LHT Holdings and SIMTech: Digital Transformation in Pallet Manufacturing

For over a decade, LHT Holdings — a Singapore Exchange-listed manufacturer and supplier of wooden pallets, cases, and proprietary technical wood — has partnered with A*STAR Singapore Institute of Manufacturing Technology (A*STAR SIMTech) to modernise its operations.

Through a series of innovation projects, from 3D design automation to sustainable smart assembly lines, SIMTech has enabled LHT to achieve significant productivity gains, reduce operational costs, and stay ahead in a competitive global market. The relationship exemplifies how SMEs can tap into national R&D capabilities to accelerate growth and sustainability without building large internal research teams.

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In search of a better solution for pallet design, LHT wanted to innovate, but did not have the capacity to perform R&D on their own as an SME with limited resources. Some issues they faced were:

• Limited access to global software: Commercial design systems were either inaccessible or unsuited to LHT’s needs.
• Complex engineering requirements: Designs had to factor in load-bearing strength, material optimisation, and transportation mode.
• Sustainability and efficiency targets: Rising material costs and the need for operational efficiency demanded smarter production systems.

Since 2008, SIMTech has collaborated with LHT across multiple technology upgrades including:

• 3D Pallet and Crate Design System: Reduced design time by 50% with integrated load calculation and optimisation features, and enabled knowledge-driven presentation for clients.
• Event-driven Business process Management System: an End-to-End Process Automation to streamline the process of orders, deliveries and inventory.
• Raw Materials Management System reducing raw material inventory by 15% and cutting operational costs by S$130,000.
• RFID Pallet Leasing & Tracking System delivering annual productivity savings of over S$50,000 for LHT and S$375,000 for clients.
• Smart and sustainable pallet assembly line deployed in 2017 through Model Factory@SIMTech, re-engineering processes for higher efficiency and greener operations.

SIMTech provided us with a system that enables us to be ahead of the game in our industry… You need to trust the professionals from SIMTech and have open discussions with them so that you can innovate together.

- Ms May Yap – Chairwoman and CEO, LHT Holdings Ltd.

By leveraging A*STAR’s capabilities, LHT holdings has become more competitive by continually innovating and improving their capabilities achieving:

• Significant annual savings for LHT and their customers, and having advantage through differentiated, knowledge-based solutions.
• Become more sustainable and green by reducing material usage and utilising smart assembly lines
• Strengthened LHT’s innovation capacity through long-term R&D collaboration.