Pallets for the Building Materials Industry: Is One-Way or Reusable the Right Choice?
We are currently monitoring a significant shift from one-way to reusable pallets in the building materials sector, particularly in Europe. But what about here in North America? Whether you use an expendable pallet or utilize a pallet reuse program, It is generally a good idea to review the fit of your pallet program with your overall supply chain strategy at least every few years. With that in mind, we highlight recent developments from home and abroad below and list some things to consider for your strategy review.
The Shift to Pallet Reuse in Europe
In a previous blog we have discussed the essential benefits of a reusable pallet program. For the construction sector, the potential opportunity for reuse is massive, yet for many applications, seems daunting. Take the UK market, for example. As of the 2020, around 18 million pallet were manufactured for the UK construction sector, with estimates suggesting less than 10% were being reused. Meanwhile, PPWR (Packaging and Packaging Waste Regulation) legislation is poised to leave its mark, with immediate requirements for 100% of pallets within an EU country to be reusable immediately and 100% of them reusable by mid-2026 for inter-country supply chains within the EU.
Several European pallet providers have been making inroads into the building materials reuse space:
Notable Drivers in North America
At the PACK EXPO International show in November 2024, Tim Debus, Reusable Packaging Association President & CEO discussed four megatrends that he believes will drive the widespread growth of reusable transport packaging, including pallets. He identified those trends as technology, automation, public policy and metrics.
“The four megatrends—technology, automation, public policy, and sustainability metrics—are coming together to reshape the landscape for reusable packaging,” he said. “Each trend individually drives significant change, but collectively, they create unprecedented opportunities for innovation, economic growth, and environmental stewardship in the supply chain.”
Looking at the North American construction sector in particular, drivers such as waste and cost reduction initiatives provide meaningful immediate incentives to develop reusable pallet systems, while over the longer term, tracking and visibility technologies will provide additional benefits.
For example, one European supplier utilizes technology-enabled reels to not only help locate its materials on the jobsite (or away from the jobsite if stolen) but also for inventory control. They can detect how much cable has been consumed. Over the longer haul, access to data will be increasingly important, and IoT equipped reusable pallets will help make good on that opportunity.
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Are Reusable Pallets the Best Fit?
The economics for pallet reuse can be challenging for building products suppliers. Minimal quantities of like-sized pallets scattered across many jobsites can make the cost of pallet retrieval too high, particularly the longer the distances involved. On the other hand, where truckload accumulations of empty like pallets develop more quickly, such as in a DIY supply chain, or a paint retail network, for instance, the economics of reuse can quickly trump a single-use pallet program.
The economic viability of reuse programs can be enhanced by developing return hubs such as DIY distribution centers or building supply wholesale locations. Think of it as a similar spoke and hub model to the grocery industry. In grocery, empty pallets are returned from the retail store to the distribution center, and accumulations are then released to pallet recyclers or returned to pallet rental companies.
Efforts to standardize pallets can further enhance the rate of empty pallet accumulation, where standardization makes sense for a particular product. Collaborating to standardize on a particular pallet size can seem daunting, but consider that 30 years ago, the U.S. fresh produce industry relied on over 30 different footprints rather than the ubiquitous 48×40 embraced by the industry today.
To be sure, there are already several companies in the construction sector that have used reusable packaging programs for many years, from paint and shingle to turf. I most frequently see reuse and deposit systems in landscaping materials such as rock and grass. These materials often have shorter delivery distances and are more convenient to return.
Reuse or Expendable: 9 Considerations
So, what are the signs that you could be a candidate for a reuse program? Here are nine factors to consider when you undertake your next pallet system review. Collectively, enough of them might tip the scales in favor of reuse.
The Right Packaging Partner
“As the largest producer of pallets for the building materials industry, PalletOne is committed to leading the way in delivering cost-effective and innovative solutions for pallet retrieval and reuse,” said Jeremy Marshall, PalletOne Sales Manager. “We recognize the critical role sustainable practices play in reducing costs and enhancing supply chain efficiency, and we are proud to be at the forefront of this transformative shift in our industry.”
Whether you rely on expendable pallets you do not anticipate receiving back, or some form of reusable pallet program, be sure to periodically review your program. Substantial benefits can be accrued by switching to reuse, and if you are already involved in a reuse program, doing it with a more durable, better designed pallet that works consistently in your material handling equipment. Why not contact us today and share where you are and where you need to go with your pallet program. It’s our mission to help you get there.