RE:RE:First ObservationsIt's great to have knowledgeable people posting, thank you.
I'll check out the iGPS bankruptcy filing, the corp site is low on details, as you would expect.
The iGPS pallet end of life recycling is an interesting point, it also increases risk of theft, as iGPS experienced - AXA claims it can grind up its pallets and reuse them and they may last longer than 10 years - that's a long time from now....
One question - thermoplastic vs. composite, why do you think thermoplastic is better and increases flexibility? My understanding is that it weakens in heat and requires support through metal or extra plastic, increasing weight.
I didn't include the data costs for the pool size as its an operating cost, I'm assuming about 50k pallets now, the additional 150k will cost CDN $15MM, built over time (~1.5 years), most from the current offering, remainder from operating cash flow as they s/b close to b/e now (if this raise is not enough I'm confident they can attact some debt once they are over 100,000 pallets assuming the margins are decent).
The data charge is an operating cost that will reduce their operating margins, something to keep an eye on once rolled out, probably Q3.
Due to financial constraints Axios took the path they did, I like the model of focusing on high turn goods (perishables), growing regionally with in house logistics to control the asset.
Agree with your RM2 comments, building disruptive pallets and trying to sell them hasn't worked in the past. The continuous long strand is only super strong against the grain...
It will be interesting to see how things unfold and how big AXA will need to be for CHEP to aggressively respond, they have a ways to go before hitting 10MM pallets.