As an eCommerce company, you might’ve heard this phrase already… but what are some examples of value-added services for retail warehouses?
To ensure that goods reach their destination in pristine condition – while both customized to specific needs and compliant with local regulations – certain third-party logistics (3PL) providers offer a range of value-added services to meet these goals. In this article, we will look at five examples of value-added services (VAS) offered by 3PL warehousing and distribution companies:
- Kitting and assembly
- Quality control inspections
- Specialized handling
- Software automation and tracking
- Repackaging and reworking
Each of these VAS’s goes beyond standard services that 3PLs offer – such as storage, pick and pack, and labeling. Let’s dive into each one and discuss why you should consider them.
Table of Contents
1. Kitting and assembly
Kitting and assembly is an essential part of the product life cycle – as it involves putting together retail items or parts into a consumer-ready product. This process often involves packaging products into bundles (e.g., multiple items into a gift set), assembling components that arrive in different packages (e.g., furniture), or customizing products for individual customers (e.g., upholstering).
Let’s say your company sells home electronics that require assembling different parts or accessories into a final package. In this case, you’ll want to use a 3PL warehouse to package, assemble, and kit various components before they are shipped out as complete products. This helps streamline operations while ensuring that every product meets high standards before it hit the shelves.
Another scenario – if you manage an online store offering customizable mugs with logos printed on them based on customers’ specifications, you may want to partner with a 3PL warehouse to:
- Gather necessary components (mugs & printing material)
- Assemble those components
- Apply designs
- Pack them
- Ship them out in time
By doing so, you’re able to better serve customers with timely deliveries – while maintaining high-quality standards throughout the entire production process.
2. Quality control inspections
Maintaining product quality is one of the most important aspects of any retailer’s warehousing processes. That’s why quality control inspections are crucial for ensuring safe storage and delivery of goods from origin to destination – both domestically or internationally – in perfect condition upon arrival at consumers’ doorsteps. Quality control inspection involves checking new batches against ideal manufacturing standards to confirm consistency – along with validating that each item is compliant.
This can include size/weight discrepancies before goods can be stored in warehouses – or shipped out directly from the manufacturers to buyers/retailers, without any further processing steps required between warehouse and end users.
An example of value-added quality control
For instance, let’s say you order 1000 units each month from your supplier located overseas – but you’re worried about receiving batches with damaged parts due to improper packaging. You may want a 3PL with dedicated staff members that are specially trained in conducting extensive quality control inspections on all incoming batches prior to storage. This can help reduce product defects – and allow you to save costs associated with rejected inventory.
Quality control on batch inventory
On the other hand – maybe you’re facing similar challenges when it comes down to monitoring consistency (in terms of batch production requirements), where multiple parts need verification against local regulations. To efficiently manage these checkpoints, you may want to outsource this responsibility over to a third-party logistics provider that conducts regular checks on each unit before deeming it fit for delivery. Doing this ensures no issues occur due to negligence on regulatory compliance – hence minimizing risks of legal problems later on.
3. Specialized handling
Many eCommerce 3PLs like ZonPrep offer specialized handling – which entails anything related to transporting, stowage, storage, and maintenance requirements for items like:
- Perishable substances
- Hazardous materials
- Controlled substances
- Valuable objects like jewelry pieces
It requires special equipment & transportation protocols designed around strict safety concerns – due to the amount of liability many of these items contain. Using a 3PL that supports specialized handling ensures no damage or mishandling occurs during transit and storage intervals.
For example, let’s say your company’s supply chain involves audit procedures with international health & safety regulations – especially when dealing with perishables like fruits/vegetables. By collaborating closely alongside your third-party logistics partner, they can help you secure customized cold storage chambers satisfying those industry standards (effectively preventing unacceptable temperature changes). This provides extra assurance that regulations are adhered to – removing any potential risk posed by merchandise being exposed to non-compliant temperatures.
