What Suppliers Need to Know About Cross Docking

Cross docking increases the efficiency of the order to store process. Products are moved at a lower cost from suppliers to end consumers.

A cross dock distribution center has multiple doors, or “docks,” for unloading and loading trucks. Large distribution centers may have hundreds of docks. Cartons from suppliers arrive at docks on one side of the distribution building, are batched by outgoing truck load with other cartons, and then are loaded onto outgoing trucks from docks on the other side of the building.

Here is how a shipment from a small business supplier to a retailer is typically moved through the cross docking process:

  • The supplier ships cartons to the distribution center
  • The supplier’s cartons are unloaded at an in-coming dock and onto a sophisticated system of conveyer belts
  • The cartons are sorted based on final store destination
  • The sorted cartons are moved across the distribution center building and grouped by final store destination with cartons from other suppliers
  • Truck-size lots of cartons are directed to an outgoing loading dock area
  • The truck-size lots are loaded onto an out-going truck bound for a specific destination store.

Benefits

The supplier benefits directly from cross docking by getting product into stores faster and indirectly by lowering costs for the retailer which helps reduce the final price for the end consumer and consequently increases the number of units sold.

The retailer reduces labor, inventory, and shipping costs because:

  • Product is handled less
  • Inventory is held for shorter periods reducing inventory carrying costs
  • Warehouse costs are saved because product is not stored
  • Fewer but larger shipments are sent to stores saving on transportation costs
  • Expensive small-volume shipments to stores are eliminated.

Mark for Store

Mark for Store is frequently a requirement for suppliers who ship to a cross dock distribution center.

Mark for Store cartons have to have a UCC bar code shipping label that includes the final destination store identification. The store identification specification varies by retailer. In addition to be being human readable, the store identifier number is usually, but not always, encoded as one of the bar codes on the label.

Mark for Store labeling is not always required for various reasons. For example, some categories of product are kept in inventory at the distribution center and then sent to stores as stock is depleted at the stores. Another example is an order that is only for one store. The distribution center will know the store destination from the order and the UCC bar code label so additional Mark for Store labeling is not needed.

EDI Plays an Essential Role

Efficient cross docking requires EDI Purchase Orders and Advance Ship Notices (ASN’s) as well as bar code labeled cartons.

ASN’s sent via EDI are essentially electronic packing slips. ASN’s from suppliers support distribution center visibility into inbound shipments and supports planning of receiving staff, allocation of receiving docks, and arrangement for out-bound trailers. You can read more about ASN’s by clicking on this link: Read about ASN’s.

ASN’s in conjunction with UCC bar code labels enable automated scanning, sorting, and movement of cartons from receipt at the unloading dock, through the distribution center’s system of conveyer belts to the outgoing loading dock. The ASN’s and UCC carton labels will be used again by the receiving dock at the final destination store.

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What Suppliers Need to Know About Cross Docking by

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