Just-in-Time Retail Distribution:A Systems Perspective on Cross-Docking

Cross-docking is a just-in-time strategy for distribution logistics. It is aimed at reducing inventory levels and distribution lead times by creating a seamless flow of products from suppliers to customers. Prior supply chain literature has argued that creating such a seamless product flows requires a holistic view on cross-docking management, aimed at synchronizing cross-docking operations at the distribution center with its inbound and outbound network logistics. This paper provides an in-depth case study illustrating how cross-docking operations can be managed more holistically in a retail distribution context. A discrete event simulation model has been developed to understand and improve the cross-docking operations of a large grocery retailer in The Netherlands. The model is used to quantitatively evaluate two proposed changes that exploit opportunities in the design and control of the retailer’s distribution network. An extensive real-world data set is used as input to the model. Overall, the case and simulation results show that a holistic cross-docking management approach can indeed improve system-wide performance, which further stresses the importance of making cross-dock operational decisions making and network decisions together