Palletline is on course to launch a direct trunking service from January 2014, a move that its MD Kevin Buchanan believes has the potential to evolve the decades-old pallet network model.

Palletline is in its second pilot phase of the scheme. Buchanan told MT that while there were obstacles, not least of all critical mass, to making the freight exchange model work, he believes it remains “absolutely critical in terms of our strategy to get members collaborating to remove cost”.

In principle, the direct trunking service would see Palletline members trunking pallets on prescribed routes direct to each other, cutting out the network’s central hub in Birmingham, and regional hubs in Scotland, Manchester and London.

“If we get it right, it could be as big – if not bigger – than the core business. There’s probably a lot more pallets moved directly than through a hub that we could be involved with,” Buchanan said.

While Palletline is not about to walk away from the hub-and-spoke format it created two decades ago, Buchanan has considered a future where Palletline Plc earns its money as a commercial co-operative, charging for supporting, managing, and providing IT to member hauliers rather than making all its money via its hubs.

He sees the scheme as another way to strengthen the membership and get them working more closely to address the changing market.

“Members have strengths as regional hauliers but there are some things they are not able to do as individual companies. Traditionally, that’s been pallet network business. One challenge will be winning sizeable customers, as buying patterns are changing – foreign parent companies are making remote purchasing decisions.

“So if we don’t redefine what we do and how we do it, we’ll miss out on market opportunities and the basic customers available to [pallet hauliers] are going to diminish.”