What is cross docking?

Cross docking is a logistical strategy used in supply chain management that looks to improve efficiency through warehousing and distribution efforts. In traditional manufacturing companies, products are stored in a warehouse or other location often for long periods of time waiting for delivery. In Lean manufacturing however, that storage time and space is considered wasteful and the longer products are stored, the lesser overall value they have.

The goal of cross docking is to reduce the amount of handling and storage needed by streamlining distribution. For instance, let’s say a company is manufacturing different bicycles that are sent to five different stores. Going the traditional route, the company may have a semi-truck pick up one type of bicycle and drive to each store, then go back and pick up the next bicycles and repeat that delivery. In this scenario, multiple trucks are operating under this schedule and are driving back and forth to multiple stores. With cross docking, all of the bikes are sent to a terminal or warehouse where the bicycles are sorted by store. Then, only one truck picks up a batch of bikes and delivers them to the store, and the delivery is completed.

At this docking site, products are brought in on one side to be sorted and consolidated for efficiency. Materials may be sorted depending on destination or type of product. Products are then moved to the other side where they will be loaded onto a different transport vehicle to be delivered to the store or customer directly. With cross docking, products reach the distributor and customer faster, and it can help businesses lower warehousing costs, improve organization, and manufacture using the just in time method.

This strategy works to simplify warehousing and companies have even found success with implementing an internal cross docking strategy. Some facilities use what is called an internal cross docking station as a way to stay more organized and reduce excess inventory. This central area tracks what is in the facility (materials, inventory, equipment, tools, etc.) and what is being used. Knowing this information can help to make more-informed decisions when ordering supplies and help keep track of items moving around the facility.