Having a cross-dock warehouse can significantly improve the material handling time and the efficiency of your business
For the rapid growth of a business, speed and productivity go hand in hand and involves multiple strategies. One of the strategies used by businesses around the globe is cross-dock warehouses. Having a cross-dock warehouse can significantly improve the material handling time and efficiency of your business.
A cross dock warehouse is a warehousing method whereby the production unit or the supplier, delivers the items or goods quickly to the buyer, thus reducing the processing and storage time. This process is carried out in a supply chain terminal which acts as a temporary stop between the inbound and outbound consignments. A cross dock warehouse enables businesses to accelerate the consignments to the end customers, which in turn means that the consumer can get their desired product at the desired time. This is what the logistics industry ultimately strives to do.
When is a Cross-Dock Warehouse Used?
This type of warehouse cannot be used across every industry, but it can help in the advanced distribution of various particular types of products. Its implementation can increase or decrease the efficiency, expenditures, and consumer happiness for your organization. Goods that need specific temperature during transit such as dairy and other food products can benefit from this type of warehouse.
Why is there a need for a Cross Dock Warehouse?
- It helps in creating a central point where the same products with different delivery locations can be arranged more productively and rapidly.
- It reduces the overall logistics cost by mixing smaller shipments into a single consignment.
- It creates an effortless distribution method by splitting bigger consignments into smaller shipments
The Benefits of a Cross Dock Warehouse
- It reduces the requirement for bigger warehouse areas since the goods come and go which means that there is no need for a storage area.
- It reduces the overall transit time of a product since it is delivered directly from the manufacturing unit.
- The cost of labor gets reduced since there is no need for the movement and sorting of products from factory to warehouse.
The Kinds of Cross Dock Warehouse
This type of cross-docking includes the movement of product directly from the dock where it is received to the dock which is outbound to the customer. It can be implemented in any type of warehouse.
In this type of cross-docking, goods and products are collected from different suppliers and then categorized and loaded to different trucks for delivery to various retail stores. A practical application of this method can be seen at Ikea and Walmart.
In this type of cross-docking, products are collected from different trucks and transferred onto a single truck to save on logistics costs and efficiently use the truckload.
In this type of cross-docking, different components of a single product are collected from different suppliers and then sorted at the warehouse before finally delivering them to the end customer. A computer system is the best example of this type of cross-docking as different components of the computer are collected before the computer is delivered to us.
Which Products are Suitable for Cross-Dock Warehouse?
Various goods and products can utilize the benefits of a cross dock warehouse. Some of them are listed below:
- Orders that are picked and packed in advance from other manufacturing units or warehouses.
- Products that are very high in demand.
- Newly launched products that are used for promotional purposes.
- Read to sell products that have pre-installed tags and other details on them.
- Products that do not need quality checks during sorting.
- Freshly produced items that need instant dispatching.
The Risks of a Cross-Dock Warehouse
Cross-Docking comes with a range of risks as the goods are not necessarily processed as per the method described by the manufacturer. This may also lead to loss of inventory if the method is implemented for a longer time than recommended.
In order to build an effective cross-dock warehouse, the people behind the planning of the distribution chain should introduce a strong inventory management process, along with quality training of the warehouse crew about the entire process. If the material handling done in a cross dock warehouse is not compliant with what the manufacturer suggests, the products which are lost in this process should be accounted for when the reconciliation process is done at both the manufacturer’s and customer’s end.
- Posted by admin
- On May 18, 2021