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Grant Agreement number: 314786

Project acronym: ECOHUBS

Project title: Environmental CO-herent measures and environmental interventions to debottleneck HUBS of

the multimodal network favoured by seamless flow of goods

Funding Scheme: Collaborative project

Best Practices in Cross Docking in Europe

WP 1.2 Industry consultations

WP 3.2 Integrated Competitive Services

WP 3.3 Measuring and Benchmarking System

WP 7 Dissemination

Project co-funded by the European Commission within the Seventh Framework Programme (2007-2013)

Dissemination Level

PU Public

PP Restricted to other programme participants (including the Commission Services)

RE Restricted to a group specified by the consortium (including the Commission

Services)

CO Confidential, only for members of the consortium (including the Commission

Services)

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Document Title: WP Document number:

Best Practices in Cross Docking in Europe WP1/3/7

Main Authors Org

Steffen Nestler

Dr Thomas Nobel

Feliks Mackenthun

DGG

Contributing Authors Org

Doc. History Version Comments Date Authorised by

14/09/23

Number of pages: 9

Number of annexes: 0

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Contents

1. DEFINITION OF CROSS DOCKING .................................................................................................................................... 4

2. BEST PRACTICES IN CROSS DOCKING IN EUROPE ............................................................................................................... 5

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1. Definition of Cross Docking Cross docking is defined as a procedure where the distribution process from a supplying company or a

manufacturing company to the customer is reduced to no or a minimum storage or handling time.1

This procedure takes place in a special distribution docking terminal. This docking terminal contains trucks

and dock doors on two sides. One side is called inbound, the other side is called outbound side. The

terminal has got a minimum storage space only. Cross docking means the process of receiving products

through an inbound dock and then transferring them across the dock to the outbound transportation dock.

Products transported by trucks/trailers arrive at the inbound dock and are allocated to a receiving dock on

one side of the ‘cross dock’ terminal.

The following diagram shows the procedure of cross docking.

Figure Cross docking warehouse procedure (Source: DGG)

When the inbound transportation has been docked at the inbound door, the goods can be moved directly

or indirectly to the outbound dock and then to outbound destinations. It is also possible to unload and sort

the goods and to move them to the other end of the docking terminal. This handling can be done by

forklifts, conveyor belt, pallet truck or other means of transportation. The next step is the way from

outbound dock to the customers.

Cross docking reduces handling time and costs. It is used in different types of warehouses and therefore

different branches. For example, it can be seen in food supply where temperature controlled products have

to be moved quickly. Furthermore, already packaged and sorted products ready for transportation to a

particular customer can become a faster and more efficient process through cross docking.

Cross docking offers advantages when a central location is needed to sort products and to combine them to

deliver these to multiple destinations. It is also implemented when many small loads shall be combined to

1 See: http://www.sciencedirect.com/science/article/pii/S136655450500013X

Cross docking terminal

Inbound Outbound

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one transport to save costs by optimizing the capacity utilization. Cross docking terminals can also be

installed for break-down of big loads to small loads to be delivered to a special market.

Three types of cross docking can be considered:

1. Fully packed pallets go in to the warehouse and are delivered in the same arrangement to the agencies/customer;

2. Several pallets with specific products are consigned to packages which include the products the agency needs;

3. Already consigned pallets or packages arrive at the center and will be handled only and delivered to the specific agency

This system requires that the processes are adjusted perfectly. The information flow between producing company, the warehouse and cross docking center and the agency has to work smoothly. The wrapping has to be standardised. Transporting companies have to be on time. There have to be enough doors for inbound and outbound processes as well to avoid congestion. The ingoing products shall be handled automatically.

The system helps improving efficiency and effectiveness regarding stock-keeping. The agencies need less stock which does not mean that the quality of supply decreases or empty shelves occur because. The cycle time of goods decreases too.2

The importance and number of cross docking centers will increase due to the increase of same day

deliveries and due to optimization of efficiency. First aim is the minimization of warehouse capacity and

transaction costs.3

2. Best Practices in Cross Docking in Europe This chapter shows some Best Practices of Cross docking in Europe. There exist different needs regarding

warehouses and the examples show where Cross docking can supply the company’s needs.

