Cross docking is a proven supply chain management strategy that minimizes storage and material handling from manufacturing to store shelf.
Benefits of cross docking solutions include:
- Reduced labor costs as warehouse picking and putaway tasks are eliminated
- Reduced distribution cycle time
- Reduced storage costs
Retailers can benefit greatly by receiving products at the cross dock facility from multiple vendors and sorting these loads onto outbound trucks for direct delivery to stores. To make it work, a few pre-requisites should be in place:
- accurate ASNs from the vast majority of suppliers
- use of bar-coded labels on suppliers' cartons
- a strong warehouse management system to automate the receiving and information reconciling process
When these building blocks are in place, retailer benefits can be impressive.
A major club store uses KANE to manage several cross dock warehouses. Read the full case study. These DCs receive supplier freight and immediately load product onto trailers for same-day delivery to stores.
Product arrives from across North America according to strict arrive-by dates. Once a shipment is verified and linked to an active P.O., loading begins.
Much of KANE's strategic role for this retailer involves store-level efficiency and sales. Upon receipt of a pallet, store staff can simply remove the shrink wrap and sell the items. Prior to shipment, KANE generates a bar code label, using the customer's WMS system, that affixes a dollar amount to the load. Upon receipt, the information downloads into the store's local inventory management system.
As technology continues to advance and the ability to sync inbound and outbound moves improves, cross docking will become an even more retail logistics component.