Brambles hopes customers will call on CHEP to help them schlep goods through the supply chain. Brambles' primary subsidiary is CHEP, a leading lessor of shipping pallets and plastic containers. In a typical transaction, CHEP issues a pallet or container to a manufacturer, which then uses the equipment to ship goods to a distributor or retailer. After products reach their destination, the pallet or container is returned to CHEP for reconditioning before being sent on its next journey. CHEP manages a pool of 300 million pallets and containers from service centers in 45 countries. In addition, Brambles owns Recall, a document management firm that helps customers store, protect, and even destroy documents and data
In mid-2011, Brambles announced it was selling Recall, which manages the storage, retrieval, and destruction of digital and physical information for about 80,000 customers. At the time, Recall was estimated by analysts to be worth up to $2 billion. Brambles wanted to use the divesture to focus solely on its global wooden pallet and plastic container business and to alleviate debt. However, in mid-2012 Brambles cancelled those plans citing unfavorable market conditions and the lingering debt crisis in Europe.
Brambles' positive 2010 results were driven by CHEP Europe, CHEP EMEA (the Middle East and Africa), and CHEP Asia/Pacific, while CHEP Americas struggled along. Brambles launched its "Better Everyday" program to boost business for CHEP USA. In 2009 Brambles spent more than $100 million to improve CHEP's US pallet business by improving the quality of the pallets (it scrapped 7 million excess pallets in 2009), improving customer service, and restructuring its sales and marketing operations. CHEP Americas went on to pick up some major customers in 2010 including Scotts Miracle-Gro and Del Monte.
Going forward, Brambles will continue to expand into emerging regions, increase its presence in the US by seeking midsized customers, grow CHEP's automotive business in untapped margins, and expand Recall's document management business and digital capability. At the same time, the company is working to expand CHEP's European business, especially in Germany and Poland. The company also launched operations in China and India, landing regional customers, including Procter & Gamble, Hewlett-Packard, and Coca-Cola.
Interested in building its global logistics business, Brambles purchased Switzerland-based Unitpool, a pooled airline container and pallet group with operations at about 300 airports, for $35 million. Unitpool brings its international customer base, including Air Asia X, Etihad, and Cargolux. – less
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