Australian transport and logistics giant Brambles had to combat a pallet shortage in its major market of the United States as high demand for groceries and other consumer staples in the stay-at-home economy injected another tricky factor into a volatile environment. Source: The Financial Review
Brambles owns about 330 million pallets and crates used to transport goods from manufacturers and food producers to retail stores and online warehouses globally. But the uncertainty of the pandemic meant many of those retail groups and manufacturers held on to more pallets than usual to give themselves a buffer.
Soaring timber prices also contributed to the pallet shortage and pushed the price of new timber pallets up 45% in 2020-21 in the US.
Brambles put in a price “surcharge” to customers to partially offset the rise, clawing back $US60 million($82.3 million).
Chief executive Graham Chipchase said the pandemic had created substantial volatility. “Customer demand for pallets was elevated but unpredictable,” he said.
British-born Mr Chipchase has been at the helm of Brambles since early 2017. He said he would give a clear outline of the next stage of growth for the company in mid-September, with some of the main planks being a step-up in digitisation of the business and details on how far the company would go in adopting plastic pallets, after a trial in parts of the business.
