Cross Docking

Written by Linda Alexander
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In cross docking, merchandise comes in one door goes right out to the consumer without being stored in the meantime. It is an effort to improve logistics, especially in the distribution center. It speeds up order turnaround time, moves goods through the distribution channel quicker, and reduces storage costs for manufacturers.

Cross docking is not as simple as it sounds. It is a response to retailers wanting to reduce operating costs, reduce inventory levels, and increase space within their stores. It is an answer to the demand chain more than to the supply chain. In order for cross docking to work successfully, senior management must view it as part of the supply chain strategy. Sharing information is important, as is teamwork between manufacturers, retailers, and 3PL providers.

Packaging for Cross Docking

With this distribution method, units are not unpacked or re-packed between receipt by the warehouse and delivery. Therefore, they must be packed according to how they will be shipped to the end-user. Also, you cannot require inspection of goods because that would slow the process and possibly require storage.

In many cases, merchandise that is cross docked only stays in a warehouse for an hour or so before being shipped out to a customer or distribution center. This method greatly reduces handling, lowering costs to the manufacturer and the consumer. In pure form it is best suited for products that are shipped in full pallets. Otherwise, the pallets will be broken into smaller shipments, then shipped out. In either case, products are not stored in the warehouse.

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