The pooled pallet was a novel concept in the early 1990’s and most American manufacturing companies did not expect them to ever to take root in the industry. Companies bought and sold pallets as needed with an exchange between sender and receiver in order to keep pallet costs down, maintain supply chain efficiencies and equipment necessities as required for down streaming products. CHEP USA, a subsidiary of Brambles Industries, brought the pooled pallet concept to the United States after reports from the grocery industry in the late 80’s indicated that there was nearly $2.5 billion in product damage during logistics operations and concluded that 70% of the pallets in the system were substandard accounting for 20% of this loss (Brindley, 2010). …show more content…
There are over 700 million pallets issued every year by pooled pallet providers for shipments throughout North America of which PECO held a 12% market share as of 2015 (Cohen, 2015). CHEP is the market leader in pooled pallets but they also provide a product that PECO does not, a half pallet. Although a much smaller market than standard size pallets, the half pallet accounts for approximately 10% of the pallet needs in North America of which PECO is unable to capture any revenue due to a lack of a product. Introducing a PECO half pallet to the US market would allow them to capture additional market share and earn the associated revenue but also improve quality, customer value and company profitability through operational efficiencies. Although the 48x40” block pallet is the staple of the industry and has led to PECO’s success, for additional growth there must be consideration of other options that can further assist customers in their supply chain efforts and provide value to their operations in supply chain solutions and thereby win customers for both full size and half pallets through product quality, diversification and …show more content…
(2010, September). CHEP USA Turns 20: Pallet Pooler Makes Indelible Mark on Industry, Demonstrates Path for Future Transformation. Pallet Enterprise. Retrieved from http://palletenterprise.com/view_article/3201/CHEP-USA-Turns-20:-Pallet-Pooler-Makes-Indelible-Mark-on-Industry,-Demonstrates-Path-for-Future-Transformation- Cohen, D. (2015, March). Developing a Refined Pallet. Middle Market Growth. Retrieved from https://www.pecopallet.com/pdf/PECO_Article.pdf LeBlanc, R. (2017, February). Markets in Transition: The Evolution of Half-Pallets -- A Double-Threat Gamebreaker. Pallet Enterprise. Retrieved from http://palletenterprise.com/view_article/4802/Markets-in-Transition:-The-Evolution-of-Half-Pallets----A-Double-Threat-Gamebreaker- Leblanc, R. (2017, April). The Benefits of the Half-Pallet. Packaging Revolution. Retrieved from https://packagingrevolution.net/the-role-of-the-half-pallet/ PECO Pallet. (2017). PECO History. Retrieved from https://www.pecopallet.com/history/ Pierce, F. (2011, June). Pallet Pooling Makes Warehousing Sense. Supply Chain Digital. Retrieved from http://www.supplychaindigital.com/warehousing/pallet-pooling-makes-warehousing-sense Russell, R. & Taylor, B. (2017). Operations and Supply Chain Management (9th