4. Software, automation, and tracking
WMS, TMS, and OMS
Warehouse Management System (WMS) is a software application that helps manage and organize warehouse operations, including:
- Inventory control
- Bin locations
- Picking processes
WMS systems are designed to automate processes such as receiving, put-away, picking, packing, and shipping of products. WMS systems are essential in improving warehouse efficiency by reducing processing delays and errors, optimizing labor, and maximizing space utilization.
Transportation Management System (TMS) involves using software that helps manage and optimize shipments to ensure the most efficient use of transportation resources. TMS systems can automate:
- Carrier selection
- Routing and scheduling
- Tracking of shipments
Overall, this helps lower shipping fees and boost end-user satisfaction. TMS systems can also help manage carrier contracts, audits, and payments to ensure compliance – one of many examples of value-added services that top-tier 3PLs offer.
Order Management System (OMS) is a software application that helps manage and process orders from multiple sales channels – such as online marketplaces, websites, and mobile apps. OMS systems allow businesses to automate:
- Order processing
- Inventory management
- Payment processing
- Customer service
This helps improve order accuracy and reduce processing times – and therefore improves customer satisfaction.
API and EDI
Application Programming Interface (API) is a type of software that enables various applications to interact and exchange data. APIs make it easier for different software applications to exchange data and share resources. APIs are essential in integrating different systems such as WMS, TMS, and OMS systems.
Electronic Data Interchange (EDI) is a method of exchanging documents between computers in a standardized format. It enables the quick, secure, and accurate transfer of documents such as orders, invoices, delivery records, and compliance docs. EDI systems improve speed and accuracy, reduce errors, and lower costs compared to traditional paper-based systems that many 3PLs still use. EDI is another example of a value-added service that allows efficient communication between trading partners in the supply chain.
5. Repackaging and reworking
Repackaging and reworking are value-added services offered by high-quality 3PL warehouse services that can improve product presentation and customer satisfaction.
Example of value-added repackaging services
This involves putting products into different types of packaging to make them more appealing or suitable for customers. For instance, if you have products that are poorly packaged, have broken containers, or cannot withstand the shipping journey – a 3PL warehouse can help by repacking the products with new and sturdy packaging materials. This can involve:
- Replacing old or damaged boxes with fresh ones
- Adjusting product arrangement to optimize the display
- Upgrading the packaging material to better-suited materials
By using quality packaging and innovative designs, 3PL centers can improve the aesthetic value of your product, enhance customer value perception, and provide a seamless end-to-end customer experience – especially when your manufacturer or supplier can’t offer the type of packaging you need.
Example of value-added reworking services
On the other hand, reworking focuses on reinforcing packaging, wrapping, and strapping pallets to ensure damaged products or packages are in a retail-ready condition. This can help your company keep customers satisfied by providing quality goods – while avoiding losses and costly returns.
For instance, if you regularly find inventory that is damaged or contains poor packaging, you can seek a 3PL warehouse service to rework the products before dispatching them to customers. This can include:
- Strapping the pallets correctly
- Reinforcing the packaging with additional padding
- Double-checking that products are professionally wrapped to keep them from damage
By engaging a 3PL provider for reworking services, you can be confident your products arrive at customers’ doorstep in good condition – creating a positive buying experience and minimizing the risk of returns due to poor product quality. This can not only maximize productivity and efficiency but also help you gain a competitive advantage by improving your brand image and average review ratings.
Final thoughts on 3PL value-added services
As you can see – beyond standard warehousing and distribution, there are several examples of value-added services that can enhance the supply chain’s efficiency and customer satisfaction. The ability to leverage value-added services (such as kitting, repackaging, and reworking) can better align your products with customers’ preferences, reduce unnecessary shipping costs, and improve order fulfillment times.
As competition in the retail sector increases, partnering with 3PL service providers that offer value-added services can help you maintain a viable business model that prioritizes customers’ needs – helping you differentiate from competitors. Thus, adopting value-added services may help create a win-win situation that results in healthier cash flow, increased sales, and enhanced profitability.
