Cross Docking Warehouse: Benefits and Cost Savings of use

Hey. This is Jeremy with Easy Logistics Management. One of the other terms that gets a lot of search is on cross-docking warehouses. I wanted to cover what cross-docking warehouses are in the warehousing and fulfillment industry, and possible reasons that you would want to look into using a cross-dock warehouse, and potential of cost saving benefits of utilizing warehouses to do cross-docking for you.

 

We have a nationwide network of warehouse and fulfillment centers that our clients can use, and cross-docking is one of the activities that especially the port warehouses facilitate on more of an ongoing basis for some of our clients. Especially for international import clients, this seems to be key. But I came up with about seven different reasons you would want to use a cross-dock warehouse.

 

Main Reasons Your Company Might Want to Use a Cross Dock Warehouse

 

No Company Location Close the Port of Entry or Contract Manufacturer

Number one, if your company has no local location to the port or close to your manufacturer, you might want to use a cross-docking warehouse to transload and ship your material to you.

 

Cheaper than Drayage

Number two, I think cross-docking can be much cheaper than drainage transportation, which would be just taking the import containers, putting them on a truck chassis and driving them to your warehouse location, ’cause then you have to pay to return the import container as well. That can really add up. It’s probably much more cost advantageous to cross-dock your import containers and ship them to you on a regular 53 foot big rig.

 

Flexibility of how Transloaded Container Can Ship intra-USA/ North America

Number three, traditionally you’re just devanning the import container or the manufacturing container into a full truckload pallet by pallet, but you can do it in a variety of different ways and then shipping that traditional 53 foot big rig truck to your final destination or warehouse.

 

More Flexibility of Where You Can Ultimately Ship Your Products

Number four, cross-docking through a warehouse can provide you flexibility of where to ship the commodities. Traditionally, it would probably go to your headquarters or main warehouse, but it can also be broken out and consolidated to ship to those regional clients, depending on your arrangement with the warehouse. I know where our warehouses can do things like that. There may be a difference in cost, but certainly it can be cost advantageous.

 

Variety of Shipping Modes from Cross Dock Warehouse

Number five, the orders can be sent out in a variety of modes, full truckload, less-than-truckload freight, or even ground or overnight parcel and consolidated in different ways. It just depends on your arrangement and the costing on how you consolidate those orders and ship them. That can allow you a lot of flexibility as opposed to just translating and shipping to your warehouse, wherever that may be.

 

Number six, generally cross-docking, in my opinion, is full pallets or full boxes of the import container and then cross-docks across the warehouse into a full truckload shipment on the other side. But it can be done in a variety of ways. It just depends on your arrangement with the warehouse.

 

Flexibility to Ship to Regional Customers First

Number seven and this may tie into number four, just the ability to ship to regional clients first, and then transload the bulk of the material to be sent to your headquarters. If you’re bringing it in into the port of Long Beach and your headquarters is let’s say in Tennessee, but yet you have a lot of orders and clients on the West Coast, cross-docking can allow you—depending on the warehouse you choose—to consolidate and ship those orders to your West Coast clients straight from the warehouse in the import container. Then send the rest of the material to your warehouse for later replenishment or whatever you need it for.

 

Those are some of the reasons you would want to use a cross-docking warehouse in my opinion. If you have other suggestions, you can leave them in the comments below and I can try and address them in later videos. This list is by no means exhaustive, but these were some of the ideas that came to my mind having done warehousing for 15 years or so.

 

Potential Cost Savings Using a Cross Dock Warehouse Setup

Then maybe why you would want to use a cross-dock that warehouse? What cost savings benefits would there be for your supply chain arrangement and logistics set up?

 

Cheaper Than Paying Drayage

Number one, I think it’s cheaper than paying for drayage directly to your headquarters. Instead of running it with the import container and then having to return the import container to the port, which is really pretty expensive in most cases, you can transload it onto a traditional full truckload and then run it one way.

 

Flexibility of Shipping Modes outbound of Cross Dock Warehouse

Number two, loads can be consolidated in different ways and shipped out full truckload, LTL or FedEx or UPS Ground. Again, something we covered here. But definitely that can save you a lot of money if you’re not having to ship everything to your warehouse and then ship it back out. If we can parcel out the loads and ship them directly to your customers or wholesale accounts from the warehouse, you can save. That can bring a substantial cost savings.

 

Ship To Regional Customers First Without Re-shipping back to them later

Number three, ship to your end customer if needed. Again, it’s the same thing, but it does definitely offer efficiency and cost saving benefits ’cause you’re not having to reship all that material. Then, number four, to my point, you’re not having to receive and then reship the material back cross country to your end customers.

 

Just using the flexibility of a warehouse and fulfillment center that can provide cross-docking activities at the warehouse level, there’s just a whole variety of cost savings and efficiencies and just more flexibility of what you can and can’t do without just sending everything to your warehouse and then shipping it all back out again, which is inherently costly.

 

If you’d like to explore some of these ideas, and if cross-docking and using a warehouse and fulfillment center is a good idea for your company, I’d be happy to drill into your supply chain and see what cost savings we can bring to the table. Currently, our primary warehouses are in Los Angeles, Carlton, Texas, Utah, New Jersey and then we also have a facility in the Kansas City, Missouri area. If any of those locations work for you, we can perform cross-docking or any warehouse fulfillment activities out of those geographic locations.

 

I like to think that that’s a one to two-day transit time from pretty much anywhere you would want to ship to in the continental US. I can be reached at 866-854-5341, extension 3. It’s my company, we’re looking to grow and we’d be honored to work with you. Don’t hesitate to give me a call. I will shoot you in the right direction for sure. Or if you want to email me, it’s Jeremy@easylogisticsmanagement.com. Make it a great week, and I hope to talk to you soon.

 

Contact us for more information on Cross Docking Servics and Pricing

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