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.
In the pallet world, wood has always been king, traditionally claiming about a 95-percent share of the overall market. And for good reason; there's a lot about the material to love. "It is cheap, strong, and safe," says Laszlo Horvath, director for the Center for Packaging and Unit Load Design at Virginia Tech.
But wood does have its disadvantages. For starters, there's the risk of splinters and protruding nails. And because wood pallets can harbor insects, pathogens, and mold, there's the issue of sanitation. Drawbacks like these have driven interest in "alternative" pallets made from materials such as plastic, paper, and metal. "For pretty much every disadvantage that wood has, there is a pallet out there that helps users [avoid] that problem," says Horvath.
So what's the best type of pallet to use? As is often the case, there's no one-size-fits-all answer—the choice will vary with the application. What follows is a look at the strengths and weaknesses of each type of material and the applications to which it is best suited.
PLASTIC: CLEAN BUT COSTLY
Next to wood, plastic is the most common material used for making pallets. Studies show that plastic accounts for 11 percent of the market demand, with 37 percent of pallet users employing at least some plastic units, according to Horvath. And interest in plastic is on the rise: In a 2013 report, the market research firm The Freedonia Group projected that demand for plastic pallets would grow at a double-digit pace through 2017.
Plastic pallets offer many advantages: They're impervious to pests and mold, they're free of splinters and nails, and they're easy to clean. Plus, they're lightweight. While wood pallets range in weight from 30 to 70 pounds, Horvath says, a plastic pallet can weigh as little as 10.
For these and other reasons, plastic pallets appeal to users across a broad range of industries, according to Curt Most of Orbis Corp., which manufactures plastic pallets. For example, food and pharmaceutical companies value them for their hygienic qualities, while many retailers prefer them for aesthetic reasons, particularly if they use pallets for store-floor displays. Companies that deal in high-end electronic goods often choose plastic because the pallets don't have any nails or protruding edges that can damage a product or its packaging, according to Most.
Plastic also has its downsides. Primary among them is cost. Plastic is typically more expensive than wood, especially if a company needs customized pallets (something other than the standard 48- by 40-inch footprint) that require unique molding and tooling, says Doug Gaier, director of regional sales for the pallet company Millwood. That makes them less than ideal for one-way shipments or applications where the pallet might get lost. In recent years, plastic pallet companies have responded to this concern by adding tracking devices and developing systems to help users keep tabs on their pallets. But the cost and the risk of "leakage" remain a deterrent for many companies.
Furthermore, although plastic is durable, it is not very "stiff," meaning the components of a plastic pallet will bend more than their wood counterparts will, says Horvath. This bending is sometimes known as "creep." And it's a bigger problem than it might seem, according to Horvath. "A lot of people say, 'Why do you care about the bending of the components if the pallet doesn't break?'" he says. The issue, he explains, is that if the components bend too much, it can result in the uneven distribution of stress on the top of the pallet. That, in turn, can compromise the integrity of the product—for example, causing bottles to leak or unit loads to become unstable.
A newer type of plastic pallet made from thermoset resins, as opposed to thermoplastic resins, may offer an answer to this problem. According to Fit Pallets, a maker of thermoset composite pallets, thermoset resins undergo a chemical change when they're molded, which strengthens the material and makes it less likely to bend or creep.
On top of that, thermoset pallets pose less of a fire risk than conventional thermoplastic pallets. Traditional thermoplastic pallets burn hotter and faster than wood ones and as a result, require a higher-capacity sprinkler system or a fire retardant. Thermoset plastic pallets, however, meet the UL 2335 classification for flammability (meaning they perform as well as or better than wood, and therefore don't require the costlier sprinklers) without the addition of fire retardants.
PAPER: LIGHT BUT SHORT-LIVED
In recent years, another type of pallet—the corrugated paper pallet—has started making inroads in the market, according to Horvath. The Swedish furniture retailer Ikea, for example, made a big splash in 2011 when it announced it was switching from wood pallets to paper. The Freedonia Group estimates that corrugated pallets represent 11 percent of all market demand.
The main selling point of corrugated pallets is their low weight (roughly 8 to 12 pounds), which makes them easy to handle and reduces shipping costs. Ikea's pallets, for example, are 90 percent lighter than their wooden predecessors. This makes them a good choice for airfreight shipments and containerized loads, says Horvath.
The pallets are also 100 percent recyclable and, unlike wood, do not require any sort of heat treatment to prevent pest infestation. As a result, they're well suited to export use.
Corrugated pallets, however, have a short lifespan, which means users shouldn't look to get multiple trips from them. They also cannot handle heavy loads. Nor do they stand up to moisture.
METAL: HEAVY GOING
Metal pallets are typically made from steel, aluminum, or some combination of the two. The market for metal pallets is still relatively small. According to Horvath, the material only represents 0.8 percent of the market demand and is being utilized by 7 percent of users. The Freedonia Group, however, expects that demand for metal pallets will grow at a faster rate than demand for pallets of any other material into 2017.
