Any article on pallet standards and specifications runs the risk of some misunderstanding, especially if it covers the historical evolution of this topic. I have attempted to be as complete as possible, yet keep it straightforward.
While a pallet may be a relatively simple product, the pallet industry often finds itself in a position where it does not have as much control over the destiny of its products as it desires. The issues covered here that affect pallet standards and specifications include the impact of raw materials, geographic differences, different standards, and board footage count differences (see accompanying article).
The Need for Pallet Standards and Our Industry’s Efforts
When people speak of pallet standards, they may be referring to specifications, manufacturing quality standards, or efforts to set allowable tolerances. The bottom line is that pallet manufacturers and recyclers supply products that are related to a customer’s specifications, but also they have to speak to the reality of available material supplies.
Our industry has gone through a few periods when lumber supplies are very tight, and it can be difficult, if not impossible, for a period of time to get enough of a particular species, grade, or quality to provide that customer what he would prefer. Most of the time, however, pallet suppliers provide their customers with products that are deemed by both parties as acceptable for the applications.
During times of raw material shortages, substituting one species for another, or a different combination of deck board widths, or one quality of material for another, may be necessary in order to help customers meet their most basic requirements. Generally, the top concern is keeping products moving instead of causing avoidable delays.
Over the past 60 years or so, the pallet industry has grown into one of the largest users of lumber in North America. This is worth mentioning to focus on the monumental job of getting people in the industry to function on the same page. So, when anybody wonders why there is such a wide spectrum of interpretations about things that relate to pallet specifications and quality, it should not be surprising.
Pallet buyers often have specifications that have evolved, gone through a number of revisions, and are not well understood by the purchaser. At the receiving dock there is often even more misunderstanding. Dock workers may not understand what they are accepting and how it matches either specifications or what is actually needed.
All of these facts point strongly to the need of accepted industry standards. Conscientious pallet companies and concerned customers would both benefit from standards that make sense, are accepted by both parties, and are enforced in some acceptable fashion. The independent, entrepreneurial nature of our industry and the competitive, limited concern of our customers unfortunately work together to limit cooperative efforts toward pallet quality and standards. Certainly, the lack of management sophistication applied by many customers and the presence of locally competitive conditions stand in the way of any pallet company to do much on its own except work closely with its customers.
Our customers are focusing primarily on their own product lines and industry competitive situations. It can be difficult for them to form cooperative industry groups to focus on common problems, particularly when pallets are so low on their list of concerns.
Unless pallet users devote more management attention to logistic problems that relate directly to unit loads, very little concern is likely to be focused on their palletization needs.
The most notable user related industry efforts in the grocery industry have certainly fallen upon mixed success. Consumer goods industries turn inventories quickly, often in products that have relatively low valued unit loads. So, it is natural that they are very interested in pallet pools and exchange programs that reduce the number of pallets being purchased. Grocery logistics systems may not be closed loops but they often function within an arena that makes pallet collection and exchange look like an attractive option.
In the United States, the Grocery Manufacturers’ Association developed its 48×40 GMA pallet specification during the 1970s. Over the years, GMA pallets experienced an erosion from their original heavy-duty 13/16” deck and 2×4 stringers. The original specification lost its influence. Today a GMA pallet is often thought of as a partial four-way, 48×40 hardwood pallet with five four-inch interior deck boards and two six-inch exterior boards on top and three fours and two sixes on the bottom. Decking and stringer dimensions vary widely, but they contain much less lumber than they originally had.
The GMA exchange system deteriorated to the point that the food industry was looking for a better solution by the late 1970s. The Grocery Pallet Council (GPC) specification was suggested by the National Wooden Pallet and Container Association (NWPCA) to fix what our industry could see was a GMA pallet pool in need of repair.
The GMA pallet began as a grocery effort, while the GPC was initiated by our industry. The GPC pallet was a stenciled heavy-duty 48×40 hardwood partial four-way pallet that is similar to the GMA but has a six-inch center bottom board instead of a four-inch middle bottom board. This GPC program only lasted a few years and came to an end because the grocery industry did not exert enough management muscle to back up its own desires.
