Home Depot

If we’ve been doing things the same way we were 5 years ago, chances are there’s a better way.”

--Pete Cleveland, The Home Depot

In early 1995, Home Depot began requiring its vendors to ship products to their stores on slipsheets instead of wood pallets. Some vendors are exempt from the requirement because their products are too heavy, awkward, or are hand-loaded (e.g., doors and windows). Before Home Depot adopted its slipsheet policy, more than 40 percent of incoming shipments came on wood pallets. Lee Bandlow, logistics manager overseeing the slip sheet program, estimates that about 55 percent of Home Depot shipments can be slip-sheeted.

Home Depot now enjoys multiple economic and environmental benefits while its vendors benefit from the long-term economic savings that result from using slipsheets to unitize their loads and from the reduced freight costs of pallet-free shipping.

One year after implementing its pallet-free program, Home Depot estimated that its supply chain, including participating vendors, saved more than $2 million from its use. In addition, Home Depot's pallet expense is down $660,000 and it has eliminated more than 1.8 million pallets from entering its stores. In total, some 15 million board-feet of lumber were saved from entering the waste stream. Additionally there are reduced air emissions from greater transport efficiency as slip sheets take up less space in trucks than bulky wood pallets.

Pallet-Free Program Savings to Home Depot
  • Pallet disposal costs: $760,000 avoided
  • Reduction in pallet purchases: $660,000
  • Freight costs: reduced by $2.4 million
  • Although they have not been quantified, Home Depot also reports significant savings in handling expenses and labor.
Environmental Impact
  • Tons of wood waste avoided: 40 lbs. x 1.8 million = 36,000 tons of wood
  • Reduction in wood use: about 1,089 tons of wood saved annually with the potential for more if slipsheeting is used for products shipped to other retailers.
  • Disposal reductions: Home Depot saves by not disposing of or managing 66,000 incoming wood pallets for recycling. Slipsheets are recycled by Home Depot and are much easier to manage because they are light and compact.
  • Fuel/transport reduction: reduced fuel emissions as the slip sheets are lighter to transport than wood pallets. Fuel is also saved as a result of transporting only one truckload of empty slipsheets for every 25 truckloads of empty pallets.
Payback Analysis

The savings on reduced pallet purchases paid for the new equipment needed to handle slipsheeted products in less than three months.

Information from the California Integrated Waste Management Board.

To read the entire report, go to: http://www.ciwmb.ca.gov/packaging/CaseStudies/HomeDepot.htm