The automotive sector is characterized by fast transportation processes. The procedure of just-in-time or

just-in-sequence are well-known in this branch to reduce storage capacity and costs.

Cross docking offers advantages for car manufacturers too. The German car manufacturer BMW AG has

implemented cross docking terminals in the south of Germany.

Best Practice BMW AG / Kuehne + Nagel

The logistics company Kuehne + Nagel (http://www.kn-portal.com/) is operating logistics centers for BMW

in Germany. In August 2012, K+N expanded their logistics center in Wörth (Bavaria) by additional 50,000

sqm. In total, the center has got 95,000 sqm area size. The plants in Dingolfing, Landshut and Leipzig are

being supplied by Wörth. Kuehne + Nagel organises the transportation services between the supply center

and the BMW production sites.

2 See http://www.business-wissen.de/artikel/lagerhaltung-aktionsfelder-fuer-bevorratung-und-umschlag/

3 See http://www.heuer-dialog.de/insight-2013-04-Logistikimmobilien-E-Commerce

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Additionally, the logistics company is in charge of warehousing services, sequencing, the

commissioning of components, reverse logistics, customs clearance and various security

tasks. This supply center is used as a cross-dock to supply all Bavarian BMW plants. The

cooperation between BMW and K+N exists since 1999. K+N is operating logistics centers

with a total area of 230,000 sqm for BMW.4

K+N is one of the biggest logistics company in Germany and is operating

worldwide. The company has got more than 1,000 locations in more than

100 countries (see www.kuehne-nagel.com for further information).

Best Practice Volkswagen AG / Schnellecke Logistics

Another best practice is the example of the car manufacturer Volkswagen

(http://www.volkswagen.de/de.html). Volkswagen implemented a cross

docking center in Bratislava (Slovakia). Suppliers deliver their products to

this center where the products will be sorted and bundled. The aim is to

maximize the loading factor of the outgoing trucks. These trucks move the

goods to the single plants of company VW then. Different forwarding agencies are in charge for the supply

of the cross docking center. The cross docking center itself is managed by

another logistics company. The distribution to the plants of Volkswagen is

organized by forwarding agencies.

(see: http://www.verkehrsrundschau.de/autoindustrie-hinterfragt-das-

modell-des-gebietsspediteurs-1373133.html for further information).

Best Practice LeClerc (France)

The company LeClerc (www.e-leclerc.com) is one of the biggest retailers in

France. The company has got 500 sale points and 16 strategic distribution

centres. Four of them dispose of fully automated cross docking systems.

In the LeClerc distribution center fresh goods as fruits, vegetables, dairy products and meat are processed

in air-conditioned buildings. The implementation of a cross docking system in this case means that products

are not stored temporarily but delivered directly to single agencies. This has got a big advantage regarding

fresh products.

One of the important modules of the system is the equipment for sorting 40,000 boxes each day. The so-

called “Posisorter” offers different advantages. The first one is the reduction of up to 50% of manual

processes. The second one is the triple flow rate per sqm in the centre. The system also guarantees 100%

quality regarding correct supplies. It also offers a comprehensive management of tracking and tracing of

goods.

4 http://www.dvz.de/rubriken/logistik-verlader/single-view/nachricht/bmw-restrukturiert-die-wareneingaenge.html

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Best Practice Logwin / Douglas

The logistics service provider Logwin is operating a new cross docking center in the Western region next to

Stuttgart since 2010. User of the center is the perfume selling company Douglas

(https://www.douglas.de/douglas). This center offers also some other value

added services. About 80 agencies are supplied by this cross docking center.

Each ingoing package will be unpacked, scanned, priced and protected if

necessary or obligatory. Then, the products will be put into reusable boxes.

The products will be sorted so that the right products will be next to each other in the shelf in the shops.

