How and Why Companies Should Palletize?

Stacked Pallets

There is much more to a pallet than just being a workhorse. Pallets are not given a lot of consideration they are often looked upon as just a necessity and their full potential is not quite realized. Most warehouses take their pallets for granted but do not consider exactly how much palletizing can really help with supply chain cost reduction as well as a more effective shipping program.

Pallets have a long history in the shipping industry. They are one of the easiest to use shipping mediums because they can easily be lifted by pallet jacks or forklifts. They can hold a great deal of weight, are easily stacked and just meet the unique needs of so many businesses.

Pallets are the bridge that keeps manufacturers retailers and distributors all connected. Most organizations outside of their shipping and warehousing divisions do not consider how important these powerful tools are too their organization.

Pallets have been called the single most important tool in the global economy. They are said to number in the billions and while they are merely a cog in the wheel of global commerce they are a very important cog.

How Widely Used Are Pallets?

It is estimated that pallets account for about 36% of the worldwide use of lumber! About 80% of all commerce globally is carried in and out on pallets. They are used in just about every industry on the planet in at least one part of the supply chain. There is a complete science to optimizing the use of pallets.

Ikea actually redesigned one of their best-selling mugs so that they could fit more on a pallet. The redesign of the mug to fit more effectively on a pallet resulted in a 60% reduction in shipping costs.

Palletizing is Time Savings

Overall wood pallets are the industry standard across a wide range of industries for the movement of goods. Palletizing saves time. Saving time saves money. The less time your warehouse crew has to spend moving things around the less money you have to spend on labor costs.

Pallets allow oversized items, heavy items and stacks of lighter items to be moved effortlessly with a fork lift or a pallet jack, one person can do the job of three to four people in less time.

Pallets offer enclosure options like shrink wrap and pallet collars to ensure that the contents is safe and secure and resists spilling. Of course saving time on movement is essential but so is saving time in the loading and the unloading at the distribution point.

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Unloading a floor loaded container can take two lumpers 4-8 hours to unload while if the contents were palletized the unloading would take one person about 30 minute to unload. That is not only a huge times savings but it is also a huge manpower savings.

Palletizing is Uniform

Using pallets for movement and storage is a uniform measure that makes the movement of goods for distribution between different points easier for all the parties involved. Most pallets sizes are standardized with only a few options to consider. Most industries use similar sizes and frames so it is easy to trade goods between locations with few issues to contend with when it comes to loading, unloading and storing.

Using pallets in any industry makes it easier to distribute products across the supply chain from growers to end clients pallets are a handy tool in the supply chain.

Palletizing Saves Space

Pallets are space saving. They can easily stack or be contained in a pallet rack until they are needed. Many retail locations will ship pallets back if requested so that the pallets can be used over and over. Many retail locations will use the pallets to display items.

Pallets save space in the warehouse as well. The can easily be stacked on top of each other with goods in place (as long as the products allow for stacking) so that vertical warehouse space can be utilized and less of a footprint is required for storage.

Palletizing goods ensures more space saving opportunities. You can load more goods on to a pallet and optimize space saving techniques to get the most out of your warehouse space. Of course space saving pallets also can help you to save a great deal on your shipping costs. Being able to more effectively stack your products means that you can ship more efficiently.

Natural, Recyclable Material

Pallets offer a natural recyclable solution for all your logistic needs. Pallets have a long lifecycle and can be reused many times before they reach the end of their lifecycle and even after they have outlived their usefulness for logistics uses they can be recycled for other uses.

They have a high return rate for resell purposes. Pallets are a sustainable option for any logistics needs. They are economical options that offer a great return on your small investment.

Now you know the why’s let’s take a look at the how’s.

The First Step

The first step in palletizing any organization is to make the choice of utilizing a one way pallet system or a pooled pallet system.  Pooled pallets are rented from a pallet company that provides the pallets and retrieves them when you are done with them. The alternative is a “one-way” pallet, a one way pallet is a disposable item that is scrapped, recycled or reused when it reaches its destination. Pooled pallets are identifiable by their colors. Each pooled pallet company has their own unique color.

Once an organization has made the decision as to whether they will opt for a pooled pallet system or a one way system the next step is making the decision as to what type of pallet to choose.

Sizes

Pallets for the most part are standardized based on the country that they originate from. In the United States, standard pallets measure 48 inches by 40 inches (this is the standard size of the Grocery Manufacturer Association’s pallet, which accounts for about 30% of new pallets in the US each year). European countries use a standard of 1000 millimeters by 1200 millimeters. Japan and much of Asia use the 1100 by 1100 millimeters as the standard. The ISO (the International Organization for Standardization) recognizes six pallet standard sizes.

Packaging is usually set to 400 millimeter by 600 millimeter footprint—the ideal size for metric pallets. There are a couple of things you should consider when you are choosing a pallet size.

  • Where will you ship to?
  • How will you load your pallets? (which equipment will you use?)
  • What storage and retrieval systems does your customers use?

Understanding what the demand will be for your products and how your customers will be moving your product once it arrives will dictate to you what size and type of pallets are best for your organization.

Some industries will dictate your pallet choice in other industries pallet choices can be based on the end products. Pharmaceutical, electronics, food and beverage, industries have very specific shipping regulations. In those industries, organizations often elect to operate closed-loop pallet distribution, sharing the pallets.

In some industries that end users equipment will determine the best pallet choice for your organization. Other decisions include the type of pallet. Block pallets are a bit more expensive but they are typically four way pallets that are compatible with more loading and unloading equipment.

The wrong choice of pallets can not only cause you issues in your supply chain but can also cause backups at the end users warehouse and ultimately end in lost business for you when the end user cannot manage to load or unload the pallets you likely will not get a lot of return business from them.

Making the right choice for your business can easily increase productivity and delivery results. Choosing the right pallets can cut down on shipping costs, storage space and manpower hours. You can get help making the right choice from any logistics expert.

Overall

Pallets may not get the credit that they are due but any good supply chain uses these valuable tools to meet all the logistic needs across industries. A strong supply chain is built on the bases of strong reliable pallets.

They are the universal tool for storage, shipping and even displaying goods across a wide range of industries. While wood pallets are the traditional pallets, plastics are quickly drawing more attention because they are durable and less breakable however wood pallets are still very much the choice in most industries.

The benefits of using pallets are tremendous to any supply chain. They offer a great range of support to any supply chain and they are an affordable option. Pallets have modernized the way shipping was done and have been a tried and true option since the 1940’s. They revolutionized the way we do business around the world.

Pallets are largely credited with being one of the most important logistic inventions. Do you have your pallets?