If you could outsource in-house operations and, at the same time, drive growth, reduce costs, improve workflows and gross profit margins – wouldn’t you take advantage of it? Welcome to the world of value added logistics services.

What is the Value of Added Logistics Services?

Value added logistics services are those additional distribution and warehousing services, such as custom packing, cross-docking and quality controls offered by 3PL partners. These services allow businesses to outsource what would normally be in-house operations and offset associated costs. By taking advantage of value added options, businesses free up resources which can then be used to strengthen core competencies.

In a highly competitive industry such as the supply chain, many SMB companies realize that partnering with a robust logistics provider who provides solutions beyond transportation and warehousing is a top criteria in a growth strategy.

“Modern logistics starts in the customer’s plant, not afterward. Manufacturers have realized that it makes economic sense to transfer certain in-house tasks to a logistics company.”

Dirk Bütow, Global Key Account Manager at BLG LOGISTICS

Types of Value Added Logistics Services

Just as there are many different types of businesses, there are a host of value added services designed to enable the logistical needs of those businesses. From industrial to pharmaceutical, the food industry and cold chain requirements, customers in the supply chain rely on the specialty and expertise of their 3PL partners to extend their workbench.

For logistics companies that provide value added services, supply chains may focus on more discrete characteristics such as time sensitivities, price or warehousing capabilities depending on the value chain they serve.

A few examples of value-added services offered by logistics companies include:

• Cross Docking
• Co-packing & Assembly
• Product Rework/ Sorting
• Reverse Logistics
• Quality Checks
• Container De-stuffing
• Shrink Wrapping
• Custom Packing
• Labelling (UPC & Barcode printing)
• E-Commerce Drop Shipping Services
• Providing EDI to Customers (Standard or Customized solutions)
• Detailed management reports

Value Added Services Make Customers More Flexible

In order to provide a higher level of service to clients, 3PL and logistics companies tailor their services to meet the specific needs of their customers. The benefit of value added services to the customer is in a more efficient supply chain. The benefit to the logistics provider is in more business through diversification.

Value added activities in logistics enable customers to offload in-house operations that are restricting growth thereby allowing them to reallocate resources that improve or maintain market competitiveness.

For instance, pre-assembly is a typical value-added service in logistics. If you employ a JIT strategy in your business, partnering with the right 3PL provider can facilitate a cost effective method of  forwarding partially assembled goods through the supply chain without having to switch carriers.

Furthermore, workers that specialize in pre-assembly are employed within the managerial sphere of the logistics provider. For your business, this further removes the burdens attached to human resources by not having to maintain staffing for these outward services.

Value Added Services and the Supply Chain

The globalization of sourcing and manufacturing has facilitated the need for more diversity in logistics. Just as early freight forwarding evolved into logistics, value-added services became a natural extension of evolving supply chain opportunities.

Where value creation was traditionally held as an internal control by the customer, the availability of cost effective outsourcing shifted value creation into becoming a collaborative effort with an external 3PL partner.

Businesses with optimal supply chains have 15% lower supply chain costs, less than 50% of the inventory holdings, and cash-to-cash cycles at least three times faster than those not focused on supply chain optimization.

Logistics Bureau

Depending on the nature of your business, key activities may require optimized trucks and container loads. Or you may require co-packing, repacking or custom packaging from your logistics relationship.

One value added service for instance, may involve re-packing goods that arrive in large batches from a distant location. The repacked goods are then sold in smaller batches at their final destination.

Another value added service may involve true diversity in customer fulfillment. For instance, a 3PL partner can both manage and fulfill B2B and B2C orders from a single pool of inventory. In a market where space is at a premium, avoiding the expense of warehousing for what would otherwise be distinct inventory sets provides an essential advantage.

Value Added Services and Sustainability

By combining transportation routes that would otherwise involve another service company, a logistics provider that offers a value added service solution can streamline an entire leg of a supply chain. For instance, by eliminating product transports, customers enjoy the benefits of more efficient transport and add to the sustainability of the supply chain itself.

Trust and Information

Like any partnership, a 3PL-client relationship works like marriage, therefor there must be a high degree of trust and the sharing of information between the two parties.

It would be fair to say a high level of trust is not only the anchor of the relationship, it’s also a prerequisite for the creation of value-added services. Meeting deadlines and expectations ensures success and facilitates the easy sharing of sensitive information. For instance, customer information may be required by a logistics provider to customize services and improve process efficiencies.

