What is cross-docking?
In a traditional product shipment, newly manufactured goods are loaded onto outgoing trucks and sent to a fulfillment center or distribution warehouse, where they remain until customers order them. The warehouse must have enough storage space to hold all these goods, potentially for an extended time. Often the manufacturer must pay for that storage space.
Cross-docking effectively eliminates the storage part of the process. In cross-docking, the goods are moved off the incoming delivery vehicle to a waiting outbound vehicle. Packages are secured to pallets and relocated by forklift straight from the inbound dock to an outbound dock.
Instead of waiting for days or weeks in the warehouse facility, the goods are processed for near-immediate shipment as soon as they reach the distribution center. Then the outbound vehicles take over and get the goods to the end users – the customers.
What are the benefits of cross-docking?
Quicker delivery. Cross-docking streamlines the supply chain, getting the product from the manufacturer to the customer much more quickly than in warehousing. There’s no need to hold the cargo in storage until enough orders come in, so the customer gets it sooner.
Cost savings. By eliminating many of the middle steps in delivery, the manufacturer may also trim some expenses that come up in traditional shipping, especially storage fees. They also cut back on the risk of the warehouse not having a space large enough to hold their shipment.
Less product handling. A product delivered through cross-docking encounters fewer people in the supply chain — there aren’t as many exchanges and checkpoints that the product must go through, so it gets touched by fewer hands.
Flexibility in order fulfillment. Cross-docking offers shippers more flexibility in delivering their products. They can adjust the size of their orders in response to fluctuations in demand without having to worry about surplus items lingering around the floor of a remote warehouse.
Is cross-docking right for your business?
Cross-docking is a comfortable fit with much of the modern retail landscape, especially e-commerce retailers. The streamlined delivery process allows retailers to fill orders more quickly and efficiently. Bulk shipments can be broken up and distributed straight from incoming trucks onto outbound vehicles on the spot, saving an incredible amount of time.
The increased expedience of cross-docking makes it a fine solution for time-sensitive goods or items with shorter shelf life, including foodstuffs, perishable goods, and individual components or parts. Cross-docking is also practical for pre-sorted items or products shipped in large quantities.
Inventory control and shipment tracking are extremely crucial aspects of cross-docking, and a shipper must have dedicated controls and processes in place for each if they opt for this process. Outgoing shipments need to be carefully monitored and accurately tracked to avoid supply chain disruption and delayed delivery.
For that reason, businesses that stay on top of the latest tracking technology are more suited for cross-docking than businesses that lag. With the right tech at their disposal, retailers are more able to integrate their shipment information with their delivery partners, ensuring better accuracy, transparency, and knowledge about their goods’ place in the supply chain.