Pallet Use by Industry

Part
01
of six
Part
01

Pallet Use: Specialty Retail

This report aims to estimate the number of shipping pallets used in the specialty retail industry. The specialty retail industry encompasses apparel retail, computer and electronics retail, home improvement retail, specialty stores, automotive retail, home furnishing retail, and fuel retail. Within the industry, pallets are a necessary tool for packing and shipping. However, the lack of available data meant there was no pre-compiled information on the number of shipping pallets used in the specialty retail industry, nor was there enough information available for us to make an estimate via triangulation. Our search for data is outlined in detail below.

In order to make an estimate, we first began looking for market reports on the specialty retail industry. All the market reports for apparel retail, computer and electronics retail, home improvement retail, specialty stores, automotive retail, home furnishing retail, and fuel retail were available only as paid sources. We checked www.ibisworld.com, www.lucintel.com, and csimarket.com, but there was no information on the use of shipping pallets by the specialty retail industry. There were no current or even old market reports available for free use, and there were no authenticated free source to identify the size of specialty retail or the percentage of specialty retail within the total retail industry. This meant we could not find any reliable information on market size, percentage of share of each sector, etc. There was also no information available on the use of shipping pallets. We also searched within each specific sector to find statistics on the sector-wide use of shipping pallets, but also could not find any reliable information.

Next, since there was no pre-compiled data available, we attempted to estimate the number of shipping pallets used in the specialty retail industry through triangulation. First, we looked for the maximum percentage of share for each specific sector within the specialty retail industry. However, there was no available data on this. Instead, we could only find information on the various types of retail industry. Next, we checked statistica.com for statistical data on pallet usage, but again we found nothing. Finally, we looked at each pallet manufacturing company's website to try to understand which industry demands the maximum number of pallets via the website's client section. This information could have been used to estimate the share of specialty retail. However, no relevant information was available.

After being unable to find information on the use of pallets within the specialty retail industry, we looked for information on the size of the pallets used within the specialty retail industry. That information was available for the retail industry (48″x20″), but not for the specialty retail industry specifically. That size is in comparison to the standard pallet sizes of 48" X 40" or 42" X 42" or 48" X 48".

We also were able to find information on the specialty retail industry as a whole. The retail industry is a section of the economy compromised of both brick-and-mortar and non-store retailers engaged in the selling of finished products to end user consumers. The specialty retail industry specifically has an annual revenue of $40bn, with an annual growth of 0.2%. We also found that within the retail and beverage industries, there has been an increase in demand for plastic, rather than wooden, pallets. Plastic pallets offer benefits such as added cleanliness and sanitation, enhanced durability, and reduced product damage.

In conclusion, we were unable to estimate the number of shipping pallets used in the specialty retail industry due to a lack of available information. This information was not available pre-compiled, and there were no free market reports or authenticated sources available that would have allowed us to triangulate the estimate.

Part
02
of six
Part
02

Pallet Use: E-commerce

INTRODUCTION

A thorough research of the internet didn't yield any results on the precise number of pallets currently in use by the e-commerce retail industry, so we had to estimate the answer. Please find the methodology and calculations below.

METHODOLOGY

The first step we took was to calculate the median of all pallets being used in the US. Then, we found that the size of the dominant pallet used in e-commerce is 40" x 48". The next step was to find the percent of 40" x 48" pallets in comparison to all the pallets used in the US. The last step included finding out how many of those pallets are used in the e-commerce industry.

Since the number of pallets currently in use hasn't been calculated, an estimate was found that between 1.8 billion and 1.9 billion of pallets are currently used in the US, with 500 million being manufactured every year. We are going to use the median of those two numbers:
(1.8 billion + 1.9 billion) / 2 = 1.85 billion
The median, which is 1.85 billion, represents the number of pallets currently in use in the US.

The dimensions of the standard and most used used pallet in the US are 40 inches by 48 inches (40" x 48"). This type of pallet is also preferred by Amazon, the number one e-commerce company. We are going to assume that, based on previously stated facts, the pallet used in the e-commerce retail industry is the 40" x 48" one.

The dominant pallet manufactured in the US is the above-mentioned pallet, with 35% of all pallets that were manufactured attributed to it. We are going to assume that the number of pallets being manufactured is proportionate to the number of pallets currently in use, as it can be assumed that pallets of different sizes degrade the same way, and in proportional quantities, so the demand for new pallets reflects the number of pallets currently in use. As we stated earlier, the number of pallets in use is 1.85 billion units. We are going to calculate the number of 40" x 48" pallets, by using the percent of pallets being manufactured with dimensions of 40" x 48" :
0.35 * 1.85 billion = 647.5 million
So, there are 647.5 million units sized 40" x 48" that are being used in the US.

