Cross Dock Warehousing

The Challenge

To reduce the staff time, space and considerable receiving deliveries that staff time for, a national convenience retailer was receiving its convenience goods we mapped the retailer’s supply chain from the suppliers to the stores across the planning, ordering and logistics processes.

The Solution

By interposing a ‘cross dock’ or consolidation staging point between the suppliers and the convenience stores would increase the throughput of goods and reduce the handling and transport costs of both the retailer and the suppliers.

This was enabled by:

  • A commercial pricing model that incentivised the suppliers to pick and deliver bulk orders to a single cross dock each day for each state that represented 600 stores across Vic, NSW and Qld.

  • The cross docks received and consolidated daily order from convenience stores and consolidated the orders on each supplier. The Suppliers were able to achieve the scale of consolidated orders and achieve bulk deliveries each day into the state cross docks.

  • The cross docks received the suppliers daily bulk deliveries and picked and sorted by individual store and consolidated all suppliers onto store pallets and delivered consolidated supplies to each store each day.

  • The cross dock scheduled and routed and loaded regional and metro trucks for daily deliveries ensuring stores received only a single truck delivery each day replacing what was once multiple supplier deliveries

The Benefits

  • Modified supplier retailer trading terms from free into store (FIS) to free into warehouse (FIW), enabling the retailer to help pay for the cross-dock warehouse in each state.

  • Reduced suppliers costs as they picked each state in bulk instead of by store, and made a single delivery per state rather than to each store.

  • A single consolidated daily delivery, reduced store congestion on the retail delivery dock and store freeing up space and staff for sales.

  • Savings in trading terms with suppliers and benefits to stores through simplified receiving tasks, which more than offset the cost of the cross docks.

  • Improved suppliers and retailers cash flow with the product moving from supplier’s warehouse to retail store shelf within 48 hours compared to more than a week.

  • Reduced warehousing ensuring at the end of the day there were no orders or stock.