The global pallet pooling (rental) market is estimated to be valued at nearly US$ 720 Mn by 2017 end and is projected to be valued at nearly US$ 1,400 Mn by 2027 end. Exhibiting a CAGR of 6.6% over the forecast period, the global pallet pooling (rental) market is driven by stringent government regulations related to hygiene issues in pharmaceuticals, demand for high durable pallets, and a simple rental system. The market is estimated to create an incremental dollar opportunity of nearly US$ 700 Mn between 2017 and 2027.
Reduction in product damage due to regular pallet repairs and quality checks aids the development of the global pallet pooling (rental) market
The main point of attraction of companies that purchase plastic pallets is the reduction in the costs associated with the repair, maintenance and storage of pallets. Rental companies, therefore, eliminate these costs by providing regular quality checks on a monthly, quarterly or an annual basis to avoid any damage to pallets. Due to the renting of pallets, the costs are curtailed by eliminating pallet procurement and disposal programmes to manage inventory.
As plastic pallets are more durable than wooden pallets, their market is showing a promising growth
Plastic pallets have a long life span of around 10-12 years and don’t shrink, warp or splinter. In addition, they are capable of working efficiently in-house. Also, another major advantage of using plastic pallets is that unlike wooden pallets, plastic pallets don’t incorporate nails, screws, or fasteners, which can possibly protrude, come-off, or loosen to cause damage to stock or injuries to the personnel handling them. In addition, plastic pallets exhibit resistance to different chemicals, resulting in increased reusability and reliability. Due to these factors, various end-use industries such as food and beverage, electronics, FMCG, and others find plastic pallets more durable and hence more attractive than wooden pallets, which is aiding growth of the plastic pallets market.
As the cost of wooden pallets is low compared to that of plastic pallets, it acts as a restraint to the growth of the plastic pallet market
The cost of wooden pallets is low as compared to that of plastic pallets, which is expected to hamper the plastic pallets rental market. The high cost of plastic pallets is associated with the three types of moulding processes used during their manufacturing; namely injection moulding, blow moulding and rotation moulding. Injection and blow moulding are commonly used processes for bulk orders and for the faster production of pallets. Due to this high cost of moulding and size limitations, the market for rental plastic pallets is hampered.
The drawback that plastic pallets are strongly affected by a change in climatic conditions is also hampering the growth of the plastic pallet rental market
Plastic pallets are unable to perform under changing climatic conditions; which is not the case with wooden pallets. Plastic pallets become brittle in cold conditions, soft in hot conditions, and when exposed to direct sun rays, they lose oil and become brittle. Such drawbacks are not experienced with wooden pallets – a main reason why they are preferred for export applications.
Demand for pallets that meet hygiene requirements and offer mechanical performance is an upcoming trend
Various end-use industries such as food and beverage, FMCG, and pharmaceuticals look for hygienic, washable, and insect-free pallets due to various sanitary issues. Wooden pallets are unable to comply with these industry requirements, due to which the demand for plastic pallets is expected to grow. Plastic pallets are also easy to clean and dry, as they have a smooth and closed surface that eliminates cavities and doesn’t allow dirt from accumulating.
Global Pallet Pooling (Rental) Market Attractiveness Analysis by Product Type
All the three kinds of pallets have demonstrated their importance in various industries. For instance, nestable pallets are considered best for the shop floor, as they are cheap as compared to the other pallet types. Stackable pallets are considered best for in-house transportation, as they are more expensive than nestable pallets. Rackable pallets are relatively expensive as compared to the other types, and provide high quality and strength to end-user industries. The nestable segment is expected to be an attractive segment in terms of market share and is expected to create a slightly high incremental opportunity as compared to the rackable segment.
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