Pallet pooling consists of outsourcing the management of your pallet pool. There are many advantages to this type of service and we have broken them down into 2 categories: Economic and Logistics.
6 reasons why pallet pooling is cost effective
As well as optimising your supply chain, pallet pooling can save you money
1. Pallet pooling reduces hidden costs
Unanticipated expenses in pallet management may cost more than you think.
The main advantage of moving to pallet pooling is economics. When compared to the purchase of pallets, pallet pooling presents better value for money, less risk and offers more flexibility.
2. A greatly reduced risk of loss of goods
Lost pallets are single-use pallets. Their low purchase price can be seen as a major argument against a pallet pooling service.
When considering which pallet provider is right for your business, you should consider all potential risks. The first should be the quality and maintenance of the pallets. Using poor quality pallets can lead to damage within your automation and deterioration of cargo during transport or storage.
Here’s a potential scenario:
1. You send your product to your customer
2. The pallet collapses and your products become damaged or lost
3. You still need to fulfil your customers order, so you need to ship additional products
Therefore, you would be required to double your costs – and potentially risk fines, particularly where your customer is a retailer. Your customer, of course, will only pay once...
By using pallet pooling, you will have access to a range of superior quality pallets, reducing your risk.
3. The non-financial costs of using a single-use pallet
Cost implications can be seen at each stage of the supply chain where a single-use pallet is used.
The storage and transport of heavy loads is limited by the fragility and poor quality of a single-use pallet.
The pallet specification of single use pallets often does not correspond to production standards, which can lead to:
Lost time: stoppages in automated production lines. Inaccurate calibration may also require human intervention (which has a safety risk) to restart the line.
Increased risk of accidents in warehouses.
Destruction of goods due to potential imbalance on forklifts (or stackers) during handling;
Productivity of the supply chain is affected, shipments are reduced and can lead to shortfalls.
4. The exchange system also have hidden costs
To avoid the many issues associated with using a single-use pallet solution, you could choose to move to a exchange pallets.
Made from better quality wood and nails, these storage and transport pallets have a longer lifespan and are intended to be reused.
This solution certainly offers money-saving opportunities and is a more profitable choice than that of the single-use pallet.
However, the exchange pallet management system is still subject to a considerable number of hidden costs:
Costs of regular pallet checks by your own staff (needed to reduce the risk of damage to both automated systems and goods);
Costs to repair or replace damaged pallets;
Costs for pallet storage: purchase of handling equipment, management personnel, storage costs and safety investmentsto protect your staff.
5. Pallet pooling has no storage or maintenance costs
Owning and storing pallets comes at a considerable cost.
To ensure that your pallet stocks are kept in good condition, significant infrastructure is required. This could become one of the biggest expenses of your entire supply chain.
Choosing pallet pooling eliminates these costs.
6. Pallet pooling frees you up from end-of-life costs
The destruction of end-of-life pallets is also a hidden cost, and one that is once again eliminated if you choose pallet pooling.
By outsourcing this activity, the recycling of pallets is no longer your responsibility. LPR - La Palette Rouge contributes to making the supply chain sustainable, in particular through the repair and reuse of pallets. It’s a great way to help the planet and save money.
5 logistics advantages of pallet pooling
Financial flows are closely linked to logistics flows. They also benefit from the advantages provided by pallet pooling.
7. The end of "empty" transport miles
For a company, there is something even worse than hidden costs: unnecessary costs.
After delivering your goods to your customers, hauliers often make the return trip empty, without added value.
If you manage your freight transport by truck, you’ll be all too aware of the incessant increase in fuel prices.
Pallet pooling takes this into account. At LPR - La Palette Rouge, we optimise our customers' logistics flows to avoid empty return flows.
Where possible, we pool transport with our other customers and partners, using the same trucks to deliver goods, to collect pallets on the return trip.
8. Finding the right pallet supplier can be difficult
Choosing a pallet supplier involves asking difficult questions:
Are they reliable?
Are their pallets certified and of good quality?
Does it cover all of my distribution or supply areas?
Can it be reactive and deliver to me anywhere, and at any time?
By outsourcing the management of your pallets, you free the employees responsible for optimising your supply chain from this delicate task. Selecting the wrong supplier could mean that you are stuck with a supplier that does not meet your expectations or business needs.
9. Pallets available anywhere, anytime
Pallet pooling ensures availability of pallets across the widest possible territory.
To maintain a good level of service, pallet poolers will usually have service centres where the pallets are sorted, inspected, repaired and stored.
This makes it possible to offer continuous service, whatever your distribution area and working hours.
To offer this level of service to our customers we have developed MyLPR. This application gives you access to a set of features to manage your day-to-day pallet needs:
Detailed reports of your movements
Manage your account
MyLPR is simple, intuitive and effective. It allows you to place orders, manage your flows and anticipate your pallet needs, wherever you are!
10. Pallet pooling - the solution to optimise your entire supply chain
If managing your pallet pool is a drain on time and resources for your business, then switching to a pallet pooling service will allow you to:
Access high quality pallets, suitable for use in all types of automated systems,
Ensure on-time deliveries thanks to an optimised logistics network; and
Calculate quantities of pallets according to your needs.
Pallet pooling reduces hazards while optimising costs and allows your team to focus on your core business.
If you would like to discuss your pallet pooling needs, our contact form is here.
11. More sustainable transport use
In addition to reducing your costs, opting for pallet pooling also allows you to reduce your carbon footprint. Your environmental impact related to the management of your pallets will be reduced.
At LPR we:
Optimise each pallet movement,
Optimise the number of miles traveled,
Optimise truck loads,
Select the same carrier for round trip deliveries
Use multi-modal transport (road and rail), where possible.
Collaborate on transport routes
By choosing pallet pooling, you also reduce your CO2 emmisions.
Use our environmental impact reduction simulator to see how.
Whatever your business needs, pallet pooling offers a beneficial solution. When considering your pallet use and needs, ensure you study the full cost of use rather than just the cost of purchase. This will save you time and money, meaning you can devote more time and resources to the activities which offer higher added value for your supply chain.