Around 1990, the grocery industry’s Cleveland study suggested that a good cooperative exchange ownership pallet pool, such as the Canadian CPC pallet program, would be the best solution. But again the grocery industry was not willing to invest the necessary money to start a high quality ownership exchange pool, even though their study suggested that it would pay off in a relatively short period of time. Over 15 years later, the 48×40 CPC hardwood pallet cooperative ownership pool is still alive and well in Canada.
Instead, the grocery industry pallet subcommittee wanted somebody else to finance the solution. They no longer wanted to deal with pallet headaches. This is what really opened the door for CHEP to enter the U.S. grocery industry. CHEP was promising to both eliminate pallet headaches and save its customers money.
For the most part, pallet specifications are established by a user to satisfy their particular needs. Some pallet buyers will have many specifications to fit different products, different materials handling systems, and differing customer requirements. Pallet manufactures and recyclers match products and services as needed. All of this takes place under the variation of parameters covered here, such as lumber variations and individual product requirements.
One of the beauties of wooden pallets and containers is their flexibility to adjust to the varying specifics of customers’ requirements. However, this same flexibility serves to get in the way of industry-wide pallet standards because we supply customized products to most industries.
While pallet companies work with customers to develop unique specifications, the industry has tried to develop some general pallet standards to offer customers. A historic overview of pallet standards must include several attempts by the NWPCA to establish and encourage standards.
The pallet industry got its start during World War II by serving the military, which is accustomed to developing its own product standards. The first NWPCA effort toward pallet standards was the grade marking program, which started in the late 1950s. Tom DePew, who championed this notable effort, is recognized on the pallet statue at Virginia Tech in memory of his work.
The grade-marked pallet program of the 1950s, which was modeled after military standards, was the most complicated pallet standard effort because we had to go through all the development and birth pain effort. This standard had four grades of pallets: A, AA, Premium, and Precision. While the A grade was the lowest grade, it was a green deck pallet that most resembled what had already been established as a common practice in the relatively young industry. The AA grade pallet had dry decks; the Premium pallet had both dry decks and dry stringers. The very tough Precision standard, which was rarely made, required equilibrium moisture content on all components.
Our young industry was off and running with a standards program that required relatively high quality, branded pallets. Unfortunately, the program had a limited thrust behind it and had no inspection authority.
About 1982, the NWPCA board approved its new logo-marked pallet program, an attempt to simplify the grade mark program. This program had an inspection element to it as well as a logo identification mark on the pallet.
In 1984-85 Virginia Tech released its new PDS Pallet Design System, the most significant pallet design tool in the industry. The NWPCA, the current owner of PDS, has been involved in its management and development from the beginning. But PDS does not have a quality assurance element in it. It is best described as a pallet performance tool.
The lack of a rigid enough inspection process in the logo-marked pallet program drove the association to consider a third quality/standards program when it developed the SPEQ program in 1992. They designed an inspection program with more teeth in it and contracted Timber Products (TP) to handle the inspection duties.
The SPEQ mark provided a quality assurance for PDS designed pallets. The SPEQ and A grade-marked pallet were very similar to each other in manufacturing standards and quality. To a great extent the difference in the two standards programs was one of control and inspection more than it was in pallet manufacturing concepts.
Dr. Mark White of the Virginia Tech Sardo Pallet Lab had a strong desire for uniform voluntary pallet specifications. The Uniform Voluntary Standard and SPEQ were developed simultaneously; the two programs were meant to compliment each other. The only real difference is that the Uniform Voluntary Standard was voluntary; it had no inspection element. But it did give the industry a manufacturing quality standard.
A number of pallet companies have established their own quality related programs to use with their customers. Certainly many companies have become known as manufacturers of high quality pallets that their customers can rely upon.
