Value added logistics; possibilities for logistic service providers.
Report 96.3.LT.4564, Transport Technology, Logistic Engineering.
Value added logistics is a 'buzz'-word that is used in the Dutch logistics
business. The activities it stands for implying an extra value that is being
added by or during the logistic process. A global distinguishment in two
sorts of value adding can be made: Value Shifting and Value Creation.
Value Shifting is the shifting of physical activities that add value to
the product. Moving the final assembly to distribution centres is a form
of value shifting.
Value Creation consists of all activities that a distribution centre or a
manufacturer can add during the logistic process. These activities are
services which are no part of the original distribution function.
These services become more and more important in a customer driven
economy. They make it possible to react faster on customer demand and
therefore deliver faster, safer and even cheaper to the customer. Value
shifting is interesting especially for the international distribution. By
transporting only the semi-products and modules to international or
regional distribution centres, multinationals can specify their products
at the latest possible moment, and so reduce the total stock levels.
Moving the assembly process closer to the customer, is especially
interesting for components with a high value density that are assembled
into final products with a low value density. Consumer electronics is an
example of this kind of products. Specification does not have to take
place for only one customer. Customers can be grouped by language, country
or even age.
Distribution Centres can use the benefits of VAL to win the battle of the
competition. When multinationals more and more chose to outsource their
distribution functions, DC's can grow into logistic service providers. The
opportunities VAL can offer for the Netherlands, being an distributing
country, especially count for the middle and small sized companies. Their
activities in the transport and distribution sector have to be supported
by the government. Examples are regions where DC's can settle down and
different kinds of transport are available.
Reports on Logistic Engineering (in Dutch)
, TU Delft