5 Benefits of Value-Added Services in E-commerce Fulfillment

By
Productiv

In the realm of e-commerce fulfillment, value-added services (VAS) encompass additional offerings beyond the standard picking, packing, and shipping processes. These services help e-commerce companies enhance the customer experience (CX) and, in many cases, streamline their operations. And as the name implies, they add value to products being sold online, helping to drive repeat sales.

E-commerce fulfillment value-added services prove extremely valuable for brands that are continually looking for ways to improve their CX and gain a competitive edge. It’s especially important as customer and brand loyalty have become harder to maintain in an era where shoppers have virtually endless choices online.

Types of Value-Added Services in Ecommerce Fulfillment

Most value-added services for ecommerce fulfillment are offered by third-party logistics companies (3PLs) within a warehouse or fulfillment center (FC) setting. Others are provided post-purchase in various locations, such as assembly and installation in an end customer’s home or putting up a product display in a retail store.

Some common examples of VAS:

  • Gift wrapping and customization: Can include personalized messages to customers, especially on gift orders.
  • Specialized packaging: Can be tailored based on specific requirements, ensuring safe delivery and minimal damage.;
  • Kitting and bundling: Assembling various products into bundles or kits, creating new product offerings or promotional packages.
  • Personalization: Customizing products, such as engraving or monogramming, according to customer preferences.
  • Returns management and reverse logistics: Simplifying the returns process for shoppers by offering pre-paid return labels, easy return instructions, and efficient handling.
  • Subscription services: Creates a reliable, recurring revenue stream, allows for more efficient monthly order fulfillment, and is convenient for customers. Loyalty programs can include discounts and other incentives.
  • Blister packs and shrink-wrapping: A blister pack is a pre-formed plastic wrapping used for small consumer items. Shrink-wrapping usually covers goods on a pallet for protection in storage or transportation.
  • Light assembly/sub-assembly: In many situations, warehouse workers perform light assembly duties, putting items together from component parts stored in the warehouse before being shipped to the customer or retailer.
  • End cap displays: Creation of end cap displays in retail stores, which often act as a lure for impulse purchases by shoppers.
  • Product inspection and quality control: Conducting quality checks to ensure products meet specified standards before shipping to customers.

In addition to these standard warehouse value-added services, companies often require some form of customized VAS specific to their business or products.

Industry Use Cases for Value-Added Services

Apparel and Fashion

  • Customization: Offering options for custom sizing, monogramming, or personalized designs enhances the customers’ connection with the product.
  • Gift Wrapping: Providing aesthetically pleasing gift-wrapping options for special occasions can attract customers seeking ready-to-gift items.

Electronics and Technology

  • Assembly or Installation Services: For complex electronics or gadgets. It can entice customers who seek convenience.
  • Product Configuration: Providing pre-configuration or setup services for tech products like computers, routers, or smart devices saves customers time and effort.

Healthcare and Pharma

  • Prescription Management: Offering services that manage prescription refills, reminders, and delivery for recurring medical needs can simplify the process for patients.
  • Health Monitoring: Providing monitoring devices with regular check-ins or consultations for patients with chronic conditions ensures ongoing support beyond just product sales.

Food and Beverage

  • Subscription Services: Offering subscription-based models for regular delivery of food items, beverages, or meal kits ensures recurring revenue and customer convenience, helping to drive loyalty.
  • Customization or Personalization: Allowing customers to personalize food items, such as creating custom gift baskets or meal plans, adds a personal touch.

Home and Furniture

  • Assembly Services: Providing assembly or installation services for furniture or home appliances can be a significant value addition for customers.
  • Interior Design Consultation: Offering virtual or in-person consultations for home decor or furniture selection helps customers make informed choices.

Entertainment and Media

  • Content Bundling: Offering curated content bundles or subscription packages for streaming services or digital media can attract customers seeking diverse entertainment options.
  • Exclusive Access: Providing exclusive access to limited-time events, behind-the-scenes content, or merchandise for loyal subscribers adds value to the entertainment experience.

Sporting Goods and Fitness

  • Personal Training or Consultation: Virtual or in-person fitness consultations or personalized training programs add value to sporting goods purchases.
  • Equipment Maintenance Services: Providing maintenance and repair services for sports equipment ensures longevity and customer satisfaction.

Key Benefits of Value-Added Services

Tapping your 3PL partner for ecommerce fulfillment value-added services provides some significant benefits for your business.

