How to crossdock successfully
Offering variations on the same theme, eight crossdocking techniques deliver distribution efficiencies and cost savings.
By Sara Pearson Specter, Editor at Large -- Modern Materials Handling, 1/1/2004
Since the concept's been around for almost 20 years, you might think crossdocking would be a common practice. After all, transferring pallets or cases of product directly from receiving to shipping, without first placing those items into storage, clearly cuts costs and creates efficiencies. Nevertheless, crossdocking is not that common for a variety of reasons, says Bruce Strahan, partner, The Progress Group (770-804-9920, www.theprogressgroup.com).
According to Strahan, crossdocking isn't as widely used as it could be for five reasons:
- An inability to successfully manage/calibrate the inbound supply cycle and synchronized timing needs;
- Purchasing, transportation and distribution systems are not adequately linked to the supply chain pipeline;
- The risk of failure encourages order fulfillment from in-house inventory (companies sell what they have on hand, not what will arrive);
- A perception that crossdocking is something only the biggest companies can do; and
- The tendency to design "one-size-fits-all" processes, disregarding the opportunities to aggressively manage special situations on a regular basis.
But crossdocking doesn't have to be this way. Those obstacles can be overcome. Furthermore, crossdocking itself can be tailored to the conditions at hand to maximize performance.
"It's important to recognize that crossdocking is not a generic term that means just one thing," says Strahan. In fact, he has identified eight different crossdocking techniques that create alternatives to traditional stage-putaway-pick-replenish distribution.
The first three are characterized by the requirements of the crossdocking process, relative to handling steps, systems needs and facility needs. The last five are characterized by the inventory flow characteristics that make crossdocking possible. "In order for each kind of crossdocking to happen, however, there are certain enabling capabilities that need to be in place, starting with adequate visibility of inbound materials matched up with outbound needs," he adds.
Those, too, are included with each listing. When done correctly, Strahan says, these eight crossdocking best practices create new handling efficiencies and reduce costs.
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