Both steel and aluminum pallets are strong, durable, and extremely easy to clean. Steel pallets, however, tend to be extremely heavy, often weighing over 50 pounds, according to Gaier. As a result, their use is largely restricted to specialized heavy-duty applications, says Horvath. For instance, the military uses steel pallets for shipping machinery and munitions.
Aluminum is lighter than steel, weighing on average less than 40 pounds for a standard 40- by 48-inch pallet, and offers a high strength-to-weight ratio, according to Peter Johnson, president of Eco Pact, a manufacturer of aluminum pallets. "Aluminum is also clean and sterile, and doesn't rust," he says. "Additionally, bacteria won't grow on it."
These qualities make the pallets well suited for industries such as pharmaceuticals, food, and industrial machinery, Johnson says.
Aluminum pallets can either be welded together or riveted, according to Johnson. Welded pallets are generally stronger but cannot be easily repaired. Eco Pact, however, makes riveted pallets with an interlocking design that improves the strength, according to the manufacturer.
While aluminum still commands only a small share of the market, Johnson says it's made headway over the last two years because of the material's cleanliness, safety (lack of nails, splinters, and protruding boards), and long lifespan. He expects demand for aluminum pallets to grow by 10 to 15 percent over the next five years.
A BIGGER PIECE OF THE PIE?
It seems unlikely that plastic, paper, or metal could topple wood from its perch at the top of the pallet market—a seat it has held for more than 70 years. "Even when you combine all of these other alternative pallet materials, you're still only talking about less than 5 percent of the pallet market," says Millwood's Gaier. "Wood is still the most sustainable, best dollar-value material for a pallet."
Yet by any measure, the pallet market is huge and growing. The Freedonia Group expects North American sales to hit 1.3 billion units by 2017, with a total value of $16.9 billion. And a bigger market means more room for lots of different types of pallets. As makers of alternative pallets proliferate and innovate, it seems likely they'll be able to carve out a profitable niche for themselves. And companies that have not looked at their pallet choices recently may find it advantageous to re-examine their options.
A move by federal regulators to reinforce requirements for broker transparency in freight transactions is stirring debate among transportation groups, after the Federal Motor Carrier Safety Administration (FMCSA) published a “notice of proposed rulemaking” this week.
According to FMCSA, its draft rule would strive to make broker transparency more common, requiring greater sharing of the material information necessary for transportation industry parties to make informed business decisions and to support the efficient resolution of disputes.
The proposed rule titled “Transparency in Property Broker Transactions” would address what FMCSA calls the lack of access to information among shippers and motor carriers that can impact the fairness and efficiency of the transportation system, and would reframe broker transparency as a regulatory duty imposed on brokers, with the goal of deterring non-compliance. Specifically, the move would require brokers to keep electronic records, and require brokers to provide transaction records to motor carriers and shippers upon request and within 48 hours of that request.
Under federal regulatory processes, public comments on the move are due by January 21, 2025. However, transportation groups are not waiting on the sidelines to voice their opinions.
According to the Transportation Intermediaries Association (TIA), an industry group representing the third-party logistics (3PL) industry, the potential rule is “misguided overreach” that fails to address the more pressing issue of freight fraud. In TIA’s view, broker transparency regulation is “obsolete and un-American,” and has no place in today’s “highly transparent” marketplace. “This proposal represents a misguided focus on outdated and unnecessary regulations rather than tackling issues that genuinely threaten the safety and efficiency of our nation’s supply chains,” TIA said.
But trucker trade group the Owner-Operator Independent Drivers Association (OOIDA) welcomed the proposed rule, which it said would ensure that brokers finally play by the rules. “We appreciate that FMCSA incorporated input from our petition, including a requirement to make records available electronically and emphasizing that brokers have a duty to comply with regulations. As FMCSA noted, broker transparency is necessary for a fair, efficient transportation system, and is especially important to help carriers defend themselves against alleged claims on a shipment,” OOIDA President Todd Spencer said in a statement.
Additional pushback came from the Small Business in Transportation Coalition (SBTC), a network of transportation professionals in small business, which said the potential rule didn’t go far enough. “This is too little too late and is disappointing. It preserves the status quo, which caters to Big Broker & TIA. There is no question now that FMCSA has been captured by Big Broker. Truckers and carriers must now come out in droves and file comments in full force against this starting tomorrow,” SBTC executive director James Lamb said in a LinkedIn post.
The “series B” funding round was financed by an unnamed “strategic customer” as well as Teradyne Robotics Ventures, Toyota Ventures, Ranpak, Third Kind Venture Capital, One Madison Group, Hyperplane, Catapult Ventures, and others.
The fresh backing comes as Massachusetts-based Pickle reported a spate of third quarter orders, saying that six customers placed orders for over 30 production robots to deploy in the first half of 2025. The new orders include pilot conversions, existing customer expansions, and new customer adoption.
