There are two primary models for pallet management: pooling (rental) and buy-sell (ownership). Each has advantages and disadvantages, and the right choice depends on your volume, supply chain complexity, and operational preferences.
Pallet pooling works like a rental service. Companies like CHEP and PECO own the pallets and lease them to shippers. You pay a per-trip or daily rental fee, and the pooling company handles collection, repair, and redistribution. The pallets remain the property of the pool operator.
Advantages of pooling: no upfront purchase cost, consistent quality (pool operators maintain their pallets to strict standards), and simplified operations (you don't manage pallet inventory). For companies with simple, high-volume supply chains, pooling can be very efficient.
Disadvantages of pooling: ongoing rental costs that can exceed purchase costs over time, less flexibility on pallet specifications, potential surcharges for lost or damaged pallets, and dependence on the pool operator's logistics network. Some companies find that pooling fees escalate significantly over time.
The buy-sell model means you purchase pallets outright. You own them, use them, and sell or recycle them when you're done. This is the model most companies use, and it offers maximum flexibility and control.
Advantages of buy-sell: lower per-pallet cost (especially with recycled pallets), full control over specifications and quality, no ongoing rental fees, and the ability to earn revenue by selling spent pallets back to recyclers.
Disadvantages of buy-sell: you manage pallet inventory, procurement, and end-of-life disposal. You also bear the cost of pallet damage and loss.
Our recommendation: for most small and mid-sized businesses, the buy-sell model with recycled pallets offers the best economics. Partner with a supplier like Riverside Pallet Co. who offers scheduled delivery, buyback, and retrieval — you get the cost benefits of ownership with the convenience of a managed program.