Cross Docking Service Reasons why To Use it

In today’s competitive and fast-moving world, suppliers and manufacturers across the globe are constantly under the pressure to deliver their products in the fastest possible time while keeping the costs under check. The primary goal of Supply Chain Management and hence Logistics is pretty straightforward – making the goods reach the destination from the source in the shortest possible time with minimal cost. However, the cost of the transportation of goods shoots up with warehousing, storing and handling costs. If you are looking for a logistics strategy where the products are undocked from an inbound truck and then docked onto an outbound truck for delivery, then cross docking might be the actual solution for your search.

Cross Docking is a genuine and reliable facility which helps save the seller money and helps the product reach the customer in time safely and reliably. Cross docking is a simple and cost effective method of transportation without the warehousing cost.

Because of cross docking the warehouse cost becomes nill as the consignment is unloaded from one truck and uploaded to the other truck which will take it to the right destination.

The customer benefits as he gets a cheaper product and the seller also benefits as his warehousing fee is greatly reduced. Thus cross docking is a win win arrangement for all the parties involved.

Cross docking is a new and unique way of transporting goods and consignments. It is less time consuming and also cost saving as the customer doesn’t have to wait long for the product and gets it cheaper as there is no warehousing cost involved.

In modern times cross docking has come out as a viable solution as it reduces the dependency of warehouses and ensures that the product is shipped fast and securely.

Many industries benefit from cross docking and all industries want to save on cost and maximize costs. Thus these industries can then depend on economies of scale and sell products at lower costs and still rake in profits.

This is made possible only because of cross docking which significantly reduces the warehousing costs and almost nullifies it.

Cross docking definitely appears to be a solution for expensive warehouse storage facilities and it is a safer and more economical alternative as compared to warehousing. This is the reason why most big industries are going for cross docking facilities rather than warehouse storage.

Surely in the times to come cross docking will play a major role in goods transportation and shipping and warehousing will slowly but surely be reduced to only a few good.

Cross-docking is a strategy that has been used in the logistics industry for more than a few decades now and is nothing new about it. However, the current market demands on the manufacturers and wholesale suppliers have brought back traction to this strategy and have kindled a ripple of interest amongst manufacturing giants who deal with the bulk volume of goods on a day-to-day basis to resort to cross-docking.

What is cross-docking?

Cross-docking is a logistics procedure to distribute the products from the manufacturer or supplier directly to the customer (or retail chain) with very little and handling and storing. Generally, the materials from an inbound truck are unloaded and loaded directly into outbound trucks with little or no storage in between. This is predominantly done to channel the materials from one supplier to many destinations. The absence of warehousing and storing clears off all additional costs that crop up with it.

Types of Cross-Docking

Different category of products requires different types of cross-docking services. To deliver products to the customers in time and when required, cross-docking facilitates speeding up of shipments. There are various diverse kinds of cross-docking to meet the necessities that arise in logistic services.

• Manufacturing Cross-Docking – It engages taking delivery of inbound goods or products as well as raw materials required for manufacturing processes. After receiving the goods or raw materials, they are organized for the assemblies, to meet the production demands.
• Distributor Cross-Docking – Various products from various suppliers are combined as single shipment and received at the distribution unit. A distributor source different components from various suppliers and merges them as one shipment and delivers it to the consumers.
• Consolidation Cross-Docking – To accomplish economic benefits, smaller shipments are put together to create large shipments. It is mostly carried out by industries that deal in smaller packages and the LTL (less-than-truckload). In such circumstance, for storage, loading and unloading, there is much more space in the terminal.
• De-consolidation Cross-Docking – To make deliveries in an easy way, large or bulky shipments are separated apart to small or compact shipments. It helps in quicker delivery of orders and lessens expenses of transportation and handling of products.
• "Hub and Spoke" Cross-Docking – It involves taking delivery of products from several suppliers or vendors at one location. After which the products are sorted and further delivered to several destinations, like the retail stores. This process optimizes the expenditure and makes distribution quicker.
• Opportunistic Cross-Docking – To meet the demands of sales order, products received at the inbound dock is directly transferred to the outbound dock. Some particular orders that customer place needs the product to be immediately shipped. It doesn't require storing of the product which is entirely forbidden.

Benefits of Cross-Docking

Cross-docking as a strategy helps in fulfillment of orders, timely and abolishes the practice of storing products. Excellent services of cross-docking would decrease errors and bring about efficiency and dexterity to businesses. The industry of supply chain acknowledges that there are many operational benefits which can be achieved by cross-docking.

