Abstract: An apparatus for forming a pallet spacer from a one-piece blank, the one piece blank having at least a first end and a second end, a retention segment disposed between the first and second ends, the retention segment defining a retention aperture, the second end including a cut-out flange having a hinge, the apparatus comprising a base, a rotating mandrel assembly mounted on the base for wrapping the one-piece blank around itself such that the retention aperture is registered directly adjacent the cut-out flange, the rotating mandrel assembly including a selective engagement means for gripping the first end of the one-piece blank when the one-piece blank is wrapped around itself, a punch for pushing the cut-out flange into the retention aperture thereby retaining the one-piece blank in a coiled shape forming a pallet spacer and a stripper for removing the pallet spacer from the rotating mandrel assembly.