Access is a major stumbling block for anyone looking to setup closed loop systems. Distribution centers play a major role in any loop system. The pallet industry will need the cooperation of the DC’s to make any pallet retrieval system work. Most DC’s do not have the space or willingness to make space for the limited on site sorts currently being done, much less adding several more.
Imagine if CHEP, PECO, and IFCO demanded a sort in addition to a whitewood pool or two. Then there are the odd sized pallets and non loop whitewood. Some contacts mentioned off-site sorting at a local recycler, but this adds several extra handlings of all pallets. Somewhere the extra handling will have to be paid for. The most sensible way to do this would be for everyone involved in the process to share the handling costs, but the very thought is akin to opening Pandora’s box.
Off-site sorting doesn’t seem to be the future. In fact as more national loop systems emerge there is the distinct possibility that more companies will want third-party on site sorting like Wal-Mart has in its DC’s. This could allow for multiple whitewood pallet management groups to survive by providing cores, retail DC access and income from sort fees. This would be a two way street that provides logistics to large retail DC’s, while providing needed cores and quality checkpoints to the sorting management company.
National Wooden Pallet and Container Association Chair Pat Sherry summed it up well in saying “The second whitewood loop in a DC isn’t in at all.”
