CHEP UPDATE ELTON POTTS WESTERN PALLET ASSOCIATION PALM SPRINGS, JANUARY 22 ND, 2006
THE BIG PICTURE US Economy in slow growth mode FMCG focus on reducing inventories and product damage Lumber prices high in 2005 More focus on the environment
CHEP CONTINUOUS IMPROVEMENT Internal benchmarking, global best practices Six Sigma methodology Lean manufacturing principles Automated inspection and repair Customer & Supplier partnerships New & improved Innovation Center Continue to enhance RFID offering
ASSET MANAGEMENT Asset productivity is increasing Enhancements made to Asset Recovery program Total pallets recovered up 29% in this fiscal year Thank you!
SOURCING Global economy –Lumber from three continents –Nails from Korea, Mexico, and China New pallet demand sourced broadly Manufacture part of demand in- house –Lower cost –Consistent quality –Improved Customer satisfaction
WHITE WOOD Outsourcing popular with customers, e.g. CHEP Total Pallet Management offering Currently four TPM suppliers, vs. one last year Customers place vendors in tiers, prefer Full Service Suppliers White pallet sales to help key customers assure supply
THE CASE OF THE DISAPPEARING PALLETS Increase in theft of white wood as well as CHEP pallets Involvement of employees from: Carriers Service Center operators Pallet Recycling Companies Law enforcement in addition to civil action
WORKING TOGETHER Promote palletization of goods over slip sheet and floor load Work with distributors to eliminate pallet exchange Co- sponsor Michigan State palletization study International –Phytosanitary rules and implementation –Global interaction with pallet organizations
THANK YOU!