Reimagining the Pallet Supply Chain
Founded in Michigan, 3R Pallets is working to transform what can be an environmentally costly component of global logistics: the shipping pallet. The company creates reusable composite pallets made with recycled plastics and reclaimed plant fibers, designed to reduce waste and extend product lifespan, offering a scalable alternative to traditional wood and plastic models. SBN Detroit interviewed co-founder Kylee Guenther about innovation in the pallet industry, the environmental consequences, and the outlook for Southeast Michigan and beyond. Q: What was the impetus behind founding 3R Pallets? A: I’m the second-generation in my family to work in Michigan’s plastics industry—I literally grew up on the shop floor, learning from the bottom up. My dad worked on everything from one-gallon milk bottles to those little lemon-shaped juice containers. I was always fascinated by the engineering, but I was also concerned by the amount of waste I saw. As an adult, I became more focused on sustainability and how I could be part of the solution, so I decided to do something about it. That’s how 3R Pallets was born. Our goal is to disrupt the archaic wooden shipping pallet industry with the world’s most sustainable pallets. Not only are our pallets sustainable, but we help save our customers money. Traditional pallets damage and destroy product, cause production downtimes and need constant repair and endless reordering. With our drop in solution, we’re disrupting this space. We just graduated from TechStars and are the first company from Lansing to ever be accepted. It’s one of the most competitive and respected accelerators in the country. We’re also currently raising a $1.2 million pre-seed round to help onboard new customers, build inventory, and grow our team. Q: What do most people misunderstand about the scale and impact of pallet production? A: People just don’t think about them. Pallets are invisible to most consumers. They’re not something you interact with every day, so it’s hard to grasp the scale unless you’ve worked in logistics or manufacturing. Compare that to straws, bags, or plastic bottles—people have firsthand experience with those, so there’s a clear sense of impact. But over 90% of the goods we use were shipped on a pallet at some point. It’s a massive part of the supply chain that’s often overlooked. Q: With pallet use expected to increase in the next decade due to e-commerce growth, what are the biggest sustainability challenges facing the industry today? A: The first big challenge is access to materials. We’re already seeing lumber shortages in many places, and if demand doubles, costs will rise, and pressure on forests will increase. We can’t pretend there’s an endless supply of trees to meet that need. Plastic pallets are often seen as an alternative, but not all plastics can be used in pallet manufacturing. And recycling plastic isn’t a forever solution—it degrades over time. Our approach uses recycled plastic and reclaimed bamboo fibers which actually strengthens the material and increases how many times it can be reused or recycled. Q: Most wooden pallets are only used a few times before being discarded. Why has reuse or recycling been such a persistent challenge? A: The main issue is durability. Wooden pallets simply aren’t built to last. They break down after a few uses, especially when hit by forklifts or exposed to the elements. And if they’ve been fumigated, they often can’t be recycled at all. Our composite pallets can be used 50 to 60 times. They won’t degrade like wooden pallets and can be repaired or recycled when necessary. That’s a huge improvement in terms of both cost and environmental impact. Q: What is the typical lifecycle of a pallet from production to landfill, and where are the biggest environmental pain points? A: For wood, a tree is grown, cut down, milled, and nailed into a pallet. It’s sent to a distributor, then to a customer, used a few times, and if it’s damaged or treated, it goes to a landfill. Best case scenario is they enter a secondary market after being repaired and get a couple more uses. Plastic pallets are usually injection molded, often using virgin plastic. They might last for 30 to 40 cycles, then either get recycled or landfilled depending on their condition. Our pallets are different. They’re made with non-edible plant fibers with recycled plastic and molded into a durable product. They can go through 50 to 60 uses, and in many cases can be repaired or recycled again. That means fewer pallets are needed overall—and far fewer are discarded. Q: How does Michigan contribute to or feel the impacts of pallet consumption? A: We use a lot of pallets here—there’s no doubt about that. But Michigan also gives us a big opportunity because the automotive industry is one of the most forward-thinking when it comes to closed loopy supply chains. We’re already seeing traction in that space. Our value proposition is simple: help customers ship more goods with fewer pallets. That’s good for business and good for the planet. Q: How does the end-of-life of a pallet impact the total carbon footprint of a shipping operation? A: It’s huge. Most traditional wood or plastic pallets end up in landfills and producing new ones requires more energy and raw materials. That adds up. If you extend the life of a pallet and reduce the number of replacements needed, you lower emissions, reduce waste, and conserve resources. Our composite pallets are designed to be durable and recyclable, which makes the whole system more sustainable from start to finish. Q: What has innovation been like in the pallet industry? A: There truly hasn’t been a lot of innovation. Most of it is on the software side but the heart of shipping is still the pallet. 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Smart and Unique Sustainability Start-Ups are Making an Impact in Southeast Michigan