• A cross-docking facility is uncomplicated to build and also needs less space.
• It is the approach which doesn't require storing of products in a warehouse besides reducing handling of materials. It can provide better service to consumers through the uninterrupted flow of products.
• It also aims to lessen the various expenses. Cross-Docking also helps to curb the expenses related to labor. Since the use of warehouse gets eliminated there is no need for moving and storing or stacking the products. It is capable of bringing down the expenses of storing and packaging. The terminals of cross-dock involve automation procedure which decreases the cost of extra packaging.
• Due to automated terminals, packages are screened efficiently and rapidly and further significantly decrease the time of shipping of a package. When the screening process gets faster, the consequence that comes forward is, the products also reach the customers faster.
• Cross-docking is implemented in transportation, distribution, manufacturing, and several others. As a result, it decreases the costs of distribution and transportation. A full load of products are shipped collectively if the destination also remains the same. With optimized routes, some of the needless practices get eliminated.
• Since cross-docking takes out the use of the warehouse, there is no need to worry about the risks of inventory management.
• With the lessened involvement of manual handling, the occurrences of product damages also get lessened. This further leads to the satisfaction of the customers. Customers never like to receive their product in damaged condition, after having paid for it.
• This approach improves the turnaround rate and organizes the inventory. Thus, it helps to enhance service towards customers and streamline the business.

Cross-docking is widely used in the logistics industry based on three common arrangements –

Hub and Spokes arrangement: In this method of Cross Docking, materials are brought from various sources into one central hub location. From the hub, the materials are sorted and then transported to a wide number of destinations. The Hub and Spoke cross docking arrangement has been successfully implied by a number of leading airlines across the length and breadth of the globe.

Consolidation arrangement: Here, a number of smaller shipments from the source are combined into one larger destination shipment. This arrangement works highly profitable when the transportation costs need to be kept under check with very little need for warehousing.

Deconsolidation arrangement: This is the reverse form of consolidation arrangements where the huge materials undocked from the source truck are broken into smaller lots. This makes delivery easy, faster and more precise.

Why should you consider cross-docking than traditional warehousing to meet your customer expectations?

Cross-docking has a number of potential advantages over other logistics processes. We list you the most important reasons on why one should actually consider cross docking –

Warehousing cost made zero with cross docking

Warehouses generally sprawl over a huge space of land and the floor space cost of warehouses is enormously high. With cross-docking, there is no warehouse and hence no warehouse and warehouse running cost. The warehouses are replaced usually by the cross-dock facility that takes only a fraction of the space that a warehouse would consume. Hence, cross-docking saves a huge penny with zero warehouses.

Reduced packaging and storing cost

The amount of time the goods are stored at the cross-dock facility is minimal and therefore, the cost incurred in storing them is also minimal. Also, most of the cross-dock facilities are automated which brings down the cost of extra packaging too.

Streamlined material handling at the cross-dock facility

All the processes around material handling at the cross-dock facility like in-motion labeling, in-motion weighing, label verification, destination scan, etc are streamlined which improves the efficiency of the cross-docking process.

Faster deliveries than traditional warehousing

The absence of warehousing, reduced storage time, no packaging time and streamlined material handling: all these measures ensure that the products reach the destination (customer or retail chain) faster than the traditional methods.

Reduced transportation cost and thus, increased profits

All the arrangements in cross-docking like Hub and Spoke, Consolidated arrangement and Deconsolidated arrangement ensure the transportation cost and distribution cost when using cross docking services is drastically reduced. The trucks are usually loaded to be full to reach the destination so that the costs are always maintained at the minimum.

Which industry is the ideal candidate for cross-docking services?

Cross-docking can be effectively used across all industries where faster delivery is required with minimal shipping cost. However, the following are the two industries that take the maximum benefit from cross-docking.

• Industries where temperature-controlled items like food and medicines that need to be transported as quickly as possible from the manufacturer to the end-customer or retailer reap the maximum benefit from cross-docking. The delivery time gets dramatically reduced through cross-dock service and the efficiency of the process is maximized. Also, the FMCG industry which deals with bulk transportation of pre-packed and sorted products is also greatly benefited by cross-docking as the amount of time that the products stay in the docking/undocking terminal is marginally very less.

• Apart from the industries that transport temperature-controlled items, cross-docking also works like magic for industries that move a bulk volume of materials on any given day. These bulk and big players also take the accuracy of the delivery very seriously which comes synonymously with cross-docking. The absence of storing and warehousing ensures the costs that come up with storing and warehousing are also marginally less or absent. This makes sure that the cost of transportation is kept well under check despite the bulk movement of materials and goods.

If you are looking for Cross Docking Services to speed up your logistics and mark a difference amongst your clients, we at Delivery Lane Express, offer professional cross docking services with exponentially faster delivery times and impeccable accuracy. We are an end-to-end logistics services company and our services include full-service trucking, warehousing, expedited trucking, courier services and same-day delivery services. Please get in touch with our representative to know more about our wide portfolio of services and our unbeatable pricing!