According to the U.S. Department of Commerce, in 2017, the e-commerce sales accounted for 8.9% of all retail sales in the US. Since e-commerce companies need to ship their products to distribution centers using pallets, and the pallet used in e-commerce is sized 40" x 48", we are going to assume that the percent in sales corresponds to the percent of pallets used in the US, and that the pallets of 48 inches by 40 inches are evenly distributed among different companies in the retail industry. With that in mind, we can calculate the number of pallets used by the e-commerce retail industry:
0.089 * 647.5 million = 57. 625 million

CONCLUSION

The number of pallets used in the e-commerce retail industry is around 57.6 million.
Part
03
of six
Part
03

Pallet Use: Mass Merchants

In the global mass market retail industry, there are 27 million shipping pallets in use each year. This is based on a simple triangulation of existing data from industry leaders. You'll find a full explanation of my findings and calculations below.

Findings

Despite extensive searching through industry reports, market research, logistics and shipping data, press releases, media coverage, and other high-quality sources, I was not able to locate any pre-compiled data on the number of shipping pallets in use in the mass market retail industry. However, I was able to perform a simple triangulation using existing data to estimate this figure.

According to this article, logistics company Hyundai Merchant Marine was handling 10% of Walmart's total freight volume, or 30,000 containers worth of freight. From this, we can deduce that Walmart's total freight volume is in the range of 300,000 containers.

By "containers", we can assume that the statistic refers to twenty-foot equivalents, as that is the industry standard, as demonstrated here. According to this source and this source, you can fit 10 standard pallets in a 20-foot container. Therefore, if Walmart has 300,000 containers with 10 pallets per container, the company's total freight volume is 3 million pallets (300,000 containers * 10 pallets = 3,000,000).

To determine Walmart's share of the mass market retail total, I first estimated the size of the mass market retail industry. This report from Deloitte assesses the top 250 global retailers, based on revenue. We can assume that all mass market retailers would qualify in this list; Walmart tops the list with its massive $480 billion in revenue. In total, the top 250 retailers have a combined revenue of $4.31 trillion. In other words, Walmart singlehandedly accounts for 11% of the total $4.31 trillion; this demonstrates the massive market share of the mass merchants. Moreover, if we know that Walmart represents 11% of the mass market retail industry, then we can deduce that Walmart's 3 million annual pallets represent 11% of the total pallets being used in this industry. Therefore, we can estimate that there are 27 million pallets in use in the mass market retail industry:

(3 million x 100)/11 = 27 million

Conclusion

To wrap up, there are 27 million pallets in use in the mass market retail industry annually.
Part
04
of six
Part
04

Pallet Use: Soda

There is an estimated 12.6 billion gallons of soda consumed each year in the United States. A pallet can hold 2,560 cans which is 240 gallons of soda. This equates to about 52,544,271 pallets used each year in the soda industry. Below is a deeper dive into my findings as well as more information on how I came to these estimates.

Findings

According to Beverage Marketing Corp., a soft drink beverage tracker, in 2016, 38.5 gallons were consumed per capita or per the number of people in the United States. To determine the amount of soda that Americans drink each year, we use 38.5 gallons and multiply that by the current population which was 327,548,707 at the time of this report. I used the census population estimate which indicates there is about one birth every 8 seconds so it is constantly changing.
According to an article by Coca-Cola, there are 80 cases of 32 count 12-oz cans of soda per pallet. The article is a company driver profile from 2013 but the number of cans per pallet is still useful information in this case. Using this information, along with the population data and per capita soda consumption we can estimate the number of pallets used in the soda industry. Because my findings are an estimate based on the volume of soda consumed in the United States, I was not able to break down the estimate further by manufacturer and distributor. My search did not yield any results indicating a percentage used by either manufacturer or distributor so I was only able to estimate the total number of pallets.

Calculations

Volume Per Pallet:

First we need to determine the number of cans of soda per pallet:

Number of Cases x Number of Cans = Number of Cans per Pallet
80 cases x 32 cans = 2,560 cans per pallet
Next we need to determine the exact liquid volume:
2,560 cans x 12 oz = 30,720 oz per pallet
There are 120oz in a gallon, which is a more manageable volume:
30,720 oz / 128 oz = 240 gallons per case

Volume Per Person:

Next we determine the total volume of soda consumed in the United States:
People in the US x Gallons per Capita = Total Gallons Consumed
327,548,707 x 38.5gallons = 12,610,625,219.5 gallons

Total Pallets:

Lastly, we can use the gallons per pallet along with the total gallons consumed to determine about how many pallets are needed to transport all the soda consumed each year.

