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Wooden Pallet Management Part 2 of 3: Supplier Selection

If you want the right pallet, it has to come from the right supplier.

Sterling Anthony

Any given CPG has policies for supplier selection. But those policies likely differ according to the importance of the item being purchased. By that association, supplier selection for wooden pallets should be governed by a formal, detailed policy. That’s because pallets enable the handling, storing, and transporting of goods throughout a supply chain, all the while impacting the costs and efficiency of those operations. Stating it differently, pallets are indispensable to commerce. There are a variety of factors that differentiate among pallets, that if disregarded, can result in mistakenly categorizing pallets as commodities (listed in Part 1 of this series). 

Since many companies already have policies for high-value procurements, little or no modifications are necessary to apply those policies to the selection of pallet suppliers. The suggestions presented in this column, therefore, will be familiar to many, and hopefully validating. After determining one’s needs, conveyed in detailed specifications, the task reduces to determining which supplier(s) can fulfill them. But as is often the case, matters are not as simple as they might sound.

The required volume is of utmost importance: a prospective supplier not only must be capable of making pallets to specification but also capable of supplying them in the needed quantities. It’s helpful if a projected annual volume can be broken into smaller time units—monthly, seasonal, weekly—whatever makes the most sense. The subsequent deliveries will impact the amount of inventory that the receiving company maintains, and in turn, whether it’s kept outside or inside (the latter at the expense of floorspace). 

Geographical proximity can place a supplier in a favorable light. Transportation times are shorter, appreciated in times of emergency or when a delivery needs to be replaced. Proximity, of course, translates into lower transportation costs. Another benefit of proximity is the convenience with which a company can perform a site inspection, whether it’s of a prospective supplier or even of an approved supplier, e.g., for auditing purposes. On the other hand, proximity benefits both aforementioned types of suppliers, facilitating visits to a company’s site for a better understanding of that company’s operations. 

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