A hardworking number of Southeast Michigan manufacturing companies and hardware entrepreneurs are getting their start at the Centrepolis Accelerator, a nonprofit business facilitator providing access to key resources, a collaborative community, product development, and manufacturing experts with an impetus to keep manufacturing in Michigan. Launched in 2017 by Lawrence Tech, the City of Southfield, and the Michigan Economic Development Corp. (MEDC), the accelerator focuses largely on the areas of climatech, cleantech, and the circular economy. SBN Detroit spoke with two woman-owned sustainability businesses working with Centrepolis to gain insights on the whys and the hows regarding their industry choice, go-to-market objective, and their start-up paths and challenges. NexTiles, a Black-, woman-owned Detroit-based textile recycling, and secondary use company uses textile waste from Detroit’s automotive and apparel manufacturing industries to make eco-friendly building insulation that can reenter the circular economy at the end of its life. The founder and CEO is Madeline Miller. Pivot Materials is a millennial-woman-owned Detroit-based social impact business that specializes in providing sustainable biomaterials by upcycling agricultural waste, including bamboo fibers and rice and coffee hulls. The co-founder and CEO is Kylee Guenther. Q: How did the concept of your business come about? Miller: I was at the University of Miami doing my graduate studies in marine and atmospheric science. My undergrad was in environmental science, and I didn’t know exactly what I wanted to do with my education, but I started studying ocean plastics and then landfill waste and developed an understanding of manufacturing overconsumption and the waste it creates. I then started an internship with a New York-based textile recycling company and began brainstorming secondary uses for this textile waste. I came up with the insulation concept and it stuck. I’ve now been able to combine my Ph.D. research at the University of Michigan School for Environment and Sustainability around the energy burden with the corresponding demand for insulation. It’s been an awesome fit and direction for me. Guenther: My co-founder Raju Patil and I combined our childhood experiences into the mission of our business, Pivot Materials. I’m the second generation in my family to work in Michigan’s plastics industry. I grew up on the shop floor learning about plastics from the bottom up. I’m so proud of my dad and his career, which spanned about four decades in the plastics industry, but even as a kid I was mortified by the amount of waste he helped create. Raju grew up the son of a rice farmer in rural India and had similar feelings about the waste created by the agricultural industry. One-third of all black carbon emissions globally are created by crop burning. We thought we could work on both issues together so we started using agricultural waste to reduce plastic usage while also reducing the amount of agricultural waste that gets burned or sent to landfill. Q: Why sustainability? Miller: Textile waste consumption needs to be slowed drastically and the overwhelming amount of manufacturing waste in the atmosphere needs to be addressed. Our natural resources are being impacted and people are being impacted. They will continue to suffer if we don’t slow down. I want to change lives for Detroiters by using locally manufactured building insulation to create clean jobs, decrease the utility burden on families, increase diversity in the energy industry, divert textile waste from landfills, and contribute to the growth of the circular economy. Guenther: I often repeat in my head “be the change you want to see in this world,” and that’s driven my passion for sustainability. I think it’s absurd that only about 9% of all plastics created get recycled. I also know that plastics aren’t going anywhere. They’re too embedded in our lifestyles and plastic makes a lot of money for a lot of people. So, my passion is to transition away from as much plastic usage as well as other non-sustainable materials while also helping reduce the environmental impact of agricultural waste. Q: Please walk us through your start-up process and your work with Centrepolis. Miller: When I transitioned from Miami to Detroit and had the idea to start the business, I began working with TechTown Detroit. They familiarized me with customer discovery process and helped me to identify challenges and opportunities for my business. Centrepolis has been extremely helpful in the product development process. After we got over the hump of exactly what we wanted to make, Centrepolis came in and helped me identify a plethora of resources, including warehouse space, equipment, product treatment packaging, and marketing. Guenther: I’m really happy to see that Dan Radomski, executive director of Centrepolis started an accelerator specifically for product-based companies. This has been missing in the ecosystem. For us, I think the biggest benefit from Centrepolis has been working with our mentor and Expert-in-Residence, Richard Broo. Richard is a plastics industry veteran with about 40 years of experience in material sciences and project management. Sometimes we have an issue that we think is huge, and he can solve our problem in about two seconds and reassure us that it’s no big deal. This helps us save a lot of time as we grow our business, and it gives us someone to learn on. Q: Are you focused on business-to-business or business-to-consumer? Miller: I work with both. The first part of my business is waste collection and recycling. Here I focus on the automotive and textile industries, so this is B2B. A portion of that waste is then upcycled into eco-friendly insulation, a product I ultimately plan to sell to consumers. Guenther: We’re B2B. We sell our materials to brand owners and manufacturers who already use plastics or are looking to create a greener new product. Q: What are your biggest challenges? Miller: Communicating the value of our business to manufacturers is one of our biggest challenges. There is so much volume when it comes to waste, and it’s cheaper to take it to a landfill than to collect and process it into a new product. Some companies are at the
