Cross-Docking: We Do It (and You Should Too)September 24, 2014
If you don’t know what cross-docking is, (or Just-in-time Inventory), sit back and relax–we’ll fill you in.
Let’s look at Jack and Jane. They run a successful eCommerce business selling high-end clothing through various online stores. They offer thousands of different items from multiple suppliers, but they don’t have the ability to carry large amounts of all of their inventory (Investing in all that merchandise is expensive). So what do they do to stay so successful? They use cross-docking.
“What is cross-docking?” you might be wondering. “Cross-docking” is a logistics practice where inventory enters a warehouse or distribution center for a very short time before leaving again, usually with little to no handling and no storage in between. It’s called “cross-docking” because warehouses usually have at least two or more docks, one for trucks to pick up and one to make deliveries: an inbound dock and an outbound one. If products are being cross-docked, then they come in the inbound dock, are scanned, repacked, (or whatever else is required), and then sent out through the outbound dock. Thus they cross the docks. This practice is also called “Just-in-time inventory” because the warehouse gets inventory just in time to fill orders.
You could, certainly. Drop-shipping–in case you’re not familiar with the term–is when a business sends orders for their products to their manufacturers, who ship the orders directly to the end consumer. Drop-shipping is another way for etailers to reduce their storage fees, but at the cost of some disadvantages. Typically, drop-shippers require a fee for their service, which can seriously cut into the profit margin of your orders. Not to mention the fact that if your product needs any sort of special treatment, packaging, or assembly, you’re out of luck. Manufacturers and distributors are typically set up to ship large shipments, so shipping one t-shirt will be very expensive for them.
Listing multiple products from a supplier quickly results in higher volume of sales. Jack and Jane will typically get enough orders to place a relatively large Purchase Order every single day. If the order exceeds certain amount, the supplier will offer free shipping, which is exactly where you want to be.
Where might I find a company that provides cross-docking?
Why, Shipedge, of course! Several of our clients have taken advantage of this logistics practice, and you can too. Head on over to our contact us page and drop us an email. We’d love to see how cross-docking can improve your business. After all, “Empowering eCommerce” is our motto for a reason. Cross docking is just another service Shipedge offers to give our customers an edge over your competitors.
Still need a deeper insight into the practice? No problem.
Cross-docking by an eCommerce specialist like us reduces your handling and shipping costs because we’re set up for high volume eCommerce. Helping you take advantage of our economies of scale is what we’re all about. As far as branding goes, we know that many products need a little bit of extra handling–like reboxing or using special packing slips–and we provide those services, ensuring that your brand gets that special treatment it deserves, while allowing your products to ship to your customers quickly. In other words, the perfect hybrid solution for someone with a business like Jack and Jane. They cross-dock their orders to ship small numbers of a large variety of products to their customers at a great price.
And you can too.