Cross docking is a logistics procedure where products from a supplier or manufacturing plant are distributed directly to a customer or retail chain with marginal to no handling or storage time. It involves unloading materials from an incoming truck and loading these materials directly onto outbound trucks with little or no storage in between. This may be done to change the type of conveyance, to sort material intended for different destinations, or to combine material from different origins into transport vehicles (or containers) with the same destination or similar destinations.
Although cross docking has been used in the US trucking industry since the 1930’s, it was introduced to retail distribution by Walmart in the late 1980’s. Cross docking’s advantages to the retail industry have widely been acknowledged as:
- It streamlines the supply chain, from point of origin to point of sale
- It reduces labor costs through less inventory handling
- It reduces inventory holding costs by reducing storage times and potentially eliminating the need to retain safety stock
- Products reach the distributor, and consequently the customer, faster
- It reduces or eliminates warehousing costs
- Less risk of inventory handling
To have an efficient cross docking operation requires EDI technology to communicate Purchase Orders (850), Advance Ship Notices (856) and GS1-128 outer case barcode labels.
If you would like to know more about how B2BGateway’s cloud based, fully integrated EDI solutions can help your cross docking needs, please visit www.B2BGateway.Net or email Sales@B2BGateway.Net for further details.