According to the US Department of Transporation, the US moves about 50 million tons of freight a day.
Our economy is made up of constant movement. From manufacturing to delivering, and all the steps between, creating an accelerating cycle. How do you gain control of this chaotic system, you may ask?
We suggest cross-docking.
Cross-docking is a freight strategy. It offers support to businesses when it comes to the fast-paced supply chain. It also provides measurable growth when managed efficiently. If you’re wondering “what is cross-docking”, then you’ve come to the right place. Keep reading as we breakdown this game-changing strategy.
What Is Cross-Docking?
Cross-docking is a way of handling goods. It’s a logistic procedure of transporting goods from suppliers to customers with as little handling and storage as possible. Sometimes even completely cutting out the storage link.
With this process, you can merge items going to the same destination into fewer vehicles. You can also break down larger orders into smaller deliveries. Either way, it creates a streamlined supply chain.
The Basic Types of Cross-Docking
There are two types of basic cross-docking: Pre-distribution and Post-distribution.
Pre-distribution consists of unloading, organizing, and repacking goods according to a set of distribution instructions. Essentially, it’s the process taken when there’s an identified customer before the goods leave the supplier. Because there is already a customer in mind, it comes with predetermined instructions.
Alternatively, in post-distribution, there is no predetermined destination or customer. So, you wait to sort products until you find a customer. With this process, goods may spend longer in a cross-docking facility, but it gives retailers and suppliers more time to make informed decisions.
In-store inventory, sales forecasts, and point of sale trends all affect decision-making. Post-distribution gives businesses extra time to process that.
Who Benefits From Cross-Docking
There are many benefits when using this strategy, but as a business, it’s important to analyze the process and see how it works for you.
Cross-docking is particularly useful for temperature-controlled shipments. For example, fresh produce, dairy, and frozen items. Since it eliminates the storage link, it can deliver temperature-sensitive products quickly.
This also goes for any products with time restrictions. Cross-docking acts as a central hub where products can be sent and then sorted and distributed based on fast decisions. This strategy is the most productive and fastest method available. And it results in lower transportation costs and better inventory management.
The Best of Cross-Docking Services
Cross-docking is a cost-effective and efficient strategy that offers endless benefits to businesses. Using a hub-like structure to manage and distribute thousands of products, it promises to advance the way supply chains work.
We hope you found this article helpful and feel confident in what to say the next time you hear “what is cross-docking”. Here at Genex, we believe in the power of this method and hope you do too. If you want to learn more, or have any questions, feel free to contact us or check out our blog!