Across nearly every industry and geographic region, pallets are virtually everywhere. Businesses of all kinds use them to ship and store everything from electronics to running shoes to chemicals. In fact, the typical company is using nearly 700,000 pallets in its operations, according to a 2019 survey.
With so many pallets in circulation—most of them wood—it’s no surprise that things can get costly, considering the expense of transporting pallets, the costs associated with product damage, and the need to recycle or dispose of the pallets. In fact, the cost associated with wood pallets is one reason that corrugated paper pallets are becoming increasingly popular, with the global market expected to reach nearly $1.5 billion by 2026.
Corrugated pallets offer a variety of benefits, including the opportunity for shippers and suppliers to save money and, in many cases, increase revenues. Let’s take a look at the basics of corrugated pallets, as well as some of the key ways you can make money by using them.
Basics of Corrugated Pallets
Corrugated paper pallets are made largely from recycled fiber materials and water-based adhesives. They weigh 8-15 pounds, a fraction of the weight of a wood pallet, and are free of nails and staples. Perhaps best of all, corrugated pallets are incredibly strong, delivering a maximum load capacity of up to 10,000 pounds.
Switching to corrugated pallets presents several opportunities for your company to reduce costs and even make money, including the following.
Reduced fuel costs
Every time your company uses a pallet, it spends money on fuel to move that pallet. It makes sense, then, that the lighter the pallet, the lower the overall weight of each shipment and the less you spend on fuel.
Corrugated paper pallets are, on average, one-third the weight of wood pallets, which means you save up to 30 pounds of weight for every pallet shipped. On a 53-foot trailer, this weight difference translates to 1,800 pounds of savings.
Reduced fuel costs have prompted many companies to switch from wood to corrugated paper pallets. IKEA provides a great example of what’s possible: The furniture and decor retailer switched to corrugated paper pallets and achieved 90 percent weight savings, which resulted in a reduction in fuel consumption and carbon dioxide emissions.
As a bonus, IKEA no longer has to transport wood pallets to and from production sites, so the company is able to avoid up to 100,000 transport movements a year.
Corrugated pallets come in a variety of customizable shapes, which lets suppliers and shippers make the most of the available space in every warehouse or shipping container. Over time, this further reduces costs.
In IKEA’s case, switching to corrugated pallets let the company take advantage of customizable shapes, which is important for any company that sells a wide variety of products. With the freedom to choose pallet sizes and shapes that work for its specific needs, IKEA can utilize more space in its warehouses and during shipping.
Less product damage
Because corrugated pallets are so much lighter, they are easier to maneuver than wood pallets and they also require more thoughtful handling. This helps prevent product damage from dropped pallets, overloaded forklifts, and similar scenarios. In the end, your company will spend less overall when its products are better handled.
Recycling and environmental credits
Like a gift that keeps on giving, corrugated pallets also reduce disposal costs and can generate revenue when they are properly disposed of. Many paper pallets, such as LoadRunner products from Conitex Sonoco, can be baled with other recyclable products, which is significantly easier and less expensive than common wood pallet recycling services.
Your earnings from recycling revenue could be significant: For example, General Motors required suppliers to ship products to its facilities with corrugated paper pallets over a period of 19 years, during which the company reported more than $2 billion in recycling revenue.
Meanwhile, corrugated pallets can give companies like yours a compelling practice to highlight in their sustainability initiatives. To really demonstrate your commitment to sustainability, opt for corrugated pallets such as those from Conitex Sonoco, which are made from 80-100 percent Sustainable Forestry Initiative Certified materials.
Benefiting Your Bottom Line
Oftentimes, some of the simplest changes in the supply chain can have a significant impact on a company’s bottom line. As many companies have discovered, switching from wood pallets to corrugated paper pallets can lead to huge cost savings in the form of reduced fuel consumption, increased payloads, reduced product damage, and an improved recycling or sustainability program.
As many businesses look for ways to cut costs during the current economic downturn, consider whether switching to corrugated pallets could help your company save money. You might be surprised to find that the decision isn’t a heavy lift at all.