Enthusiastic About Plastic Pallets

Dan Starnes, Sales Director, goplasticpallets.com, argues that plastic pallets are the smarter choice for logistics managers.

For supply chain managers and logistics professionals, the ‘plastic pallets versus wooden pallets’ debate is the modern-day logistics dilemma. Although wooden pallets have traditionally been the go-to, plastic pallets have well and truly emerged as a superior alternative offering many benefits.

“Why should I switch from wooden to plastic pallets?” is the most common question our team is asked on any given week, so we are well-versed on the advantages when it comes to making that change.

Firstly, plastic pallets offer supreme strength and reliability over their wooden counterparts and have a proven track record in all types of automated handling scenarios. They are robust, consistent, and offer an ideal solution for heavy loads and complex tasks, supporting a higher load capacity than wooden pallets. They are also safe and easy to handle. Unlike wooden pallets, there are no nails, sharp edges or splinters, which also helps to minimise damage to products that are being stored or shipped. Plastic pallets are easier to wash and keep clean, whilst they are
impervious to moisture, weak acids and alkalis, which is a common problem for wooden alternatives.

Lower Freight Rates

Plastic pallets are lighter than wooden units (they tend to be about 30% lighter than wooden pallets of the same size and design), so freight rates are generally lower, whether by road, rail, sea or air, making them ideal for exports. They are also exempt from the ISPM15 rules for heat-treated wooden packaging, which minimises the risk of valuable consignments being held up during the customs process. Additionally, nestable plastic pallets are helping our customers to save valuable space when they are not in use or during return journeys, helping to save both money and carbon emissions.

There are now a huge variety of plastic pallets available to logistics managers. Through our network of exclusive partnerships with leading manufacturers, we offer the UK’s most comprehensive range of plastic pallets, allowing our team to find the perfect fit for any application or type of business – whether that comes down to size, weight, load capacity, an open or closed deck, or whether they are made from recycled or virgin-grade plastic. For example, we work with several major food manufacturers who use our hygienic pallets during the production process, whilst opting for recycled, lighter pallets for distribution once the finished products have been packaged.

Sustainable Credentials

Finally, and the most important consideration for our business, plastic pallets are far more sustainable. The pallets we supply will often last 10 to 15 years within the supply chain, offering an eco-friendly alternative to traditional wooden pallets, which are often discarded after a few supply chain cycles and contribute to deforestation.

At the end of a plastic pallet’s lifespan, it can be recycled into a new pallet. Through our own industry-leading recycling scheme (we’ve now recycled more than 1,800 tonnes of plastic), we are helping our customers to play their part in the circular economy.

Cost Benefits

At this point of the conversation, we are normally asked, “but plastic pallets are more expensive, aren’t they?”. There is no denying they are more expensive than their wooden counterparts,
although the gap is tightening due to rises in global timber prices. If you are choosing pallets for multiple deliveries over many years, then plastic pallets will offer significant savings.

For example, and I’ll keep this relatively simple, if you purchase 5,000 plastic pallets at £40 each, you’ll have spent £200,000, twice the cost of 5,000 new wooden pallets at £20 each. However,
you are likely to replace around 35% of the wooden pallets each year due to breakages, compared to just 10% of the plastic pallets over five years. Therefore, at the end of the five-year period, the total cost of the plastic pallets would be £220,000, less £20,000, which is their recycling value at the end of their life. Meanwhile, the total cost of the wooden ones would be £275,000. After 10 years, the savings are even more substantial. When it comes to operational efficiency, safety, and total cost of ownership, plastic pallets win hands down.

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Wooden pallet industry sets sustainability goals

 

Calls to Reform Plastic Packaging Tax

Less than one in five of forecasted businesses have registered for the UK Plastic Packaging Tax (PPT) since its launch in April 2022, casting doubts on the effectiveness of the levy and whether it is achieving its environmental goals. The low registration rate and “baffling qualifying criteria” has led to calls to thoroughly reform or completely scrap the tax.

A recent Freedom of Information (FOI) request from goplasticpallets.com has revealed that only 3,426 businesses (17%) of HMRC’s forecasted 20,000 manufacturers and importers of plastic packaging signed up for PPT between its introduction on 1 April 2022 and 16 February 2023. PPT applies to plastic packaging manufactured in, or imported into the UK, that does not contain at least 30% recycled plastic. A lack of clarity surrounding the qualifying criteria has been cited as one reason behind the low registration rate, whilst HMRC has also received criticism for determining which companies and products are subject to the tax.

goplasticpallets.com argues that it has been unjustly targeted by the PPT, bearing a disproportionate financial burden despite their environmentally-friendly practices and products. The company offers the largest range of sustainable plastic pallets and pallet boxes in the UK, the majority of which are made from recycled plastic; however, a limited number are made from virgin plastic, and therefore subject to the tax.

Jim Hardisty, Managing Director, said: “I do believe HMRC started off with good intentions by looking to drive down the use of single-use and limited-use plastics and packaging, such as plastic water bottles, food packaging, shrink wrap, etc. However, as more people asked questions due to a lack of clarity, it became apparent there was no logic or consistency around qualifying criteria. It was at this point that we were informed our virgin products would be subject to the tax. It’s baffling.

“The plastic pallets we supply to our customers are robust, durable and will often last 10 or 15 years within the supply chain – they should not be considered “packaging”. In fact, they offer an eco-friendly alternative to traditional wooden pallets, which are often discarded after a few supply chain cycles and contribute to deforestation. We have long been a sustainability-focused business, through our products, our industry-first recycling scheme, and the work we do with charities and environmental organisations. It’s bizarre that we are being penalised for something we are fighting against – the prevalence of single-use plastic.”

According to the same FOI request, HMRC’s revenue target for PPT appears to be on track despite the low registration rates. The department collected approximately £195 million from April 2022 to the end of January 2023, after initially estimating £200 million for the entire year, before later revising it to £300 million.

Hardisty revealed that goplasticpallets.com has already paid £146,667 so far, covering three-quarters of the first year of PPT, with the total figure expected to surpass £200,000. “Given that HMRC originally projected 20,000 companies would pay £200 million in the first year, averaging £10,000 each, it seems that goplasticpallets.com is paying significantly more than anticipated for selling environmentally beneficial products. There’s a clear gap between the government’s expectations and the reality of the tax’s implementation. My message would be to scrap it completely and start again with a focus on single-use plastic. I’m willing to meet with Rishi Sunak, who was Chancellor of the Exchequer when PPT was devised and introduced, to fight the case of sustainably-focused businesses like us, who have been battered by a tax that just isn’t fit for purpose.”

• Only 17% of forecasted businesses have actually registered for the tax
• Companies like GPP, have been unfairly hit. The tax should really focus on cutting down single use plastic, not sustainable plastic pallets that are used for 10+ years across the supply chain
• Despite the lack of registered firms, HMRC will comfortably exceed forecasted revenue, begging the question, “are they charging too much?”
• The qualifying criteria is called “baffling” and the tax is labelled “not fit for purpose”
• Logistics expert calls for reform and wants conversation with Prime Minister Rishi Sunak, who was Chancellor when the tax was introduced

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