An arcane technical bulletin on sprinkler systems ignited a firestorm among pallet users before being withdrawn this spring. But the controversy continues to smolder.
Susan Lacefield has been working for supply chain publications since 1999. Before joining DC VELOCITY, she was an associate editor for Supply Chain Management Review and wrote for Logistics Management magazine. She holds a master's degree in English.
It's not every day that an arcane technical bulletin sets off a storm of controversy, rumors, and finger pointing. But when the National Association of State Fire Marshals (NASFM) issued a draft code application bulletin (CAB) in September 2008, it caused just such a flare-up in the pallet community.
The source of the controversy was the humble wood composite pallet—or to be precise, the question of whether it could legitimately be classified as a wood—as opposed to plastic—pallet for purposes of fire code enforcement. That may sound like a semantic distinction, but it has big implications for DCs that use these pallets. A change in classification to plastic (wood composite units contain a plastic resin) would raise the units' fire rating, meaning they'd require higher-capacity (read: costlier) sprinkler systems to protect them.
Fears that they might be forced to retrofit their facilities with expensive new sprinklers sparked an outcry from several large shippers and groups like the National Wooden Pallet and Container Association (NWPCA). At a meeting in May, the NASFM attempted to quell those fears, offering public assurances that it had no intention of pushing for new rules or enforcement practices. Although the hubbub eventually died down, the incident pointed up how much confusion remains when it comes to pallets and fire safety.
The spark
The publication that sparked the incident was not a law or even a fire code, but rather a guide for fire inspectors. Titled "Pallet Fire Loading Impact on Sprinkler Design," the bulletin was written to address issues relating to compliance with section 13 of the National Fire Protection Association (NFPA) standard, which lays out requirements for installing automatic sprinkler systems.
Designing a sprinkler system to the NFPA standard is a complex calculus that involves many variables: floor area, the type of commodity stored, and the type of pallet the product is stored on, to name a few. But that last variable is sometimes overlooked, according to the NASFM. "When automatic fire sprinkler systems are designed pursuant to NFPA 13, the type of pallet intended to be used is a factor that is considered," says Jim Narva, chief project manager for the NASFM. "Changing the type of pallet that is used can have unintended consequences that affect the fire protection and the capability of the system."
What caused all the uproar was a section in the NASFM bulletin that pointed out that the "wood pallets" referred to in the NFPA standard are different from the wood composite units used widely today. The NFPA defines wood pallets as pallets made of pure wood with metal fasteners. Wood composite pallets, by contrast, are formed of sawdust held together with adhesives made out of a plastic resin called formaldehyde urea, the NASFM noted in the bulletin. That comment raised concerns that the NASFM considered composite pallets to be a variety of plastic pallet, and led to worries that wood composite pallets might be regulated as plastic pallets at some point down the road.
Narva insists that the association had no such intentions. "NASFM has been misrepresented as in some way proposing changes to the existing codes and standards or re-interpreting them; that is not what we are doing and that has never been our intent," he says.
In the end, the NASFM withdrew the CAB from its Web site. It also formed a committee to help rewrite the CAB to reflect only what's in the existing fire codes.
What does this mean for pallet users? For practical purposes, nothing. No company is going to have to upgrade its sprinkler systems, nor is anyone suggesting that they might be required to do so in the near future. However, the controversy does highlight the need to understand—at least on a basic level—the implications of the type of pallet you use for the safety of your facilities, your employees, and the surrounding community.
Total meltdown?
As for why fire codes treat plastic pallets differently from wood, it's all in the way the material burns. Although plastic may take longer to ignite than wood, plastic products (if they aren't treated with a flame retardant) burn hotter and faster than wood products do. And when heated, plastic tends to melt and run like lava.
"Plastic commodities typically produce higher-challenge fires and therefore require sprinklers that deliver more water," explains Jim Lake, senior fire protection specialist for the NFPA.
If a plastic pallet is treated with a fire retardant, however, it may be exempt from requirements for higher-capacity sprinklers. To receive that exemption, the pallet manufacturer must have its pallets certified by a testing laboratory, like Underwriters Laboratories (UL) or Factory Mutual (FM) Approvals.
The testing laboratory will subject the pallets to a 30minute burn test in a controlled environment. If the pallets are found to perform as well as or better than wood, they will receive an FM 4996 Approval or a UL 2335 Listing. For example, all of the pallets used by pallet pooling company iGPS have received a UL 2335 Listing, says Bob Moore, the company's CEO. "Our pallet just doesn't burn at all," he says. "It smokes a little bit." (That's not to say that fire-retardant plastic isn't without its own controversies. See sidebar, "another firestorm in the making?")
Name game
So why not simply declare the wood composite pallet to be a variety of plastic pallet, subject to the same requirements as plastic units? For one thing, calling wood composite plastic is stretching things a bit. According to pallet pooler CHEP, there's actually very little plastic in wood composite-block pallets; they are 95 percent wood.
