Lane Pence has held numerous roles at CHEP, but he enjoys his current position best because it puts him in direct contact with end users.
RPA Editor: Tell us about your background in the reusable market.
Pence: I’ve held several positions during my 15 years with CHEP. I’ve worked in operations, production, global sourcing, consulting, and strategy. Right now, I’m director of the retail supply chain. I work with customers to help them improve how their reusable assets get through the supply chain. This is a major focus of CHEP: helping customers improve the performance of their assets to create greater efficiencies.
RPA Editor: Describe CHEP’s services.
Pence: CHEP is a global leader in managed, returnable and reusable packaging solutions, serving many of the world’s largest companies in sectors such as consumer goods, fresh produce, beverage and automotive. Its customer portfolio includes many of the world’s largest supply chains. Grocery, drug store, and food service companies use our services for fast-moving consumer goods, primarily from manufacturing to distribution.
RPA Editor: Describe some of the challenges you see that impede companies from implementing reusable packaging.
Pence: Given our global footprint, CHEP sees the issue resonating in many places around the world and in many industries: a company must be willing to execute and then maintain a reusable program. Whether it is a breakfast restaurant chain in Canada, a brewer’s association in Japan, or a provider of laundry detergent in the US, the challenge is the same. If you lose focus on your program, then you have performance issues. Reusables can save money, but they require a system and that requires a commitment.
RPA Editor: What makes a program successful?
Pence: A successful program is when everyone in the end-to-end supply chain – everyone who touches that reusable – realizes it is an asset, understands its value, and handles it appropriately. A lot of companies still don’t view reusables as assets in the same way as they view raw materials or the end product. One $5 pallet expense might not seem like a lot, but if you look at what the retailer spends collectively on pallets, it can add up to a lot of money. And many pallets are more in the range of $5-$20. Companies need to understand that, individually, a reusable asset might have low value, but if you lose them, the cost adds up to a high-value impact.
RPA Editor: How do you get a company to understand the value of a reusable?
Pence: It is really about culture and awareness. We should educate companies, and they should educate their supply chain so that people understand the value of their reusable assets. A well-designed pallet can deliver substantial savings in product protection or transportation. A company needs to demonstrate that value and savings to its supply chain so that people understand the pallet’s value.
RPA Editor: What are the key changes you see happening in the reusable marketplace in the near future?
Pence: End-to-end supply chain optimization is becoming more possible with improved visibility. There is more collaboration amongst trading partners as we look for new ways to create value and reduce costs. Sustainability and safety are being added to the cost benefit analysis, and that’s a good thing. Also, the global economy is still driving companies to look harder for more efficiencies; that is leading some to consider reusables.
RPA Editor: CHEP is a regular exhibitor in the RPA Reusable Packaging Pavilion at PACK EXPO. How does your company benefit by being part of the Pavilion?
Pence: We definitely get more traffic than when we exhibited outside of the Pavilion. Having a concentration of companies supporting the theme of reusables draws more traffic.
RPA Editor: Tell us about your personal involvement with the RPA.
Pence: I am the Chair of the Industry Relations Committee and am a member of the RPA Board. The role of the committee is to look for opportunities to work with associations, like the collaboration with PMMI at PACK EXPO. I’ve liked being involved with the RPA because it helps CHEP build relationships with customers and potential vendors. We are a pooler, not a manufacturer, so it is beneficial to us to hear about potential new products and stay more in touch with our customers and the market.
RPA Editor: Is there a particular industry challenge or issue that you would like the RPA to address?
Pence: Yes, I’d like to see the Association be more vocal about promoting the responsible use of reusable assets and asset productivity. A main reason that customers stop using reusable containers is because of the cost of losing them. We need to help the market implement better strategies and programs to protect their assets.
Also, I think the RPA needs to facilitate the setting of standards in order to expand the potential for reusables. The first one is to standardize the footprint of reusables. Standards would help lower the cost because of the economies of scale; custom pallets and crates increase costs. Setting a standard would require consensus among the major users of these assets, and the RPA could lead that effort.
RPA Editor: Is there anything else you would like to share with the RPA membership?
Pence: I’m pleased to see that membership continues to grow in number and in diversity. The concept of reusables is really an old one, but it has been gaining momentum. It needed a voice like the RPA.
You can reach Lane at lane.pence@chep.com Phone: 513-445-2357