Back when I started in grocery distribution, we used the old mantra – if it ain’t broke, don’t fix it! It applied to our approach to preventive maintenance (or lack thereof) as well as operations. Your processes worked until the day came when they didn’t. And then you made the fixes necessary to get back to full speed – while your supply chain experienced a hiccup in continuity. In the case of pallets, when we started receiving too many broken ones from vendors that were causing delays and incremental labor hours, for instance, we started enforcing a policy for inbound pallet quality.
Those days are increasingly behind us. We feel the cost and pain of supply chain disruption. Nowadays, a review of pallet specification is a critical element of project and change management, not to mention risk management. In this first installment on Why It Might Be Time to Review Your Pallet Specification, I offer seven reasons why you might wish to take a fresh look at your specs.
1) Pallet prices have gone crazy.
In 2021, dramatic price increases gave many pallet buyers cause to discuss their pallet specification. Could they mitigate the increase by using a lighter specification pallet or by switching to used or remanufactured, etc.? In some cases, the answer can be counter-intuitive. It might make sense on a cost-per-trip basis to invest more to buy a more durable pallet that will last longer in a reuse program. Likewise, it might make sense to invest more in a stiffer pallet to save even more money by being able to reduce the amount of product packaging required. Or a better nail or thicker boards could reduce product damage.
2) You are being asked about sustainability.
Increasingly, purchasing agents will be paying attention to sustainability. Options such as pallet reuse programs mean that less material is consumed and often result in a lower environmental impact – subject to the impact of reverse logistics. Likewise, remanufactured pallets and used pallets also avoid resource consumption. For new pallet situations, pallet design software can minimize material consumption.
3) It has been many years since you reviewed your specification.
You might be surprised by how many companies haven’t updated their pallet specification in over a decade. A lot of things change over the years, even for companies that have been producing largely the same product mix. It is well worth taking the time to review. Hardwood and softwood prices change comparatively over time, for example.
If your original specification wasn’t created with the help of pallet design software such as Best Pallet or Best Load or the Pallet Design System (PDS), take the time to see if there is a better option. Or perhaps your distribution channel has changed. You may no longer need pallets that were designed to be small enough to go through retail man doors or be loaded onto sideload trucks. Why keep on using a small pallet if you no longer need to, when you could handle more product with fewer moves on a larger footprint?
Also, if you have had several supplier or design changes, you may be surprised to learn that the pallet specification you have on file and think you are getting is not what you regularly receive. Frequently, pallet companies will look at old pallet samples more than specs when creating a program for a customer. If you haven’t noticed a problem, then your old spec was probably over-designed.
4) Your operation is becoming automated.
Some automated storage and material handling systems such as AS/RS systems or autonomous forklifts, for example, are often quite sensitive to size deviations or pallet damage, while others, such as robots that place product on pallets, for instance, can be less sensitive to pallet quality. Regardless, when an investment is made in automation, ensure that pallet specification and ongoing quality control are part of the conversation.
5) Your supply chain has experienced merger and acquisition activity.
M&A activity can result in new material handling scenarios. Different plants might have particular handling needs as well as divergent storage capacity and unloading capabilities. Likewise, if M&A activity leads to SKU specialization and longer runs at various plants to increase efficiency, this approach should prompt a review and perhaps harmonization of pallet specs among the various plants and distribution channels.
6) As part of safety and health due diligence
As discussed above, supply chains change over time for various reasons – as do pallet suppliers. Where pallet specification or quality has potential safety implications for your operations, the pallet spec should be part of your annual or periodic safety review.
7) You are getting negative feedback from customers.
If customers are experiencing frustration with your pallets, or if you have been charged compliance penalties, a specification and/or quality review just might be in order. One thing that can frustrate customers is empty pallet accumulation at their locations. Where possible, a move to a popular pallet size such as 48×40" would make the empty pallets easier to move. A pallet retrieval program might also be an alternative – perhaps requiring a redesign to a more robust specification.
There are many reasons to take a fresh look at your pallet specification. It just might make your supply chain run more smoothly, more sustainably, more safely, and more cost-effectively.
