How "Not" Cross Docking Affects A Business And Supply Chain?

In supply chain logistics, a business owner continuously strives for innovation. These innovations are meant to increase the efficiency of the supply chain. They must maximize the profit with minor handling and inputs, with simultaneous quality checks. One concept of increasing the efficiency in the supply chain is to carry out "Cross Docking." In this article, we will explore this idea.

Furthermore, we will look into its benefits for a particular business. After that, we will also look at other warehouse and supply chain management that increase efficiency. So without further ado, let us dwell on it. 

Cross Docking: What You Need To Know? 

Cross docking is a simple process in supply chain management where the warehouse eliminates or omits the "storage part" completely. The motive is to reduce the supply time from suppliers to final consumers. Furthermore, this particular supply chain model ensures that by the time product reaches the consumer, its quality and value undergo the least depreciation. Alternatively, the consumers receive the top-quality product.

In this supply chain model, there are three participants, namely:

• INBOUND SOURCE: The inbound sources are those who bring in the packages from the supplier for distribution. 
• DISTRIBUTION CENTRES: The distribution centers are not applicable in case of cross-docking. However, distribution centers are sometimes set up for sorting and distributing large packages. Here the items are stored and sorted for the least time possible and quickly sent to the outbound transportation. 
• OUTBOUND TRANSPORTATION: Outbound transportation is the point that carries out the final distribution of the items. 

In cross-docking, the suppliers send their items via inbound sources such as railways and immediately transfer them to the outbound transportation media. In between, there is no stationing or storage process involved. This ensures quick transfers of the items. However, there are times when there are distribution centers that sort oversized packages and materials before sending them to outbound transportation media.

Why Must One Opt For Cross Docking? 

Now you must be wondering why one must opt for cross-docking. The answer is simple: to eliminate storing of the items. So we will answer the question about issues that comes with unloading and Storage. To answer it, we have presented some of the potential reasons:

• Drop-In Value Of The Items

When an item enters storage, it sits there until final shipping. When things stay in storage, their price tends to fall. As a result, the supplier faces heavy losses when the bulk of his manufactured products remain in storage or warehouses. By opting for cross-docking, the packages directly go for distribution to the consumers. Thus the supplier gets the most profit out of his production.

• Damage To Items

In supply chain management, the business handles large bulky packages. Sometimes there are fragile materials in them as well. Though, no matter how many precautions the warehouse workers take, the loading, unloading, and shifting process often poses higher risks of damage to the product. As a result, this poses more threats to price lowering and contributes to the above causative factor. Since cross-docking involves a minor loading and unloading process, it keeps the items safer.

• Risk Of Thefts

When a product sits on the shelf of a warehouse, it becomes prone to theft and burglary. Furthermore, the smaller the size of the items, the more it becomes the thief's target. Though there are now technologies and modifications in security systems to prevent such mishaps, theft always creeps into the safety system. Moreover, despite the tight security system, some loopholes always leave an opportunity for theft.

• Risks Of Facing Low Demands

One cannot deny that the tides of demand in the supply and demand market are ever-changing. At one moment, requests for a particular item could be soaring high. At the other moment, it could see the abyss of low demands. Given such unpredictability, preventing the storage of items and opting for cross-docking is better.

Conclusion 

We want to conclude that Cross Docking is an emerging trend with much potential. It allows the supplier to get value for its production and increases the supply-chain management's overall quality. Thus, installing a cross-docking facility in every supply chain management firm becomes necessary.