Construction pallet reuse program welcomed by JM Norway
“We get a lot of packaging at our construction sites,” said Cecilie Nødtvedt, head of sustainability at JM Norway. “Many products are delivered on wooden pallets. We see that many of these are difficult to get rid of. We thought it was pointless to throw pallets of good quality,” she said.
“Our logistics manager, Morten Trosterud, came across the company called SmartRetur, and contacted them,” she continued. “Then the ball began to roll. We started with the project to have the pallets recycled in the autumn of 2019, and it has gone very well for us. It has been very easy for us to implement.”
The process thus works so that JM has an agreement with SmartRetur, while the suppliers on the manufacturer side, such as Glava Isolasjon, have a customer relationship with SmartRetur and thus buy part recovered pallets back from them.
Experts in the reuse of wooden pallets
Daniel Østbye, general manager of SmartRetur, saw the need for the reuse of wooden construction pallets early. “It has become our core business where we are established in Norway, Sweden and Denmark,” he said. “In Norway, we now handle approximately 4.5 million pallets each year. This is what we define as reuse, which is especially important in a market that is screaming for wood packaging.”
According to Østbye, as many as 98 percent of these construction pallets are returned back to the market. Some just need to be sorted, while others require repair. Around 30 percent of the collected pallets are broken. “These are pallets that were previously just thrown away,” he said. “The return scheme creates better logistics around pallets, better transport solutions, better economy, and most importantly, there is a good solution around the environment and sustainability.”
Importance of simplicity for pallet recovery
Before SmartRetur began the pallet recovery program from construction sites, it had been common practice to put all wood in waste containers, to possibly be used for heat generation. There is now a container at the construction site strictly for pallets, regardless of pallet type. When the container is full, the customer enters a web portal and orders a collection of the container.
Loads of recovered construction pallets are then taken for processing to a SmartRetur depot – SmartRetur has 16 locations, including four in Norway. Once the collection has been ordered, pallets are transported to the nearest warehouse, where they are sorted. The pallets the customer wants to exchange with their suppliers are placed on an account displayed in the web portal. The customer can retrieve these directly via the portal, and Smart Retur delivers them to the customer’s supplier. The remaining pallets are purchased at an agreed upon price.
“When the pallets have been sorted, the customer can go in and look at what has been received,” Østbye said. “In the solution, customers also receive a separate environmental account where information is provided on the number of units, the number of tonnes of wood delivered, the degree of filling of the trailer and reuse.” There is also a separate CO2 account in the report.
Promotes sustainability in manufacturers
Pallet quality is also a very important aspect for companies with automated processes, such as Glava Insulation. Iver Kasbo, who is purchasing manager at Glava Isolasjon, pointed out that their facilities are very advanced, with 24/7 operation and fully automated systems that require high-quality construction pallets. There are not necessarily people in contact with the goods until they have been stored in the company’s warehouse.
“In order to make this system flow as efficiently as possible, we have quite high requirements for the quality of a pallet,” he said. “It must be within the specifications and tolerances of our system.”
“We have been a little skeptical about using a pallet that has already been used on a construction site and may have received rough treatment. Careful sorting is therefore necessary.”
His experience today is that the system works better than expected and that the process runs almost as well as when using completely new pallets.
“For us on the producer side, this also has a very good effect on sustainability, but even with today’s galloping timber prices, it is beneficial financially to actually get these pallets reused, rather than taking out new pallets and new wood,” Kasbo continued. “But the most important of all is the climate and environmental benefits of saving a lot of trees and emissions by not producing new pallets.
Easy for all parties
Cecilie Nødtvedt agrees that the process is very smooth. “We order building materials for the construction site, rem.ve the products, stack the pallets, then we order a 45-foot container from SmartRetur,” she said.
“It is also possible with smaller containers if there is less space on the project. We store the pallets in the container, and when it is full, SmartRetur comes and picks it up. They do quality checks on the pallets in their warehouse and can also repair them.”
It is a very good climate and environmental measure, she added, noting that wood waste has been reduced by 24 percent. “It pays off for us financially, but the most important thing is to reduce the amount of waste and have more circular products. And we would like more players to start with this.”
Daniel Østbye has also noticed increasing interest in the return scheme. “I have worked with this for ten years, and previously I talked to warehouse managers or logistics and finance. But lately, people who are responsible for sustainability in the companies are turning to us. There is a growing awareness of this,” he concluded.
When a company makes a construction estimate, there are a lot of costs that go together to culminate in the bottom line. By increasing the efficiency of pallet usage, direct and indirect pallet-related costs can be reduced over the long-haul.