Final Thoughts

Nobody can predict the future with absolute certainty. Take the Pandemic for example. We would like to think our existing infrastructures and supply chains are robust enough to weather minor hiccups, and perhaps they are, but these are evolving technologies in a world currently experience a bullwhip effect after a near dead-stop.

The shortage of truckers and the start-stop jerkiness of the availability of products has been working its way through the supply chain for a number of years now.

Yet, according to a recent report from Statistics Canada on rental space in commercial markets:

Compared with the fourth quarter of 2020, commercial rents were up 3.3%, supported by increases across all building types: industrial buildings and warehouses (+4.2%), retail buildings (+3.8%), and office buildings (+1.8%).

These positive growth numbers would seem to reflect a continuous and expected demand. As for the supply chain hiccups, they may just be growing pains.

Will the wrinkles smooth out eventually? Hard to say. But being able to share the load of value creation for your customers through good logistics partnerships makes sense. Plus, partnering with a reliable, environmentally responsible 3PL provider who offers value added services tailored to your needs has the added benefit of increasing sustainability.

To find out how Brimich Logistics and Packaging can help your business grow through value added services, contact us today!

Managed warehousing services provide a new level of inventory control and convenience for both manufacturers and entrepreneurs alike – but is it the right solution for you?

What is a Managed Warehouse Service?

A managed warehouse service allows companies to outsource their inventory storage and shipping requirements thereby streamlining the order fulfilment process. The process includes warehousing a company’s products, picking and packing, shipping and delivery to the end user.

With storage space in high demand, and hyperconnected urban fulfilment continuing to escalate, effectively managing a network of third-party warehouses becomes that much more challenging.

Ideally, better quality warehousing facilities should be in logistically efficient locations.

What are the Essential Managed Warehouse Processes?

Whether you’re new to warehousing or more familiar with traditional inventory management, warehouse processes are essentially the same. Core warehousing competencies include such elements as:

• Receiving inventory
• Warehousing and storage
• Order processing
• Returns processing
• Processing returns (reverse logistics)
• Picking and packing
• Assembling and kitting
• Tracking
• Cross-Docking
• Shipping
• Reporting

What do Managed Warehouse Services Include?

A well-oiled service requires partnerships with experienced 3PL providers who have access to or control warehouses managed by a team of experts who specialize in:

• Warehouse availability and locations
• Current rates and renewals
• Storage negotiations
• Warehousing insurance types and evaluations
• Contract administration and negotiation
• Material handling operations
• Transportation networks
• Food-grade safety and compliance

Who Should Use Managed Warehousing?

If you’re a relatively small business selling products online, a managed warehouse service is an ideal solution for eCommerce fulfillment.

For instance, you may have limited space to store products, or you may sell products from different physical locations that need to wind up in one order.

Or you may be a medium sized business that’s growing to the point where you must off-load your warehousing processes because you lack the expertise and storage space.

Using a 3rd party warehousing systems allows you to boost profitability by having all your products deliverable from a single warehousing source or network. This expedites the delivery process which in turn creates happy customers.

Order Fulfillment in a Nutshell

Regardless of the size of your business, order fulfillment encompasses all the steps required to send out your orders.

When your customer finishes the payment phase, your 3PL gets an electronic copy of the purchase order which triggers the pick and pack process.

The last step in order fulfillment is transferring the parcel to a carrier for the last mile of delivery to your customer.

Types of Fulfillment Warehouse Services

Fulfillment warehouses can specialize a wide range of individual services. But most provide the essential fulfillment services such as storage, picking, packing, shipping and tracking.

At Brimich, we also offer additional services such as

• Cross Docking
• Co-packing & Assembly
• Rework/ Sorting
• Reverse Logistics
• Quality Checks
• Container De-stuffing
• Shrink Wrapping
• Custom Packing
• Labelling (UPC & Barcode printing)
• E-Commerce Drop Shipping Services
• Providing EDI to Customers (Standard & Customized solutions)
• A broad range of detailed management reports

Knowing what warehouse services are available to you helps add value and profitability to your business. Additionally, an experienced 3PL partner can help you develop a strategy that allows your company to move products intelligently.