Furthermore, not all plastics are the same. The plastic in the adhesives used in the wood composite blocks is known as a thermoset. "A thermoset doesn't flow like lava; instead, it chars up on the outside," says David Deal, director of product services and industry affairs for CHEP. This means that wood composite blocks react to fire the same way pure blocks of wood do, he says. To confirm this assertion, the NASFM is reviewing the latest evidence as part of the process of revising the CAB.
Then why not just revise the standard to state that wood composite pallets should be considered to be wood pallets? Lake says an NFPA technical committee did review a proposal to change the definition of wood pallets in NFPA 13 during a previous revision cycle but decided it was unwarranted at the time. He adds, however, that the technical committee would be willing to revisit the issue if the NASFM's research shows a compelling reason to do so.
Several pallet suppliers say the confusion surrounding fire performance could be eliminated if all pallets were simply required to undergo a burn test and certification process. "There should be a 'meets and exceeds' standard," says Steve Letnich, vice president of sales and marketing of steel pallet manufacturer Worthington Steelpac. But others disagree, contending that testing would be unnecessary as well as burdensome and expensive.
In the absence of such standards, what should conscientious DC managers do? Since different states have different fire codes and regulations, it's best to work closely with local officials to make sure you stay on the right side of the law.
"Basically, the best thing they can do is go to their local fire marshal and ask questions before they build a building, before they talk about what they're going to put in a building," says Letnich, "so they know exactly what type of sprinkler system they're going to require."
another firestorm in the making?
Just as one controversy is being put to rest, another is flaring up. The focus this time, however, isn't wood pallets but plastic ones that use the fire retardant deca-bromine.
Some brominated flame retardants have been linked to health risks like nerve damage and thyroid problems. In fact, fire retardants using pentabromine and octa-bromine have been pulled from the market because of their toxicity. Some researchers say that deca-bromine breaks down into these more toxic forms and that the chemical then leaches into the environment. These concerns have led several states to restrict the use of deca-bromine.
Plastic pallet pooler iGPS, however, disagrees with that assertion, countering that deca-bromine is encapsulated in the resin and that it does not off-gas. The company says that the European Commission's environmental protection authorities evaluated more than 1,000 scientific studies and concluded that there was no need for risk reduction measures related to the use of deca-bromine.
The debate continues. In the meantime, plastic pallet users would be wise to keep an eye on the issue and discuss potential repercussions and alternatives with their pallet companies.
Logistics real estate developer Prologis today named a new chief executive, saying the company’s current president, Dan Letter, will succeed CEO and co-founder Hamid Moghadam when he steps down in about a year.
After retiring on January 1, 2026, Moghadam will continue as San Francisco-based Prologis’ executive chairman, providing strategic guidance. According to the company, Moghadam co-founded Prologis’ predecessor, AMB Property Corporation, in 1983. Under his leadership, the company grew from a startup to a global leader, with a successful IPO in 1997 and its merger with ProLogis in 2011.
Letter has been with Prologis since 2004, and before being president served as global head of capital deployment, where he had responsibility for the company’s Investment Committee, deployment pipeline management, and multi-market portfolio acquisitions and dispositions.
Irving F. “Bud” Lyons, lead independent director for Prologis’ Board of Directors, said: “We are deeply grateful for Hamid’s transformative leadership. Hamid’s 40-plus-year tenure—starting as an entrepreneurial co-founder and evolving into the CEO of a major public company—is a rare achievement in today’s corporate world. We are confident that Dan is the right leader to guide Prologis in its next chapter, and this transition underscores the strength and continuity of our leadership team.”
The New York-based industrial artificial intelligence (AI) provider Augury has raised $75 million for its process optimization tools for manufacturers, in a deal that values the company at more than $1 billion, the firm said today.
According to Augury, its goal is deliver a new generation of AI solutions that provide the accuracy and reliability manufacturers need to make AI a trusted partner in every phase of the manufacturing process.
The “series F” venture capital round was led by Lightrock, with participation from several of Augury’s existing investors; Insight Partners, Eclipse, and Qumra Capital as well as Schneider Electric Ventures and Qualcomm Ventures. In addition to securing the new funding, Augury also said it has added Elan Greenberg as Chief Operating Officer.
“Augury is at the forefront of digitalizing equipment maintenance with AI-driven solutions that enhance cost efficiency, sustainability performance, and energy savings,” Ashish (Ash) Puri, Partner at Lightrock, said in a release. “Their predictive maintenance technology, boasting 99.9% failure detection accuracy and a 5-20x ROI when deployed at scale, significantly reduces downtime and energy consumption for its blue-chip clients globally, offering a compelling value proposition.”
The money supports the firm’s approach of "Hybrid Autonomous Mobile Robotics (Hybrid AMRs)," which integrate the intelligence of "Autonomous Mobile Robots (AMRs)" with the precision and structure of "Automated Guided Vehicles (AGVs)."
According to Anscer, it supports the acceleration to Industry 4.0 by ensuring that its autonomous solutions seamlessly integrate with customers’ existing infrastructures to help transform material handling and warehouse automation.