The agencies get the boxes which are allocated to a special shelf and not mixed. This is a big advantage for

the agencies to fill up their shops with new supplies. The agencies get boxes instead of partial shipment.

It reduces storage costs and saves time. This time period can be used for providing customers in the

agencies. The company Logwin is a logistics service provider which employs more than 5,500 people in a

worldwide market.5

Best Practice Trinks GmbH

In the sector of food logistics, especially logistics of beverages, the

company “trinks GmbH” (http://www.trinks.de/) buys non-alcoholic

drinks and beer from their suppliers and stores these products at their

plants. This describes the usual way of processing.

In contrast to this the products will be purchased and arranged at the assigned loading zones. Together

with the beforehand allocated consignments from the “trinks” core product line the whole arrangement

will be delivered.

The advantage for the customer is to be seen in having only one contact person and therefore reduction of

process steps. It also reduces costs of storing.

Best Practice Alcaro Invest GmbH / Emons Spedition GmbH

In the Freight Village of Berlin South (Großbeeren) sold another project

called “ALCARO Logistikpark Großbeeren III” (www.alcaro.de) to the real

estate fund “Henderson German Logistics Fund” in 2013. This object is a warehouse which does not have

support columns. It has got 54 doors and a size of about 6,400 sqm of storage

space and 1,200 sqm for offices. The logistics company Emons Spedition GmbH

(http://www.emons.de) is the main tenant of this warehouse. Emons is

operating on a worldwide level.

5 See http://www.logwin-logistics.com/de/news/pressemeldungen/detail/logwin-betreibt-neues-ersatzteillager-fuer-

deutschen-automobilhersteller.html

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Best Practice Post CH AG

The Swiss Post company (http://www.post.ch/) is operating a cross docking center

for different clients. By using intelligent information systems goods arrive at this

center from different producers at the same time. The goods can be assigned to

one or more recipients. The company Post CH AG checks the inbound goods, does quality control and

repacks the products then. The goods for a specific recipient are allocated at one place in the center.

One example is a trading company which sells electronics in Switzerland. DVD recorders are supplied by a

company which produces in Ireland. The same producing company delivers blu ray players from their plant

in Portugal too. Two other producing companies deliver their MP3 players and digital cameras as well at

the same time. The Post CH AG then arranges the shipments for the single agencies in Switzerland within

24 hours usually.

Due to this cross docking center the producing companies save their own central warehouse.6

Best Practice HAVI Logistics / Ba-Ha-Ma´s Ltd

Another example of food logistics is the supply of the zoo of Budapest with fishes for the penguins. The

company HAVI Logistics (http://www.havi-logistics.com/) and its daughter company STI Hungary took over

the delivery of this zoo.7 8

The supply chain starts at the terminal at Riga in Latvia. The transport goes

to the cross-docking center of the mother company HAVI Logistics in

Warsaw (Poland). It is done with multi-temperature-managed trucks. From

this point in the supply chain the goods are delivered to Budapest then.

The transport time is about 3 days in total.

Summary

Cross Docking is a helpful instrument for shortening the delivery process and for reducing warehouse

capacities. Both aspects have benefits regarding costs and efficiency. Many current examples show the gain

of importance of this approach in the logistics sector. For specific branches the implementation makes

sense as described in the examples before.

In the context of the project EcoHubs the usage of the cross docking approach is one instrument to

optimize supply chains. Logistics hubs / centers should therefore integrate and push the idea of cross

docking centers.

6 See http://www.post.ch/post-lagerlogistik-crossdocking for further information

7 See http://www.inar.de/damit-pinguine-satt-werden/

8 This example focuses on food logistics for animals. It is integrated to show the concept of cross docking to the

successive generation.

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Figure Cross docking approach (Source: own diagram according to Trinks GmbH)

Incoming

Sorting

Outgoing

Supplier / Manufacturer

Customers

Supplier / Manufacturer

Supplier / Manufacturer

Customers

Customers

After

Before

Cross-Docking Inventory