In logistic industry, it is essential to make the customer to have full confidence on the company they choose for their logistic services customer needs. Cross-docking is one of the logistics strategies that can help achieve the competitive advantage:
Cross docking is a form of freight movement whereby raw, partial components or finished products from a supplier or manufacturer are distributed directly to the users, which include the next level manufacturers, or end consumers, with minimal or no storage time.
When part of a global logistics network it allows for more competitive rates and to the streamlining of shipping.
What is cross docking?
Cross docking can be understood as a logistics procedure where products from a supplier or manufacturing plant are distributed directly to a customer or retail chain with very less to no handling or storage time. Cross docking takes place in a distribution docking terminal, usually consisting of trucks and dock doors on two (inbound and outbound) sides with minimal storage space. The name ‘cross docking’ explains the process of receiving products through an inbound dock and then transferring them across the dock to the outbound transportation dock. These two docks are the passage for the shipment being transferred from receiving end to shipping end.
Cross Docking example
In simple terms, inbound products arrive through transportation such as trucks/trailers, and are allocated to a receiving dock on one side of the ‘cross dock’ terminal. Once the inbound transportation has been docked its products can be moved either directly or indirectly to the outbound destinations; they can be unloaded, sorted and screened to identify their end destinations. After being sorted, products are moved to the other end of the ‘cross dock’ terminal via a forklift, conveyor belt, pallet truck or another means of transportation to their destined outbound dock. When the outbound transportation has been loaded, the products can then make their way to customers.