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Airdex Seeks to License Wood Pallet Suppliers to Produce Its Foam Pallets
Maker of light-weight foam pallets for air freight and export applications begins offering its patented manufacturing system to pallet suppliers.

By Staff
Date Posted: 11/1/2005

Airdex International has begun offering its patented manufacturing system to pallet suppliers to manufacture the line of Airdex pallets.

The Nevada-based company, which has manufacturing facilities in California, is offering qualified pallet manufacturers and pallet recyclers the opportunity to install equipment to produce standard and custom size ultra-light pallets using the Airdex process.

The program will provide wood pallet suppliers an efficient, low-cost, controlled pallet supply for customers
that require pallets for air freight and export applications.

Airdex will provide licensees a turnkey operation with the ability to make custom size pallets from very simple tooling. The fully patented process is
licensed through protected marketing territories.

Foam tooling costs for manufacturing Airdex molded-core pallets is less than injection molding, roto-molding or thermoforming, according to the company. In addition, machine set-up is faster and costs less.

Airdex pallets are made from a polystyrene foam core and coated with a full jacket of high impact polystyrene. They are a block-style design featuring four-way entry with a custom undercarriage permitting six pallets to fit on LD-7 airfreight containers. In addition, Airdex pallets are of light-weight construction; they weigh 6-8 pounds, depending on coating and strength capacities. Despite their light-weight construction, they are strong; two different standard 48x40 pallets are rated for a static load of 8,000 pounds and a dynamic load of 3,600 pounds.

Airdex International was founded by Vance Seagle, president and chief executive officer. Vance is an entrepreneur with a background in technology. He was an early founder in the computer technology business. After selling his interest in the business, he entered the investment arena with a focus on technology companies. For the past 15 years, he has specialized in turning around businesses for other investors and banks, usually leveraging some advantages of technology.

He went to Australia in the early 1990s to turn around a business for a bank. He met a number of investors and business developers there and wound up living there for 10 years and also becoming an Australian citizen. Vance returned to the U.S. in 2000, when an assignment for a bank led him to Las Vegas.

While living in Las Vegas, friends in Australia contacted him. They had
acquired the technology for manufacturing the foam pallets and asked him to investigate market opportunities in the U.S. Vance investigated market opportunities for a year before founding Airdex International.

Several factors have come together to create opportunities for the Airdex technology and pallet, according to Vance. One is the consolidation of manufacturing that is going into Asia, particularly for fast-moving retail products, such as home electronics. There is also a shift to more global commerce in food products, particularly perishables, such as seafood and produce; this latter trend has been enabled by more effective packaging and greater efficiency in logistics and shipping via air freight and fast ocean-going vessels. The third factor has been the rise of the ISPM 15 regulations governing wood packaging for export applications.

"We saw a need for an ultra-light-weight pallet that would reduce air freight costs and also could meet the ISPM 15 regulations," he explained.

The pallets are targeted particularly for manufacturers and shippers that use air freight, which was the reason behind the company’s name.

Airdex is not looking to supplant wooden pallets, except for this niche application. The Airdex pallet makes a better shipping pallet for air freight and export applications because of the difference in weight and reduced air freight costs as well as other benefits. In addition, the pallet readily complies with export regulations intended to control wood-eating insects.

The technology for the Airdex pallet originated in the Australian-Asian region, where air freight shipping is prevalent yet costly. With the advent of the ISPM 15 global phytosanitary restrictions on wood pallets and containers and rising fuel prices, the company developed the pallet to meet these challenges, particularly for applications involving high-tech and cold-chain cargo, including perishables, pharmaceuticals and biotech products.

Since it is made of plastic, the Airdex Pallet does not have to comply with global phytosanitary requirements
for wooden pallets and packaging used in exports.

The plastic construction eliminates some health and materials handling issues associated with wood packaging, such as wood breakage and splinters, which can cause product damage, injuries, and interfere with automated material handling systems.

The Airdex pallet offers a number of additional benefits, including thermal insulation, which helps chill cargo that requires cooling. The foam core also helps absorb shocks to the unit load. The polystyrene is waterproof and non-condensing and it is fully certified for food and drug applications. The pallets also are available with a fire retardant coating. The pallets are washable and do not support mold or mildew.

Airdex pallets also can accommodate radio frequency identification (RFID) tags; the tags may be attached anywhere in the core of the pallet.

Airdex offers several standard pallets and also will provide custom manufacturing services in cooperation with wood pallet manufacturing partners. The company also manufactures half-pallets and quarter-pallets.

The Airdex AIRpallet is recyclable and accepted worldwide by all customs and phytosanitary inspectors, according to the company.

Vance is seeking to partner with wood pallet suppliers that have customers that ship via air freight, especially for export. "We’re offering them the manufacturing technology for a niche market and a whole new line of products," he said. Vance also sees potential for Airdex pallet applications as point-of-sale pallets (in standard pallet sizes or half- or quarter-pallets) that would go directly to the retail floor.

Airdex developed portable, scalable equipment to manufacture its pallets. There are two manufacturing options. A shape-molded foam core can be placed into the Airdex machine to produce the pallet, or extruded foam ‘board’ or block foam can be cut and then assembled by hand and fastened with glue. The molded foam is supplied typically by companies that manufacture foam packaging – dozens of which are already under exclusive license by Airdex worldwide.

The Airdex production operation requires one to three workers, depending on volume, and can produce 700 to 1,000 pallets in a 24-hour period. Working with the foam board, two workers — one cutting the components and one assembling them — can achieve similar production levels. The foam material can be cut with knives, hot wire or conventional saws.

Companies can lease the Airdex manufacturing equipment at a cost of about $7,000 monthly. If a pallet supplier manufactured and sold only an average of 70 Airdex pallets daily, it would break even, according to Vance. If the pallets are priced in the $25-$30 range, a company can expect to make about $5-$10 profit per pallet, he said.

At that price range, the Airdex pallet is still attractive to air freight users, he noted. A wooden pallet weighing 47 pounds would cost about $23.50 to ship (at air freight rates as low as 50 cents per pound, which currently are more than twice that amount because of fuel surcharges alone) while the Airdex pallet would cost about $3.50 to ship.

Wood pallet suppliers would receive a manufacturing license, equipment, training, technical and marketing support, and start-up materials from Airdex as well as a protected territory roughly covering a 100 mile radius from their plant.

Airdex is deploying manufacturing capacity in Asia to supply pallets to a global manufacturer of consumer electronics products. The manufacturer did a two year feasibility and cost analysis study of using the Airdex pallet. "The savings are astronomical as airfreight rates and surcharges are skyrocketing in Asia," said Vance. The new Airdex client requires their OEM manufacturers to use the Airdex pallet. Manufacturing was scheduled to start in late October.

Airdex also has been involved in extensive testing of its pallet for global transport of perishable foods and new concepts in "smart packaging" according to Vance. For more information, contact Airdex at (702) 270-6004, e-mail sales@airdex.com or visit the Web site at www.airdex.com.








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