Impact Analysis of Covid-19
The complete version of the Report will include the impact of the COVID-19, and anticipated change on the future outlook of the industry, by taking into the account the political, economic, social, and technological parameters.
Market Insight- Global Pallet Pooling (Rental) Market
A pallet pooling company manages pallets for manufacturing organizations. An organization rents them from a shared pool instead of buying its own supply of pallets. The primary job of pallet pooling company is to ensure the supply of pallets in good repair and read-to-use at the company’s disposal whenever it needs them. Moreover, pallet pooling company will organize the pallets that are to be taken to other companies or back to production facilities. Moreover, pallet pooling companies reduce complexity of pallet procurement, recovery, and management with decreasing waste and total cost of business (TCB).
The global pallet pooling (rental) market was estimated to account for US$ 880,593 Mn in terms of value by the end of 2019.
Market Dynamics- Driver
- Reduction of in pallet damage, owing to timely pallet repairs and quality inspections are expected to drive growth of the global pallet pooling (rental) market during the forecast period
The primary concern of many companies while procurement of plastic pallets is the cost of repair, storage, and maintenance of pallets. It becomes extremely challenging for companies to maintain the balance between the cost of products and plastic pallets. Rental companies eliminate these costs by providing timely quality inspections on an annual, quarterly, or monthly bases, in order to avoid damage of pallets. Moreover, logistics of pallets reduce staff costs by removing pallet procurement and disposal programs to manage inventory. Hence, decrease in pallet damage is expected to support the global pallet pooling (rental) market during the forecast period.
- Long-lasting quality provided by plastic pallets as compared to wooden pallets is expected to propel the global pallet pooling (rental) market over the forecast period
Plastic pallets are relatively more durable than wooden pallets, lasting for around 10-12 years. They do not shrink, warp, and splinter easily and are capable of working efficiently in-house. Moreover, plastic pallets are manufactured with nails, fasteners or screws, which can potentially swell, loosen or come-off to injure a worker or cause damage to products. Hence, these factors are expected to boost the adoption of plastic pallets and thereby accelerate the market growth over the forecast period.
North America region dominated the global pallet pooling (rental) market in 2019, accounting for 38.4% share in terms of value, followed by Europe, and Asia Pacific, respectively.
Source: Coherent Market Insights
Market Dynamics- Restraints
- Low-cost associated with wooden pallets as compared to plastic pallets is expected to restrain growth of the global pallet pooling (rental) market over the forecast period
The cost of wooden pallets is relatively less as compared to plastic pallets, which in turn, is expected to hinder its adoption. The expensive procurement price of plastic pallets is related to three types of molding processes during its manufacturing namely injection molding, blow molding, and rotation molding. Furthermore, blow and injection molding are commonly used processes for bulk orders and fast production pallets. Apart from having several advantages, high cost of molding and limitation in sizing are the factors restraining growth of pallet rental business. Therefore, these factors are expected to restrain the market growth in the near future.
- Severely affected by change in climatic conditions is expected to hamper the global pallet pooling (rental) market growth during the forecast period
Plastic pallets often fail to perform under changing climatic conditions, which is not the case with wooden pallets. Moreover, plastic pallets often change their properties and become fragile in cold conditions, soft in hot conditions, and they lose oil and become fragile when they as exposed to direct sun rays. Wooden pallets do not show such changes, and thus, they are preferred for export applications. Hence, change due to climatic conditions is expected to hinder the market growth in the near future.
- Developing affordable plastic pallets is expected to pose lucrative growth opportunity for market players
Since plastic pallets cost more than wooden pallets during their procurement, manufacturers in the market can provide novel products to capitalize on untapped potential in the market. Investing in research and development, in order to innovate affordable plastic pallets can enable manufacturers to expand their consumer base and gain competitive edge in the market. Moreover, manufacturers can focus on reducing the cost of molding of plastic pallets, thereby providing lucrative growth opportunity over the forecast period.
- High demand from food and beverages industry is expected to present excellent business opportunity
Food and beverage industry requires enormous amount of plastic pallets for transportation of frozen and fresh foods. Plastic pallets provide sturdy and reliable options as compared to wooden pallets. Providing long-lasting and affordable plastic pallets is expected to pose excellent business opportunity for market players over the forecast period.
Source: Coherent Market Insights
In global pallet pooling (rental) market, by material segment HDPE sub-segment dominated the global pallet pooling (rental) market in 2019, accounting for 74.9 % share in terms of value, followed by Polypropylene, and Advanced Composite sub-segment, respectively.
Source: Coherent Market Insights
- Increasing demand for hygienic pallets for medical requirements
Numerous end-use industries such as pharmaceutical, food and beverage, medical, and FMCG require washable, hygienic, and germ-free pallets in order to comply with sanitary standards. Wooden pallets often fail to fulfill these requirements, thereby boosting the demand for plastic pallets. Since plastic pallets can be washed after used and can be kept clean dry, they have witnessed significant demand in the recent past. Moreover, they offer smooth and closed surface thereby eliminating cavities and dirt from the surface area.
- Growing use of radiofrequency identification (RFID) tags
Companies are incorporating RIFD tags by embedding them into plastic pallets. RFID tags can trance the plastic pallets through supply chain from rental service center to distribution facility to end-use industry, thereby preventing it from being stolen. This is done with the help of radio waves that communicate with transponder and store valuable information in a microchip. Furthermore, Intelligent Global Pooling System (iGPS) was the first pallet pooling company to include RIFD tags into their pallets, in order to make its supply chain management sophisticated.
Value Chain Analysis
Key players involved in the global pallet pooling (rental) market are Demes Logistics GmbH & Co. KG, iGPS Logistics LLC, Schoeller Arca Time Materials Handling Solutions Limited, Loscam Australia Pty. Ltd., Zentek Pool System GmbH, Brambles Limited, Euro Pool Group, PPS Midlands Limited, Contraload NV, and Faber Halbertsma Groep B.V.
- In February 2017, La Palette Rouge, a pallet pooling subsidiary of Euro Pool Group, was ranked and awarded “Advanced Gold” by EcoVadis for best practices in business from the Corporate Social Responsibility front
- Key companies in the market are focused on mergers and acquisitions, in order to enhance their market presence. For instance, in April 2017, PPS Midlands Limited acquired United Kingdom’s insulated containers and fish boxes manufacturers, GW containers to improve its market share in packaging solutions businesses.