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.
Online merchants should consider seven key factors about American consumers in order to optimize their sales and operations this holiday season, according to a report from DHL eCommerce.
First, many of the most powerful sales platforms are marketplaces. With nearly universal appeal, 99% of U.S. shoppers buy from marketplaces, ranked in popularity from Amazon (92%) to Walmart (68%), eBay (47%), Temu (32%), Etsy (28%), and Shein (21%).
Second, they use them often, with 61% of American shoppers buying online at least once a week. Among the most popular items are online clothing and footwear (63%), followed by consumer electronics (33%) and health supplements (30%).
Third, delivery is a crucial aspect of making the sale. Fully 94% of U.S. shoppers say delivery options influence where they shop online, and 45% of consumers abandon their baskets if their preferred delivery option is not offered.
That finding meshes with another report released this week, as a white paper from FedEx Corp. and Morning Consult said that 75% of consumers prioritize free shipping over fast shipping. Over half of those surveyed (57%) prioritize free shipping when making an online purchase, even more than finding the best prices (54%). In fact, 81% of shoppers are willing to increase their spending to meet a retailer’s free shipping threshold, FedEx said.
In additional findings from DHL, the Weston, Florida-based company found:
43% of Americans have an online shopping subscription, with pet food subscriptions being particularly popular (44% compared to 25% globally). Social Media Influence:
61% of shoppers use social media for shopping inspiration, and 26% have made a purchase directly on a social platform.
37% of Americans buy from online retailers in other countries, with 70% doing so at least once a month. Of the 49% of Americans who buy from abroad, most shop from China (64%), followed by the U.K. (29%), France (23%), Canada (15%), and Germany (13%).
While 58% of shoppers say sustainability is important, they are not necessarily willing to pay more for sustainable delivery options.
Schneider says its FreightPower platform now offers owner-operators significantly more access to Schneider’s range of freight options. That can help drivers to generate revenue and strengthen their business through: increased access to freight, high drop and hook rates of over 95% of loads, and a trip planning feature that calculates road miles.
“Collaborating with owner-operators is an important component in the success of our business and the reliable service we can provide customers, which is why the network has grown tremendously in the last 25 years,” Schneider Senior Vice President and General Manager of Truckload and Mexico John Bozec said in a release. "We want to invest in tools that support owner-operators in running and growing their businesses. With Schneider FreightPower, they gain access to better load management, increasing their productivity and revenue potential.”
Economic activity in the logistics industry continued its expansion streak in October, growing for the 11th straight month and reaching its highest level in two years, according to the most recent Logistics Managers’ Index report (LMI), released this week.
The LMI registered 58.9, up from 58.6 in September, and continued a run of moderate growth that began late in 2023. The LMI is a monthly measure of business activity across warehousing and transportation markets. A reading above 50 indicates expansion, and a reading below 50 indicates contraction.
October’s reading showed the fastest rate of expansion in the overall index since September of 2022, when the index hit 61.4. The results show that the industry is continuing its steady recovery from the volatility and sluggish freight market conditions that plagued the sector just after the Covid-19 pandemic, according to the LMI researchers.
“The big takeaway is that we’re continuing the slow, steady recovery,” said LMI researcher Zac Rogers, associate professor of supply chain management at Colorado State University. “I think, ultimately, it’s better to have the slow and steady recovery because it is more sustainable.”
All eight of the LMI’s indices grew during the month, with the Transportation Prices index showing the most growth, at nearly 6 points higher than September, reflecting increased activity across transportation markets. Transportation capacity expanded slightly during the month, remaining just above the 50-point threshold. Rogers said more capacity will enter the market if prices continue to rise, citing idle capacity across the market due to overbuilding during the pandemic years.
“Normally we don’t have this much slack in the market,” he said. “We overbuilt in 2021, so there’s more slack available to soak up this additional demand.”
The LMI is a monthly survey of logistics managers from across the country. It tracks industry growth overall and across eight areas: inventory levels and costs; warehousing capacity, utilization, and prices; and transportation capacity, utilization, and prices. The report is released monthly by researchers from Arizona State University, Colorado State University, Rochester Institute of Technology, Rutgers University, and the University of Nevada, Reno, in conjunction with the Council of Supply Chain Management Professionals (CSCMP).
The port worker strike that began yesterday on Canada’s west coast could cost that country $765 million a day in lost trade, according to the ALPS Marine analysis by Russell Group, a British data and analytics company.
Specifically, the labor strike at the ports of Vancouver, Prince Rupert, and Fraser-Surrey will hurt the commodities of furniture, metal products, meat products, aluminum, and clothing. But since the strike action is focused on stopping containers and general cargo, it will not slow operations in grain vessels or cruise ships, the firm said.
“The Canadian port strike is a microcosm of many of the issues that are impacting Western economies today; protection against automation, better work-life balance, and a cost-of-living crisis,” Russell Group Managing Director Suki Basi said in a release. “Taken together, these pressures are creating a cocktail of connected risk for countries, business, individuals and entire sectors such as marine insurance, which help to mitigate cargo exposures.”
The strike is also sending ripples through neighboring U.S. ports, which are hustling to absorb the diverted cargo, according to David Kamran, assistant vice president for Moody’s Ratings.
“The recurrence of strikes at Canadian seaports is positive for U.S. ports that may gain cargo throughput, depending on the strike duration,” Kamran said in a statement. “The current dispute at Vancouver is another example of the resistance of port unions to automation and the social risk involved with implementing these technologies. Persistent disruption in Canadian port access would strengthen the competitive position of US West Coast ports over the medium-term, as shippers seek to diversify cargo away from unreliable gateways.”
The strike is also affected rail movements, according to ocean cargo carrier Maersk. CN has stopped all international intermodal shipments bound for the west coast ports of Prince Rupert, Robbank, Centerm, Vanterm, and Fraser Surrey Docks. And CPKC has stopped acceptance of all export loads and pre-billed empties destined for Vancouver ports.
Connected with the turmoil, Maersk has suspended its import and export carrier demurrage and detention clock for most affected operations. The ultimate duration of the strike is unknown, but the situation is “rapidly evolving” as talks continue between the Longshore Workers Union (ILWU 514) and the British Columbia Maritime Employers Association (BCMEA), Maersk said.
Terms of the acquisition were not disclosed, but Mode Global said it will now assume Jillamy's comprehensive logistics and freight management solutions, while Jillamy's warehousing, packaging and fulfillment services remain unchanged. Under the agreement, Mode Global will gain more than 200 employees and add facilities in Pennsylvania, Arizona, Florida, Texas, Illinois, South Carolina, Maryland, and Ontario to its existing national footprint.
Chalfont, Pennsylvania-based Jillamy calls itself a 3PL provider with expertise in international freight, intermodal, less than truckload (LTL), consolidation, over the road truckload, partials, expedited, and air freight.
"We are excited to welcome the Jillamy freight team into the Mode Global family," Lance Malesh, Mode’s president and CEO, said in a release. "This acquisition represents a significant step forward in our growth strategy and aligns perfectly with Mode's strategic vision to expand our footprint, ensuring we remain at the forefront of the logistics industry. Joining forces with Jillamy enhances our service portfolio and provides our clients with more comprehensive and efficient logistics solutions."