Cross Docking Essay

1067 words - 5 pages

Supply Chain News: Where does Crossdocking have the Best Operational Fit? Crossdocking can Lower Costs, but Fits Especially well with Specific Retail Scenarios; Key Operational IssuesCrossdocking or flow through distribution is a goal of many retailers, but it works better in some scenarios and for some type of goods than others.Last week, we wrote about recent crossdocking research by Dr. Kevin Gue of Auburn University, focusing on the different options for managing retail distribution, such as traditional distribution, direct store delivery and cross docking, and the pros and cons of each approach. (See Understanding Retail Distribution Models.)This week, we look at Gue's thoughts on ...view middle of the document...

Gue notes that when a "stockout" in a store does not mean a lost sale, crossdocking can become very attractive.Push distribution systems should crossdock everything that can be sold in stores now: This model is especially associated with heavy discount retailers, such as Ross Dress for Less or TJMaxx, where merchandise is acquired at a discount and everything is pushed to the stores. Customers are used to constantly changing merchandise and inventories. Gue says warehouse club stores such as Costco and Sam's Club take a similar distribution approach for many of their SKUs. When customers have a low expectation that any particular item will be in stock, it is a "perfect situation" for cross docking, Gue says.Gue adds that Ross is very good at merging incoming, crossdocked merchandise with the portion of their inventory that is placed in storage into one outbound truck for a given store, which includes a substantial price ticketing operation.If inventory costs are a concern, delay the allocation of incoming products until they arrive at the crossdock. Otherwise, allocate at the vendor to reduce material handling costs: "Because the lead time in a crossdocking system is longer than in a traditional warehousing system, demand at stores during the lead time could throw off replenishment quantities," Gue notes. "By aggregating orders to a vendor from several stores, and then making a final allocation at the last possible moment, replenishment quantities are as accurate as possible, and inventory costs are reduced."(Distribution/Materials Handling Story Continues Below) |
| | |
By allocating at the time the Purchase Order is released, retailers can certainly gain efficiencies, using a "Mark for" UCC-128 label in which the store destination of each carton is already known when the vendor ships the goods. But as Gue notes, either demand uncertainty or the actual fill rate from the vendor could make that a riskier strategy, leading to a move to late stage allocation based on the latest demand and inventory data and exact knowledge of what is in the shipment based on the advanced ship notice (ASN). Source: Kevin Gue/International Commerce ReviewFor example, Stage Stores, a department store chain that includes under that banner along with Bealls, Peebles and other names, went to a crossdock distribution...

Other Papers Like Cross Docking

Walmart Amazon Supply Chain Essay

3398 words - 14 pages minutes of Walmart (Leeb, 2016). Walmart has been known for its successful implementation of cross docking and how it made them the world’s #1 retailer. To begin with, cross docking can be defined generally as the transfer of goods and material from an inbound carrier to an outbound carrier, without goods or products actually entering the warehouse or stored as an inventory (Kulweic, 2004). Cross docking combined with Walmart’s own private truck

Merloni Case Essay

1006 words - 5 pages not, what changes, if any, would you recommend Merloni make to its distribution system? Answer 2: To understand whether we need to go for transit planning or regional warehousing, let us first gain an insight into the pros and cons of transit planning. Advantages for Cross docking: * Cost saving in terms of infrastructure cost of regional warehouses and their maintenance. * Lesser amounts of overall inventory to be maintained

Seven Eleven Japan

672 words - 3 pages order terminal) helps to collect, process and report all relevant data through the entire SC (stores, headquarters, suppliers and distributors), thus it enables efficient data analysis, forecast, and inventory management. Inventory management: stores keep low inventory and instead rely on low lead times of the SC. This results in high sales/m 2 since no space is wasted for storage. Transportation system: implemented as cross-docking at DCs (all

Bathking Companies Case Study

539 words - 3 pages that the solution has its own advantage and disadvantage. On the bright side, establishing 6-facility RDC network to locate in high-demand areas can, firstly, shorten the lead times and increase the company’s flexibility. Pallet cross-docking would also decrease the inventory and increase the speed of delivery to the customers. Process of order will become much faster and may be able to meet its customers’ requirements. Nevertheless, the cost