Total Consumed / Gallons per Pallet = Total Pallets
12,610,625,219.5 gallons / 240 gallons per pallet = 52,544,271 pallets

Conclusion

The United States consumes over 12.6 billion gallons of soda each year. Since soda is transported by the pallet, there is an estimated 52,544,271 pallets used in the industry annually.
Part
05
of six
Part
05

Pallet Use: Spirits

There is an estimated 1,533,542,193 cases of spirits consumed each year in the United States. There are about 1,515,357,807 cases of beer and 341,100,000 cases of wine consumed each year. The total consumed cases of wine and beer have not been included in the calculations as they are part of a different request. A pallet can hold between 44 and 96 cases of bottles of spirits. This equates to about 23,961,597 pallets used each year in the spirits industry. Below is a deeper dive into my findings as well as more information on how we came to these estimates.

Calculations

In 2016, 3.39 billion cases of alcoholic beverages were consumed in the United States. Of this, the total spirits consumed was 1,533,542,193 cases (calcualtion below). Because our findings are an estimate based on the number of cases consumed in the United States, we were not able to break down the estimate further by manufacturer and distributor. Our search did not yield any results indicating a percentage used by either manufacturer or distributor, leaving only the pallet number available for estimation.

Total Spirits

Total Alcohol Consumed - Total Beer Consumed = Total Spirits & Wine Consumed
3,390,000,000 - 1,515,357,807 = 1,874,642,193 cases
Total Spirits & Wine Consumed - Total Wine Consumed = Total Spirits Consumed
1,874,642,193 - 341,100,000 = 1,533,542,193 cases

Total Cases

The average size bottles for spirits are 750 milliliters or 1.75 liters. Because bottles do vary, I used the 750 milliliter bottles to estimate the number of pallets. There are several examples for this based on the style of bottle which are as follows:
Full Punt 750 ml Bottles - 44 cases per pallet
Flint Claret - Flat Bottom 750 ml Bottles - 64 cases per pallet
Amber Champagne/Belgian Style 750ml Bottles - 96 cases per pallet
In order to determine the estimated number of pallets, we used the median number of cases per pallet or 64 cases per pallet.

Total Pallets

Total Spirits Cases / Cases per Pallet = Total Pallets
1,533,542,193 / 64 = 23,961,597 pallets

Conclusion

The United States consumes over 3.39 billion cases of alcoholic beverages each year. Of this, 1,533,542,193 cases are attributed to spirits. Wine and beer make up the other part of the total alcohol consumed. Since spirits are transported by the pallet, there is an estimated 23,961,597 pallets used in the industry annually.
Part
06
of six
Part
06

Pallet Use: Beer/Wine

In the United States, there are about 1,515,357,807 cases of beer and 341,100,000 cases of wine consumed each year. A pallet can hold between 44 and 96 cases of bottles of wine and 60 cases of beer. This equates to about 25,255,964 pallets of beer and 5,329,688 pallets of wine used each year for a total estimate of about 30,585,652 pallets. Below is a deeper dive into our findings as well as more information on how we came to these estimates.

Calculations

In 2016, the United States consumed 1,515,357,807 cases of beer and 341,100,000 cases of wine. Because these findings are an estimate based on the number of cases consumed in the United States, we were not able to break down the estimate further by manufacturer and distributor. Our search did not yield any results indicating a percentage used by either manufacturer or distributor so we were only able to estimate the total number of pallets for each industry.

Total Cases

The average size for wine bottles are 750 milliliters or 1.75 liters. Because bottles do vary, we used the 750 milliliter bottles to estimate the number of pallets. We chose several examples of bottles based on the style of bottle and number per pallet to give a sample of sizing. The examples are as follows:
Full Punt 750 ml Bottles - 44 cases per pallet
Flint Claret - Flat Bottom 750 ml Bottles - 64 cases per pallet
Amber Champagne/Belgian Style 750ml Bottles - 96 cases per pallet
In order to determine the estimated number of pallets for wine we are going to use the median number of cases per pallet based on these examples, 64 cases per pallet for wine. Beer has about 60 cases of bottles or cans per pallet.

Total Pallets

Total Cases / Cases per Pallet = Total Pallets

Beer:

1,515,357,807 / 60 = 25,255,964 pallets

Wine:

341,100,000 / 64 = 5,329,688 pallets

Total:

25,255,964 Beer + 5,329,688 Wine = 30,585,652 pallets

Conclusion

The United States consumes 1,515,357,807 cases of beer and 341,100,000 cases of wine. The beer industry uses 25,255,964 pallets, while the wine industry uses 5,329,688 pallets for a combined total of 30,585,652 pallets used annually.
Sources
Sources