Over the years, companies have graduated to palletizing products to make handling pallets easier but that change has come at the expense of freight. In today’s world of rising freight costs, is palletizing still the right way to go? Here are some things to consider along with examples of company decisions about when not to palletize.

The reason many companies preferred using pallets is it became a soft handling alternative. Soft handling generates less product damage. Palletizing also speeds up loading and unloading while reducing damage in transit. Pallets replaced clamp trucks that were once considered rough on loads and resulted in high incidents of damage to goods.

The downside – pallets consume capacity in a truck. A manufacturer of frozen pizzas hand loads all of their trucks. Load maximization is a key cost driver for them. Another redeeming factor is that the cases of pizza are relatively large and light.

Another consideration is that while the pallet takes up space, weight must be a consideration, because this can detract from the payload. As an example, 60 Chep pallets weigh over 3,900 lbs. By taking away pallets, you can increase the weight of the product that can be hauled by 8%. A manufacturer of heavy consumer goods ships from its plants to its DC’s on slip-sheets. They have calculated that the extra labor required to palletize at the DC is much less than the freight gain.

There are numerous costs associated with shipping on the floor (without pallets). Labor can be reduced by the right application of technology. Hand stacking requires intensive labor, which is increased as the case size declines. One type of technology used to cut labor is “slip sheets”. This is where the product ships on a large piece of plastic, which is grabbed by a push-pull device and pulled onto the platens of the forklift. It allows the product to be handled with only additional labor required for palletized shipping when that is a customer requirement.

The last item that must be taken into consideration is the cost of the pallets themselves. Whether a pallet exchange program, disposable pallets, or rented pallets (like Chep) are used, the pallets themselves cost money.

The decision to ship on or off a pallet is a consideration, and more and more Companies are factoring this into their decision making process as they review cost savings against the potential for damage.

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