Greater Flexibility

Having an expert partner offering VAS helps you address a variety of business scenarios, whether it’s meeting seasonal demand, launching a new product, or providing enhanced services on an ongoing basis.

Improved Quality

Ensuring quality in your ecommerce fulfillment operations is another key capability of leading VAS offerings. Any defective or incomplete order that goes out the door can mean a lost customer for life, so quality control and inspections are critical.

Enhanced Efficiency

Using VAS helps you streamline operational processes and reduce order handling time. Optimization of inventory management through the use of Vendor Managed Inventory (VMI) services is another plus. This includes managing inventory levels, ordering products, and arranging for delivery.

In many cases, a 3PL can handle a range of VAS for ecommerce fulfillment. This makes it much simpler to manage versus cobbling together multiple service providers to meet all your needs. It also helps drive greater operational efficiency by having operations under one roof and drives down costs through economies of scale, especially in multi-client facilities.

Improved CX

Order personalization and customization options help you create a better customer experience, including packaging that leads to a “wow” unboxing experience. The ability of a 3PL to speed up order cycle time and get products delivered faster also enhances CX and customer loyalty.

Cost Savings and Revenue Generation

Companies can drive additional revenue through VAS by utilizing kitting and bundling services. For instance, by analyzing sales data, assortments can be adjusted to boost conversion, while a hot-selling item can be combined with a slower one, helping to clear idle inventory.

Specialized packaging can be a sales driver, especially around the year-end holidays. Bundling also results in cost savings during fulfillment. If you bundle three items, for example, you incur one line fee instead of three.

Providing VAS Within An E-commerce Warehouse

While there are instances where value-added services occur outside of the four walls, as noted above, the majority are handled within a warehouse by associates. They could be assigned to dedicated workers who do nothing else or be done in addition to standard pick-pack-ship duties.

If you’re following an insourcing versus outsourcing fulfillment model, space must be allocated in the warehouse for value-added services work to be performed, and equipment set up as required. This includes things such as light assembly, kitting, subscription order prep, Amazon FBA prep, garment-on-hanger in apparel, or any kind of order personalization.

Special associate training is required as these tasks go beyond the scope of ecommerce order fulfillment duties. New hires can be cross-trained to perform particular VAS duties in addition to their regular work.  

Because of the complexity and special expertise required to set up and maintain VAS within an ecommerce warehouse, most companies choose the outsourcing model. 3PLs have much more industry experience and know-how to guide you through the process.

A Knowledgeable, Experienced Provider of Value-Added Services

As in any other business endeavor, choosing the right partner to implement value-added services for your ecommerce business makes all the difference in the world.

Productiv offers an array of state-of-the-art technologies, proven methodologies, and a deep bench of industry experts who take a consultative approach to crafting the ideal VAS solution for your ecommerce fulfillment needs. The company provides kitting, custom packaging, labeling, assembly, rework, and reverse logistics, in addition to shrink-wrapping and support for international shipping.

Some use cases for Productiv’s VAS include:

  • Store display cases: Building and stocking corrugated displays for consumer brands
  • Retail compliance: Setting up SOPs based on routing guides to ensure correct case and pallet labeling, routing and shipping rules, and any other retailer-specific requirements.
  • Cosmetic sampling kits: Productiv puts together kits of up to 20 different cosmetic items for brands selling DTC and through retail stores.
  • Healthcare: Building first aid kids with up to 100 unique items that are lot coded, and surgical kits for hospitals and outpatient surgery centers.
  • Entertainment: Packaging CDs, DVDs, and video games into collector’s editions and providing shrink-wrapping for shipping.
  • Subscription box programs: Provide picking and packing, kitting, labeling, and shipping for subscription orders.
  • Packaging: Handles relabeling projects, saving brands the cost of purchasing new folding cartons and repackaging labor to accommodate minor content changes.
  • Returns: Productiv handles product returns on consumer goods, including dispositioning to inventory, recycling, or disposal.

Let Our Value-Added Services Optimize Ecommerce Fulfillment and Wow Your Customers

Companies across industries are realizing significant benefits from implementing ecommerce fulfillment value-added services. From streamlining operations to driving down costs through economies of scale, to boosting the customer experience, it’s a win-win-win for businesses large and small. Find out how you can gain a competitive advantage with Productiv by speaking with an expert today.

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