Why start a new online marketplace for the wood pallet sector? John Vaccaro, president of Bettaway Supply Chain Services, explained, “Somebody was going to do this. Why not somebody who has been in the industry and cares about the industry? It’s better for the industry if someone on the inside does this than an outside technology company.”
Vaccaro is the driving force behind PalletTrader (www.palletrader.com), a neutral online platform for conducting pallet transactions for those inside and outside of the industry.
The new online platform, designed and built exclusively for the sourcing, buying and selling of commercial wooden pallets, brings the ease, simplicity and efficiency of a common eCommerce transaction experience to what has been a fragmented world of suppliers and pallet “recyclers” who have for years conducted business manually, typically by emails, phone calls and fax, noted Vaccaro.
Bettaway Supply Chain Services has funded, built and is operating PalletTrader as an independent, neutral online business platform. As a pallet management company and broker, Bettaway knows the pallet business. Vaccaro was clear that PalletTrader is an independent company that is seeking to be open to anyone and everyone who buys and sells pallets, from manufacturers to recyclers to brokers to users and distribution centers.
The idea for PalletTrader came to Vaccaro four years ago. He stated, “Once I realized what this is and what is missing in the sector, I became concerned if we didn’t do it, someone else would, and they may be an evil force, not a friendly force to our industry.”
PalletTrader seeks to meet a need that is filled in many other industries. Vaccaro explained, “When I am out selling corporate accounts, I go into large customers who want a single source and a technology solution. In most other industries, it is available. In pallet, it’s not!”
When the Bettaway leadership was discussing the opportunity for a technology solution, they discussed two main business options – creating a national broker model with top technology tools or an online marketplace open to all, similar to Ebay, Etsy or Amazon. Vaccaro and his team decided to use the online marketplace to open up opportunities for more pallet providers. He said, “The big companies have a thirst for instant reach and technology. But that doesn’t mean they want to throw all of their eggs in one basket.”
Bettaway has worked in beverage logistics, bottling and pallet management for decades. It has operated a national pallet program for Snapple for 35 years, and for some three decades has handled nationwide pallet management and supply for Arizona Beverage Company, makers of the iconic iced tea drink, known for its 99-cent can The company has also managed trucking and transportation networks for clients. Vaccaro explained why a pallet marketplace is inevitable. He said, “You can buy anything online. But you can’t buy a pallet online, well maybe a pallet on Uline for $99. Pallets are as big as trucks and shipping. For every truck, there are multiple pallets. But yet, there is no national name that is widely recognized for supplying pallets.”
PalletTrader has been optimized to work on any browser, computer platform or smartphone. The financial transaction is completed through the platform. Payments can be made via credit card or ACH bank transfer. In addition to its open, public-facing transaction ability, PalletTrader allows users to set up their own private networks in a secure, permission-based environment, creating defined communities of specific customers.
“It’s like using Venmo, where you transact with many others, you have your own account and you can make your transaction public or private,” Vaccaro explained. “The private network option is an important feature as many pallet businesses want to protect the identity of their customers, but still want to enjoy the ease and cost-savings of a collaborative online platform.”
Vaccaro admitted, “There is a lot of protectionism in the pallet industry. It is the same as it used to be in trucking. I don’t want others to see my rate. I don’t want them to know my partners or suppliers, etc.” That’s why the designers behind PalletTrader tried to make the best of all worlds by offering a very flexible technology platform. You don’t have to show your price. But you can if you want. You don’t have to show your location at first. But you will later, once the deal is done. Prices can be set up front or a seller can offer a bid opportunity.
The platform has officially launched online at www.pallettrader.com and Bettaway worked with a team of pallet industry professionals to provide feedback on the design. Vaccaro recalled, “Our Founders Circle pallet company members have provided feedback, and they told us that we have thought of everything.”
A development team of 14 people has spent more than three years developing the website marketplace. The PalletTrader team has put in over 20,000 testing hours, and actual transactions have been conducted with Bettaway partners.
One big advantage for the sellers is faster payments. Once a load has been received, the payment is initiated 2 days after it is marked as delivered. Many customers typically push for 45-60 day terms or longer in traditional pallet sales. Vaccaro commented, “This is about immediate payment…One of the ideas about this marketplace is to break a lot of molds. I am sick and tired of customers pushing 90 and 120-day payments. This is a transaction, and that should be attractive to pallet vendors.” Money transactions take place outside of PalletTrader and Bettaway. Neither company holds any payments. The platform uses Stripe and other payment processing tools.
Is the marketplace free? No, but it is a deal compared to the cost to develop. For the first six months, businesses who sign up on PalletTrader will get the service for free with no monthly subscription fee. The only cost is a small transaction fee of 1.5 percent from the buyer, and 1.5 percent from the seller (brokers pay a 2.5% per-transaction all-in administrative fee). Fees do not include any credit card or ACH fees from the payment entity.
To receive six months of membership for free, use the code REIMAGINE. After the initial trial period, the monthly membership fee is $79 for individuals/companies (up to three users per location) and $279 per month for brokers (up to ten users). Since the payment is conducted through the website, no credit checks are required.
Since the website can be used to replace traditional sales processes, one question is, “How will brokers view PalletTrader?” Vaccaro responded, “We are creating a haven for more brokers to evolve.” He added that brokers can use the website to sell more lots, connect with more customers and reduce customer development costs.
While there have been some websites that attempted to connect buyers and sellers in the past, Vaccaro pointed out, “Those were just lead generation or a matchmaker. Those are a lemonade stands compared to the brand we just built with technology.”
PalletTrader provides a vehicle to help pallet companies and users sell odd-sized pallets and unwanted pallets. The platform can also be used to set up private networks or even help companies recover stray assets. Vaccaro added, “PalletTrader is going to be good for everyone in an up market and even better in a down market because they will be able to sell excess pallets and turn them into cash.”
The developers are also spending a lot of time and money marketing the website to build the user base. Among the inaugural industry users are Paltech Enterprises, John Rock, Inc. and San Fernando Valley Pallet Co.
Why does the industry need an online marketplace? Vaccaro explained, “We are bringing the convenience and efficiency of online commerce technology to the world of pallets. And we are providing a common set of tools and processes that can be shared by everyone to manage and optimize pallet inventory as a renewable asset, not discarded as a throw-away piece of wood.”
While the majority of PalletTrader’s market is expected to be “white wood” pallets, the platform can accommodate all other types of pallets as well, including those made of plastic, composite or other materials.
Interested parties can sign up and begin using the platform at www.pallettrader.com, make sure to use the code REIMAGINE to receive a discount.
Buyers Advantages
• Find new core sources and pallet suppliers for one low cost.
• Develop private networks connected to a public marketplace.
• Take advantage of online tools offering tons of customization.
• Reduce costs associated with managing pallet purchases.
• Find odd-sized pallets, set own specifications.
• Access large database of pallet contacts.
Sellers Advantages
• Find new pallet buyers for one low cost.
• Develop private networks connected to a public marketplace.
• Options for pallet manufacturers, recyclers and brokers.
• Provide customers online tools they want to manage their pallet purchases.
• Tons of customization and activity alerts.
• Get paid faster, guaranteed.
• Eliminate the need to conduct credit checks.
• Reduce costs associated with having a large sales team.
• Sell excess inventory and odd-sized pallets.
