Since my second column in December 2003, I have changed the picture that accompanied my bi-monthly column in the Pallet Enterprise. Some of these images were quite comical. Others were serious because the topic was nothing to laugh at. Still, others were memorable because a picture truly says a thousand words.
I have selected my favorite images and memories from the last seven years. This traces some of the biggest industry issues and news over that time with a humorous look at my continual process of outlandish costumes and photo manipulation. Hopefully, it is as much fun for you to read as it was for me to produce.
Searching for the Secret Formula
Finding the next big new thing or ways to make the old thing better has consumed the pallet brain of the industry since I wrote that column in early 2004. If you don't find a way to make your product unique, you will be fighting your competition mainly on price.
Can a mature industry really learn new tricks?
Asking the Right Questions in a Bobble Head World
For every successful idea, like the bobble head or overnight parcel delivery, there are piles of things that don't catch on or develop significant demand in the marketplace.
The worse the white wood pallet pool gets, the harder it becomes to present recycled pallets to customers as a viable option to alternatives. Developing a quality standard similar to the Europallet in Europe will only help the white wood industry remain competitive. You can be like a bobble head and react to whatever forces act upon you. Or you can use your head and look for a way to be a part of the future.
Avoid the Cash Flow Crunch
Cash flow problems are one of the major killers of small businesses in the United States, and the forest products industry is no different. The best way to avoid the cash flow crunch is to be proactive and develop a comprehensive cash management plan.
Can the General White Wood Pool Be Disciplined Enough to Survive
Some of the most important lessons in business we learn in kindergarten. Things like sharing, working with others and being responsible for the property of others. But these issues are some of the very challenges that the pallet industry in the United States faces as it struggles to develop an industry cooperative pool to compete against pallet rental providers.
Bridging the Language Barrier
Hispanics are now the largest minority group in the country, and they have become a major factor in the labor pool of the U.S. pallet industry. It is important to understand the culture of Hispanics, especially the importance of family, being part of a team, and doing well to please the boss. As Hispanics have become a more prevalent part of the industry, pallet and lumber companies have had to change workplace practices to accommodate language and cultural barriers.
Just One More Little Thing
Like Columbo in the TV show, I raised the question if CHEP's Asset Recovery Program (ARP) was fair and just compensation given the fact that the Mock Pallet case suggested that the basis should be the benefit conferred on the rental provider and not the cost of the service to the recycler. I still raise this question today. Years after the Mock case was settled in court, Ricky Mock of Covington, Ga. remains one of the few recyclers who is paid more than the ARP. He makes about $5 per pallet.
Branding Wood – Harley Lessons
The forest products industry needs to do a better job of marketing itself to the world. This includes all sectors of the industry because the radical preservationists are winning the PR war. We should take a lesson from Harley-Davidson Motor Company, which took a negative, the term “Hog” and made it a positive by linking the concept to the reliability, power and noise of the brand. Harley-Davidson built a powerful brand by turning negatives into positives, focusing on its dealer network, developing new businesses, and creating a sense of brand loyalty and identity. A strong affinity for wood and wood products will help the industry improve its position for the future.
Don't Mean to Bug You
Little pests became a big deal as Ohio, New York, Michigan and others states enact quarantines to limit the spread of the emerald ash borer. The fight to stop the invasive species is no longer at the U.S. border. It became a domestic problem as well. Some consider the potential impact of requiring heat treatment for a wide variety of wood products nationwide to stop the spread of these pests.
Transportation & Logistics – Headache or Opportunity?
Beyond Just-In-Time (JIT) delivery, there are a number of things that smart companies can do to offer value-added services. These include dispatching, trucking, freight brokerage, reverse logistics, warehousing, etc. These are both challenges and business opportunities. From cutting costs to being prepared for driver and truck shortages, smart companies are taking a closer look at these areas to be better prepared to compete in the future.
Beware: The Scammer
After a string of alleged pallet scam artists, the industry learns to be a little less trusting. Scams took a wide variety of forms including those involving credit card payments, interstate transactions where the person ordering never pays for the pallet or freight costs, and stealing the identity of legitimate pallet buyers to conduct business. Scam artists get away with it because it is hard to track and prove. Many times these scams involve multiple jurisdictions. And the federal authorities are too busy focusing on terrorism and other higher profile crime to mess with small-time fraud. Pallet and lumber companies learn that they have to do better screening before shipping orders.
Dealing with Economic Doldrums
Very few people thought at the beginning of 2008 that Wall Street would go through a financial meltdown. A great economic recession led the global economy to react. Lending ground to a halt, companies began cutting back spending and inventories, cash flow became crucial for survival, and everything become less certain. A lot more pallet companies survived this period than many people expected. Many sawmills were not so lucky. This economic downturn has left a long-term deficit in total lumber capacity as the wood products industries were impacted by a severe decline in the U.S. housing sector.
The New Face of Guerrilla Marketing
CHEP USA and Intelligent Global Pooling Systems (iGPS) face off in the marketplace, sparking the age-old plastic vs. wooden pallet debate. Using Life Cycle Analysis and other scientific arguments, these competitors waged guerrilla marketing in hopes of landing a knockout punch. In the middle stood the white wood pallet industry that wasn't involved at first but was drug into the battle due to numerous PR controversies over environmental, fire safety, performance, and costs issues.
Future Shock: Predictions, Warnings & Musings
With all the uncertainty in the world today, I took a shot at making my predictions for the future. Improved coordination between retailers, warehouses, and product manufacturers will mean fewer inventories on hand while lowering costs for the supply chain. This will also mean that in instances when demand is not accurately forecasted, there could be shortages. Higher transportation and other costs will somewhat reverse the trend of globalization. Near sourcing will become more common for staple good and some high-end products.
The U.S. pallet industry will develop new quality standards and an industry cooperative pool within the next five years. This pool will meet with limited success although it will get enough funding to bring adequate competition to the market.
Cross Contamination – Real Threat or Media Hype
Media reports about recalls by Johnson & Johnson possibly involving a chemical used to treat pallets in Puerto Rico, a study by the National Consumer League identifying taint risks involving pallets in the supply chain, and growing concerns about mold force the pallet industry to answer critics. Are pallets potentially a source of contamination or taint in the supply chain? It appears that the wooden pallet industry becomes the fall guy for Johnson & Johnson and global sourcing problems. Also wooden pallets are a likely target for anti-wood interests especially iGPS. All of this despite the fact that there are no cases of food illness tied to contamination by pallets. Despite all the misinformation out there about pallet and food safety, at least the pallet industry has not become the punch line for Jay Leno. If that ever happened, it would be hard to change public perception.
Biomass Backlash – Rules Pose Threat to Energy Bonanza
The EPA considers regulating carbon dioxide release from burning wood biomass. This signals a change in course for the Obama administration which had been supporting biomass projects through research, grants and tax breaks. Some scientific reports question the environmental benefits of biomass-powered energy plants. Wood energy gets put under the microscope and some opponents call for planned facilities to be put on hold. Yet, biomass markets could throw a lifeline to many sawmills and loggers that are teetering on the edge of extinction. Wood biomass shows promise as a good use for wood waste, which helps convey the message that wood is good for energy.
