What Wooden Pallets Have to Do With Russia's Invasion of Ukraine

Tracy Alloway (0:10)

Hello, and welcome to another episode of the Odd Lots Podcast. I'm Tracy Alloway.

Joe Weisenthal (0:15)

And I'm Joe Weisenthal.

Tracy Alloway (0:16)

Joe, I feel like if we've learned one thing over the past year or two, it's that supply chains rule everything around us.

Joe Weisenthal (0:25)

Yes, that's exactly right. Everything, I mean, you can't talk, there's something I've been thinking about a lot, actually, which is that you really can't talk about a good, any sort of good, whether it's a washing machine or a piece of lumber for a house or something like that, without talking about the system that brings it. And to some extent, even to talk about goods and services as distinct categories of economic spending or whatever, is kind of a fallacy because in the end, there is nothing without the services that brought the good to you or brought the good to the factory or brought the parts to the factory. It's all intertwined.

Tracy Alloway (1:06)

I agree with that. So one of the things that we're realizing right now is that supply chains also play a very, very big role in military conflicts.

And to some extent, I guess that would be expected because in a military conflict, essentially you're moving lots of goods and people from one area into another area. But in another sense, it's kind of surprising when you read headlines along the lines of shortage of pallets is hampering Russia's invasion of Ukraine.

Joe Weisenthal (1:36)

Right, there have been a lot of people talking about how like wars are very big exercises in supply chains and logistics planning.

And I guess it stands to reason, but it's not something that had occurred to me up until very recently, that a lot of the supply chain stresses that we're seeing across the economy would also affect the ability of nations to conduct war, which of course needs a lot of metal and other goods and food and energy and oil, and the same thing everyone else needs. And there was a Twitter thread by talking about pallets. And of course, we've talked about pallets.

Tracy Alloway (2:15)

We have indeed. So I'm pleased to say, we are going to be continuing our conversation about pallets in today's episode, but we are going to be focusing on military applications of pallets, which there are a bunch apparently.

We are bringing back Marshall White. He is of course a professor emeritus at Virginia Tech, and considered America's leading expert on wooden pallets. So Mark, thanks so much for coming back on the show.

Marshall White (2:43)

Tracy, Joe, thank you very much for having me back.

Joe Weisenthal (2:45)

Thanks for coming on.

Tracy Alloway (2:47)

Yeah, absolutely. So maybe just to begin, can you explain what exactly, what role do pallets play in the military, in offense slash defense?

Marshall White (2:59)

I work with the corporate world in supply chain efficiency design and the role of the pallet, which of course is the interface between all of the materials handling equipment and the product being shipped. So the component is critical, and thus I've devoted an entire career to it. But there's a difference in the goals and objectives of military supply chains and corporate commerce supply chains. In the corporate world, we're continually focused on reducing cost, keeping it as lean as possible, but still versatile and reliable. So it's cost reduction. The military is very different.

Number one priority is what they call preparedness. That is making sure the soldiers are prepared on the battlefield, and therefore getting them what they need, when they need. And cost, and I appreciate this, is a secondary issue in the military supply chain. So when you look at designs and efficiencies, there are significant differences between military and corporate Karmos supply chains.

And then if I might just continue by saying that the way we make either supply chain more efficient is we delay as much as possible downstream the handling of each's. In the case of the military, individual boxes of munitions. What you want to do is unitize as far down the supply chain as you can, quite frankly, as the military says, onto the integrated battlefield. You want palletized products all the way down. That's how you gain efficiency. Ironically, it's the same in the military world as in the commerce world and those we design. But we will have very specialized equipment to do this in the military.

I'm not an expert on Russian supply chains, but I've worked with our military, both the Department of Army and the Department of Navy in designing components of the supply chains.

So that's how I respond in a general sense to the differences between military and commerce, but also the similarities. And one more comment. You both are absolutely correct. Supply chains win wars. And I think it's Dwight Eisenhower who made that quote back at the end of World War II.