Leading the new U.S. office will be Mark Messina, who was named this week as Anscer’s Managing Director & CEO, Americas. He has been tasked with leading the firm’s expansion by bringing its automation solutions to industries such as manufacturing, logistics, retail, food & beverage, and third-party logistics (3PL).
Supply chains continue to deal with a growing volume of returns following the holiday peak season, and 2024 was no exception. Recent survey data from product information management technology company Akeneo showed that 65% of shoppers made holiday returns this year, with most reporting that their experience played a large role in their reason for doing so.
The survey—which included information from more than 1,000 U.S. consumers gathered in January—provides insight into the main reasons consumers return products, generational differences in return and online shopping behaviors, and the steadily growing influence that sustainability has on consumers.
Among the results, 62% of consumers said that having more accurate product information upfront would reduce their likelihood of making a return, and 59% said they had made a return specifically because the online product description was misleading or inaccurate.
And when it comes to making those returns, 65% of respondents said they would prefer to return in-store, if possible, followed by 22% who said they prefer to ship products back.
“This indicates that consumers are gravitating toward the most sustainable option by reducing additional shipping,” the survey authors said in a statement announcing the findings, adding that 68% of respondents said they are aware of the environmental impact of returns, and 39% said the environmental impact factors into their decision to make a return or exchange.
The authors also said that investing in the product experience and providing reliable product data can help brands reduce returns, increase loyalty, and provide the best customer experience possible alongside profitability.
When asked what products they return the most, 60% of respondents said clothing items. Sizing issues were the number one reason for those returns (58%) followed by conflicting or lack of customer reviews (35%). In addition, 34% cited misleading product images and 29% pointed to inaccurate product information online as reasons for returning items.
More than 60% of respondents said that having more reliable information would reduce the likelihood of making a return.
“Whether customers are shopping directly from a brand website or on the hundreds of e-commerce marketplaces available today [such as Amazon, Walmart, etc.] the product experience must remain consistent, complete and accurate to instill brand trust and loyalty,” the authors said.
When you get the chance to automate your distribution center, take it.
That's exactly what leaders at interior design house
Thibaut Design did when they relocated operations from two New Jersey distribution centers (DCs) into a single facility in Charlotte, North Carolina, in 2019. Moving to an "empty shell of a building," as Thibaut's Michael Fechter describes it, was the perfect time to switch from a manual picking system to an automated one—in this case, one that would be driven by voice-directed technology.
"We were 100% paper-based picking in New Jersey," Fechter, the company's vice president of distribution and technology, explained in a
case study published by Voxware last year. "We knew there was a need for automation, and when we moved to Charlotte, we wanted to implement that technology."
Fechter cites Voxware's promise of simple and easy integration, configuration, use, and training as some of the key reasons Thibaut's leaders chose the system. Since implementing the voice technology, the company has streamlined its fulfillment process and can onboard and cross-train warehouse employees in a fraction of the time it used to take back in New Jersey.
And the results speak for themselves.
"We've seen incredible gains [from a] productivity standpoint," Fechter reports. "A 50% increase from pre-implementation to today."
THE NEED FOR SPEED
Thibaut was founded in 1886 and is the oldest operating wallpaper company in the United States, according to Fechter. The company works with a global network of designers, shipping samples of wallpaper and fabrics around the world.
For the design house's warehouse associates, picking, packing, and shipping thousands of samples every day was a cumbersome, labor-intensive process—and one that was prone to inaccuracy. With its paper-based picking system, mispicks were common—Fechter cites a 2% to 5% mispick rate—which necessitated stationing an extra associate at each pack station to check that orders were accurate before they left the facility.
All that has changed since implementing Voxware's Voice Management Suite (VMS) at the Charlotte DC. The system automates the workflow and guides associates through the picking process via a headset, using voice commands. The hands-free, eyes-free solution allows workers to focus on locating and selecting the right item, with no paper-based lists to check or written instructions to follow.
Thibaut also uses the tech provider's analytics tool, VoxPilot, to monitor work progress, check orders, and keep track of incoming work—managers can see what orders are open, what's in process, and what's completed for the day, for example. And it uses VoxTempo, the system's natural language voice recognition (NLVR) solution, to streamline training. The intuitive app whittles training time down to minutes and gets associates up and working fast—and Thibaut hitting minimum productivity targets within hours, according to Fechter.
EXPECTED RESULTS REALIZED
Key benefits of the project include a reduction in mispicks—which have dropped to zero—and the elimination of those extra quality-control measures Thibaut needed in the New Jersey DCs.
"We've gotten to the point where we don't even measure mispicks today—because there are none," Fechter said in the case study. "Having an extra person at a pack station to [check] every order before we pack [it]—that's been eliminated. Not only is the pick right the first time, but [the order] also gets packed and shipped faster than ever before."
The system has increased inventory accuracy as well. According to Fechter, it's now "well over 99.9%."