Development of wood-plastic composite pallet for Indian market and determining the profitability of the investment

Abstract

Pallet are one of the main aspect of material handling system. Most of the pallet in circulation are made up of wood, however the market share of plastic pallet is also increasing rapidly. In India, the pallet industry in valued at approximately Euro 858.3 Million, with wood pallets dominating the market. However, with wood resources dwindling in India, timber imports are increasing and plastic being a non-environmental friendly resource, it is crucial to find an alternative solution to such a problem. This research work gives a detail description of developing a wood-plastic composite pallets for Indian market. The report aims to determine the current status of the Indian Pallet market and how a foreign firm can establish its unit of operation in India to produce wood-plastic composite pallets. The main feature of this research is the usage of waste material as raw material to produce composite pallet. Also, the research aims to identify the profitability of the investment if a foreign firm decides to invest in India and starts its production operation. The design and analysis is done of two size of pallets 600x400 mm and 800x600 mm. The design and analysis results determine the load capacity of the pallet which is similar to that of wooden pallets. The economic evaluation of the initial investment of Euro 1 Million shows return of investment at 110.51 % for 600x400 mm pallet and 48.36 % for 800x600 mm pallet. Furthermore, the breakeven point for the return of investment will be achieved in quarter 6 for 600x400 mm and quarter 7 for 800x600 mm.