The SPEQ program was the first NWPCA standards program with a recycled or used pallet aspect to it. Steve Sykes, formerly of Interstate Pallet, became a well known recycler for his efforts to help develop the recycle market. In 1994 he worked to spearhead the NWPCA’s buy-back program in the produce industry. This was an effort to put some control into recycled pallets and the produce markets.
I recall taking the train from Richmond to Philadelphia with Steve to write an article on the first load of buy-back pallets being loaded and shipped out of the Philadelphia produce market. This was a relatively short lived attempt to instill quality into pallet recycling.
The association developed its CPR certified pallet repair standards in 1997. In spite of a number of good efforts, the industry never really got behind these programs. To date, the recycling industry has very little that looks like a successful standards program.
The SPEQ program is still officially in use, but none of our industry’s quality and standards programs, no matter how noble the effort, ever established a significant long-lasting impact. The SPEQ program, which once had over 100 participating pallet companies, now has 19.
All of the standards programs adapted by the NWPCA were really quality assurance programs more than a true standard or specification. The NWPCA first developed the SPEQ program. It intended to follow that with specific specifications for selected industries, such as grocery, roofing, cans, etc. There were some attempts made in this direction, but none were successful.
A good friend of mine, Ray Piland, supplied some of the insights that I have shared. Ray, president of Williamsburg Millwork, joined his father in business in 1955. He has served our industry devotedly ever since. Williamsburg Millwork was one of the founding companies in the NWPCA. Both Ray and his father served as association presidents. Ray, and more recently his son Jordan, served for many years on the association’s Standards Committee.
When asked to summarize the gallant association efforts at standardization, Ray said, “The main purpose behind our efforts to standardize has been to provide consistency of quality. We need for our customers to respect both us and our products. Unfortunately, none of the standards programs was widely endorsed by the pallet industry. I still feel strongly that we need industry standards.”
I could not agree more. I commend the association for its standardization efforts over the years. While most pallet companies would agree that the most important thing is to serve our customers with the products they specify, having a quality standard enhances our professionalism and ensures more consistent products for our customers. If we want our customers to trust our products and rely upon our integrity, a widely followed standards program could be valuable.
When asked why these valiant NWPCA standards efforts never obtained strong market acceptance, Ray said, “Not enough pallet manufacturers were pushing for it, and some were not in favor of the concept. Our customers did not support them. We did not sell them hard enough. And the association did not push and support them. The Trade Promotion Committee never really threw its weight behind a promotional effort to support the SPEQ program.”
Raw Material Impact
Unlike many products, wooden pallets are typically made from materials over which our industry has limited control. For the most part the pallet industry uses wood that is downfall in the sawmilling process. The industry uses wood it can buy at the lowest price. Sawmills process logs into a wide variety of products with different grades for different customers and products. Similar to meat products, lumber products are sometimes called split products because incoming logs can yield such a wide mixture of products and qualities. This split products model impacts costs and the raw material supply.
Keep in mind, however, that higher priced lumber often reflects on visual quality, not necessarily engineering strength. Thus, much of the lower valued hardwood and softwood that is used in pallets is actually strong material, and strength is the desirable property for pallets.
Pallets are what an economist calls derived demand products, so buyers strive to pay as little as possible. Users often do not expect to see a specific pallet again once they ship it. As a consequence, pallet manufacturers and recyclers strive to keep their costs as low as possible to compete. Since lumber is the biggest cost component in a pallet, pallet suppliers buy the lowest priced materials they can.
In addition to buying lower grades of sawmill materials, pallet manufacturers often use precut pallet parts and cuts from remanufacturing facilities that typically upgrade lower grades of lumber into acceptable material for pallets. All of these elements impact the variety and quality of the products cut.
Beyond the natural variations from log to log within the same species, there is an inherent variation between species. Some species are stronger than others, and different species have different nail holding capabilities, elasticity, etc. Not all wood is equally suitable for all products. Pallets probably undergo more stresses than most other wood products, which puts more stringent performance requirements on the lumber.
