Pallets move Modern’s readers

Love them or hate them – and most pallet users have mixed emotions – there’s a reason billions of pallets are floating around the supply chain: When it comes to getting a product from point A to point B, a pallet is probably involved. Build a better mousetrap and the world will probably shrug its shoulders; build a better pallet and we guarantee that manufacturers will beat a path to your door.

It’s been eight years since Modern’s last pallet survey. Since then, used pallets and pallet recycling programs have surged in popularity; there has been an expansion of pallet rental and pooling programs from providers like Peco and CHEP; and iGPS entered the market with the first rental pool of plastic pallets.

So, we decided to revisit the subject to see what the pallet landscape looks like today. To find out, we surveyed subscribers of Modern as well as some of our e-newsletter recipients. The full story will be published in the September issue of Modern and on mmh.com. For now, here’s a preview of what moves our readers when it comes to pallets.

Pallet usage has remained steady: Despite a tough economy, 37% of readers say their usage has not changed and 39% say it has increased. Only 24% said their pallet usage went down.

Double duty pallets: Pallets used to be a once and done item; once they left a facility, most manufacturers were done with them. Today, Modern’s readers are also getting double and triple duty from their pallets. Most readers (83%) are using their pallets for warehousing and shipping. Look deeper, and we found that more than half of our readers are shipping pallets between facilities (55%), as part of a closed loop between trading partners (23%), and for export purposes (38%). Those multiple uses explain why readers said they are using pallets an average of 7.5 times each. Only 29% said they get just one use out of a pallet.

Wood, plastic, metal or something else?: Paper or plastic may be the question at the checkout line. When it comes to pallets, there are two questions: Are your pallets still made from wood or another material, and are you using new pallets or used pallets? Wood still dominates, accounting for 84% of the pallets being used; plastic pallets account for just 8% of the number of pallets being used, and metal makes up just 2% of the volume. While alternative pallets are still niche products, 33% of our readers are using some plastic pallets, 15% are using some type of wood composite pallet, and 10% are using some corrugated/cardboard pallets for some applications. For more on alternatives, read our Pallet 101 story.

New or used: While wood still predominates, more users are turning to used pallets. In our survey, only 30% of our readers said they only purchase new pallets; 49% said they purchase both new and used, and 21% said they only purchase used pallets. Expect the trend toward used pallets to continue: 80% of respondents said they are using the same number or more used pallets than two years ago, and 84% expect to use the same or more used pallets in the next two years.

Get into the pool: Pallet pooling—renting a pallet on a per trip basis rather than owning a pallet—is still a niche, but one with room to grow: Only 33% of our readers said they were currently participating in some kind of pallet pool, and of those, only 34% of those were renting their pallets from one of the pallet pool providers. Still, nearly 60% of the respondents said they would consider participating in a pallet retrieval or third party pallet rental system in the future. The biggest driver: Large customers, especially big box retailers, are demanding it. As one reader explained, “Because of requests from our big box customers, we will continue to use more pooled pallets than we do today. And, I expect wooden pooled pallet usage to be replaced more and more with pooled plastic pallets.”

Look for the rest of Modern’s pallet survey in the September issue or on mmh.com.

Want to learn more about pallets? Join pallet experts as they put context behind the findings of Modern’s 2010 Pallet Usage and Trending Study Webcast on October 28, 2010 at 2 pm ET.