A group of pallet industry veterans are launching a new wood pallet pool equipped with tags to track supply chain data. The new company is called Pooling and Logistics Experts or PalX for short. Originally, the company is targeting regional customers with specialized needs, such as cold chains, pharmaceuticals and secure supply chains.
PalX has secured a contract with a national dairy producer and is working on finalizing contracts with two other companies. The board and staff of the new company is full of pallet industry veterans from both white-wood and rental companies.
The CEO of PalX is Steve Mazza, who has run a pallet recycling operation in New Jersey as well as national pallet programs for major brands. Mazza has collaborated with a number of other pallet industry veterans in the past on various pool efforts. He explained, “The PalX pallet is designed to meet the needs of a digital supply chain where information is critical… Pallets are the next wave in supply chain visibility.”
The PalX pallet is a wood, block pallet that is designed to be stronger and more durable than a typical rental pallet. It is also equipped with sensors to allow for location tracking, temperature monitoring and shock/vibration analysis. The PalX team is currently launching the proof of concept and has raised some seed capital from companies and individuals in the pallet industry. The PalX Board is also looking to crowdfund about $1 million dollars to boost funding levels.
Key members of the PalX team include: Steve Mazza (CEO); Elton Potts, board member of PalX, former SVP Supply Chain & Asset Management Chep USA; Stuart Lerner, board member PalX, formerly Bluechip Logistics; Michael Lamb, board member and CFO PalX, former president of Chep USA; and John Huber, board member PalX, former founding partner PECO. Each member of the executive team has considerable experience in the pallet management, production and/or rental areas. For example, Stuart Lerner’s operations built over 50 million pallets and repaired over 300 million through the years for CHEP USA.
More than just another new face in the rental game, the PalX team hopes to revolutionize supply chains. Mazza stated, “The wood pallet is the workhorse of the supply chain, but increasingly supply chains need a pallet that brings the industry into the digital age.” PalX intends to offer a pallet that can integrate with various Warehouse Management Systems and other key supply chain software.
A tag is placed between center deck boards on a specially designed block pallet. PalX is using low-R (radio frequency) technology. Gateways at customer locations scan the tags and connect the data with remote computer monitoring. Specifically, the tags provide data on temperature, shock/vibration incidents and location.
PalX CTO Spencer Giacalone said, “Our tag technology contains various sensors and a low power radio. We have longer range than RFID but use less power than cellular-based solutions. Data is securely captured and stored in the cloud. We are natively cloud-based and multi-tenant capable on day one.”
Giacalone added, “Our design is less prone to interference than cellular based systems, while also conserving battery power for longer sensor life. We have multiple metrics to detect and track tag damage, backed by physical inspection at PalX facilities. While our sensors measure various parameters, our implementation conserves power via adaptive measurement intervals, triggers and thresholds.”
When asked why CHEP was not able to make tags really work in its model, Mazza commented, “CHEP’s scale works against them when it comes to integrating new technology. It would be extremely difficult to put tags in more than 85 million pallets. CHEP would have to manage two pools.”
The PalX pallet will be painted bright green and made from SYP KD lumber sourced in the United States with solid wood blocks. Over time, PalX plans to build and use millions of pallets based on its specification designed to offer a very strong and precise pallet to end users.
So, why might this new platform and rental pool approach where other upstarts have failed? Michael Lamb, CFO of PalX, explained, “PalX offers the market a more reliable and stronger platform when there are market shortages, while its competitive technology advantage provides customers environmental information to reduce wastage.
Looking at how its pricing compares to other rental providers, Lamb stated, “PalX can offer bundled or unbundled pricing depending upon customer preference, with the technology solution improving accuracy for activity-based pricing. This encourages the right behavior across the supply chain to reduce costs while data can be priced relative to the benefits provided to the customer.”
Transportation is a huge cost for any pooler. Since the PalX pool will be fairly small initially, the company plans to take a measured approach to growth. Lamb said, “Initially the pool will commence regionally to reduce ‘national’ leakage and LTL volume returns leveraged via our strong relationship with the pallet industry which sets PalX apart from the current poolers.”
Pallet companies can also get in on the ground floor as investors. Lamb explained, “When you invest in PalX on the Republic.co crowdfunding platform you receive an interest in the company, in the form of a security.” More information can be found at Republic.co/palx.
For more information on the company or to see its new pallet design, visit www.palx.io.