The Importance of Warehouse Locations

Strategically significant warehouse locations are the backbone of efficient logistics. A quick drive around the perimeter of virtually any growing community of significant size will undoubtedly have numerous warehousing locations in all phases of development – from established to newly broken ground.

In traditionally dense areas such as the greater Toronto area, every opportunity is taken to maximize the value of real estate when geared towards warehousing – especially when located close to major city centres and transportation arteries.

As older buildings are removed at the end of their life-cycle, newer modernized facilities spring up filling the void in short order.

Even though E-commerce companies can market to consumers anywhere around the world, the three most important factors in warehousing are still “location, location, location”.

The Future of the Fulfilment and Warehousing Market

Driven by consumer demand and emerging economies, the size of the fulfilment market, and by extension the increased need for warehousing services, shows no sign of stopping anytime soon.

The global e-commerce fulfillment services market size was estimated at USD 86,449.97 million in 2021 and is expected to reach USD 96,257.94 million in 2022.

source: https://www.grandviewresearch.com/industry-analysis/ecommerce-fulfillment-service-market

E-commerce Fulfillment Services Market Size

According to this same report, a projected growth rate of 9.5% is expected from 2022 to 2030.

With Complexity Comes Vulnerability

The convenience that a managed warehouse service offers is the result of redefining the logistics system in general. Over time, more layers of complexity are added as the supply chain adapts to the changing landscape.

On the downside, shortages and delays have far more impact on a system that relies on all the parts moving as they should. In other words, even a small wrench thrown into this machinery can bring things to a grinding halt.

But the same could be said for virtually any arm of today’s supply chain as was evidenced by the world wide shortages experienced in early 2022.

Final Thoughts

Managed warehouse services provide by a 3PL partner can help take your eCommerce business to the next level. You benefit from having an experienced warehouse staff without the hassle of hiring workers yourself.

Moreover, strategically located warehouse facilities can reduce delivery times. You also may be pleasantly surprised at the affordability fulfillment services, especially when you factor in the savings from diminished errors and returns.

If you have a business that needs assistance with fulfilment, warehousing, or logistics in general talk to us at Brimich. We’re always ready to help you grow.

What role does freight logistics play in making sure your products are delivered on time, and on budget?

What Is Freight Logistics?

Freight logistics comprise the core systems and infrastructure of an estimated $270 billion global business.

At any given point, the knowledge of shippers and carriers, the technology, experience, and human resources make possible the smooth and efficient movement of goods around the world.

One major example, international maritime shipping, accounts for about 90 percent of world trade, and without these logistical mechanisms, simply would not be possible.

The following is a useful look into the key components of freight logistics including: communication, tracking and tracing, warehousing and distribution, customs, and insurance.

The Seven Rs of Logistics

To understand the complexities of strategically coordinating the elements and functions necessary to the efficient operation of the international maritime shipping industry, it’s helpful to understand the basic principles represented by:

1. The Right Product

2. The Right Place

3. The Right Price

4. The Right Customer

5. The Right Condition

6. The Right Time

7. The Right Quantity

In practice, making sure the correct cargo reaches its intended destination safely and on time is priority one.

The logistical systems of freight management are equal parts mechanical and organic. In order for their respective supply chains to properly function, each  must pull its weight in perfect synchronicity.

To get a better idea of how massively intricate the global flow of freight is, the interactive map below illustrates just how much the world relies on coordinated logistics systems:

How Freight Forwarders Play Their Part

Managing the specific needs of such a highly coordinated system requires a freight logistics team dedicated to:

• Negotiating freight rate contracts
  
• Ensuring continued customs compliance and insurance protection
• Maintaining relationships with steamship lines
• Minimizing empty miles by coordinating efficient shipping routes

Freight forwarders oversee the following logistical responsibilities:

1. Communication

2. Tracing and Tracking

3. Warehousing and Distribution

4. Customs

5. Insurance

Logistics Communications

Logistics companies partner with businesses to make the right decisions impacting finance, production, engineering, marketing, transport, warehousing, purchasing, and inventory management.

What does this do for your business’s bottom line?

By minimizing the amount of connections needed to link a variety of economic players, third party logistics providers help reduce costs.

Tracking and Tracing

Freight Forwarders typically utilize specialized software called a Transportation Management System, or TMS, to trace and track shipments, making any freight’s journey transparent. This helps logistics management to:

• Develop more efficient procedures
• Improve customer service
• Save money

An integrated TMS reports crucial data about carrier performance, transportation costs, and market trends.

