Custom pallets may cost 10% more, but actually decrease the total cost of goods and delivery
Custom Pallet Design to Reduce Total Cost
Mark White, president of the packaging research and consulting firm White & Co, recommends considering the role pallets play in the total cost of product and delivery. Often stronger pallets can better protect products they carry, allowing manufacturers to use less expensive materials in their products.
By way of example, White explains how a wall and floor manufacturer reduced the cost of shipping plastic pails to big box stores. When the pails were stacked three-high on standard pallets, the manufacturer had to use high quality 90-mil pails to minimize product damage from compression stresses. Rather than increase the product cost by using even more expensive plastic material to prevent product damage, the manufacturer redesigned a stronger pallet – and was able to actually reduce the pail product material to 80-mil, for a net savings of $7.30 per load. Ironically, the increase in pallet cost of $1.70 actually saved the company an annual savings of at least $380,000. Stiffening a pallet deck with another stringer turned out to be a much better solution than stiffening the product with a higher-grade plastic!
When evaluating the total cost of product and delivery, the lowest cost pallet is not necessarily the best solution. Although a standard 48 x 40-inch pallet designed to carry 2,000 pounds may be good for many applications, it is not always the best option. Many of Greenway’s customers rely on the company’s knowledge and extensive experience to optimize for the best pallet design to reduce the total cost of product and deliveries.
Engineered Pallet Factors
Some factors that contribute to designing the best pallet solution for a given product and delivery system include determining the correct:
- Pallet Strength
- Pallet Capacity
- Pallet Racking Strength
- Pallet Size
- Supply Chain requirements and opportunities for improved efficiencies
- Will the pallets be stored in a racking system or on the floor
- How many times is the palletized product being touched throughout the supply chain
- Does the pallet need to be hygienic
- What will be put on the pallet
- Will pallet tracking be required
- The effect of packaging on unit load
Product and Packaging Redesigns
As products are redesigned, the impact of the pallet also need to be considered. Product changes may change package weight and dimensions, impacting the appropriate pallet selection. Tragic results can occur when new pallets are not engineered to accommodate new product designs, such as happened to one bottled water company. A redesigned bottle packaging changed the pallet unit load, and the pallets previously used no longer could handle the new load. Unfortunately, the manufacturer continued to use the old sized pallets, and a warehouse worker was killed as a result.
Engineered pallets that meet the requirements of palletized packages:
- Move and store materials and product quickly
- Reduce product damage
- Minimize the risk of worker injury
If you would like a consultation on how an optimally designed pallet can reduce your total costs, schedule a consult with Dominick Davi. You can reach him by email at email@example.com, or by phone at 516-437-6300.