October 30, 2014

Our “Unpacking” series is dedicated to defining and expanding upon a practice or concept in the supply chain world that prompts a lot of questions. You can read all of the previous entries here

This week we look at price ticketing, an activity that for us comes under the category of “value added services.” These are activities that we undertake above our core services, often tailored to a client’s custom requirements. There are plenty of service solutions that come under this category and we’ll explore many of them in this series before the year is out.

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Price ticketing is the process of labeling up products so that they include the information required by the customer and end-retailer. This includes the price, of course, any discounts, relevant product information, and often codes that can be scanned. In some cases customer-friendly codes may even be included, such as Quick Response (QR) codes that can be scanned by mobile devices and allow the customer to access more detailed product info and specifications.

Price ticketing tends to be completed at the point of manufacture, whenever possible. Product planners usually have close relationships with their manufacturer and build the price and information tags/labels into the production process. Often labor costs are lowest at this section of the supply chain, bringing the marginal cost per product down, and it’s appealing to have products labeled up and ready to go the minute they arrive at the warehouse.

That being said, when the country of origin has higher labor costs or insufficent expertise on the supplier’s part, the price ticketing activity may need to be moved further down the supply chain. We perform the price ticketing function for most of our clients. We focus a lot of effort and attention on our value added services and have become well-known . The labels often come from an approved vendor, or the client will provide an approved sample as a blueprint for production of the full batch. This makes it possible to take stock product and customize it for a specific retailer.

If price ticketing is pushed all the way to the end of the supply chain and reaches the retailer (DC or store level), they tend to levy charge back fees. These are sufficiently large enough to discourage this practice, making the 3PL an attractive alternative to price ticketing at origin.

 

Along with assembly activities – such as kits, gift sets, shopping channel combination packagess – this type of value added service comprises approximately 10 to 20 percent of the work that a 3PL (third party logistics) provider like Capacity LLC undertakes. It also provides an opportunity to get closer to our clients and understand their requirements a little better, the value of which is tough to put a price on (in a metaphorical sense, of course!)