Drake Says:
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Not
all 3PLs are equipped
to handle the responsibility
– nor do some want
to try.
What
do you say? Send
us your comments here
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One
ripple effect of higher transportation
costs that are impacting all
facets of the supply chain is
that more customers are looking
to 3PLs to provide services
traditionally provided by co-packers.
These are value-added services
(VAS), such as packaging, labeling,
kitting, display building, etc.
This
trend is competing with the
well-worn model, where products
leave the manufacturer and go
to a co-packer before arriving
at the 3PL – or where
product goes from the manufacturer
to the 3PL and then takes a
side trip to a co-packer when
needed. In the new model, customers
want to eliminate one or two
legs of the journey by asking
the 3PL to provide more services
on site; therefore, viewing
their trip to the logistics
center as “one-stop shopping.”
In
addition to the potential for
saving costs associated with
transportation, the option of
assigning more value-added services
to 3PLs on-site offers another
benefit. For the growing number
of businesses that want to adopt
practices that are more sustainable
and environmentally sound, reducing
the need for extra product movement
serves that purpose.
Not
all 3PLs are equipped to handle
the responsibility – nor
do some want to try. To successfully
provide these extra services
may require increased engineering
expertise, more space dedicated
to packaging or other operations,
additions to the labor force,
and/or a greater level of automation.
The 3PLs who do want to take
on this added role must be willing
and able to be resourceful,
adaptable, and creative.
Some
recent challenges we have faced
in the category of value-added
services include: learning how
to assemble musical instruments
on site, designing a way to
best assemble a mixed-SKU pallet
for Sam’s club, adapting
an each pick system to process
components for a plasma TV kitting
operation, and deploying additional
personnel to handle a customer’s
product return. Extending capabilities
beyond the traditional responsibilities
of “logistics” is
another example of the way in
which 3PLs are playing an expanded
role in many manufacturers’
competitive business strategies.
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