Just as a human body needs all organs in good working order, for your company to be successful it is also important that the sectors are in sync. And, for this to happen, it is essential to have an adequate logistics strategy, after all, this is one of the factors that will ensure that the end customer is served according to the established expectations.
In addition, using this method also allows the reduction of operating costs and the promotion of continuous improvements, both internally and externally.
In this article we will talk about a strategy that is well known in the world of logistics: Cross Docking. How it works? Are there any advantages? How to deploy in the company?
We have all these answers, so be sure to read the article until the end and, if you have any questions, just talk to our team, we're on hand to help.
How does Cross Docking work?
The expression “cross docking” can literally be translated as crossing docks, the term began to be used in 1930, during operations involving road transport in the United States.
Currently, this is a technique that has been used a lot by e-commerce, the concept is to work with zero stock, so it is not necessary to store a large amount of products if there is no order. Basically it works like this: when the customer makes the purchase, the supplier delivers the goods to the team of the logistic operator, who is in charge of the organization, distribution and transport until the last mile (last tip or final delivery).
It is important to note that in this type of operation, the time the goods remain in the operator must be kept to a minimum, usually the period is at least one day and at most three, everything depends on the service that was contracted.
There are three types of Cross Docking that are the most common among companies:
- Continuous Movement: This is the most traditional method of Cross Docking. Products are received and dispatched as quickly as possible, with the aim of avoiding the accumulation of items in stock;
- Consolidated or Hybrid Movement: In this modality, after the orders are received and separated, a part follows the logistical flow to be delivered to the final customer. The other part is directed to the stock so that there is a combination with other products that will form complete orders;
- Distribution movement: This option is generally used in B2B (Business to Business), which involves the cargo being distributed in FTL (Full Truck Load) loads to customers.
What are the advantages of Cross Docking?
Using Cross Docking as a logistics strategy can benefit your operation in several ways, find out some of the advantages:
- Shortest delivery time: As we mentioned earlier, this method aims to optimize the operations that begin when the product is picked up at the supplier until the final delivery, so the customer receives before and has exceeded their expectations, which can be converted into new purchases. As a consequence, there is also a reduction in lead time, which is an important indicator for companies and which represents the time that the order takes from the time of payment to the receipt of the product at the indicated address. Ensuring good performance in relation to this indicator is yet another action that promotes sales conversion;
- Lower logistical cost: Cross Docking allows cost reduction in relation to handling processes, since no stock is needed, only an inventory. Transportation expenses also decrease, since the cargo from several suppliers is agglomerated to be distributed among the same specific region. Usually the vehicles leave the warehouse with a full load (Full Truck Load) and with optimization of delivery routes;
- Working capital reduction: This strategy develops from the premises just in time (at the right time), that is, it is not necessary to buy several products to form a stock and wait for the sale. As a result, working capital can be applied to other aspects of the company;
- Zero stock: One of the biggest problems for companies is dealing with forecasts of demand, lack of product or excessive spending on what is not for sale, so the Cross Docking method can eliminate all this worry and expense;
- Customer satisfaction: With each passing day the market is more competitive, once your company is able to offer a good shopping experience, the customer will feel more inclined to buy again at your store;
- Facilitates Supply Chain management: Whoever is behind the supply chain management ends up being responsible for several processes that are optimized with the application of Cross Docking. With that, the focus can be directed to other parts of the company, such as process improvements and increased productivity.
How do I implement Cross Docking in my company?
Cross Docking is a logistics strategy that can be applied to various business models and, for it to be successful, one of the factors considered essential is the good relationship between all parties involved, after all, this is a type of complex operation.
Brclog understands the importance of open communication with customers, precisely for this reason, which works with a team trained to provide personalized support, which always takes into account the needs of the partner and its operation. It also uses a state-of-the-art WMS system to ensure good process management.
Your company needs and deserves the best in the market, so make a detailed analysis before implementing Cross Docking, select several options and make a comparison, this is the best way to find the ideal partnership to meet your need.
Another important factor to be considered is the distribution center and its characteristics. For example, the size of the location needs to be adequate to your order flow, and the location must also be strategic, as it is a factor that can directly influence the indicator average lead time.
Brclog is located in São Bernardo do Campo, strategically next to the Ring Road, which also allows easy access to the port of Santos and the airports of Guarulhos and Cumbica in São Paulo. To find out more about it you can access the “Infrastructure”Which is located here on our website.
There is also one more factor that can make a total difference to the success of your operation: the application of technology. Cross Docking involves the synchronization of several stages, so it is crucial that your company has visibility of each stage, thus, in addition to monitoring every detail via the system, it can also prevent situations that generate a possible delay in delivery to the end customer.
Even after your operation is in progress, it is essential that you continue to monitor indicators and results, after all, it is through this information that you can find the bottlenecks and points for performance improvement.
Cross Docking is yet another service that is available to brclog customers, who, by acting in different branches, are able to offer flexibility to meet the requirements of each partner.
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