Best practices: consolidation and cross-docking

Consolidation and cross-docking can help increase efficiencies and lower costs for shippers.

Consolidation

Consolidation combines several smaller shipments into one larger load. For example, a furniture retailer might consolidate small shipments from a Ready-To-Assemble (RTA) or Knock Down (KD) furniture manufacturer, a casegoods manufacturer, and an upholstery manufacturer into one less expensive full truckload, rather than three separate LTL (Less Than Load) deliveries.

Consolidation can:

• Make it possible for shippers to get discounted pricing across all modes of transportation
• Be useful for inbound supply shipments or outbound customer orders
• Increase volume for weight advantage
• Mean a customer service trade off between a delay and truckload rate savings

Cross-docking

Cross-docking is the process of receiving product, sorting it at the warehouse, and shipping it out without putting it into storage.

For example, four full truckloads each with one commodity, such as shirts, hats, coats and pants arrive to the warehouse.

The loading dock is used as a staging area where incoming shipments are quickly transitioned into outgoing shipments, eliminating the need to put the stock in storage and take up space in the warehouse.

The four single-commodity truckloads are sorted into four mixed-commodity truckloads, each full of shirts, hats, coats and pants delivered to a clothing retailer.

Instead of sixteen potential deliveries to four retailers, you’ll have four deliveries and lower costs.

Cross-docking can:

• Include full truckload inbound deliveries from suppliers and outbound deliveries to customers
• Improve facility utilization by eliminating the need for inventory storage or adding new/extra warehouse space
• Can provide a process for overnight delivery, without storage costs

As proven best practices, consolidation and cross-docking can improve your supply chain’s performance and reduce your operations costs.

Reach out to our Freight experts today to learn more about maximizing your delivery performance and efficiency.

Information provided by: Freight Dept. - Cole International

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