Manufacturing Publications

WOOD PALLET WASTE REDUCTION -

LOCKHEED MARTIN AERONAUTICAL SYSTEMS

SUMMARY

Lockheed Martin Aeronautical Systems, located in Marietta, Georgia, reduced the quantity of wood waste being sent to a landfill by providing a local company with good shipping pallets generated from their receiving department. The direct reuse of the pallets reduces solid waste, saves disposal expense, and benefits a local company.

BACKGROUND

Lockheed Martin receives sheet metal stock on 4 foot by 12 foot hardwood pallets. Once emptied the pallets were taken to a central location, broken apart, and sent to a landfill for disposal. In an effort to reduce the amount of solid waste going to the landfill and the associated disposal cost, the company began to search for ways to reuse these pallets.

PROCESS MODIFICATIONS

An investigation determined that returning the pallets to the supplier was not cost effective due to handling and transportation costs resulting from the supplier's out of state location. The investigation did result in locating a local sheet metal company that could use the pallets to ship product. An agreement was reached where the company will pick up the pallets on a predetermined schedule at no cost. This eliminates Lockheed's handing and disposal costs while reducing the solid waste being sent to a landfill.

RESULTS

The reuse of the 4 foot by 12 foot hardwood pallets by a local company will save Lockheed $6,374 per year in handling and disposal costs. Additionally, it is estimated that the local sheet metal company will avoid the cost of purchasing new pallets, saving approximately $30,000 annually.

Implementation cost = $0

Waste disposal cost = 105 pallets/mo x 75 lbs/pallet x 12 mo/yr = 94,500 lbs/yr = 47.25 tons/yr

= 47.25 tons x $32.50/ ton = $1,535/yr

In-house handling = 3 hrs/wk x $31.63/hr x 51 wks/yr = $4,839/yr

Total Lockheed savings = $1,535 + $4,839 = $6,374/year

Local company's estimated cost avoidance = 1260 pallets/yr x $25/pallet = $31,500

Note: The estimated value of the pallets was reduced $2.00 per pallet to compensate for transportation.

C-30-98

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