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Thinking Ahead–Letter from Chaille: Do You Have a Story to Tell?
Whether you realize it or not, your business has a story to tell. There are reasons for its success and things that put a drain on profits and productivity.

By Chaille M. Brindley
Date Posted: 5/1/2008

   As a kid, I remember going on camping trips with friends. One of my favorite activities was the competitive game of telling ghost stories and jokes. Every kid took turns trying to one-up what the others had done. I was never really a great storyteller or jokester. But I always enjoyed listening and commenting on what I thought was the best story or joke.

   Whether you realize it or not, your business has a story to tell. There are reasons for its success and things that put a drain on profits and productivity. Sometimes we don’t realize all the aspects of our story in the moment. We only put the pieces together when we stop to tell what is really going on. 

   Now is one of those times when you can tell a story that could impact a much larger story. What am I talking about?

   Well, the March issue of Pallet Enterprise carried an article on a coalition of pallet recyclers that have filed an antitrust, class action lawsuit against CHEP. This is the first time that a lawsuit of such magnitude has been brought on behalf of all recyclers seeking fair compensation for services involved in returning stray proprietary pallets.

   The recyclers behind the case are looking for help in gathering real-world data that can be used in the class action lawsuit. They are working with a group of independent experts to conduct studies that can be helpful in certifying that indeed there is an industry wide justification for the lawsuit to proceed.

   If you come into contact with CHEP pallets on a regular basis and want to see compensation levels that reflect your real-world experiences, you should consider contacting the legal team so that you can participate in the data gathering project. There is no cost to you for the study. It does not in any way commit you to the outcome of the case. This is a fairly benign way to make sure that your story is heard. Research is ongoing and will be taking place this month.

   Some pallet companies may be reluctant to participate out of fear of retaliation by CHEP or its business partners. But unless you directly manage a facility for CHEP or have other contractual relations with CHEP, it appears that the rewards could far outweigh any risks. Given the legal risks involved in aggressive posturing, CHEP might avoid any type of strong response against recyclers in this situation. 

   Pallet rental is here to stay, and it appears that recyclers will have to learn how to develop financial relationships with leasing companies that are fair to all involved. Many recyclers contend that the current level of compensation offered by CHEP is better than nothing although it is hardly a money maker. Higher core acquisition costs as well as higher costs for labor and general expenses have not been reflected in CHEP’s Asset Recovery Plan (ARP). Other than a fuel surcharge, which was enacted as part of a deal brokered to end a previous lawsuit, the ARP has remained the same price for years. All the while, CHEP is reporting strong profits thanks in part to the work of recyclers.

   The CHEP class action lawsuit could help set a strong legal precedence that impacts recycler services for the future. This case could have ramifications to a wide variety of proprietary pallet situations far beyond CHEP. That all depends on whether the case moves forward and what is decided when all parties get a chance to make their arguments. The first major hurdles for the lawsuit are CHEP’s challenge to outright dismiss the case and the certification of the class. It is expected that both sides will present their arguments on these key decisions this summer.

   Recyclers interested in participating in the data gathering project should contact the Coalition of North American Pallet Recyclers at P.O. Box 8322, Fort Smith, Ark.  72902, call 479/650-3654 or e-mail mailto:ADMIN@CHEPCLASSACTION.COM. 

   P.S. On a separate note, our staff hopes you liked the first issue of the digital edition. So far, readers seem to like it. We hope to add more interactivity in the future. If you don’t get the digital edition, sign up today at www.palletenterprise.com/digitaledition or call 800/805-0263.

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