Browsing by Author "Hagedorn, Alexander"

Now showing 1 - 2 of 2
  • Thumbnail Image
    The Effect of Pallets and Unitization on the Efficiency of Intercontinental Product Movement Using Ocean Freight Containers
    Hagedorn, Alexander (Virginia Tech, 2009-07-20)
    Global industrialization was developed in response to both consumers and manufacturers demand for lower product prices and availability of goods and services. As a result, products are transported greater distances. Shipping constitutes the majority of costs in the export/import supply chain. Shippers and buyers commonly attempt to offset these costs by maximizing the capacity of ocean freight containers (cube or weight). Boxes (usually constructed of corrugated fiberboard) containing consumer grade products are commonly floor loaded into containers to maximize capacity. Boxes that are not floor loaded are likely to be unitized on pallets in containers. Beyond maximizing a container with cargo, a defined decision to determine which method of loading is most efficient in regard to cost and time does not exist. For this research, field studies were conducted and questionnaires were distributed to identify the variables that influence efficiency. A method to make an efficient decision was developed by incorporating the variables into a model. The model compares the overall export/import supply chain efficiency for boxes that are floor loaded to boxes that are unitized on pallets in containers. The recommended decision is determined by comparing the shipping and handling costs and the receiving dock door capability for the two loading methods. The results of this research reveal that floor loading boxes can provide a higher value per container due to increased capacity. Increased capacity by floor loading often reduces the number of containers needed to meet daily demand. However, since manual labor is utilized for the loading/unloading process, more time is required, which results in higher labor costs and restricted product throughput. Unitized boxes loaded in containers on pallets can limit container capacity, but allows for faster loading/unloading times (if no incompatibilities between product and pallet or pallet and/or material handling equipment exist), reduced labor costs, and the potential for increased product throughput. Importing boxes unitized on pallets commonly requires more containers to meet demand, but fewer receiving dock doors. Utilizing fewer dock doors allows otherwise occupied doors to be available to receive additional product. The decision to floor load or unitize exports/imports needs to be made on a SKU basis meeting daily demand, not only per container capacity. Labor cost, pallet cost, the magnitude of box variation between loading methods, and the ability of the receiver to process containers are all influencing factors in determining which loading method is most overall efficient. Given the current cost for containerized shipments and considering all costs, most consumer goods are more efficiently shipped floor loaded. When additional containers would be needed to meet demand for product unitized on pallets, floor loading will be more efficient. When there is only a small difference in box count between floor loading and palletizing, palletizing product will be more efficient. This will often occur when loads will meet container weight capacity before it reaches volume capacity. If the product is too heavy to move manually it will be palletized.
  • Thumbnail Image
    Identifying Success Factors in the Wood Pallet Supply Chain
    Sanchez, Leslie Scarlett (Virginia Tech, 2011-05-02)
    Pallets are a critical component of logistics infrastructure. Approximately 1.9 billion pallets are used each year in the United States for transportation of goods, from raw materials to finished products. Solid wood pallets represent 90% to 95% of the pallet market. To run their operations, wood pallet companies deal with suppliers, customers, and other supply chain components. Each of the steps is important to deliver the right products, with the required quality, and in a timely fashion. However, there is little research about the industry's supply chain practices. The objective of this research is to increase the understanding of the U.S. wood pallet manufacturing industry, its supply chain management practices, and factors affecting the supply chain management processes. To accomplish the research objectives, a nationwide mail survey of wood pallet manufacturers was carried out. In total 1,500 companies were sent questionnaires and the response rate was 14%. A model for supply chain success factors was developed based on previous research and was analyzed using the results from the survey. Results of the survey provide an up-to-date profile of the US wood pallet industry. It was found that pallet production per company was 727,229 units on average during 2009. Out of the 1500 respondents, 38.6% indicated they were medium-sized companies (20 to 99 employees) and 53.9% small companies (1 to 19 employees). Thirty five percentage of respondents indicated that their sales were less than one million dollars and 43% from one to five million dollars. Also, 45% of respondents were involved in pallet recycling or repair, and these companies indicated that, on average, 42% of the material in a recycled pallet is, in fact, new material. Regarding Supply Chain practices, close to three-quarters (73.1%) of respondents sold their products directly to customers and the order lead time for raw materials to shipment was 1 to 10 days for 81.9% of companies. The most important factors for purchasing decisions are availability, cost, and reliability of supplier (all rated 4.4 in an importance scale from 1 to 5, respectively). Respondents' answers suggest a preference to work with domestic materials (rated 4.3); however, respondents also indicated that there is currently a high level of competition for raw materials (rated 4.3). Results also indicated that information technology (IT) appears to receive little attention from wood pallet manufacturers, given that the importance of items in this area were rated relatively low, especially the use of internet for purchasing and training in IT (rated 2.2 and 2.1, respectively). Lastly, 86.0% of respondents did not believe that their customers would be willing to pay a premium for environmentally certified pallets, citing cost as the major barrier for a higher demand of these products. Also, a theoretical framework of supply chain management was designed, developed, and tested with factor analysis, allowing identification of seven factors in the wood pallet supply chain: (1) environmental uncertainty, (2) information technology, (3) supply chain relationships, (4) value-added process, (5) supply chain management performance, (6) business management, and (7) customer satisfaction. Relationships between factors were tested using multiple linear regression. Results show that value-added process positively affects supply chain relationships, and these in turn are positively correlated to supply chain management performance and customer satisfaction. Results from this research are useful for the industry to formulate a well-informed supply chain management strategy by understanding the connections between the different supply chain management practices and the business performance and customer satisfaction. The information presented is also useful for organizations supporting the wood pallet industry to design more effective assistance and educational programs.