Cross-docking is once more growing in popularity, especially when it comes to consolidation, deconsolidation, and “hub-and-spoke” arrangements. Excluding storage from the supply chain as an expensive and unnecessary step can help save time, money, and other resources.
Here’s how cross-docking can better your supply chain too.
What Is Cross-Docking?
Cross-docking is a practice in supply chain logistics where products are received from a supplier or manufacturing plant and then shipped directly to a retail chain or customers. In between point A and point B, cross-docked products will not be sent into a warehouse or other storage space for a layover.
The Benefits of Cross-Docking
There are two main reasons why you should consider including cross-docking into your supply chain. Making the transportation process far more efficient, this practice can save a lot of your money and make your customers happy. Here’s how cross-docking drives business growth in two simple ways:
Better Customer Service
Cross-docking reduces the time needed for products to arrive from point A to point B, which is becoming increasingly important to today’s consumers. Same-day and next-day deliveries are more frequent than ever before, urging more companies to make the switch to a direct-to-consumer model.
In this context, cross-docking is the only supply chain practice that can help companies improve the quality of their customer service. But cross-docking offers more than shorter routes and quicker deliveries - this great practice can also be used to get the right combination of products to the customer’s address.
While supply chain typically breaks apart pallets into individual orders, employing case picking and layer picking to ger retail stores what they need, cross-docking allows suppliers to make store-ready orders, send them to the cross-dock, and then see them routed using the least expensive transport.
Significant Cost Savings
Speaking of which, cost savings are generally considered the most important benefit of cross-docking practices. And though this is certainly not the only perk of shipping through cross-docks, the opportunity to save lots of money on transportation, storage, and labor is simply too great to miss.
Storage-wise, your company will absolutely benefit from employing a less expensive practice. However, cross-docking may not be the best way to go if you’re dealing with small orders that may require short-term storage. But even in these scenarios, the practice still delivers some cost savings.
By consolidating LTL shipments into full loads, you can make your supply chain more cost-efficient than using any other method of shipment and transportation. The cost and distance of final-mile deliveries can also be reduced with cross-docking by shipping full truckloads directly to the customer.
With cross-docking, your company will not need to pay for additional labor costs, while also saving on storage and transportation. Whether you’re delivering products directly to customers or not, faster delivery will surely keep the consumer satisfied.
Contact JRC Dedicated Services to find out more about how cross-docking can benefit your company!