Hardwoods are generally considered to be stronger, but qualities vary widely from species to species. Softer hardwoods, such as aspen, alder, poplars, and cottonwood, are on the lower end of the strength spectrum. The stronger hardwoods include species such as oaks, maples, ash, and hickory.
Estimates are that from 40% to as much as 50% of the hardwood growing in the United States is oak, including both red oaks and white oaks. The northern forests are heavy to aspens and maples, while the southern forests have more poplars. While hardwoods are not as widespread in the west, alder is common in the northwest.
Softwoods dominate the western forests and are common in the northern forests, including Doug Fir, spruces, pines, and firs. Southern Yellow Pine in the southeast is one of the strongest softwoods on the continent.
Significant differences exist between hardwood and softwood sawing practices because of the products sawn from them. A sawmill is setup to saw logs according to the higher priced products and higher volumes that the log can produce, with the exception of scragg mills that are designed to cut smaller, low-grade logs into pallet stock and other low-grade products. Larger, grade logs are typically sawn into higher valued products with lower-grade downfall going into secondary markets, such as pallets.
Pallets are typically manufactured from either the lower-grade downfall lumber or from the cants that come from log centers. While there is a great deal of good lumber going into pallets, the nature of the forest products industry has dictated pallets to the bargain basement of sawmill lumber production.
International Standards Impact
One can make an argument that international standards efforts have had very little impact on the U.S. market. With the exception of the recent international phytosanitary situation, this may be true today. But we should keep our eyes on international markets for both more potential business and more influence coming into the North American market in the future.
The EUR pallets in Europe (sometimes called europallets in the United States) represent the largest cooperative ownership pallet pool in the world. The EUR pallet is an 800x1200mm block style pallet that has been tried and true in European distribution systems. It is controlled by the UIC, international union of railroads, and now has over several hundred million pallets under the EUR pallet umbrella. There have been some discussions of how to implement an EUR pallet system model in the United States. But to date, there is no formal EUR pallet system functioning here.
The CPC pallet in Canada has been a successful ownership pallet pool since the 1970s. Because it has been successful in the Canadian grocery industry in spite of stiff competition from CHEP, many people have thought over the years that the U.S. should study the CPC model. Certainly our shared border and interacting economies suggest that this is something that might be worth considering.
No brief coverage of international pallet standards and management efforts would be complete without mentioning CHEP. There is no worldwide pallet management system with any where near the level of acceptance of CHEP.
CHEP’s early history dates back to post World War II in Australia. CHEP has pools in many European economies, Canada, the United States, South Africa, Australia, New Zealand, and a relatively new thrust in the Pacific Rim region.
Because of its worldwide outreach, CHEP is likely to impact any consideration of international pallet standards. Since CHEP, the EUR pallet system, and a growing number of domestic grocery retailers favor a block style pallet, this increases the likelihood that any future international standard will lean toward a block design.
Most CHEP pallets are either 48×40-inch or 1200x1000mm pallets, depending upon the part of the world. They are typically heavy-duty, softwood, block style pallets. The CHEP system utilizes a depot system where returned pallets are inspected and repaired when necessary before reuse.
Certainly the pallet industry, under the NWPCA’s leadership, has made several efforts to institute standards and quality assurance into the pallet markets. The difficulty in successfully establishing a solid industry program is primarily due to the competitive nature of our industry and problems that customers have working cooperatively with their competitors. That does not diminish our thanks for those who have worked tirelessly over the years in the standards arena.
Now the question remains, “Will the industry have the foresight to see the value in quality and possibly size standards?”
Size standards are debatable because versatility is one of wood’s major assets, but quality standards seem to me to be a motherhood and apple pie kind of issue. I can not understand why any thoughtful business in the industry would have serious objection to higher quality pallets. While we do not want to give up our right to exercise our own control, the unfortunate part of the equation is that all of us suffer from any overall quality problems.
Who will lead the next revolution? And this time will the climate be right for real, meaningful change?
