Thank you, Madam Chair.
My name is Lisa Vegso, and I am the chief commercial officer of PECO Pallet.
I am pleased to be here today to share PECO Pallet's perspective on Canada's supply chain ecosystem and how it impacts international trade for Canadian businesses.
PECO Pallet is a leader in the North American pallet pooling market, with a fleet of over 24 million pallets.
In case you aren't familiar with pallet pooling, PECO rents pallets to manufacturers, who use our pallets to ship their products to retailers where consumers purchase their goods. Once they are empty, pallets are returned to PECO to be inspected, repaired and recirculated within our network.
PECO was founded in the U.S., and as we grew our network, American manufacturers who were using our pallets domestically began urging PECO to allow them to ship pallets to Canadian retailers. There were many challenges along the way as PECO expanded into the Canadian market, due to the market's high barrier to entry, including a high capital investment. PECO has invested nearly a billion dollars in our pool. There was a need for support from retailers who had to agree to accept and return our pallets.
By making these investments, PECO now has long-term relationships with over 700 food and consumer packaged goods manufacturers supplying North American retailers, including club stores, grocery stores and food service providers. Today, PECO is one of the largest pallet providers in North America.
As a cross-border pallet supply company, we experience first-hand any impact on the supply chain. Simply put, everything that you eat, drink and wear travelled on a pallet at some point.
The pandemic demonstrated that there were gaps in supply chains across the world, including in Canada. At a time when pallet availability challenges were rampant, PECO fully maintained its operations across North America while following health protocols and avoiding work stoppages within our facilities, demonstrating our ability to navigate through supply chain disruptions.
In the last 12 months, more than two million of our pallets have moved food and consumer packaged goods products between the U.S. and Canada.
While COVID-19 did create challenges, it also created an opportunity to develop positive change. It resulted in the creation of the supply chain task force and its final report, culminating in the establishment of the national supply chain office. When the initiative was announced, PECO welcomed this review of barriers that were impacting the efficiency of supply chains.
The most important recommendation to ensure strong supply chains would be to maintain and regularly consult with stakeholders through the national supply chain office. By receiving feedback end to end from the many parties involved in ensuring a product goes from production to the store aisle, the government can gain a full scope of the complexities of supply chains. PECO would be more than willing to participate in any consultations moving forward.
Our second recommendation would be to maintain consistency with requirements across North America and to help prepare stakeholders for any expected changes. Canada-U.S. trade relations are uniquely intertwined, and uneven requirements can create additional costs for an already costly process.
The ISPM 15 bilateral exemption between Canada and the U.S. remains in place and eliminates the need to heat-treat wood packaging, including pallets, which facilitates easier and more cost-efficient trade between the two countries. This is just one example of the importance of maintaining consistent policies with our largest trading partners.
In conclusion, PECO supports the committee's commitment to this study and urges the government to prioritize stakeholder engagement with all levels of the supply chain.
Thank you for your time.