How 3PLs Can Reduce Costs and Improve Control ?
For years, 3PL providers have operated on a simple model—store, pick, pack, and ship. But as businesses face increasing tariffs, supply chain risks, and quality control challenges, they need more than just warehousing. By expanding into assembly, finishing, and packaging, 3PLs can not only reduce costs but also gain long-term, high-margin contracts. QSSI’s PowerHouse WMS helps streamline these complex operations and supports 3PLs in this transformation.
Reducing Tariffs Through U.S. Assembly
Importing finished products from other countries comes with high tariff costs. For example, importing a finished product at $150 per unit incurs a 25% tariff, adding $37.50 in duties. However, if components are imported instead at $35 per unit, the tariff applies to the lower cost, reducing duty payments to just $1.75 per unit—a savings of $35.75 per unit. Adding a 3PL assembly service that charges $10 to $20 per unit for final finishing means businesses still save $15 to $25 per unit while gaining direct control over production.
With QSSI’s PowerHouse WMS, 3PLs can easily track and manage assembly, packaging, and other value-added services in real-time. By integrating this system into their operations, businesses can improve efficiency, reduce errors, and ensure high-quality finished products.
Why Intellectual Property, Labor, and Quality Control Matter
Beyond tariffs, direct imports from other countries bring additional risks, including labor issues, intellectual property theft, counterfeit goods, and quality concerns. Reports indicate that over $600 billion is lost annually due to IP theft. In 2022 alone, U.S. Customs seized over 7,000 counterfeit shipments worth over $630 million. Furthermore, 52% of manufacturers relying on international suppliers report quality problems, leading to costly rework.
Labor conditions also play a critical role in supply chain decisions. Many businesses face challenges with offshore labor, including wage fluctuations, worker shortages, and compliance risks. By shifting final assembly to the U.S., businesses can:
- Secure sensitive designs from being copied.
- Improve quality control and reduce defects and rework costs.
- Minimize counterfeit risks by eliminating third-party intermediaries.
- Maintain better oversight of labor conditions and workforce management.
- Qualify for “Assembled in USA” labeling, which 52% of consumers prefer.
With QSSI’s PowerHouse WMS, 3PLs can integrate labor management tools and quality control processes directly into their assembly lines. Real-time data tracking ensures defects are identified early, reducing the need for costly rework.
How QSSI-WMS Helps 3PLs Scale Value-Added Services?
Expanding into assembly and finishing requires precision, efficiency, and real-time tracking—services that QSSI’s PowerHouse WMS delivers. Here’s how:
- High Functionality: Customizable features for assembly, packaging, and order fulfillment, ensuring seamless operations across all stages.
- 3PL Billing: Accurate tracking of labor and material costs for value-added services such as assembly and finishing, ensuring transparency in pricing.
- Labor Management: Helps forecast and allocate workforce efficiently, ensuring scalability and cost-effective labor utilization.
- Enterprise Integration: Connects seamlessly with ERP systems, offering real-time tracking, compliance, and reporting.
The Future of 3PLs
As businesses increasingly reshore production, they don’t need just another warehouse—they need a strategic partner who can handle assembly, finishing, and fulfillment. QSSI’s PowerHouse WMS empowers 3PLs to scale their services with precision and efficiency.
3PLs that adapt to these demands will secure high-margin contracts and become key players in modern supply chains. Those that don’t evolve will remain just another storage provider in a rapidly changing industry.
Book a demo today and see how PowerHouse WMS can transform your 3PL operations.
