Pallet pooling is becoming an increasingly popular option for businesses looking to reduce their pallet costs. This article will explore the pros and cons of pallet pooling, and help you decide if it is the right option for your company.

Pallet pooling is the practice of outsourcing your pallet pool management. There are several advantages to this form of service, which we've divided into two categories: Economic and Logistics.

Is Pallet Pooling A Good Option?

Pallet Pooling may be a beneficial packaging technique; nevertheless, it might not work for every company. Before sourcing Pallet Pooling from a pallet pooling company, consider these:

1. Non-Standard Sizing Needs

Do you require a different pallet size than the typical 1165 x 1165?

Pallet Pooling firms may restrict or limit the ways you use the pallets if they only provide Australian standard size pallets (1165 x 1165 x 150mm) in one size and type. Because they only offer the Australian standard size pallets of this format, they may limit or restrict your usage of them. Consider the advantages of a variety of types and sizes of pallets before deciding whether to utilise basic palettes that don't offer adequate protection or durability for your product.

Pallets that are over or under-engineered for the job are commonly utilised. Customising your pallet ensures that you receive a pallet that is appropriate for your needs. We've previously covered why bespoke pallets are advantageous and how they protect your products from harm.

2. Warehouse Racking

How will the pallets be used? Will they be racked or kept in your warehouse for a lengthy time?

Pallet pooling may be a waste of money for your business if you are thinking about obtaining pallets for racking or don't physically change your pallets on a regular basis. Why? Because the Pallet Pooling System's pallets are (often) charged on a daily rate, and costs accrue with each day that they stay in your warehouse or yard.

Keeping pallets for extended periods of time may result in the same cost, if not more, than custom-made pallets. That's why we can and do produce bespoke pallets that are used to ship as well as store products. The upfront price of your own pallet is greater than you imagine, yet it is the more cost-effective option when your shelves will remain empty in your warehouse for a long period of time.

3. Intra-Company Pallet Exchange

Is your inventory transferred between the same warehouses on a regular basis?

If you're swapping pallets among your group, you have everything you need to manage your own pallet pooling system. Our firm can help you choose the size and style of pallets that work best for you. You could pick pink or yellow pallets, for example. Maybe you want something lighter with less material and corporate branding. These alternatives are readily accessible and more cost-effective than anticipated.

4. Resource for Pallet Management

Do you require extra resources to handle pallets in your pool?

Pallet Pooling has an integrated paperwork management system that adds to the complexity of your logistics procedures. If you don't keep track of the Pallet Pooling documentation, you may be penalised; if the regulations and standards aren't followed, fines and penalties can also be imposed. This is also true for pallets that have been damaged or lost. A simple search on Google can reveal how much money firms have spent when pallets were misplaced or destroyed.

If you responded "yes" to most, or all, of the above 4 questions, Pallet Pooling may not be the ideal solution for your company.

Pallet pooling is cost-effective because of the following six reasons.

1. Pallet pooling lowers the cost of operation.

Unfortunately, diverting costs from pallet management may end up costing you more than you expect. The main advantage of adopting a pallet pool is its low cost. Pallet pooling has fewer dangers, greater adaptability, and a lower cost than buying pallets.

2. A significant reduction in the danger of losing goods

The term "single-use pallets" refers to old, used pallets that have vanished. The low price at which they can be purchased is a major deterrent to pallet pooling. When deciding which pallet provider is best for your company, consider all potential drawbacks. The first should be the quality and maintenance of the pallets. Using low-quality pallets may cause damage to your equipment and cargo during transportation or storage as a result of deterioration.

Here's a possible scenario:

You ship your item to your client.
The pallet collapses, and your goods are damaged or lost.
You still must fulfil your client's order, therefore you'll need to ship extra goods.

As a result, you'll have to double your expenditures, which may result in fines, especially if you're selling to a company. Of course, your client will only pay once. You can reduce the danger of using pallet pooling by having access to a wider variety of higher-quality pallets.

3. The non-financial costs of utilising a single-use pallet

A single-use pallet may be a great way to save money, but it will come at a cost. Each stage of the supply chain where a single-use pallet is utilised exposes these costs. The weight and bulk of heavy goods are hampered by the fragility and low quality of single-use pallets. Single-use pallets are frequently produced to inadequate specifications, which can lead to the following:

Time lost: interruption in automated manufacturing processes. To resume the line, human intervention (which poses a safety risk) is required if the incorrect calibration was used.
Accidents are more likely in warehouses.
During handling, the possibility of goods imbalance on forklifts (or stackers) causes damage.

Productivity of the supply chain is affected, shipments are curtailed, and shortages may result.

4. There are also hidden costs in the exchange system.

You may choose to exchange pallets to avoid the many problems that come with using a single-use pallet solution. Made of higher-quality wood and nails, these storage and transport pallets have a longer life expectancy and are designed to be reused. This technique delivers significant money savings while also being a more profitable option than the single-use pallet.

However, there are still a number of hidden fees associated with the exchange pallet management system:

The costs of on-site pallet inspections by your own staff, which is required to minimise the danger of damage to both automated systems and products
The costs of repairing or replacing damaged pallets.
Pallet storage costs: purchasing of handling equipment, storage fees, management personnel, and safety measures to safeguard your employees.

5. There are no storage or maintenance expenses associated with pallet pooling

Pallets are expensive to own and store. To keep your pallet stocks in good shape, significant infrastructure is required. This may end up being one of the most costly elements of your entire supply chain. Pallet pooling allows you to avoid paying for these expenses.

6. Pallet pooling eliminates the expense of end-of-life services

Pallet pooling also eliminates this hidden cost, as it does with any other aspect of the end-of-life pallet industry. If you want to get rid of your old pallets, you'll save money by outsourcing this task.