So, what’s the big deal with small pallets? Spoiler alert, bigger is often better.
I remember being with Ed and Carolyn Brindley and the late Stan Bowes (EPAL President 2000-2010) and his wife at Interpal 2005 in Victoria, British Columbia. I hadn’t given much thought to the importance of footprint size before, but Stan drew it out for me on a dinner napkin. The standard UK pallet footprint of 1000×1200 mm is a whopping 25% larger than continental Europe’s 800×1200 mm footprint. That’s a 25% productivity gain for each pallet moved by a forklift in the facility or onto or off a trailer. That’s an enormous material handling boost.
But if bigger is better, generally speaking, mini pallets can still play a crucial complementary role in supply chains. I discovered this firsthand in the mid-1990s, when I first started writing for Pallet Enterprise. I visited a local Toyota wheel plant and discovered they used half pallets at the back of the trailer to completely fill it because there wasn’t room to accommodate a full pallet position. A few weeks later, I visited a paint manufacturer to report on their pallet program and discovered they selected narrower pallets because they needed to bring them through the main doors at retail paint shops. Pallet size appropriate to navigate narrow doors and tight aisles for small retail outlets such as convenience stores remains a consideration today.
When Do Mini Pallets Make Sense?
As stated above, smaller pallets can help squeeze palletized product through narrow doorways and help fill trailers where an extra full pallet won’t fit. Here are some of the additional use cases for mini pallets.
• Increased floor display opportunities: Floor displays have been proven to boost sales while also eliminating the need for shelf-stocking labor. Small pallets take up less space on the retail floor than a full pallet footprint, which means there is an opportunity to create floor displays for more products than using full pallets, which should translate into extra sales.
• In-aisle display: In Europe, the strategy of placing half pallets in aisles under top shelves is more mature than in North America, but it is an approach that at least one domestic pallet rental company has promoted. For bulkier or faster-moving items, placing the half pallet under the shelf in the aisle eliminates stocking labor for the retailer and case-picking labor at the distribution center.
• More opportunities for display pallet shipments: A few decades ago, a J.T. Kearney study looked at the opportunity for single SKU (single product) pallet shipments to retail stores. As already mentioned, single SKU pallets eliminate warehouse case pick and supermarket shelf stocking labor. Less handling also translates into less product damage. All of these features cut costs. The study determined that only a small percentage of products had the sales volume to warrant full pallet deliveries, however. If the amount were reduced to a half pallet quantity, on the other hand, the amount of products that could be profitably handled would be dramatically greater. Hence, the argument was made for the introduction of half pallets to capture that greater amount of single SKU unit loads that could be shipped on smaller pallets.
• When only a smaller size is required: Beyond retail display pallets, a product or part might only require a smaller size. Supply chain operators can significantly reduce wasted pallet underhang by rightsizing the pallet to the product.
What Do We See In the Market Today?
Small custom expendable pallets are still seen in supply chains, but retailers increasingly frown upon them due to sustainability concerns and solid waste reduction efforts. Even 15 years ago when I still worked in distribution, small pallets were an aggravation for reverse logistics attuned to a 48×40" environment. They literally didn’t stack up. Recyclers didn’t want the emptied mini pallets. But they reluctantly took them to get pallet core removal contracts.
When CHEP launched its U.S. half pallet in 2014, it said it was already issuing 100 million half pallets annually across its global operations. Today, CHEP and PECO both offer rental half pallets. Internationally, CHEP, LPR, IPP, Svenska Retursystem (SRS), and Norsk Lastbærer Pool (NLP) offer pooled half pallets. While lacking the customization opportunities of expendable pallets, they come with reverse logistics systems that avoid solid waste generation.
In North America, the two predominant half pallet footprints are the 40×24", which is used by CHEP and the 48×20", offered by PECO. The 48×20" was previously offered by the now-defunct Canadian Pallet Council. There has long been debate about which size is best for half pallets. Conventional wisdom was that the 48×20" version was preferred for end aisle displays in retail stores. In contrast, the 40×24" is preferred for in-aisle placement. The CHEP half features galvanized metal risers (exterior blocks) that leave a wide enough opening to accommodate pallet jack entry on the 24" face. This feature is important because material handling can be a hassle with small pallet handling. On a fast-moving loading dock, maneuvering and loading small pallets can be a tedious process that jacks up the blood pressure of time-pressured shipping supervisors.
EPAL has two half pallet standards, EPAL 6 and EPAL 7. The EPAL 7 features exterior metal risers and round center supports. The Scandinavian pools (NLP and SRS) offer plastic half pallets (600×400 mm). In some markets, CHEP offers plastic quarter pallets and a Y! pallet (Australia).
Would the U.S. Benefit from a GMA “Standard” Half Pallet?
Standardizing a half pallet for the U.S. market should be considered at this time when retailers are looking at rental or corrugated as their main small pallet options. Some retailers also have in-house small display pallets, often plastic, but if the small pallets have to be stacked with product at the store level, some of the benefits are negated.
The half pallet market still has room to grow, and a standard size would facilitate material handling efficiency and demand for the half pallet cores when emptied. What would be the best size and design? It would probably be 40×24". It is a familiar size for retailers and would work for in-aisle placement, as that approach gains traction. The use of metal risers, similar to those used by CHEP and EPAL, for example, would help maintain the opening size for pallet jack access.
But at the end of the day, this is purely speculation on my part. Further research is warranted to determine the scope of the opportunity and the hurdles to success. Much is uncertain, but in my mind, it is worth taking out a magnifying glass and giving small pallets a closer look.
