Every growing business needs to implement different strategies and services, especially when dealing with the supply chain. A reasonable amount of businesses implement cross-docking because doing so would help in improving business efficiency and productivity in the supply chain.
Cross-docking is a procedure any company can implement to speed up its logistics. The process involves the distribution of supply or products directly to the customer or the retailer. Besides, companies that use cross-docking will not need large storage spaces because products coming in will only be at the warehouse for a short amount of time. Most of the time, the products are directly transferred to distribution vehicles to maximize storage and time.
Things To Consider When Hiring
The whole system hinges on having a cross-dock terminal. There’s a department set for receiving the products in the terminal, while there’s another for sending products. This is best done by a logistics firm that can efficiently allocate each product depending on the final destination.
But with a lot of companies providing this service, it’s essential to be vigilant in choosing. It is important to research about various cross-docking services and visit website of the reliable ones to know what they offer and what locations they cater to.
In choosing the service provider, consider the following factors:
1. Your Needs
While there are several benefits from implementing cross-docking, it’s important to note that this will cost you and your company time and money. Assess if cross-docking is the best option for your company as some businesses benefit less from implementing cross-docking compared to others.
See if you belong in these industries which are considered excellent candidates for cross-docking:
- Chemicals: The main issue of storing chemicals is their maintenance cost. Purchase these chemicals from companies then use cross-docking to avoid the maintenance cost. Receive it, then directly send it to production or the customer.
- Consumer Goods: You can see the clearest form of cross-docking in companies that deal in large-scale retail. Online shops and stores use cross-docking to avoid the need for large warehouses in regional areas. If you’re a retail company, you can also make use of cross-docking. Order supplies or products from manufacturers then directly send them to your customers—no need to keep many supplies in storage.
- Food And Beverage Industry: Restaurants can now buy products before opening using cross-docking. This avoids the need for extensive and industrial-grade storage for food and ingredients. Furthermore, ingredients and food don’t go to waste by overstocking. They only need the suppliers to send ingredients based on their orders which is also through cross-docking form
- Automotive Industry: Most automotive companies have been using cross-docking for decades. If you deal with manufacturing parts and automobile parts, then cross-docking is perfect. When parts come, you can directly attach them to the car of your customers or send them to the car dealer for the customers to receive the product from there.
If your company wants to implement cross-docking, make sure it will reduce your warehousing needs. If cross-docking doesn’t eliminate or reduce your need for ample storage, it may not be a good choice.
2. Cross Docking Company’s Logistics Management And Analytical Skills
When scouting logistics companies, you should ask them about their analytical and logistical management skills. A good logistics company has a reputable background in managing and analyzing the load of products.
This includes storing, warehousing, transportation, distribution, and fulfillment. Besides, direct customer service quality will also be an essential factor as these companies will eventually deliver products to your customers. Negative interactions between them and your customers could damage your company’s reputation.
3. Years of Experience In The Industry
A good mark of a reliable logistics service provider is their company’s age. How long the company has been on the market shows their experience in the field. Their experience may have given them the wisdom and skill in handling various troubles and success.
However, this may result in higher pricing. If your budget allows, go for these companies as the price and cost will be outweighed by the experience and skills it provides. If your budget cannot reach the service fees and price, still aim for reputable companies with significant experience.
4. Types Of Cross-Docking
You need to determine the types of cross-docking you need if your industry fits the needs for cross-docking. As some companies may specialize in different types of cross-docking, you must also hire the ones who know your industry well:
- Retail Cross Docking: This is used by companies which deal with selling different types and kinds of products from various companies. Hence, this type of cross-docking will involve receiving from different companies. The stocks received will be distributed to their stores depending on demand.
- Manufacturing Cross Docking: The product is received in their main warehouse then distributed to the manufacturing sites. This will be preventing the need for onsite storage.
- Distributor Cross Docking: This type is used wherein cross-docking organizes the delivery based on location. It can also be delivered to specific smaller warehouses where it can be sorted as well.
- Opportunistic Cross Docking: This is used when a company manufactures their products then forwards them to their logistics for distribution. Through this, cross-docking is implemented toward customers and retailers.
5. What Policies Or Protocols
Aim for logistic service providers which have policies and protocols already in place to prevent errors. These companies have excellent track records as policies and procedures are placed to avoid mistakes.
Choose a company that can deliver its services constantly. When dealing with the supply chain, the flow must run smoothly. This avoids unnecessary hold-ups from production to fulfillment of delivery. You can be at peace with this type of company since their services’ policies prevent them from minimizing potential errors, ensuring safety and security for the cross-docking processes.
Hiring an excellent cross-docking service provider is important to send and receive products securely. Considering these guidelines would help you narrow your options, allowing your supply chain to be delivered in the most efficient way possible.