Receiving and Dispatch, Processes | Cross Docking Advantages, Disadvantages

  • Post last modified:1 June 2021
  • Reading time:7 mins read

What is Receiving and Dispatch?

Receiving is one of the basic activities or functions that are performed in a warehouse where products or materials arrive in large quantities from suppliers or manufacturing plant. This inbound consignment needs to be unloaded from the transport vehicles. The unloaded cartons or packages are arranged on pallets which are moved inside the ware house either manually or using a conveyor belt.

Dispatch is a process of sending finished goods from warehouse to its consumer. In case of dispatch process, the warehouse receives finished goods shipped from distribution team of an organization which indicates date of shipment, finished goods code, shipping number, BNP number, product description, number of pallets, pallets location, invoice number, total quantity, address to be sent and transportation mode


Receiving Processes

Receiving process is considered as an administrative function that involves checking of the quality, quantity, and condition of the incoming goods followed by their proper storage. The activities involve in the receiving process are:

Inspections

An initial visual inspection will be performed on all material and equipment received via outside freight carriers. The purpose of this inspection is to discover any damage, overage or shortage to the shipment in the presence of the carrier’s representative.

When technical items are received, the final inspection may be performed by the requesting department at the receiving dock and may support any damage reports recorded prior to receiving enter the information into the financials system.

Direct Shipments to Departments

If a shipment is made directly to a department and it is not specified in the purchase order, it should be refused by the department. The carrier should be directed to the receiving department for the delivery to be completed. Acceptance of this type of shipment places full responsibility for all receiving claims processing, and payment liability on the individual who accepts the shipment. Again, it is not uncommon that items can inadvertently be shipped directly to the requesting department.

Oversized Shipments

With the carrier’s approval, requesting departments may arrange the delivery of large, bulky items directly to the final destination to avoid double-handling. Departments should note the delivery and handling instructions on the purchase order and make advanced arrangements with the supplier. Proper receiving procedures should be followed at the delivery site.

Stores Deliveries

Items ordered from Stores will be consolidated in receiving for delivery to the requesting department. Follow-up action by the department should be directed to Stores.

Special Handling

Various live, perishable, and sensitive shipments require special processing and expedited service. Receiving will take every precaution to protect these special shipments. The Requesting Department will be notified immediately of any items noted to require controlled temperatures or refrigeration. Classified items will be maintained in a secure area and delivered only to persons authorized on the purchase order.

Shortages/Overages/Damaged Shipment

While receiving and inspecting shipments if a shortage is discovered, a claim shall be issued against the supplier. Such shortages generally result from an error in packing unless evidence indicates that the original supplier package has been tampered with.

  • Overages & Duplicate Shipments: When Receiving Department inspects shipments and the quantity count reveals an excessive quantity or a duplicate shipment, the buyer or requesting department will be contacted to determine whether the additional quantity can be accepted.
  • Damaged Shipments: When Receiving Department inspects shipments and damages are discovered, a notation is immediately referenced on the carrier’s bill of lading, in the Financials Systems and reported to the Buyer.
  • Shipments That Do Not Meet Specifications: Items that do not comply with the specifications of the purchase order will be rejected at the time of inspection. The Receiving Department will notify the Buyer and/or the Requesting Department immediately upon rejection.

Storage

Items received by the Receiving Department are delivered to the Requesting Department within the requisite time frame from the time of receipt unless otherwise specified on the purchase order.


Dispatch Processes

Dispatch process, the warehouse receives finished goods shipped from the distribution team of an organization which indicates the date of shipment, finished goods code, shipping number, BNP number, product description, number of pallets, pallets location, invoice number, total quantity, address to be sent and transportation mode.

Accordingly, warehouse authorized staff has to pick the goods from its correct location verify that:

  • The shipment form is signed by an authorized supply person.
  • All pallets have ‘Released’ stickers prominent to each side of the pallets.
  • The product code, name, and description are matching with the shipping form.
  • A pallet ID card is the present one.
  • GBS number is matching with that pallet ID card.
  • The sender address invoice number is present on the form. Etc. After going through above mention details with regard to.

After going through above mention details with regard to checking, the warehouse staff have to write down from pallet ID card details such as product code, product name, number of pallet, total quantity of goods, BPN number, GBS number (as written on the pallet ID card), etc.


Cross Docking

Cross docking is a logistics procedure where products from a supplier or manufacturing plant are distributed directly to a customer or retail chain with marginal to no handling or storage time.

There are multiple customers who need combination of different products i.e. bulk consignment from multiple manufacturers are received at the warehouses and they are sorted as per individual orders for each customer and the prepared consignment is forwarded to the customers.

Some of the main reasons why cross docking is implemented are to:

  1. Provide a central site for products to be sorted and similar products combined to be delivered to multiple destinations in the most productive and fastest method. This process can be described as “hub and spoke”.
  2. Combine numerous smaller product loads into one method of transport to save on transportation costs. This process can be described as ‘consolidation arrangements.
  3. Break down large product loads into smaller loads for transportation to create an easier delivery process to the customer. This process can be described as ‘deconsolidation arrangements’.

Advantages of Cross Docking

These are some advantages of cross docking which given below:

  1. Reduces material handling.

  2. Reduces need to store products in warehouse.

  3. No need for large warehouse areas.

  4. Reduced labour costs (no packaging and storing).

  5. Reduced time to reach customer.

  6. Transportation has fuller loads for each trip thereby saving in transportation costs while also being more environment friendly.

  7. Products are moved more quickly through a cross dock.

  8. Easier to screen product quality.

  9. Elimination of processes such as ‘pick-location’ and ‘order picking’.

  10. Cross docking terminals are less expensive to construct than your average warehouse.

  11. High turnover of products with everything moving quickly through the cross docking terminal. Products usually spend less than 24 hours here.

  12. Products destined for a similar end point can be transported as a full load, reducing overall distribution cost.

Disadvantages of Cross Docking

These are some disadvantages of cross docking which given below:

  1. Much management attention, time and planning is necessary to make it work effectively.

  2. Setting up the cross docking terminal structures would take quite a bit of time and capital to start with.

  3. Some suppliers would not be able to deliver customer ready products to the cross docking terminal.

  4. A sufficient number of transport carriers are necessary for the cross docking terminal to run smoothly, therefore is mainly dependent on trucking.

  5. A high volume of product is necessary to be cost effective.

  6. The organization has to have a comfortable reliance that their suppliers will deliver the right product in its right amount to the cross docking terminal on time which doesn’t leave too much room for error.

Thus, understanding the advantages and disadvantages of cross-docking and how they fit with your organization is an important step for evaluating the supply chain process and deciding whether Cross-docking is right for your organization.

Make sure you understand the key factor requirements of your organization. For example: High Volume Turnover, Rapid turnaround, Perishable goods are all factors that indicate a successful fit for Cross-Docking.


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