Plastic Pallet Insider Takes Aim at Plastic Pallet Market Report

Recently we ran a press release for a plastic pallet market study, entitled When It Comes to Plastic Pallets, Buyers Have the Edge. Certain comments attributed to the market analyst involved in the study prompted this response from one reader, veteran plastic pallet professional, Michel Trapp. Michel’s comments appear below. We welcome the points of view of other readers as well.

Hi Rick,

It is very rare that I comment on your excellent articles but this analyst’s comments are the most stupid things I have heard in a long time about plastic pallets. Being one of the pioneers in introducing plastic pallets in a large scale to the returnable packaging industry, I just couldn’t ignore such lack of Industry understanding. Please let me elaborate:

• ” Pallets have a low level of specialisation and switching costs…” This may be true for cheaper one-way pallets but otherwise, as you know, returnable plastic pallets have a high degree of specialisation and require an educated customer, modifications in production lines, pallets designed for specific applications (glass, metal and  plastic food and beverage containers, filled goods and dairy pallets, hygienic pallets in Europe, post office pallets, etc.), as well as operator training  to take full advantage of the benefits provided by plastic pallets. However, the low level of knowledge and sophistication of buyers makes it difficult for pallets to be sold on their technical merits and specificity of the application. Most buyers who buy on price alone end up having problems in their production lines, warehousing and logistic chains.

• ” Lack of dominant players…. ” Again this may be true for cheap one-way where anybody who injects plastic parts thinks he can make plastic pallets but in the returnable market there are only a few dominant players with the technical and testing resources needed for the high performance and durability require in closed and open pools, rackable pallets for automated warehousing, etc. In Europe, SAH and Cabka-IPS lead the pack in the general purpose and specialty pallets. Craemer and UTZ are strong in specialty niches. The US returnable pallet market is led by ORBIS and Rehrig Pacific. DIC leads the Japanese market. – M.T.