Cross-docking

What is cross-docking?

Cross-docking can be defined as the main method for managing the supply chain of perishable goods. The short life span of certain food products imposes the implementation of a logistics strategy which bypasses storage. Goods are distributed directly from the point of supply to the point of reception aiming to speed up the transport procedures. Today, cross-docking is especially used by e-commerce in order to reduce delivery times.

In the face of globalization of the market and competition between transport companies, increasingly reactive supply systems have emerged. Industries wish to respond to the increasingly specific needs of consumers. It was the desire for greater efficiency and guarantee of quality and freshness of goods that justified the creation of just-in-time procedures.

Cross-docking is the most widely used procedure for organizing the supply chain, especially for large retailers of fruits and vegetables and other products with short shelf-life or with fast rotation. It involves consolidation of packing by order then using a cross-dock platform. The order can thus be prepared without using warehouse services or a storage platform. Cross-docking platforms serve in managing the urgency of transit operations. In general, goods don’t spend more than a few hours and never longer than 24 hours at a platform.

The specificities of cross-docking

To ensure the management of just-in-time supply of goods, logistics must be coordinated and be able to rely on the following:

• Software systems capable of managing the different functionalities of cross-docking and ensure direct traceability of packages throughout operations;
• The ability of suppliers to provide order preparations and conditioning required by the cross-docking procedure;
• Highly precise planning of reception and shipping;
• Adapted indexing for fast and simple identification of packages;
• Synchronized convergence from the supply chain to the cross-dock platform.

Examples and practical applications

The different stages of cross-docking

The procedure is made up of several, perfectly coordinated stages. The progression of the packages follows the stages below:

• Packages prepared by the suppliers are rapidly put into groups thanks to a specific coding system;
• The packages are then grouped together according to the destination platform in order to avoid intermediary storage;
• The packages are not warehoused but directed to the appropriate exit dock of the platform ready for shipment.

The advantages of cross-docking

Primarily, cross-docking offers increased reactivity, which is a major challenge in terms of logistics. In fact, the platform is construed as a place of handling with no storage. The shipments are already packaged and ready to be delivered to the client. This procedure is greatly used for high-priority products (fresh goods, products destined for events, daily press…) but also for reducing delivery times in e-commerce.

This procedure offers a second, undeniable advantage – the cost. By accelerating the logistics procedure and by eliminating the need for storage used in traditional logistics chains, the cost of warehousing and intermediate handling operations is nil. The cost of delivery is therefore reduced while providing improved distribution of goods.

Prerequisites of cross-docking

Cross-docking does reduce delivery times and increase financial margins but only when the upstream supply chain is mastered. Without coordinated convergence of goods to the cross-docking platform, the procedure will fail to deliver effectively. Equally, cross-docking demands highly rigorous organization.

Cross-docking in figures

Cross-docking allows up to 20% reduction in product storage times.