chaz1Despite being the rising star of the logistics sector, pallet networks like those of Palletforce, Pall-Ex and UPN are still ignored or misunderstood by many business leaders , says Palletforce. This is almost tragic for three reasons: costs, the environment and safety.

By their very nature, these ‘shared network’ services, based on a central hub and depots operated by member hauliers, nationwide and abroad, are inherently green, because they reduce unnecessary, half-empty vehicle movements. Palletforce network trunks, for example, run at 83% full.

On safety issues, the leading operators have invested heavily in IT so that all vehicles cannot be overloaded or the loads dangerously distributed on double deck trailers. This is a crucial issue for shipping lines and governments because there is deliberate, widespread under declaring of container payload weights to swindle shipping lines and governments out of billions of pounds in revenue each year.

Unscrupulous container stuffers can get away with it because there is, as yet, no requirement for European container ports to weigh containers. Instead, port operators rely entirely on consignors’ weight declarations. When the MSC Napoli container ship was beached on a Devon coast two years ago it was found that 20% of the above deck container payloads were at least three tonnes heavier than declared, and in one case 20 tonnes. Such behaviour may also be a factor in container crane collapses, one of which closed down the Honda Swindon car plant because Just in Time deliveries became Just too Late.

The pallet exchange networks have moved on significantly over the last 20 years, when they were originally seen as just a cheap way to send one to six pallet loads nationwide, with a choice of delivery times. Now they offer extra services hitherto offered only be dedicated 3PL companies, such as repackaging, order picking, sorting, high value goods and outsize load handling, direct line side deliveries on trolleys or in cages, and waste recycling.

Eco-drive is a good example of packaging waste management removal and recycling. Developed by Pall-Ex, in association with The Green House, their service will remove many thousands of tonnes of recyclable waste from customers’ premises, diverting it from landfill sites. It will also reduce the carbon footprint by sharply cutting vehicle journeys.

The UK model of pallet exchange networks is exportable and a keen believer in this, Pall-Ex, has forged ahead with European agreements. “By forming a strategic partnership with like-minded, ambitious businesses in Europe,” said Pall-Ex’s MD, Adrian Russell, “we can further our mission to establish a palletised freight distribution service on a truly pan-European basis.” He sees pan-European pallet networks as the answer to reducing the carbon footprint of the logistics industry on a national scale, while saving many thousands of pounds in shipping and delivery costs. The company’s vision is to connect the national networks together and drive forward its collective pan-European growth, says the chairman, Hilary Devey.

Among the recent trends spotted by UPN is the high level of growth for its micro pallet service, which provides a new price point for a smaller pallet size. This has proven popular because customers can consolidate parcel freight up to 150 kg on one pallet. Currently, UPN reports this side of its business as growing at 48% p.a. The company also sees a strong trend towards using eco-deck trailers in the network as this greatly improves efficiency.

UPN sees the UK pallet exchange market, currently worth 12.5 million pallets in 2009, continuing to grow but at a slower pace than before. Long term prospects, its says, are good because networks still provide a highly cost efficient model. Smaller consignments and JIT are the new norm, so the future for all network operators should be bright. In this respect, UPN proved its confidence by planning to relocate its hub in August to double capacity.

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