In today’s competitive business world, many manufacturers and distributors face the challenge of delivering their products as quickly as possible with minimal shipping rates. When sending multiple shipments to different destinations, these companies experience inflated shipping fees because of each load’s additional warehousing and handling costs.
Cross-docking is a practice that many third-party logistics (3PL) service providers utilize to streamline shipping speeds and efficiencies while keeping costs low.
How Does Cross-Docking Work?
Although cross-docking is a straightforward process used by many trucking companies and 3PL providers nationwide, it takes experience, knowledge, and careful planning to execute it efficiently. The primary goal of cross-docking is to minimize handling and reduce the time a product spends on a loading dock or warehouse floor.
The 3PL unloads the incoming shipments and coordinates a plan to immediately load the product onto an outbound truck for final delivery. This strategy often involves mixing and matching loads or directing a shipment to different locations across a wider area based on the final destination. In either case, the process results in a more efficient, leaner supply chain with less warehousing and handling than conventional, less-than-truckload (LTL) operations.
Types of Cross-Docking
Because the primary goal of cross-docking is less holding time at a dock facility, the strategy requires minimal warehousing space when executed effectively. Transportation professionals coined the term “cross-docking” decades ago because the shipments come in through the inbound dock, then transfer across the facility into the outbound truck for immediate shipment.
Although various terms relate to how the concept works, the theory is generally the same. The two primary types of cross-docking are pre-distribution and post-distribution.
- Pre-distribution cross-docking: This method involves shipping freight from suppliers to consumers with minimal time on the warehouse floor. In this case, 3PLs are typically aware of the end user before the shipment arrives. Workers then unload incoming freight and quickly reload it onto outbound trucks based on the most practical logistics.
- Post-distribution cross-docking: This process requires 3PLs to briefly store goods at their facility until the end users become defined. This method lets the originator strategically determine where to ship the goods based on incoming orders and inventory forecasting.
Implementing cross-docking into your company’s shipping strategy offers many new opportunities to serve your customers better, increase shipping efficiency and reduce operational overhead.
Benefits of partnering with a third-party logistics provider for cross-docking services include:
- Reduced costs: The primary reason why cross-docking offers significant cost savings is because the warehouse time is minimal. Products do not require long-term storage or placement on racks or shelves that involve a separate picking process later. In addition, a 3PL with various strategically placed hubs or warehouses reduces the stops a shipment needs before final delivery, minimizing how long the freight spends on the road.
- Faster shipping times: A successful pre-distribution cross-docking strategy minimizes warehouse time and handling labor by immediately transferring goods from inbound to outbound transportation at the docking facility. When 3PLs divide larger loads into smaller shipments and utilize trucks traveling in the same direction, shipping efficiency increases. This advantage makes it easier for manufacturers and distributors to keep up with customers requiring the quickest delivery times.
- Decreased handling: Because cross-docking centralizes a shipment in one location, fewer workers handle the freight, reducing the chance of human error and minimizing spoilage. Last-mile distribution from one centralized hub reduces travel time and decreases transit costs. It also decreases the amount of space needed at each warehouse facility.
- Increased sustainability: Cross-docking enables third-party logistics providers to use trucks to their total capacity, so the process results in fewer trucks on the road and decreased overall emissions. Cross-docking also minimizes warehouse utility expenses like electricity and heating.
- Optimized space management: Choosing a 3PL with cross-docking capabilities means you’ll have more room at your facility to devote to your company’s highest priorities, whether you need to add office space, manufacturing equipment, or other new capabilities.
Cross-Docking Considerations for Distribution Centers and Warehouses
For companies looking to implement cross-docking strategies into their shipping processes, choosing a reliable and experienced 3PL is essential. Successful cross-docking management requires numerous facility and trucking resources with advanced planning and tracking technology.
Several examples include the following:
- Warehousing and trucking: A cross-dock facility relies heavily on its trucking capabilities since the primary goal is expedited shipping. Third-party logistics providers must often partner with other transportation companies to maximize their capabilities with additional trucking solutions and warehouse locations.
- Volume: Because a successful cross-docking operation depends on transportation efficiency, a 3PL needs a steady flow of business to utilize trucks to their total capacity. Maximizing the use of an entire trailer is often essential for optimal cost efficiency.
- Management and coordination: Cross-docking depends on careful coordination between the service provider’s warehouse and transportation teams. These efforts rely on advanced technology and state-of-the-art software to track loads while optimizing shipping schedules and loading sequences. Without precise management, mistakes in handling and shipping delays can occur.
Improve OTD Times With Cross-Docking From Keller Warehousing & Co-Packing
On-time delivery (OTD) is one of the most critical performance indicators for customer satisfaction and retention. Keller Warehousing & Co-Packing, an affiliate of Keller Logistics Group, has the resources, technology, and industry expertise to meet all your warehousing and transportation needs, regardless of your company size or location. Our cross-docking capabilities are just one example of the many warehousing and distribution solutions we offer to improve OTD and maximize cost savings.
When you partner with us, you’ll experience benefits like:
- A comprehensive network: Our many warehouse locations across the United States and our relationships with some of the industry’s top carriers allow us to serve customers coast to coast reliably and cost-effectively.
- Modern technology: You need cross-docking strategies and other services to be efficient and effective. We utilize the industry’s most advanced software and warehousing technology to ensure optimal shipping accuracy and provide real-time tracking updates.
- Knowledgeable and experienced staff: We’re proud of all our employees, from warehousing operators meeting peak efficiencies to logistics strategists eliminating disruptions in your supply chain. We consider every possible option to deliver the highest service value to each customer.
- Our performance guarantee: Our customizable performance guarantee ensures the highest service levels. We pledge to do whatever it takes to help you meet your business goals.
Contact Us Today for More Information
If you want to learn more about the benefits of cross-docking and whether it’s a good fit for your company, the experts at Keller Warehousing & Co-Packing can help. Our warehouse locations serve a variety of industries, from automotive manufacturers and packaging companies to food and beverage processing facilities.
Our knowledgeable team has years of combined experience helping customers develop custom logistics solutions that align with their timelines, budgets, and distribution strategies. Connect with us online today to get started.