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Markets in Transition: Wood Pallets Play Key Role in Automated Warehouse Storage
When it comes to pallet selection there are two sides to the equation. The first side is the storage pallet. The other side of the equation is the “order” pallet or distribution pallet.

By Rick LeBlanc
Date Posted: 5/1/2009

            In this issue I report on the success of plastic pallets at the highly automated mailing room of Canada’s largest daily newspaper, The Toronto Star.  But to bring some perspective to automation in warehouses, many facilities specify wood slave pallets. 

            With this in mind, I recently spoke with Chris DeLisle, a senior engineer at WITRON (pronounced VITRON) Integrated Logistics. WITRON is a systems integrator, a company that provides automated warehouses, typically for companies requiring automated case picking in fast moving consumer goods environments. The company has over 1,500 installations worldwide, with North American clients including Super Valu, Kroger, as well as Sobey’s, the second largest Canadian grocery retailer.

            When it comes to pallet selection, Chris reported that there are two sides to the equation. The first side is the storage pallet. The storage pallet moves goods in and out of storage to the point goods are depalletized. The other side of the equation is what Chris refers to as the “order” pallet or distribution pallet. Here, Chris’ North American grocery clients typically use a plastic downstream pallet, as many grocery retailers do with their conventional distribution centers.

            As for storage, when pallets of merchandise are received at a Witron-designed installation, they typically have been palletized by the product shipper on a rental pallet (predominantly CHEP), a GMA pallet, or at Canadian locations, a CPC pallet. At this point, the inbound pallet is automatically placed atop a slave pallet to facilitate handling on powered conveyors and crane systems.

            “Typical vendor pallets dealt with include CHEP, CPC and GMA,” Chris said.  “Out of those three types of pallets we do generally find that CHEP is better, but not to the extent that we are comfortable handling it without any kind of system or slave pallet. The primary issue is the variability of quality. So on average we find that CHEP is of higher quality than the other two but for our systems, without a slave pallet, we don’t feel that the quality is high enough.”

            When it comes to the use of slave pallets, Chris said there are two negatives. One is the investment requirement. At each location there are at least 30,000 pallets so the initial purchase of slave pallets is a large investment.  And secondly, because the vendor’s shipping pallet is placed atop the slave pallet, there is the loss of usable height due to the extra pallet.

            “To be honest at first our customers struggle with this (the investment in pallets),” Chris offered, “but we get into discussions and at the end of the day we show them that we have developed several automated warehouses throughout North America and every one of them uses a system pallet.”

            In the WITRON design, slave pallets have a similar bottom deck configuration to a Euro pallet in order to compensate for the doubling up of the pallets. “The way we compensate for the loss of space is that we have developed a pallet with an open bottom,” Chris explained.  “The crane is utilizing the space between the blocks. That’s one way we compensate.”

            For storage pallets, WITRON continues to specify wood pallets. “For the storage pallet we have investigated plastic pallets several times but we have yet to find a business case that will support it,” Chris remarked.  “The issue with plastic is basically threefold. One is the rigidity requirement. It may be sitting in storage for potentially 30 days. You have to obviously make sure that the pallet is very rigid, and in order to get that rigidity, you have to insert a lot of steel, which can make the pallet very heavy, and ultimately very expensive. The second issue is the friction issue. The plastic pallet is sometimes slippery. The third aspect is fire. Round ball figures, I haven’t seen a plastic pallet come in yet under $60 (for the storage application).”

            In Europe, where WITRON has operated for 30 years, most installations also employ wood slave pallets, although Chris noted that there are two exceptions where warehouses run with vendor pallets and no slave pallets. One is Edeka, the largest grocery chain in Germany. The other retailer is Mercadona in Spain. Mercadona recently finalized an order for its fourth Witron automated facility.

            In this type of environment, the warehouse must compensate by having much stricter quality controls on inbound pallets, and enhanced design of the automation to accept greater pallet variability.

            Chris says there is a lot of interest in Witron’s automated case picking solutions, and sees continued growth in the near future.

            “We offer a number of systems,” Chris elaborated. “The one we are offering to Sobey’s is like our Ferrari. It’s fully automated, requiring no operators. That’s generating a lot of excitement. We do have a number of other systems that are automated, but not to the same extent. So we cover the gamut. I think the interest will continue to grow because not only is labor expensive but it is hard to find.

            “We are bullish about the future. The good thing about our company is that we have customers such as Kroger and Super Valu with the potential for repeat business.”

 








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