Paper pallets at IKEA and supply chain benefit

An article in Bloombergbusinessweek (Nov 28, 2011) describes efforts by IKEA to replace its 10 million annual usage of wood pallets with paper pallets. The paper version is 90% lighter, designed to pack more load, is single use and can be assembled on site by suppliers. The lighter weight saves the company 140 million euros in transport costs, while adding about 90million  euros to pallet costs and forklift costs. Will IKEAs unilateral use of paper pallets provide as large a benefit as shared pallets over the long run? Will he new forklifts etc required for handling, and their associated replacement impact, continue to show the paper pallet as a more sustainable solution?

Advertisements

About aviyer2010

Professor
This entry was posted in Global Contexts, Service Operations, Supply Chain Issues, Sustainability and tagged , , , , , . Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s