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The Global Pallet Rack Industry in 2018

Most of understand that pallet racking increases storage density of the stored goods & associated costs with the racking increases with increasing storage density. While this is minimum understanding, what happens with the industry still remains a story to be told. Read ON!
Pallet Racks Pallet racking basically refers to one of the most used tools for storage systems around the world. It’s basically used for storing and/or stacking palletized loads. Because of so, pallet racks have easily become a fundamental tool for businesses that partake in storage, distribution, and material handling operations. It is because of such pallet racks that companies are able to efficiently operate and supply their customer’s demands.

As a result of the pallet rack’s effect on a business’ overall efficiency, the demand for it has significantly increased globally. In fact, according to Persistence Market Research’s new report, the global pallets market is now valued at a little over US$ 47,337 Mn and is expected to register a CAGR of 5.4% by 2025. Which basically means its value will grow up to US$ 76,067.2 Mn in the next seven years.

The Increasing Demand for Pallet Racking

So what exactly is causing the increased demand for pallet racking? The reason is quite simple. Lots of companies are learning how to save on costs by maximizing their warehouse spaces. New warehouses cost companies a lot. Plus, some companies are unable to meet the requirements for new warehouses. To keep up with their customers’ demands without too much-added expense, these companies are looking to pallet racks for increased storage capacity.

Though recent research says that warehouses decrease their productivity level when their storage capacity is exceeded by 75%-85%, pallet racking systems allow businesses to maintain their productivity levels even when their warehouses are fully or overstocked.

With pallet racking’s affordable cost and the promise of efficiency, it’s no wonder its demand and market value is forecasted to increase in the next seven years.

Industries that Demand Pallet Racking

Now that we know what’s the cause for the increased demand of pallet racking, let’s now learn a bit more about the pallet racking industry by identifying the different sectors that drive the increase of its global market value.

As of today, it has been found that the top three industries with the largest demand for pallet racking include food and beverages, automotive, and retail stores. Various companies from these three sectors have been growing their storage facilities in emerging countries like India, China, and Brazil. As a result, such companies are able to implicate better and safer transportation systems for their large-scale industries. This is according to the research that was done by Global Industrial – Australia’s leading manufacturer of pallet racking systems.

Furthermore, recent market research continue to backup the predicted forecast for the pallet racking industry for the next seven years. In fact, according to Technavio of warehouse and storage research lead analyst, Shakti Jakhar, food and beverage companies will continue to increase their demand for warehouses near cities to meet on-time delivery demands due to increased consumption of packaged food and beverages in urbanized communities.

The same thing is foreseen for the automotive industry since automotive sectors are predicted to expand their reach across the Asia Pacific and Latin American regions.

As for retail stores, the number of e-commerce websites has drastically increased over the past few years. And e-commerce companies are still growing at a rapid rate today. With the constant production of e-commerce goods along with the continuous increase of e-commerce companies, experts are certain that the rise of the global warehouse racking market is inevitable during the seven-year forecast period.

For now, the top players that continue to drive the increase of the global pallet rack market include: UNARCO, Mecalux, KNAPP, Kardex Group, TGW Logistics Group, Swisslog, Murata Machinery, Intelligrated, Fives Group, DMW&H, Constructor Group AS, Groupe Legris Industries, FlexLink, BEUMER Group, AK Material Handling Systems, Vanderlande, Dematic, Interroll Group, SSI SCHAEFER, and Daifuku.

Types of Pallets that are in Demand

There are several types of pallet racks that are in demand. The top two most used types are block pallets and wood pallets.

Block pallets are the most used type around the world. Because of so, block pallets are assumed to account for the largest market share over the seven-year forecast period. As for wood pallets, they’re the most sought-after type for manufacturing purposes.

Another kind of pallet that has been catching the attention of buyers and business owners are second- hand pallet racking. Though second-hand items aren’t usually the ideal choice for certain businesses or individuals, the same may not be said about pallet racking since they’re usually made to last. Plus, pallet racks are initially developed to withstand heavy loads for a long period of time. At the end of the day, no matter what kind of pallet racking you plan to buy or use, know that you’d be better off buying them today. Especially since they’re predicted to get more expensive in the future.

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Any facts, figures or references stated here are made by the author & don't reflect the endorsement of iU at all times unless otherwise drafted by official staff at iU. This article was first published here on 26th September 2018.

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