TVS Logistics acquires US firm, to offer value-added services

City-based TVS Logistics Services is planning to focus on offering end-to-end logistics solutions, including value-added services like assembling of key components for automobile companies in India and abroad, a top company official said Thursday.

"We have come to the end of our first phase- buying companies for acquiring capabilities. In the second phase, we will leverage our capabilities and grow regionally. In Asia, logistics is becoming an outsourced activity and we will offer value added services like assembling of key components or sub-assemblies," R. Dinesh, managing director, told reporters here.

The concept is popular in the US and Europe while in India there are not many third-party logistics providers offering such service, he remarked.

The company is offering such a service to Ashok Leyland to sub-assemble the latter's genset engine powerpacks.

It recently acquired US-based $20 million turnover Wainwright Industries, which has customers like General Motors. The US company's key strength is ability to provide seamless integration with manufacturing process through its cross docking capability, Dinesh said.

Cross docking is a document control and traceability system through which the materials are efficiently managed and supplied for just-in-time production.

Dinesh said TVS Logistics has paid Rs.25 crore to the promoters of Wainwright as part purchase price and the balance Rs.25 crore will be paid on achievement of specified milestones.

He said though logistics is termed as low margin industry, third party logistics companies can differentiate themselves by offering value added services and in India there is good potential.