Suppliers who are sending multiple medium and small sized orders a long way from their base, have difficulties in their distribution model. Sending large lorries to make many small stops is often impractical from an access point of view, and time consuming from the time of first drop to last. Similarly, sending a fleet of smaller vans a long distance to their final drop off is expensive on man power and fuel.
The compromise is to use a Cross docking operation close to the area the orders are to be sent. In it’s simplest form, cross docking is a cost saving exercise to facilitate small delivery operations into from a far away supply point. The bulk transport happens from base to close to the centre of distribution, and then the goods are moved across to a set of smaller vehicles who perform the last short leg to final destination. This gives the economy of scale on the long distribution leg, and shortens the time to fulfil all orders.
Another major use of a cross docking facility is to simplify the number of deliveries going into a specific location, and hence the overall transport cost. In the case of chain restaurant supplies, they may in total have a great number of individual suppliers who each send in small quantities. Instead of each supplier sending a delivery to each restaurant, all suppliers send their stock to one cross dock location, and from there the stock is consolidated, so that only one delivery needs to go to each of restaurant
With these type of operations, there are a number of methods for handling the stock to ensure the correct product is sent out on the correct final order. The supplier can simply bulk pick all orders to be dispatched, and send them to the cross docking operation, segregated by product. This is the most efficient method for maximising loading of the long distance leg. The personnel operating the cross dock operation would then unload these deliveries to the loading bays, and pick the individual orders from the bulk stock that has been received. The down side to this method is the double handling on the picking side, and the inability for the operators at the cross docking element to be able to correct mistakes in the original pick. Similarly, with the operators at the cross dock operation being less familiar with the product in question, there is a higher likelihood of mispricing the final orders.
The alternative method would be to pick the individual orders at source, and send them to the cross dock operation consolidated by order. For this to work effectively, the source would have to have a standard set of package / crate sizes, where they put the individual order components. These standard sized packaging can be easily labelled by order and greatly reduce the amount of work to be undertaken at the cross dock. The IT system needs to be sufficient to provide a clear indication of the number of boxes going out to each final destination, to ensure the final delivery vehicle can ensure they are delivering what is expected. Here the cross docking operator are not aware of what is being sent out ot the final destination, so the accountability of what is being sent out remains with the source pickers, while the final distributor only need concern himself with the quantity of boxes to be delivered.