The Impact of Listening to Your Employees
Question: What was the genesis of Pallet?
Answer: My husband and I started a general contracting company about seven years ago. Because of the labor shortage, we started hiring folks with a justice system history. It was not planned or intentional, but we did it, and then we thought these guys are great workers. They’re really wonderful people. We sat down and got to know them and heard their stories of re-entry and all the things that they’d faced. And we thought, we can do more.
Q: How did that morph into Pallet shelters?
A: Over time, we’ve employed hundreds, maybe even a thousand people who we’ve trained in the construction and manufacturing trades or served through the sister non-profit we founded. And as that entity grew, the homeless crisis was growing. A lot of our folks had lived experience with homelessness and addiction and the justice system. We were learning from them. The Pallet shelters you see today, my husband had the concept for them right after Hurricane Katrina in response to the disaster. But when the homeless crisis started to grow, we went to our staff and said, ‘Hey, we have this idea to make these panelized shelter systems since we do construction. Would it make sense?’ From a place of lived experience, they said this is absolutely what’s missing. Most people won’t accept services because they want their own space. They want to stay with their pet, stay with their partner, bring their things. And they can’t do that in the traditional congregate setting. Our staff said, ‘You guys have to do this, you have to build this out.’ So, we took some profits out of our construction company and put them towards launching the Pallet concept.
Q: Can you describe what Pallet shelters are?
A: Ultimately, permanent housing is the solution to homelessness. But it takes forever to build permanent housing, and it’s really expensive. People need a solution now. Our Pallet shelters are inexpensive. Each private shelter comes with heat, air conditioning, electrical panels, beds—all of that. Each is fully insulated and thermally tested and approved for temperatures up to negative 40 degrees. We can fit about 30 of our standard shelters on a 53-foot semi. So, we can show up with a truck and set up a village of 30 shelters in a day when requested. They can be set up and taken down in about an hour each with a team of four people. We have built over one hundred sites across the country so far. They’ve been so successful that once the cities get them up, they leave them up and then they just continue to cycle people through.
Q: How many Pallet shelters are in the field right now, and how much bigger do you think this market could get?
A: Currently we have over 100 sites either operating or in development across the country. I think that equates to almost 4,000 shelters. We are currently producing 60 per week and can get up to 160 per week if we need to.. As far as growth goes, I expect that we will probably quadruple in size over the next two years in terms of capacity—maybe more than that. To give you an idea of the potential demand for our product, there’s like 500,000 to 600,000 people sleeping outside unsheltered in America on any given night. We don’t think Pallet is the solution for all those people, because not everybody wants a Pallet shelter and that’s okay.
Q: Are the shelters meant to be part of a community?
A: We want to be able to set up whole communities and villages. In addition to the personal shelters, we have bathroom products and community rooms as well. Though we don’t operate the communities, we have five dignity standards that our customers are contractually obligated to meet before we will send them the units. One of those is 24-7 on-site service for the residents. The customer, which would in most cases be a city or county, has to contract a service provider and show us proof of service provision before we will ship the products.
Q: Do you see Pallet shelters exclusively being used by cities and counties?
A: Another model we want to push is partnering with developers to utilize vacant land. In this model, we could set up a community, have it up and running for say one to two years while the developer is waiting for their permits. And then when they get their permits (to start construction), we would break everything down and move the shelters to a different developer site.
Q: Do you see your Pallet shelters exclusively being used for homelessness?
A: We always intended that Pallet shelters would be utilized for disaster response, homelessness, and the needs of the mobile workforce, such as agricultural workers. That was originally the three markets we intended to serve because of necessity. And then when COVID struck, homelessness became kind of our primary marketplace right out of the gate.
Q: Do you see demand for your products beyond the US?
A: Absolutely. We have a strategic plan to grow our footprint globally within the next five years. I think it’ll probably actually be faster than that. We have had some initial conversations in relation to the refugee crises that are going on globally. Our product is designed and built specifically to meet domestic housing code sets. International code sets are different so we’ll have to do some product redesign in order to be compliant with international regulatory requirements.
Q: When you started Pallet, was it always your intention to be a mission-driven organization—to try to make an impact?
A: The idea of doing something in a space like housing, which is very profit driven, and saying, ‘Yes, we can be profitable and be mission focused and use capitalism for the good of others,’ was very appealing.
There’s never really been social impact in the housing space that I’m aware of. There’s non-profit, low- income housing, and then there’s for-profit market-based housing. There’s little in the middle. We said, ‘Let’s do it. Let’s see if it works.’ Is it a challenge? Absolutely. There’s a constant tension between mission and profitability that is hard to navigate. But we want to be a part of creating an economic stimulator and opportunities that everybody benefits from—and mostly our workforce. We are a certified living wage employer and the social enterprise model we utilize allows for sustainable business practices and better opportunities for our workers. Additional business growth equates to more living wage jobs for marginalized workers in cities across America as we grow our production footprint. Everyone wins with social enterprise.