By reducing dependence on inventory buffers and speeding up consumer orders, cross docking promotes a flow-through supply-chain pipeline. Cross docking as a circulation tactic is not new. However, its usage continues to grow with the appeal of just-in-time (JIT) methods, and as supply chain ideas such as collaboration take hold, and advanced infotech multiply. Cross docking is mainly a warehousing practice, but in order for it to be efficient and successful, there has to be close coordination and continuous, top quality info flow among producer, distributor, and consumer levels.
What Cross Docking Is:
A broad meaning of cross docking is the transfer of items and materials from an incoming carrier to an outbound provider, without products or products actually going into the storage facility or being put away into storage. Therefore, the items “cross the docks” from the receiving dock location to the shipping dock location. Truth is a bit more complex than this broad meaning, since there are several versions of cross docking, as explained in the accompanying box, “Typical Types of Crossdocking.” And it is clear that the carrier, typically the maker, carries a high degree of obligation for making cross docking at its consumer (distributor) centers effective. Crossdocking can offer significant inventory cost savings. In its purest type, there is no storage. For that reason, there is no routing to storage areas, no subsequent retrieval from storage racks, and no rerouting back to dock areas. Both the costs of holding stock and the costs of managing the stock are eliminated or significantly decreased. In addition, crossdocking provides enhanced customer support by accelerating customer shipments.
Owens Corning’s Crossdock Method
Many storage facilities can crossdock a minimum of a portion of their incoming materials. Owens Corning, based in Toledo, OH, reports a variety from a small portion to 40 percent to 50 percent, depending on the place. This maker practices “opportunistic” crossdocking, as well as direct loading of outgoing deliveries from the production line. Opportunistic crossdocking takes “hot” products such as back-ordered or late-arriving products and moves them straight to outbound shipping locations instead of moving them first to storage and putaway. Even if a few of the required items remain in stock, crossdocking of the arriving products is performed to conserve time and speed up orders. In some cases the “hot” products are integrated with products coming straight off the assembly line to make up outgoing orders. Inning accordance with Logistics Systems Development Team Leader Barry Burnham, crossdocking at Owens Corning happens mainly at multi-purpose warehouses co-located with the business’s production centers. They serve retail and wholesale centers, and other distribution warehouses.
The company moves big, large materials such as fiberglass insulation, pallets of glass supports, and vinyl siding. Effectiveness of material motion is a significant issue. By minimizing the number of “touches” applied to materials, the business has actually experienced substantial decreases in labor, item damage, and cycle time.
Burnham states that cross docking is carried out solely for palletized or otherwise unitized loads. Turns for many crossdocked products typical 25 to 50 each year.
Primarily they are completed products. Crossdocking is not applied to materials coming off the assembly line that have treating or quality testing requirements.
Translation of the Acronyms
Crossdocking is an essential aspect in a synchronized supply chain. In turn, supply chain management today relies on making use of different infotech and strategies whose acronyms have become an “alphabet soup.”
Brief explanations of the acronyms are provided:
ASN – Advance ship notice
An electronic notice that an item is due, prior to it is gotten
ERP – Business resources preparing
LTL – Less-than-truckload amount for delivery
OMS – Order management system
A cross in between preparation and execution software application. OMS performs order entry, inventory management, order processing, and customer care. It prepares the shipping and delivery execution program, which is then moved to a warehouse management system.
POS – Point of sale
RFDC – Radio frequency data communication
SCM – Supply chain management
The procedure of enhancing the flow of products and products from the provider’s supplier to the client’s customer.
TMS – Transport management system
An execution software application system that plans freight movement, supervises freight ranking, picks the route and provider, and handles freight costs and payments.
VMI – Supplier managed inventory
A process in which the vendor assumes responsibility for replenishing the client’s stock as needed.
WMS – Storage facility management system
An execution system that manages the operations or a storage facility or warehouse, including getting, crossdocking, putaway, stock control, order selecting, replenishment, packaging, and shipping.
YMS – Lawn management system
An execution system that handles backyard operations, consisting of receipt of providers, dock scheduling and finding, and operator activities associating with receiving and shipping. minimal stocks is the aspect that links the supply and need sides of the chain.
Luton notes that market forces are constantly increasing pressure on supply chain management (SCM) efficiency, with requirements for 1) increased throughput with lower inventories, 2) more line of product with lower functional expenses, and 3) more value-added services offered to consumers. In the past, states Luton, the traditional SCM model relied on the use of inventory buffers at tactical points within the supply chain to minimize the unpredictability in between supply and demand (see Figure 1). Note that in this example the supply and demand chains are de-coupled, and stock buffers are used to offer a connecting link. Today, however, the objective is to synchronize the supply and need chains (Figure 2) to supply flow-through operation made possible by crossdocking. In this design, the chains are combined, and crossdocking replaces stock buffering as the linking system.
Clearly supply-chain dependability is vital when operating with very little stock buffers. (If product does not get here from the supplier on time, there is little contingency in the inventory buffers.) Therefore, details sharing is crucial. Prior to thinking about the role of sophisticated information technologies, take a look at an easy and standard information technique– labeling. The most convenient labeling scenario is when stretch-wrapped pallet loads take a trip intact to the ultimate location. Because each case in the load does not have to be recognized, only the pallet needs identification, on 2 faces if possible.
On the other hand, incoming pallet loads that have to be broken down will need labeling of private cases or products, and the number of pieces to each consignee identified. Crossdocking ends up being more made complex when less-than-full-case situations are involved. Unpacking, choosing, packing, and identifying obviously are more time consuming. Some distributors choose not to crossdock less-than-full-case shipments.