Shortage of shipping pallets could disrupt supply chain

Brace yourselves, the latest shortage doesn't just affect one type of product, it affects many of them.

Video Transcript

ED CRUMP: A large portion of the things in your home are shipped on wooden pallets, from electronics to food.

TIM KRAFT: The pallets, surprisingly, it's the secret lifeblood of logistics and distribution.

ED CRUMP: Tim Kraft is an NC State supply chain expert. So he knows all about the role of pallets in shipping.

TIM KRAFT: Any industry that ships a product, a component, or a raw material, they need pallets. And so this could touch a lot of different industries.

ED CRUMP: From the giant big box and grocery stores all the way down to businesses like mom and pop hardware stores.

JEFF HASTINGS: A lot of these, they'll use reclaimed wood to make some of the pallets.

ED CRUMP: Jeff Hastings owns Burke Brothers Hardware in West Raleigh where the vast majority of products arrive on pallets.

JEFF HASTINGS: Now it seems like the pallets are sort of that next domino to fall in supply chain. So not only are some materials short. But now with the pallet shortage being what it is, there's one more thing that makes it difficult to get product from point A to point B.

ED CRUMP: The pallets showed up on the shipping scene about 100 years ago. And attempts to replace it have proven unsuccessful. The simple design allows products to be stacked on top and allows a forklift to slide right into the wooden frame and lift it.

But now with a shortage of lumber, the lowly and once cheap pallet has become valuable with some companies stamping their name and the cost on each pallet. And not just the cost of the pallets but also the cost of delays from the lack of pallets will end up trickling down from manufacturers.

JEFF HASTINGS: And we suffer for it. The consumer ends up suffering for it.

ED CRUMP: So once again, a pandemic shortage is going to hit your wallet hard. And this time, it may be extra hard because the lack of pallets will affect so many different consumer products, especially the products we need most.

TIM KRAFT: This increased cost of packaging and transportation gets passed on to the consumer, particularly in industries like grocery, for example, that rely heavily on pallets and have tight margins to begin with. There is the threat that consumers will start to see this cost.

ED CRUMP: After this, you may never look at a pallet the same way again. Ed Crump, ABC 11, Eyewitness News.