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TIPS AND TRICKS FOR MANAGING PALLET INVENTORY

T2IPS ANDune 023 TRICKS FOR MANAGING PALL


ET INVENTORYJ

June 2023


It takes literally billions of pallets to keep supply chains in the United States moving. Hundreds of millions of new pallets are produced every year just to maintain the numbers needed to keep the stream of goods flowing from manufacturers to retailers and consumers. Even a single manufacturer or distributor deals with a huge number of pallets, and keeping track of them all as they come into the warehouse and are loaded with products and shipped to retailers is a substantial task.


In fact, managing pallet inventory is such a hassle that many companies do not even bother to do more than ensure they have enough pallets on hand to make a shipment. They treat their pallets as disposable, shipping them one way and foregoing retrieval. This treatment is understandable when the pallets being used have a short lifespan. However, many retailers are tired of receiving damaged stringer pallets and are demanding the use of more durable, higher-quality pallets to reduce product damage during shipping and make pallets safer to handle once they arrive. Walmart, for instance, demands products be shipped to them on high-quality block pallets that meet or exceed the highest Grocery Manufacturers Association (GMA) pallet grades. These sturdier block pallets cost too much to be thoughtlessly disposed of, and as a result, many companies are being forced to develop a means of managing pallet inventory.



The Challenges of Managing Pallet Inventory

Pallets are simply a form of product packaging that make it possible to move products with forklift trucks. However, while products and product packaging make a one-way journey, they are also capable of making a two-way journey; they can go from manufacturer to retail to the manufacturer for reuse. To reuse pallets in their inventory, companies should be able to arrange for the following to be implemented:


· Recovery: The return trip a pallet must make to the manufacturer to be reused effectively doubles the transportation required to keep the supply chain running. Perhaps the bigger challenge, however, is the administrative work involved in keeping track of how many pallets are in each location and when enough pallets have accumulated at a location to make it worth sending a truck for retrieval.

· Sorting: Once pallets have been returned to the warehouse or distribution center, the ones that are damaged will need to be sorted from the ones that are still fit for use as-is. Damaged pallets will need to be further sorted to separate ones that can be repaired from those that are too damaged to be used again.

· Repair: Damaged pallets that can be salvaged will need to be repaired either by swapping out broken boards or by adding reinforcement. While this isn’t a complicated task, it requires employees who possess skills in the safe use of tools as well as appropriate wages, equipment, and a facility for doing the work.

· Storage: Pallets are bulky, which means that safe idle pallet storage requires a large amount of space at production facilities or a separate storage area with transportation to bring pallets to where they will be used.




· Disposal: Pallets that are damaged beyond repair must be properly disposed of. Typically, pallets at the end of their useful life are taken to the local landfill where dumping fees are based on weight. For an additional labor cost, nails and screws can be removed from the pallets and they can be ground up and used as mulch or wood filler.


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