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VAS In Warehouse

Value-added services (VAS) in logistics play a crucial role in enhancing customer satisfaction for businesses. They have become an indispensable tool for providing comprehensive benefits. In supply chain management (SCM), warehouse value-added services hold significant importance. These services offer numerous advantages to businesses, such as enhancing efficiency and quality, addressing storage needs, and freeing up time for business expansion. A value-added service (VAS service) extends beyond the typical warehousing scope, encompassing additional services that a warehouse or third-party logistics (3PL) provider can offer to clients, surpassing the standard storage and shipping services.

Value addition includes kitting, bundling, re-branding, customization, re-packaging, and work order processing (where components are put together to create a new item). These services are customizable to the client’s needs whether shipping retail goods, perishable cargo or high-tech devices to streamline logistics & reduce costs.

Why do you need them?

Whenever logistics providers add value the right way, it affects the level of customer satisfaction, while indirectly increasing their bottom line
Service providers know the ins and outs of the business and they can assist companies in responding to customers’ needs
Companies collaborating with value-added logistics providers can focus on their core business and work on being more competent in the market
Value addition requires continuous maintenance and 3PLs are working toward providing value-added services in conjunction with their more traditional offerings

How do VAS help businesses’ supply chains & logistics?

Forward-thinking companies leverage their supply chain to gain a competitive edge and market share. Entrepreneurs now widely adopt supply chain excellence as a vital business strategy. To stay ahead and outperform competitors, businesses must revamp traditional supply chains. This presents an opportunity for specialists to propose VAS solutions, driving accelerated supply chain innovation.

Increased price wars and competition

Previously, brand recognition and product features were more than enough to set companies apart but things have shifted
Brand equity and product innovation are no longer the only tools that can allow a business to set a higher selling price
Companies now are using two methods to adapt to this trend
First, they assess cost-reduction strategies and create new techniques to build a more efficient value chain
These changes will allow them to retain a competitive edge
Second, companies are searching for strategies to provide value-added services that will enable them to meet savvy customers’ demands

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Outsourcing

Many companies are taking a step back to evaluate their core competency and some realized that outsourcing part of the supply chain can be beneficial
The marketplace continues to revolve around three pillars:
- Cost and quality of global manufacturing and distribution
- Information mediums and systems
- Product design capabilities
By outsourcing their supply chain and logistics operations, companies can breathe new life into their business
When their business model relies too heavily on outsourcing, companies must implement solutions to make up for off-site supply chain capabilities

Complex & shortened Product lifecycles

Companies are under significant pressure to develop cutting-edge products and launch them to market quickly, without compromising their high-demand existing products
To meet this ever-growing need, companies require streamlined product lifecycle management processes, which emphasize new product launches, product discontinuation and design
The primary benefit of product lifecycle management technology and processes is that it helps companies design products that can share components, operations or materials — reducing the risk of obsolescence write-offs, ensuring optimal use of all infrastructure investments and limiting increased costs when buying essential materials
These practices will also enhance customer perception of your company and establish yourself as an innovative reformer

Types of VAS

Cross Docking

A cross-docking system allows companies to move products directly from the receiving dock to the shipping dock
Cross-docking requires close synchronization of all outbound and inbound shipping movements and reduces the cost by decreasing stockpiling
Cross-docking also involves re-packing, inspection and labeling

Transloading

The process of transloading requires more than one transport mode
International shipments, which require multiple modes of transportation, are the best example of transloading
All shipments get grouped upon arrival, eliminating the need for any distribution center

Palletizing

In palletizing, items or goods are placed on pallets
Depending on the business and product, manual, semi-automated or fully automated methods can be used to put the shipments on pallets
With palletizing, perishable goods can be moved faster and decrease the risk of spoilage
Palletizing significantly reduces the risk of worker injury as they are durable than other shipping containers, allowing more products to be carried at a single time

Kitting

The kitting process includes combining multiple products into a simple and easy-to-pick package
The process works in many ways, whether it’s banding two similar items or creating an integrated solution by pairing two commonly purchased products

Returns processing

The service providers have dedicated warehouses and ample personnel to process and manage the returns as required
When a return arrives, workers scan it into the system to determine whether it’s possible to resell

Labelling

Labelling is done if the company may want a specific branding to be in stores versus sent direct to consumers or for international shipping
Many markets abroad have different label requirements, and 3PLs ensure that the products have the correct label based on which country they are being shipped to

Repacking

Repacking services involve packing products into a different type of packaging, such as changing from bulk packaging to retail-ready packaging

Postponement services

Postponement is the process of bringing multiple individual units together in the fulfillment process to create one unique SKU

Sorting & Inspection

Sorting and inspection services fall under quality assurance
Sometimes component parts need to be separated or joined after they are manufactured and need to be inspected for very specific tasks or capabilities
Companies can have product parts shipped to their fulfillment provider to do this as part of their fulfillment

Benefits of VAS

Flexibility

Partnering with 3PLs will allow you more flexibility in labor, space and equipment
They can offer all these components to enable you to meet your customers’ requirements more effectively
Some 3PL providers also offer extra physical space for a specific time as a value-added service, which could be a warehouse for storing rush inventory or a meeting space for discussing on-the-fly software updates
Labor resources are also available as part of value-added services
If any of your product campaigns require a more hands-on approach to attract your audience’s attention, a 3PL can quickly shift their staff to your project and keep your labor cost to a bare minimum

Quality

With the assistance of a dedicated professional team working or overseeing any customization, you can focus on quality and work efficiency
The value-adding team provided by a trusted 3PL provider might collaborate with customers
They can outline the project, ensure accuracy and precision and take the necessary steps to complete the project on time

Ease of integration

A reliable 3PL can assist you in managing warehousing, transportation and all the value-added services you need
This help can make the process more seamless to integrate any updates or changes along the way
Keeping the product in a single fulfillment center can also minimize the cost of moving products and transportation

Closing Thoughts

Value-added services can transform your Supply Chain, but it is not a one-size-fits-all solution
Service providers must understand a supply chain’s business model and weak spots
With an effective solution, you can optimize your supply chain’s operations
Besides solving logistical challenges, an expert service provider can also provide other long-term benefits
Customized value-added services can build delivery models that will improve inventory and transportation costs, enhancing your operations and saving time and money
Value-added service solutions can work on distribution channels to address your company’s trucking capacity and assist you with time-sensitive deliveries
Service providers can offer consultations and innovative solutions to address your trade landscape and warehousing requirements
A significant benefit of customizing value-added services is an improvement of the supply chain by finding discrepancies in the process and taking corrective measures to improve them, so you can focus on customer satisfaction by providing optimum services