Case Study – TAGG’s Complete Solution to Outsource Fulfillment
TAGG Logistics is a leading third party logistics (3PL) provider specializing in order fulfillment, outsourced distribution services and packaging, kitting and assembly. Our clients turn to us to provide a complete solution to their supply chain needs.
TAGG’s client is a premier provider of travel mugs, water bottles, kids cups, and coffee mugs for savvy consumers who seek solutions to the daily challenges of their active lifestyles. Developed with the knowledge that on-the-go beverages can be messy and complicated to use, our client developed a line of simple, yet functionally innovative, environmentally friendly drinkware to help people face life’s daily challenges. The products are stylish, yet resilient; sleek yet strong – the perfect combination of performance and grace.
Why Not do It Yourself?The Decision to Outsource Your Supply Chain
When asked “Why outsource your order fulfillment and distribution?” our client summarizes that it is not their area of expertise. They are a product development firm. They market products to various channels and they source effective production of those products. “We are not in business to provide logistics solutions, distribution services, order fulfillment or packaging. That is what TAGG does, that is not our business.”
Some other factors that led to their decision to outsource include:
The Desire to Save Money There are numerous areas our client has gained efficiencies by outsourcing:
No need for a warehouse to store goods
No need for forklifts and warehouse/inventory management systems
Seasonality or volume spikes and dips become more manageable
Staffing and human resource cost are reduced
Possibly most important, TAGG is able to pool its shipping and get large volume discounts in freight and small-pack delivery. These discounts are far greater than if our client wanted to go it alone with the carriers!
The Desire to Do It Better They understand they are not in the business to manage inventory, pick and pack, fulfill and process orders and manage returns. Not only are costs reduced, but the level of customer service is increased.
The Need to Keep Up With Technology TAGG’s Warehouse Management System (WMS) and Transportation Management System (TMS) are modern, state-of-the-art tools that would be timely and expensive to implement on their own.
The Ability to Focus on Your Core Strengths Our client wants to sell more travel mugs and water bottles. Simply put, outsourcing allows everyone to focus on what they do best.
TAGG’s Operational Overview
TAGG receives containers into our West Coast fulfillment center in Reno, NV. Product is palletized and entered into our Warehouse Management System. Our client has a variety of sales channels which it sells product thru. TAGG does direct-to-consumer order fulfillment, as well as business-to-business product distribution. In addition, TAGG completes various value-added projects such as point-of-purchase display kitting, club packs and various re-work and labeling projects and also does return processing. In essence, TAGG’s approach is a turn-key service providing complete supply chain management for all our client’s needs.
Order Fulfillment – Direct to Consumer eFulfillment
TAGG provides direct-to-consumer order fulfillment. Our client’s site contains a shopping cart for those customers who prefer to purchase product on-line direct from the company. E-Commerce is a significant sales channel for our client. TAGG receives a daily order file which we import into our WMS. Orders are picked, packaged and shipped via USPS and FedEX directly to the consumer. Orders received prior to 2:00 p.m. are shipped the same day and all other orders are shipped within 24 hours. An order file is sent back to our client with tracking information so a shipping confirmation e-mail can be sent. Product is also sold through a variety of third party e-commerce sites. For example, Amazon is a large ‘retailer’ of our client’s products. TAGG delivers weekly an outbound shipment to Amazon distribution centers – this a common part of our distribution services listed below.
Outsourced Distribution – Business to Business
TAGG handles complete product distribution to a wide variety of our client’s retailers. Selling product through retailers such as Target, Costco, Dicks, etc…is the largest sales channel of our client. This involves case pick and palletized shipping, appropriate EDI labeling and strict adherence to all vendor compliance (routing guide requirements). TAGG coordinates all outbound freight, primarily less-than-truckload (LTL) on our national accounts.
Kitting and Assembly – Value-added Packaging and Re-work
On a regular basis, TAGG performs a variety of project work for our client. These projects are either per piece priced or at a standard hourly rate and include point-of-purchase displays, club packs, kits, re-labels and reworks.
Reverse Logistics – Returns Processing
All of our client’s returns are sent to TAGG’s West Coast facility. There, returns are processed against a return merchandise authorization (RMA) and or assigned an RMA for customer credit. Then returns are either disposed of in terms of product damage or defect, or returned to stock.
Complete Shipping Services – Huge Cost Savings on Small Package and Freight
All outbound freight, both LTL and small package, is shipped on TAGG’s accounts. TAGG ships parcel packages through a combination of USPS, FedEX and UPS. TAGG’s volume shipping provides our clients with a pooled rate significantly below what they would be able to achieve on their own. TAGG handles every aspect of shipping for our client, to arranging pick-ups and deliveries, to bills-of-lading, auditing costs and coordinating damage claims. Our client simply sends us the orders and our systems choose the required, fastest and/or cheapest way possible.
TAGG Offers a Complete Outsourced Solution
TAGG’s client needed a complete outsourced solution; e-commerce high-volume order fulfillment, outsourced distribution to a variety of large retailers, strict EDI and routing guide compliance, complete reverse logistics services, shipping – both small package and freight. They wanted it all and they wanted one 3PL who could handle it all – and do it well. Our goal with this client, and with all clients is to provide the complete solution they are looking for – to become a key partner in their business. We understand that the only way to be successful is to make our clients successful.