Companies use third-party logistics providers (3PLs) most commonly for core fulfillment services like warehousing, transportation, and shipping. With today’s fast-paced and on-demand business needs, 3PLs are offering a multitude of more modern amenities, often known as “value added services.” Due to consumer demands, tastes and preferences, the need for ecommerce companies to stand out in their field, often comes down to the finer details in product delivery and order fulfillment. These value added services can include anything from specialized distribution, to customized labeling or final assembly. Because 3PLs are set up to handle end-to-end fulfillment needs, offering value added services can be an easy add-on for their clients. When working with a 3PL, it’s important to sync your brand needs with the value added services your 3PL provides. Below are some of the most common value added services and reasons why they might be a good addition to your order fulfillment strategy.
Benefits of a 3PL that Offers Value Added Services
Flexibility
One of the most significant benefits of using a 3PL is that they will have more flexibility in the space, labor, and equipment they have to respond to fluctuations in orders and meet consumer needs. Some 3PLs can offer a client extra physical space for a limited time as a value added service—this may be in the warehouse for a rush of inventory, or a meeting space to make last minute software updates. Labor resources might be an available value added service when a product campaign might entail more involved attention—a 3PLs ability to quickly shift staff to the project will keep your company labor costs to a minimum.
3PLs usually have the necessary equipment to help complete value added tasks, including conveyor belts, shrink-wrapping machines, automated assembly lines, pallet wrappers, blister packaging machines, box taping machines, and so many more. An experienced 3PL will have these tools on hand and staff trained to use, which affords them the flexibility to add any of these services when a client has a specific need. By using a 3PL for these value added services, your company resources can be allotted to other aspects of your business: sales and marketing, or other important areas.
Quality
The value-added department of a 3PL is usually a team specifically trained to help execute specialized projects. With a dedicated team working to oversee any customization, this brings a focus of quality and efficiency of work. The value-added team will, they are able to work with the customer to outline the project, create the steps necessary to complete the project, and ensure accuracy and precision.
Ease of Integration
Using the value added services of a 3PL allows the seller to work with one partner for all of their logistics needs. A full service 3PL can help manage transportation, warehousing, and all value added services, making it more seamless to integrate any changes or updates along the way. Keeping your product in one fulfillment center also minimizes costs associated with transporting or moving products between facilities.
“Willow did an exhaustive search of 3PL partners. We felt our needs were unique in that we required a partner with consumer medical device experience, DTC, Amazon and retail fulfillment capability and value added services which included the ability to do late stage product differentiation and product rework. DCL was chosen because of their employees, capabilities, flexibility and cost.”
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Common Value Added Services
Kitting
Kitting takes multiple products and combines them into a single easy-to-pick package and easy-to-track SKU. Whether taking two of the same item and banding them together for a “two-for-one” sale, or creating an integrated solution combining products commonly purchased together into a single package, kitting makes the picking aspect of the supply chain more efficient.
Blister Packs
Blister packaging is a broad class of items that can protect items during shipping. Often used for valuable, perishable, or fragile items, having blister packaging done by a 3PL close to the point of sale can lower shipping costs, while also limiting the distance that the relatively fragile blister packages need to be shipped.
Personalization
Adding initials or a laser-etched inscription to the back of an electronic item can increase its perceived value. Some 3PLs have the ability to personalize items before they leave the 3PL warehouse, which means less time that you are involved in the supply chain operations.
Labeling
When products need specialized labeling, for different retailers, or government regulatory systems, having a 3PL do it can save time and money.
Product Destruction
3PL value added services don’t only encompass adding items to your packaging. Sometimes companies also need to get rid of damaged or obsolete products. 3PLs can add value by breaking down those products, recycling them, or disposing of them safely and cost-effectively.
Reverse Logistics
3PLs can work with you to determine if damaged products can be repaired, or flagged to go all the way back to the manufacturer. They can also store extra packaging so that refurbished units can be sent out looking their best. Some larger 3PLs will even offer repair services when it is a simple problem to address.
Postponement Packaging
This is a technique where goods are packaged for bulk shipping and delivery in a way that looks different from when the customer gets their final, single product. Your logistics provider either can ship or accept a shipment of goods packed in larger containers while packing materials such as specialty boxes are shipped separately. At the fulfillment center, the 3PLs staff will assemble the product and packaging into the final single-product package. This generally saves you on labor and shipping costs, plus it can allows changes like adding new combinations or packaging design easier.
International Trade Compliance
Ecommerce is creating more global business opportunities for products of all shapes and sizes. This is great for expanding your customer base and adding additional revenue streams. Unfortunately, expansion can mean a lot of time and expertise needed to understand the complex trade requirements and legal compliance needed in each market. A 3PL that already works with international trade organizations can help you navigate the landscape, and provide the tools or make suggestions to ensure that you are operating in compliance with applicable laws and restrictions.
Bottom Line
There are as many different types of value added services as there are specific ecommerce company needs. This article only touches a few of the most common types, and the benefits of working with a 3PL to provide these services. A modern 3PL can do a great deal more than simply coordinate shipments, load and unload trucks. By partnering with the right 3PL for your brand, it will allow you to scale or change with market demands in the most efficient way possible.
Send us a note to connect about how DCL Logistics can help your company. You can read DCL’s list of services to learn more, or check out the many companies we work with.
Tags: Fulfillment Articles, What is a 3PL?
