History

A revolutionary idea in the early part of the 20th century, the pallet was a means of storing, loading and transporting supplies through ports. Loose cargo could be stacked on a pallet, where it would remain until moved.

A turning point for early pallets came in the late 1930s with the development of the standardized pallet. A 40 x 48 design, it allowed the exchange of pallets across a number of different industries for the first time, further facilitating the transport of goods. This predictable, unitized load led to the standardization of forklifts and the development of storage racks to replace shelving.

In the 1940s, the pallet took another step forward with the development of the four-way pallet, which could be approached by a forklift from any direction. At this time, all pallets were made of nondescript, unbranded wood. For this reason they are, to this day, frequently referred to as whitewood pallets – and the makers of them collectively as the whitewood industry.

The stringer-style pallet became the lowest cost to manufacture and predominant type of pallet in the US, as it was consistent with American standard lumber production and the fragmented, decentralized and entrepreneurial nature of the US industry. It is called such because it uses stringer boards, each typically 2 x 4 or 3 x 4, sandwiched between the top and bottom deck boards, to support the unit load. These stringers might also be notched to allow for four-way fork entry but only two-way pallet jack entry, thus creating a partial four-way stringer pallet. When the stringers are not notched, it is a two-way pallet, with fork entry only from either end. Bottom deck boards can be chamfered to allow entry for the wheels of a pallet jack.

Supply chains tend to prefer block-style pallets for ease of handling and efficiency. Block pallets are true four-way entry (forklifts and pallet jacks can enter from all four sides) pallets. Typically, block pallets use blocks of solid wood, plywood, or plastic to support the unit load, with 4 to 12 blocks to support the top deck boards. A standard 48 x 40 pallet typically uses nine blocks. Since they are more costly to produce, block pallets tend to be used less frequently, except where they can be reused or when a consistent standard can be enforced.

 

In the 1970s, the Grocery Manufacturer Association (GMA) created a standard 48 x 40 hardwood stringer pallet specification that is used widely for many consumer products. But the American wood pallet industry is highly fragmented, making standardization and cooperation difficult. And since a standards body did not exist within the industry, this standard was never enforced.

 

In the 1980s, pallet users began to shift from predominantly using new, high quality pallets to the recycling, repair and reuse of GMA pallets. Recyclers retrieved or purchased used pallets (cores), then inspected and repaired and sell them to customers for reuse. Recycled pallets became more popular due to their lower cost and higher availability, and fewer new pallets were purchased to renew the overall stock. As the pallet pool aged and wore out over time, quality and availability suffered, and a standard of stratified quality grades (A, B and C or 1, 2 and 3) emerged.

Over time, as customers demanded lower prices and more pallet companies competed for limited business, the GMA pallet specification was compromised. This resulted in inconsistently built pallets with far lower quality. In the late 1980s, the American Pallet Industry launched SPEC, a quality inspection program offered to the purchasers of new, primarily stringer pallets. But because it was sold to the pallet buyer (the product manufacturer), who wanted low purchase cost and not the end users (the product retailer) who wanted quality, consistency and safety, SPEC never gained momentum. Over the next twenty years, other attempts to develop a consistent, industry-sponsored pallet program failed to gain any consensus or traction.

The US pallet industry dramatically changed when CHEP introduced their pallet rental program. While they started with a pool of new, high quality stringer pallets, CHEP quickly converted to block pallets due to ease of entry, safety factors and the efficiencies offered throughout the entire supply chain. As a result, large-scale pallet buyers stopped purchasing stringer pallets and the rest of the industry quickly followed. And since most pallet buyers considered pallets an expendable packaging cost, renting became widely popular.

But as retailers have become stronger, they are viewing their supply chains as a source of competitive advantage – and are seeing pallets as strategically important. Costco became the first major retailer to define and enforce a pallet specification, and it has sent strong waves throughout the industry. Their directive mandated that Costco suppliers use one of only three wood pallet rental companies, virtually locking out all independent whitewood pallet manufacturers.

Knowing that this trend would effectively devastate independent whitewood companies, a group of industry leaders began working on a series of initiatives to create a network that would support cost-effective ways for independent pallet players to retool, innovate, and remain solvent and competitive.

Their focus was two-fold:

•  Address the immediate need of designing a whitewood pallet that would meet the needs of Costco, and

•  Create a logistics structure that would allow independents to remain competitive in the face of these changes.

Accordingly, the National Wooden Pallet and Container Association (NWPCA) launched an initiative called PIMS, Pallet Industry Management System™, to harness the power of the wooden pallet industry to collectively confront the changes and challenges lurking on the horizon. One of the initiatives studied was the development of an industry whitewood pallet specification; it was this spec that was approved by Costco. While the concept was accepted, a key concern arose regarding maintaining product consistency and quality. It was then determined that PIMS should be a stand-alone program not affiliated with the NWPCA.

Pallet Logistics and Unit Load Solutions, Inc. doing business as 9BLOC, was conceived with a mission to continue the initiatives set in motion by PIMS. The objective of 9BLOC is to offer a cooperative pallet pool where small and large users, pallet manufacturers and pallet recyclers, would have options in choosing the type of pallet pool they wanted. The 9BLOC standard provides options for a high quality, independently managed pallet pool managed by individual participants, product manufacturers and retailers/distributors who have joined together, to provide an alternative to the rental-only model.