Question

What is cross docking? Discuss its characteristics and operational requirements.

Answer 1

Cross Docking:

Cross docking is a practice in logistics industry where material is unloaded from an inbound vehicle (truck/trailer/rail) and is directly loaded in the outbound vehicle (truck/trailer/rail). This is done with very little or no storage between the transfer. It may be done in order to sort the inbound material as per need (by customer or by location) or also to consolidate the material from various inbound vehicles to a single outbound vehicle for a single location or a single customer.

Advantages:

• Streamlines the flow the materials in supply chain.
• Low inventory handling
• Low inventory holding cost
• Low storage requirement
• Low labour costs

Disadvantages:

• More transportation vehicles requirement, leading to more cost
• Cannot be extended as a storage facility

Operational requirements for Corss Docking:

The requirement for cross dock requirement in a supply chain are as follows.

• Identification of Products
  • All the products cannot be a part of cross-dock based supply chain.
  • Products with similar handling and storage requirement can be a part of cross-dock based supply chain.
  • For example, food and paint cannot be handled together in a cross-dock based supply chain.
  • You need to establish different cross-dock models for each of them.
• Effective Tools (Softwares)
  • For a cross-dock based operations, you need storng tools to support the supply chain.
  • You need following basic tools in order to manage operations smoothly.
    • Pallet Tracking
    • Order Management
    • Vehicle Tracking
• Facility Design and Layout
  • The facility design plays an importatnt role in successful operations of cross-dock based supply chain.
  • The facility needs to be designed basis the type of incoming and outgoing vehicles so that they can be docked together at the facility.
  • Also, if needed, the facility needs to have minimal storage in order to unload, sort and load the material.
• Suppliers
  • Set of suppliers you need in order to operate a cross-dock bases supply chain also plays an important role.
  • Suppliers need have ample storage available with them to store the inventory for you, as you do not store any inventory.
  • Also, their supply chain needs to be agile enough to support your demand fluctuations.
• Skilled Manpower
  • Manpower also plays a pivotal role here.
  • Manpower has to be skilled well so that they can visually identify the products and can guide their way from one vehicle to another without taking much of time.
  • This can lead to better turn-around time leading to quicker deliveries of stocks.