It’s critical for business leaders to have a thorough understanding of wooden pallet costs!
As you could probably imagine, we’re often asked about how much certain pallets cost and why they cost specific amounts. A lot of business leaders consider pallets to be pretty unanimous in terms of construction, and this leads a lot of people to believe that all pallets should have the same price. However, this simply is just not the case!
Pallet pricing is actually influenced by a whole array of different factors, and on this page we’ll be going over just 8 of the most important factors that play a role in developing the prices of wooden pallets.
1. Lumber Prices
Lumber prices are undoubtedly one of the most important factors to keep in mind when it comes to overall wooden pallet costs, and at the moment the lumber industry is experiencing a major shortage that is causing prices to skyrocket to unprecedented levels.
The fact that demand has exponentially increased over the past year or so hasn’t helped, either! Mills simply haven’t caught up with their production and have had low lumber supplies since the beginning of the pandemic last year. And when you add in all of the people investing in home renovations and DIY projects, you’ve got the perfect storm to put the entire lumber industry out of balance and cause ever-increasing prices.
Raw material costs are always a major determinant of new wooden pallet costs, which is why lumber costs are at the top of the list. Certain commodities like lumber are always going to be dictated by the market, which subsequently has a ripple effect throughout many other industries like the pallet industry.
2. Lumber Amounts Needed Per Pallet
Due to raw material costs being one the most important price-determining factors for pallets, it makes sense that the overall amount of necessary raw materials per pallet will also affect pallet pricing.
Smaller, custom sized pallets will require a lot less lumber as compared to massive, heavy duty pallets; however, there are also many other stipulations to keep in mind like wood type and dimensional lumber cuts as well when it comes to price comparisons based upon size.
And this is exactly where the entire question of pallet pricing becomes A LOT more complex!
3. Lumber Type
The type of wood that’s utilized within the pallet construction process is also a major price factor, and most wooden pallets are made with southern yellow pine. However, there of course could be many other types of wood that are used within pallets like hardwoods.
It’s important to remember how lumber is directly affected by market conditions, and southern yellow pine is a go-to type of wood because of its cost-effectiveness. But southern yellow pine can many times end up being more expensive as compared to other hardwoods due to all sorts of market conditions.
Right now there are many different factors affecting the lumber industry, including the pandemic, massive wildfires, beetle infestations, mill production lapses, economic conditions and even politics. These unprecedented market conditions have affected just about every type of lumber within the pallet industry.
4. Board Sizes
During the custom pallet construction process, there will be different board dimensions utilized for each part of the pallet. There really are hundreds of different board size combinations available within custom pallet creation, and the best combination for your business will largely depend upon your preferred design, load sizes, weights, transportation methods and so much more.
What’s important for business leaders to understand is that dimensional lumber will also go through unique supply/demand challenges on top of more ubiquitous market conditions.
An example of this would be what’s currently happening with 2×4’s, because lumber mills are now producing high-grade 2×4’s for builders and producing far less lumber that’s more suitable for the pallet industry. This then leads to 3 and 4 grade 2×4’s being more expensive than usual.
5. Quantity And Types Of Fasteners
There are also many other intricate factors beyond lumber that affect pallet prices, and one of these factors is fasteners (nails, staples, screws, etc.) that play a major role in pallet assembly. Fasteners are almost always comprised of metals, which of course are another commodity that’s affected by market conditions. This subsequently means that the overall quantity and quality of fasteners utilized within your company’s pallet production will play a role in overall pricing.
You can always count on The Pallet Guys to work closely with you and let you in on these more intricate details about the production of your wooden pallets. We highly value transparency on every level, and we’ll always do our best to protect the overall integrity of your pallets and shipping products at the lowest possible production price.
6. Required Labor
The Pallet Guys will utilize state-of-the-art machinery for certain tasks and manual labor for other important duties. We understand how every pallet should be directly examined and handled by a number of our experienced specialists, and we take quality assurance very seriously for a whole variety of reasons.
A lot of our pallets are rather labor intensive, so this is yet another contributing factor to pallet costs.
Everything we do simply requires an extensive amount of labor, which of course makes it a factor for business leaders to keep in mind.
7. Pallet Order Volume
Order volumes do have a rather dramatic effect on per pallet costs, but this shouldn’t be much of a surprise for business leaders that require frequent pallet orders. Bulk purchases will always make overall costs less expensive within just about any industry, and the pallet industry is the same way.
When you take labor into consideration, high-volume orders will spread out the labor expenses over a longer period of time, which then lowers per pallet prices. Production costs actually are decreased with larger orders due to our team’s incredible efficiency!
8. Shipping
The last factor we’re going to discuss on this page is shipping, because it does play a role in overall pallet price even though it doesn’t apply to the production process.
And as we all know, shipping is another pricing component that can be affected by a whole array of different factors like driver shortages, fuel costs and volume/distance.
Reach Out To The Pallet Guys To Learn More About The Pricing Of Our Wooden Pallets!
The Pallet Guys have supported countless companies throughout the United States and abroad when it comes to providing the best combination of quality and affordability for commercial pallet supplies, and we’ll always be more than happy to be your business’ go-to pallet and custom crate provider.
Reach out to us online or call us at 832-895-7555 to get in touch with our specialists and let us know what questions you have about our wooden pallet prices!