How Wooden Reels Are Driving Sustainability in the Cable and Wiring Industry

In the cable and wiring industry, packaging typically represents around 32% of a production plant's indirect spend, making it a key category for buyers. 

Due to its significant impact on the bottom line, packaging often ranks among the "vital few" in Pareto analysis. This category includes not only the specialized pallets used for transporting coils of copper wire but also the drums or reels essential for transporting various types of cables.

Leading companies in the industry produce cables for residential, commercial, and industrial applications. The process begins by drawing metal into thin wires, which are stranded together. Insulation is added for protection, followed by optional shielding and a durable outer jacket. After testing, the cables are coiled and packaged for distribution, where packaging materials play a crucial role in the process.

As such, the lack of proper packaging materials can disrupt the supply chain and delay customer deliveries, causing inefficiencies that affect the availability of essential cables across various sectors including telecommunications, energy, transportation, and construction. 

The transportation of such cables relies heavily on different types of reels such as metal spools, steel reels and wooden reels, as they provide the most effective means of handling and distributing these materials. No matter what the application, cables must be coiled on reels or drums to ensure efficient handling and secure storage.

The Dominance of Wooden Reels 

Among the various packaging solutions, wooden reels are particularly noteworthy. They are not only fundamental for securing cables during storage and transit but are also the most frequently purchased.
Wooden reels are the backbone of cable and wiring packaging due to their versatility, cost-effectiveness, and, most importantly, sustainability. 

Companies in the industry increasingly seek FSC (Forest Stewardship Council) or PEFC (Programme for the Endorsement of Forest Certification) certifications to emphasize their products' eco-friendly and recyclable nature while promoting sustainable forest management.

The cycle for wooden reels is straightforward: the drums supplier assembles the reels, cable companies wind the cable onto them, and the reels are then shipped to customers. After use, the reels are returned to the supplier, where they are graded and, if possible, repaired. This creates a win-win situation — it's environment friendly and more economical than producing new reels.

Wooden reels are preferred for their ease of customization, enabling manufacturers to adapt them to different cable sizes and weight capacities. 

Tin Metal Spools 

Tin metal spools provide a reliable packaging solution for delicate or lightweight cables, offering durability in a lightweight form. 

Made from tin, these spools are resilient, providing strong protection for smaller or sensitive wiring, and are corrosion-resistant, making them ideal for cables exposed to moisture.

To achieve cost savings on tin metal spools, an effective strategy is to ship them unassembled to the cable company. This approach optimizes space utilization within the transport vehicle, resulting in reduced shipping costs. The spool heads can be efficiently consolidated for shipping, as can the barrels, allowing for a more streamlined and economical logistics process.

Metal spools are commonly utilized in regions with harsh, cold winters, due to their durability and resistance to extreme temperatures. 

In less frigid climates, however, customers often prefer plastic spools, which offer a lightweight alternative that can be more cost-effective while still meeting their packaging needs. This versatility allows businesses to choose the most suitable option based on their specific environmental conditions and operational requirements.

Steel Reels: Heavy-Duty Support 

For the heaviest and most sensitive loads, steel reels are the preferred packaging solution, engineered to support substantial weight while maintaining structural integrity.

These reels offer high weight tolerance, making them ideal for extremely heavy cables used in industrial and energy applications. They are also often treated with anti-corrosion coatings, ensuring the protection of cables in corrosive environments, such as marine and chemical industries. Furthermore, steel reels also promote sustainability through their reusability and recyclability, allowing them to be repurposed multiple times and recycled at the end of their life cycle.

Procurement & Supply Chain Challenges  

GEP has partnered with various business units across North America and Europe in the wooden reel industry. Throughout this collaboration, we have encountered the following major challenges:

1. Reel Returns

One of the most unpredictable aspects is the timing of reel returns. Customers may return wooden reels in under three months or take over a year. This uncertainty makes it difficult to decide whether to place new orders with suppliers or wait for returns, which can then be repaired to save costs. 

2. Order Forecasting 

In some plants, reel priorities shift frequently — sometimes weekly — adding complexity to accurate forecasting. With limited storage capacity, suppliers must constantly adjust, accommodating demand fluctuations and managing inventory challenges.

3. Supplier Negotiations

Annual price negotiations with suppliers are driven by inflation and factors like rising labor costs. With few suppliers located near the factories, sourcing from distant suppliers often results in uncompetitive bids due to high transportation costs.

The Solutions

To tackle these challenges, it is important to identify the most competitive drum suppliers located near the factories and negotiate a stable base price, allowing only quarterly adjustments based on wood price fluctuations. This approach has proven effective, especially given the volatility of the wood market.

To improve reel returns, it is also important to collaborate with plants to encourage the return of reels once they are no longer needed, thereby reducing the necessity for new orders. For order forecasting, close coordination with the plants is imperative to align priorities and implement flexible inventory strategies with suppliers to accommodate fluctuating demands.

A Case Study

GEP collaborated with suppliers to implement FSC-certified wooden reels in Canada. Initially focusing on high-demand SKUs, the initiative now aims to extend the FSC logo across all SKUs, reinforcing GEP's commitment to sustainability and industry leadership.

GEP is also working towards leading a project designed to double the lifespan of wooden reels, currently in the sourcing strategy alignment phase. By extending reel usage and maximizing repair cycles, this initiative is expected to result in significant annual cost savings for 2025 and reduce the need for purchasing new reels. The focus will shift more towards repairs rather than acquiring new reels.

For the latest packaging trends and strategies, download the 2025 GEP Spend Category Outlook Report. 

Author: Rafael Martinez