Though the goal is always in smooth logistical operations, the TMS detects hiccups that may defer delivery, facilitating prompt notification for any customers who may be affected by the delay.

This enables freight forwarders to continually refine their strategies in creating a cost-effective supply chain.

Warehousing and Distribution

Diligence in warehousing and distribution pays dividends for your supply chain. There are many opportunities that can cause costly mistakes, there are just as many to excel.

Freight is the life’s blood of both buyers and sellers, therefor faithfully adhering to regulated warehousing and distribution procedures help logistics partners earn trust and strengthen relationships.

A breakdown of value-added warehousing and distribution services include:

• Cargo Packing and Crating
• Pick and Pack
• Labeling+ Barcode schema:
  + Label materials
  + Label placement
  + Complementary technologies
• Vendor Assembly and Consolidation
• Kitting
• Visual Inspection Services:
  1. Inspect the carrier for cleanliness, dryness, ventilation, and cargo separation to be sure the vessel is appropriate for its designated cargo.
  2. Report on markings, type of packing (bulk, cartons/drums, etc.) and a count of goods.
  3. Confirm that a valid mate receipt (document signed by an officer of a vessel evidencing receipt of a shipment on board the vessel) was received.
  4. Verify that units match those listed on the order description.
  5. Check packages and labels for correct dates and batch numbers as well as supplier certificates.
  6. Document when and where product was loaded, and the processes used to do it.
  7. Maintain a time log that includes dates and times of arrival, departure, loading, and delays (citing the reasons for the delays). Descriptions of loading gear and weather conditions should also be listed.

Managing Customs

In simple terms, customs brokers produce documentation for shippers to prove that the required customs procedures have been performed and the goods have cleared for shipment when entering or leaving a country.

If warehousing procedures aren’t complied with properly, the warehoused freight waiting for clearance might instigate extra fees. This can add up to hundreds or thousands in avoidable shipping costs.

Whether importing or exporting, the documentation is extensive, plus laws vary from country to country and port to port.

Time, money, and relationships can be compromised without the proper attention from a licensed customs broker as logistical errors can easily be made.

Required documents for importing or exporting cargo are:

• Purchase order from buyer – The terms include:
  • Price
  • Quantity
  • Quality
  • Description
  • Latest ship date
  • Mode of transportation

• Sales Invoice – An example sales invoice may include:
  • Clear description of the item
  • Quantity
  • Value, in foreign currency and U.S. dollars
  • Country of Origin
  • Where it was purchased
  • Names and locations of buyer and seller
  • Address of the person or business the goods are being shipped to

• Packing list – A packing list may also:
  • Accompany an insurance certificate
  • Be used to issue a Bill of Lading
  • Contribute to electronic export information (EEI)
  • Help customs officials verify goods

• Shipping bill
• Bill of lading
• Bill of entry
• Certificate of Origin

Other requirements may include other documentation specific to the buyer, or financial institution, or Letter of Credit terms per importing country regulations.

When negotiating for an appropriate freight forwarder, it’s imperative to exercise due diligence and research whether a given forwarder has experience and is knowledgeable enough to handle your particular customs brokerage needs.

If not, consider splitting the tasks between a separate customs broker and forwarder. Though the costs may rise, the price of inadequate or negligent customs brokerage is not worth the risk.

Insurance

Due to the inherent nature of unforeseen problems arising despite best hopes, whether accidental or instigated, the need for insurance is a must in freight logistics.

Industry experts cite that, cargo theft is a $30 billion a year business. While this is indeed a serious potential threat to your freight, it’s far from the only bad thing that could happen to your cargo.

Also adding to the potential for loss or damage are:

• General Handling
• Bad weather
• Long extended voyages
• Continuous moving and shifting of cargo

Therefor protecting your cargo from its point of departure to final delivery warrants insurance coverage.

Because of the broad scope of goods that require transportation, it’s imperative you work with a partner that can set you up with a plan that best suits your cargo’s, and your business’s needs.

What Is The Most Important Part of Freight Logistics?

As you can see, freight logistics is a multi-faceted and intricate balance of elements all designed to help move your business forward. But the most important thing to remember is that it always involves engaging the right people with the right expertise at each step along the way.