Double D Trucking

1182 words - 5 pages docking, sub assembly or pack out. For the car manufactures, they could offer Kanban replenishment, JIT inventory or even postponement. The Project should be broken down into phases so as to attain success for overall project Phase 1 • Storage & inventory management • Breakdown & Cross docking Phase 2 • Subassembly & Kitting • JIT deliveries • Kanbans & Milk runs Phase 3 • Postponement

Wal-Mart Supply Chain

2085 words - 9 pages :// The remaining was shipped directly to stores from suppliers in a process called “cross-docking” ( In this system, the finished goods are directly picked up from the manufacturing plant, sorted out and then directly supplied to the customers. Cross-docking reduced the number of times goods were handled and virtually eliminated the role of


767 words - 4 pages times are 3.4 minutes, 2.9 minutes, 1.3 minutes, and 2.2 minutes. The maximum cycle time is ________ and the minimum cycle time is ________ minutes. a. 3.4, 1.3 b. 9.8, 1.3 c. 9.8, 3.4 d. None of the above 20. _________________ popularized the Supply chain strategy called Cross-docking a. Amazon b. Dell c. Walmart d. Toyota

Walmart Strategy

735 words - 3 pages activities that provides it a continued cost advantage. As a whole, these intangibles will be difficult to replicate. Third, Walmart benefits from IMPERFECT MOBILITY as best exemplified by its operations. Walmarts strategy involves a whole system of activities that underpin strategy (cross-docking, distribution centre management, electronic inventory systems, supplier networks, etc that are linked to fit and reinforce each other. Walmart’s culture

Wal-Mart’s Supply Chain

897 words - 4 pages store shelves twice a week. To make its distribution process more efficient, Wal-Mart adopts a logistics technique called ‘cross-docking’ where finished goods were directly picked up from suppliers’ manufacturing plant, sorted out and then directly supplied to the customers. This reduced the handling and storage of finished goods, virtually eliminating the role of the distribution centers and stores. Inventory Management Wal-Mart allowed

The Logistic Term

916 words - 4 pages company use the cross docking approach to stored their product. In this approach, the product is not actually warehouse in the facility, instead the facility is used to house a process where trucks from the suppliers arrive and unload large quantities of different products. These large lots are then broken down into smaller lots. Smaller lots of different products are recombined according to the needs of the day and quickly loaded onto outbound trucks


864 words - 4 pages 1. Introduction 1.1 Background information of warehouse Warehousing can be defined as an essential activity in various supply chain, and it plays an important role “in the success, or failure, of business today” (Frazelle, 2002a). Compared with the traditional inventory holding function, modern warehouse has been acting as cross-docking point, valued added service center, production postponement points, and return good centers and so on (Baker

Related Essays

Challbot Wallpaper

539 words - 3 pages 2. What would you recommend to solve these problems? Our solution to Chabot Wallpaper’s customer problem involves three steps. They are to evaluate and discontinue the number of ineffective product offerings, identify and develop accuracy in the forecast by partnering with Lowes for collaborative information sharing of in store inventories, and to develop an infrastructure of cross docking platforms to allow customized shipping quantities of

Supply Chain Management Essay

849 words - 4 pages Wal-Mart Stores Inc., popularly known as Wal-Mart is one of the world’s largest retailers. It operates a system of an efficient network of cross docking facilities which enables it to keep a minimal store inventory while simultaneously enabling more frequent supplies to the retail stores. This system is reliant on a sophisticated highway transportation system in the United States which allows Wal-Mart to accurately estimate arrival and

Business Management Essay

3033 words - 13 pages the company to overcome the requirement of regional warehouses since those activities were now been taken care by the cross docks. This helped the company to reduce their inventory and holding costs. The company made Milano as their location for cross docking warehouse loading area. Hence, this is a must for us to evaluate the costs that was involved on this scenario. An analysis towards Costs incurred: Transport form plant to central

Walmart Essay

682 words - 3 pages also benefit from economies of scales; the volume purchased each year is so immense, that it gives huge bargaining power with its suppliers. They also used cross docking as inventory tactic. Cross docking consists in directly transferring products from inbound or outbound truck by eliminating extra storage. Items are unloaded and directly reloaded on another truck, another benefit is the gain in time, and transportation time is reduced