When gas prices soar, transport costs also follow. This is a simple equation. Hence, how can freight forwarders and distributors combat rising costs of transport? As per experts, the most practical solution is pallet pooling.
On its own, palletization can be a tough process, but the pooling of pallets fundamentally implies leasing or renting out pallets from a common pool. This reduces costs, and companies do not need to purchase new pallets nor sustain an entire fleet of pallets on their own.
Pooling of pallets permits businesses to focus their daily supply chain operations and capital expenditure on their main business and get rid of the expensive distraction of ownership and maintenance of their pallet inventory.
Many companies make use of single-use stringer pallets and discard them after one use. But purchasing a fresh pallet for each load for shipping is unsustainable, both environmentally and economically. Cheap stringer pallets tend to break, lose pieces and shed nails which can damage products, injure logistics personnel and break equipment.
The disadvantages of single-use stringer pallets are quite obvious, and hence, several big stores refuse to accept loads that are shipped on these on the pretext of safety and aesthetic needs. In contrast, they insist on shipping their products on much sturdier block pallets.
Block pallets look better and last longer but are more expensive and heavier compared to stringer pallets. These pallets are meant for reuse, thanks to their durability. But reuse brings about its own issues since it involves the need to return pallets to their centres of production and conduct repairs and cleaning on them.
The solution for logistics is, therefore, the pooling of pallets. This makes management of pallets simple by the pooling company taking over all the responsibility of maintaining and providing pallets. The main advantage of pooling pallets is the simplification of logistics, combined with a better reusable platform at the cost of stringer pallets.
The major advantage of renting pallets using pooling of pallets is that one is no longer liable or accountable for the balance of logistics of reaching one’s products to the market against the reverse logistics of recovering empty pallets.
The company for the pooling of pallets handles such reverse logistics by delivering pallets as per one’s request and handling the empty pallets at the concluding point of the supply chain.
With the pooling of pallets, one can enjoy the following benefits:
No need to buy pallets
It is a substantial cost to acquire a supply of block or stringer pallets. Though the cost of a single pallet is minuscule, repeated purchase of thousands of them to fuel supply will add up to be exorbitant.
No need to recover pallets
It can be quite a challenge to recover pallets of good quality from their last destination. Block pallets that are unlabelled and in good condition carry the risk of being usurped by the retailers or robbed by thieves.
No need to transport pallets
In the absence of pooling of pallets, even if pallets are stored safely at their destination, one will still be responsible for recovering them. Companies that ship nationally will find such costs of transport for recovering pallets substantial.
No need to repair pallets
Pallets can be damaged at certain points in the supply chain. Most of the time, they can be repaired. But this involves setting up depots that can sort pallets by their condition to repair those that can be reused and discarding those that cannot. This can be avoided by the pooling of pallets.
No need to store pallets
When one owns the pallets, it implies the need for big supplies enough to deal with peak seasons of demand and supply. In slow periods, huge numbers of empty pallets will be required to be stored in ways that comply with insurance guidelines, local codes etc.
In sum, pallet pooling is an environmentally and economically sustainable process. All such benefits of the pooling of pallets are magnified in modern times.
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