“Pickle is hitting its strides delivering innovation, development, commercial traction, and customer satisfaction. The company is building groundbreaking technology while executing on essential recurring parts of a successful business like field service and manufacturing management,” Omar Asali, Pickle board member and CEO of investor Ranpak, said in a release.
According to Pickle, its truck-unloading robot applies “Physical AI” technology to one of the most labor-intensive, physically demanding, and highest turnover work areas in logistics operations. The platform combines a powerful vision system with generative AI foundation models trained on millions of data points from real logistics and warehouse operations that enable Pickle’s robotic hardware platform to perform physical work at human-scale or better, the company says.
Bloomington, Indiana-based FTR said its Trucking Conditions Index declined in September to -2.47 from -1.39 in August as weakness in the principal freight dynamics – freight rates, utilization, and volume – offset lower fuel costs and slightly less unfavorable financing costs.
Those negative numbers are nothing new—the TCI has been positive only twice – in May and June of this year – since April 2022, but the group’s current forecast still envisions consistently positive readings through at least a two-year forecast horizon.
“Aside from a near-term boost mostly related to falling diesel prices, we have not changed our Trucking Conditions Index forecast significantly in the wake of the election,” Avery Vise, FTR’s vice president of trucking, said in a release. “The outlook continues to be more favorable for carriers than what they have experienced for well over two years. Our analysis indicates gradual but steadily rising capacity utilization leading to stronger freight rates in 2025.”
But FTR said its forecast remains unchanged. “Just like everyone else, we’ll be watching closely to see exactly what trade and other economic policies are implemented and over what time frame. Some freight disruptions are likely due to tariffs and other factors, but it is not yet clear that those actions will do more than shift the timing of activity,” Vise said.
The TCI tracks the changes representing five major conditions in the U.S. truck market: freight volumes, freight rates, fleet capacity, fuel prices, and financing costs. Combined into a single index indicating the industry’s overall health, a positive score represents good, optimistic conditions while a negative score shows the inverse.
Specifically, the new global average robot density has reached a record 162 units per 10,000 employees in 2023, which is more than double the mark of 74 units measured seven years ago.
Broken into geographical regions, the European Union has a robot density of 219 units per 10,000 employees, an increase of 5.2%, with Germany, Sweden, Denmark and Slovenia in the global top ten. Next, North America’s robot density is 197 units per 10,000 employees – up 4.2%. And Asia has a robot density of 182 units per 10,000 persons employed in manufacturing - an increase of 7.6%. The economies of Korea, Singapore, mainland China and Japan are among the top ten most automated countries.
Broken into individual countries, the U.S. ranked in 10th place in 2023, with a robot density of 295 units. Higher up on the list, the top five are:
The Republic of Korea, with 1,012 robot units, showing a 5% increase on average each year since 2018 thanks to its strong electronics and automotive industries.
Singapore had 770 robot units, in part because it is a small country with a very low number of employees in the manufacturing industry, so it can reach a high robot density with a relatively small operational stock.
China took third place in 2023, surpassing Germany and Japan with a mark of 470 robot units as the nation has managed to double its robot density within four years.
Germany ranks fourth with 429 robot units for a 5% CAGR since 2018.
Japan is in fifth place with 419 robot units, showing growth of 7% on average each year from 2018 to 2023.
Progress in generative AI (GenAI) is poised to impact business procurement processes through advancements in three areas—agentic reasoning, multimodality, and AI agents—according to Gartner Inc.
Those functions will redefine how procurement operates and significantly impact the agendas of chief procurement officers (CPOs). And 72% of procurement leaders are already prioritizing the integration of GenAI into their strategies, thus highlighting the recognition of its potential to drive significant improvements in efficiency and effectiveness, Gartner found in a survey conducted in July, 2024, with 258 global respondents.
Gartner defined the new functions as follows:
Agentic reasoning in GenAI allows for advanced decision-making processes that mimic human-like cognition. This capability will enable procurement functions to leverage GenAI to analyze complex scenarios and make informed decisions with greater accuracy and speed.
Multimodality refers to the ability of GenAI to process and integrate multiple forms of data, such as text, images, and audio. This will make GenAI more intuitively consumable to users and enhance procurement's ability to gather and analyze diverse information sources, leading to more comprehensive insights and better-informed strategies.
AI agents are autonomous systems that can perform tasks and make decisions on behalf of human operators. In procurement, these agents will automate procurement tasks and activities, freeing up human resources to focus on strategic initiatives, complex problem-solving and edge cases.
As CPOs look to maximize the value of GenAI in procurement, the study recommended three starting points: double down on data governance, develop and incorporate privacy standards into contracts, and increase procurement thresholds.
“These advancements will usher procurement into an era where the distance between ideas, insights, and actions will shorten rapidly,” Ryan Polk, senior director analyst in Gartner’s Supply Chain practice, said in a release. "Procurement leaders who build their foundation now through a focus on data quality, privacy and risk management have the potential to reap new levels of productivity and strategic value from the technology."