There is a pallet shortage. Why? My take is that the Bullwhip effect is in full display. For example, after hoarding toilet paper, consumers stopped buying (Sales down 14%) but manufactures keep on making it. I suspect that we are seeing this in a lot of commodities.
With lumber prices sky high, expect pallet pools (Chep, Peco, etc.) to scour the world for empties, raise prices, convert some parts to plastic, or all of the above. In any event, be prepared to pay a big premium for new pallets. This brings up a significant problem – case-pick operations often use more pallets than needed because pickers encounter bins that have not been replenished or the bin has insufficient stock forcing a return trip – generally by a different picker with a different piece of wood! More wood, more problems on the dock, more re-stacking – AutoScheduler can help you solve this issue. Call Keith (615) 428-2035 to learn more.
UPS, whose stock was up 10% last week, sees much improved margins (Revenue up 10.2% while cost only up 2.2%). Why:
- More small shippers who pay closer to list price
- Better delivery density
$2.93 = Average rate per mile for flatbed truck transport on the U.S. spot market in the first three weeks of April – up 44¢, or 17.7%, since January, according to DAT Solutions.