Over the years, companies have graduated to palletizing products to make handling pallets easier but that change has come at the expense of freight. In today's world of rising freight costs, is palletizing still the right way to go? Here are some things to consider along with examples of company decisions about when not to palletize.
Companies had a choice to go with pallets that speed up loading and unloading and reduce product damage to goods or to floor load. Clamp trucks were often used to speed loading but because of the damage they created, they were referred to as the squeeze of death as they caused high damage. Pallets became the alternative. They provide a softer approach.
But pallets chew up capacity in a truck. By eliminating them, companies like Frito Lay have often achieved numbers in the 90+% utilization of the water cube (the 100% utilization of capacity of the trailer would be when it was full of water). Frito has traditionally seen cube maximization as an important metric and key cost driver. All their salty snacks are hand loaded onto high-cube trailers. The one redeeming factor is that the cases Frito uses are relatively large and light.
You have to take into consideration the pallet weight when determining payload. By removing pallets, you can increase the weight of the product carried. For example, if you have 60 pallets, they weigh over 3,900 lbs and decrease that weight of product by 8%. In many cases, DC replenishment shipments can be more economically shipped without pallets. The extra labor costs associated with palletizing when they are received, are often calculated to be less than the freight savings.
It is important to understand there can be many costs associated when shipping without pallets. It is called shipping on the floor. This is where technology can come into play. There is an approach called "slip sheets". The product ships on a large piece of plastic that is pulled-pushed and manipulated onto and off the platens of a forklift with a special attachment. Additional labor costs are required in palletized shipping, if it is requested by the customer or put onto racks for efficient storage.
The last item that must be taken into consideration is the cost of the pallets themselves. Whether a pallet exchange program, disposable pallets, or rented pallets (like Chep) are used, the pallets themselves cost money.
The cost decision of shipping on or off pallets must be considered and reviewed carefully against the potential for damage.
When you consider a transportation consultant, Transportation | Warehouse Optimization has been working with some of the top companies in America, finding practical solutions that have resulted in saving millions of dollars. They take a long-term view and keep the client as top priority. Contact them at www.TransportationOptimization.com for transportation cost reductions or solutions to warehouse challenges. While visiting their website, sign up for their exclusive free Truck Loading Manual that can SAVE YOU MONEY and offer you the perfect Operator Manual for truck operators. Transportation | Warehouse Optimization - Solutions that work. Solutions that save. - 15275
Companies had a choice to go with pallets that speed up loading and unloading and reduce product damage to goods or to floor load. Clamp trucks were often used to speed loading but because of the damage they created, they were referred to as the squeeze of death as they caused high damage. Pallets became the alternative. They provide a softer approach.
But pallets chew up capacity in a truck. By eliminating them, companies like Frito Lay have often achieved numbers in the 90+% utilization of the water cube (the 100% utilization of capacity of the trailer would be when it was full of water). Frito has traditionally seen cube maximization as an important metric and key cost driver. All their salty snacks are hand loaded onto high-cube trailers. The one redeeming factor is that the cases Frito uses are relatively large and light.
You have to take into consideration the pallet weight when determining payload. By removing pallets, you can increase the weight of the product carried. For example, if you have 60 pallets, they weigh over 3,900 lbs and decrease that weight of product by 8%. In many cases, DC replenishment shipments can be more economically shipped without pallets. The extra labor costs associated with palletizing when they are received, are often calculated to be less than the freight savings.
It is important to understand there can be many costs associated when shipping without pallets. It is called shipping on the floor. This is where technology can come into play. There is an approach called "slip sheets". The product ships on a large piece of plastic that is pulled-pushed and manipulated onto and off the platens of a forklift with a special attachment. Additional labor costs are required in palletized shipping, if it is requested by the customer or put onto racks for efficient storage.
The last item that must be taken into consideration is the cost of the pallets themselves. Whether a pallet exchange program, disposable pallets, or rented pallets (like Chep) are used, the pallets themselves cost money.
The cost decision of shipping on or off pallets must be considered and reviewed carefully against the potential for damage.
When you consider a transportation consultant, Transportation | Warehouse Optimization has been working with some of the top companies in America, finding practical solutions that have resulted in saving millions of dollars. They take a long-term view and keep the client as top priority. Contact them at www.TransportationOptimization.com for transportation cost reductions or solutions to warehouse challenges. While visiting their website, sign up for their exclusive free Truck Loading Manual that can SAVE YOU MONEY and offer you the perfect Operator Manual for truck operators. Transportation | Warehouse Optimization - Solutions that work. Solutions that save. - 15275
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Sign up for a exclusive free truck loading Manual that can SAVE YOU MONEY and offer you the perfect Operator Manual for Truck Operators. While there, request a call back from one of the premier transportation consultantsin the industry. Tom Moore or one of his associates will get back with you. Transportation l Warehouse Optimization - Solutions that work. Solutions that save.
