaging. Both of which equate to higher wood prices.

​As the cost of lumber continues to rise, how can you prepare your business for increased packaging costs? Is it time to redesign your wood packaging or start that return program you've thought about many times? Or... maybe it is time to consider an alternative material.

If you are concerned about the future of wood prices, now is the time to start asking questions about ways to save money. Drop me a line or ask your question in the comments below.

Post by: Rich Reiher, Vice President

www.nelsoncompany.com/containers.cfm?Group=CollapsibleAre empty containers taking up too much room in your warehouse?

When not in use, collapsible plastic containers fold to a fraction of their size and can drastically increase your available warehouse space.

How do they Work?

Easy. Look for the different colored handles.

• Lower and Raise the Drop Gate
  When you pull the inside two yellow handles toward each other, a drop gate folds down. This drop gate articulates to the outside of the container. To close a drop gate, simply lift it up and snap it back into place.
    
• Collapse the Container
  The gray handles located on two opposing sides of the container do the job here. Starting on one side, simply pull the two gray handles towards each other and the wall will collapse in. Do the same on the opposite side. The two remaining walls can then be folded inwards. That's it!
    
• Unfold and Use Again
  To unfold the box, reach in and pull up the first side wall. It will snap in place. Do the same with the opposite wall. Then, reach in and pull the next one into place and finally the fourth wall. Voila! Your container is ready to handle 2000 lbs.​

Collapses to About a Foot

A standard 48x45x34" plastic container like the ones shown here will collapse down to less than 13". As you can see, collapsible plastic containers are a snap to use and store.


What will you do with all that extra space? Tell me in the comments below.

Post by: Penny Peirce, Sales Representative

Your pallets look clean, your production facility is exemplary, yet once you put your product on the pallet and stretch wrap the unit load, mold starts to appear!

​What's to blame and how can I avoid this from happening?

The Hunt for Mold

Don't feel bad, people in production facilities all over the world find themselves asking the same questions throughout the year. To find the answer, we'll address 4 variables for the unit load pictured above.
  

1. The wood pallets appear to be clean but...
   As you know, wood comes from a living thing.  Even if it is treated and appears to be free of dirt and mold, every wooden pallet still has some degree of bacteria and moisture present.
     
2. What does my product have to do with mold...
   Does your product come off the line warm? If so, it may be using that heat to draw out moisture from the pallet. So, what if the warm bags are on a slip sheet or a piece or corrugate and they aren’t even touching the pallet? See the next point...
     
3. Wood Pallet + Warm Product + Stretch Wrap = Mold Incubator
   That's right. Warm product combined with a wood pallet that's been sealed tight with stretch wrap can trap the warmth and promote mold growth. Obviously, this can be exacerbated by high summer temperatures (variable #4) which was the case in the picture above.

Well there you have it. It's not one thing causing the mold but instead, it's a combination of 3 or 4 things.

What Happens Now?

In some situations, it may be possible to save your moldy wood pallets. Other times conditions simply don't make for a fair fight. In this particular case (pictured), the facility immediately opted to switch over to plastic pallets to avoid sending mold-damaged product to customers.

Have you experienced similar mold issues on pallets? Tell us what did you do to fix the problem or ask for expert advice in the comments below.
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Post by: Mike Cunneen, Director of Sales & Marketing