For distributors, cross-docking is an essential component of their business. With rising fuel costs and shipping costs, and a need to streamline distribution network processes, software has been developed to meet the challenge of cross docking.

Another challenge that distributors are facing is that of increasing imports from developing nations. This leads to port congestion, which only increases the need for improved cross docking.

I’ll describe what cross docking is, how it is conducted, and the different software applications that are out there to aid distributors facing distribution challenges.

Cross docking enables distributors to re-distribute shipments in multiple ways (in other words, to “cross shipping docks”) to gain maximum efficiency out of their supply chain.

For instance, a shipment or shipments are sent to a distribution center (DC). The distribution then de-consolidates the load(s), re-packs them according to the end-users’ requirements (also known as re-consolidation), and then ships to a single destination, or many final destinations.

What does this mean exactly?

When a shipment or multiple shipments need to get from one location to another, often they will go through a DC. When the shipment(s) arrive at the DC, they get deconsolidated and reconsolidated onto a new load and sent to a new location. This is due to the fact that many products can be made in different locations, yet will need to be packed together for a final destination.

Below are 3 of the main methods of cross-docking:

Cross-docking method 1:

This first method indicates that multiple suppliers are entering the distribution center with different products. The products are de-consolidated in the DC from each truck, re-packaged and sent to one final location.

Cross-docking method 2:

The above method is where one supplier comes in to the DC with a shipment of different items the items are then de-consolidated and separated, and finally packaged in different ways in order to meet customer demands. One example of this would be one shipment of a book distributor where the producer sends many types of books. For example, three types of books come in: university level, high school level, and primary school level. The DC then de-consolidates this load, separates the load and each new load would go to the appropriate school.

Cross-docking method 3:

The above method is the most complex, as there are many suppliers and many final destinations. In this situation, many trucks with multiple products come into the DC. They are then de-consolidated, re-packaged according to the requirements of each final destination, re-consolidated for each truck, and finally shipped to each final destination.

Cross docking is often a complex process, due to the volume of trucks coming in and out of the warehouse, scheduling issues, customer requirements, and warehouse efficiencies (just some of the critical issues at hand).

Because cross docking is very complex, software has been developed to meet the demands of distribution centers. In order to highlight the necessary functionality, I have chosen four vendors as an example from TEC’s knowledge base of supply chain management systems.

These are not the only vendors that provide this functionality, but you can get a feeling for the types of requirements it takes to have a successful cross docking operation.

To evaluate a comprehensive range of functionality and how other vendors support this distribution method, log in to TEC’s SCM Evaluation Center.

The four vendor solutions:

• Epicor Enterprise
• JD Edwards EnterpriseOne Supply Management
• Lawson M3 Supply Chain Management
• Retalix

The chart below shows the essential functionality needed for successful cross docking based on TEC’s model of SCM systems.

The first three criteria accommodate the fact that orders can be multiple or single. This is essential for managing how the loads come in and out of the DC.

How the warehouse is utilized is also essential for determining what resources are not being used, and can help increase the efficiency not only of the warehouse, but the speed at which loads can be consolidated and de-consolidated.

Finally, the automation criterion at the end of the list highlights the fact  that if a warehouse process can be automated, it will improve the operations I mention above.

The final word:

A solid supply chain management system will help manage the movement of products and shipments. The key to success are these warehouse management system criteria. Distributors should consider them if they hope to achieve cross docking success!