Pallet partnership cuts headaches for national manufacturer

This article was published in Modern’s 2011 Casebook.

Managing pallets is a difficult chore for any company, especially one with 11 manufacturing plants across the country. For a leading container manufacturer, outsourcing its pallet recovery and repair operations (Millwood, 330-393-4400, http://www.millwoodinc.com) produced substantial savings and significantly improved customer relations.

Prior to outsourcing the operations, the manufacturer handled the receipt, sortation, repair and re-distribution of more than one million pallets per year with its own personnel. When one of the manufacturer’s plants needed a load of pallets, personnel would check pallet reserves before ordering new pallets. However, since the plants only took a physical inventory once a month, the information was often out of date and inaccurate, leading to billing disputes and unnecessary purchases.

A key feature of the pallet management program is an on-line portal that tracks the status and location of pallets. The information in the system is updated daily, or whenever pallets are repaired or shipped out, giving the manufacturer a much more accurate view of its inventory. In addition, the pallet management company handles all of the pallet repair operations at the manufacturer’s plant locations.

The manufacturer now has visibility into its pallet inventory across its network on a daily basis. The availability of timely data has reduced billing disputes and unnecessary purchases.