Posted in Operations and Supply Chain Terms, Total Reads: 524
Definition: Flow Through Distribution
Flow through distribution is an alternative way of referring to cross docking. It is a strategy to achieve an advantage in terms of speed, productivity and efficiency in a supply chain. Flow through distribution or cross docking is a logistic method to distribute or supply goods from the supplier directly to the consumer with almost no storage or handling time. It is usually implemented with trucks and two dock doors (inbound and outbound) occupying minimal storage area. It receives the product through an inbound door and transfers them to the outbound transportation dock.
To simplify, the incoming products arriving through trucks/trailers are allocated at the inbound door of the cross dock terminal. The docked products at the inbound can be sorted, screened or unloaded to identify their end destinations. After sorting, they can be directly or indirectly moved to the outbound dock. Once loaded, the outbound transportation can then deliver the products to the customers.
Some primary reasons for implementation of flow through distribution are:
• To implement the hub and spoke model to achieve productivity and efficiency by sorting similar products together
• To save transportation costs by consolidation arrangements,i.e. combining numerous smaller products into one transport
• To implement deconsolidation arrangements by breaking large product loads into smaller ones for ease of delivery
The benefits of this distribution are:
• Reduced labour costs
• Improved customer satisfaction due to reduction of time of delivery
• Reduction in need of warehouse space due to no requirement to store the products