A business-to-business (B2B) integration is the software that is used for transferring business data between two or more partner organisations. Nowadays, inventory management in a supply chain is of paramount importance. Cross-docking is an intelligent logistics procedure that eliminates or minimises storage requirements on the part of the manufacturer and channels products directly to the customer ends or retail chains.
Logistics is the system of transferring, warehousing, and distribution of products from their point of manufacture to places where they meet their end users. Transportation means moving materials by air, waterways, road, and railway to reach their clients or distribution networks.
Role of Logistics and Transportation in Supply Chains
The logistics and transportation system is the heart of a supply chain network. The growth of a modern organisation is a function of its supply chain management. Similarly, the efficiency of the supply chain is a function of its robust logistics system and diversified transportation network. Salient roles that the department plays are as follows -
A strong network of transportation and logistics systems makes the supply chain efficient and physically secure from human-created or natural disruptions.
This industry depends on information and communication technology. Thus, cyber-attacks covertly launched by rival organisations or hackers are to be prevented by the logistics team by implementing a robust cyber security system.
Information technology helps to share real-time data to quicken the process in the supply chain in terms of time and operational efficiency.
Warehousing planning or inventory management in a supply chain is a logistics function. Besides catering to the normal demand, logistics strategies also respond to special inventory needs like the latest trends, sudden demand surges, seasonality and other factors.
Another important logistics function is to strategise the mode of transport or its combination sequence in order to ensure the fastest and most cost-effective delivery. Choosing the best mode of transport is also a logistics function.
Importance of Cross-Docking in Supply Chains
Cross-docking is a digital data-based advanced logistics arrangement where products are directly forwarded to the customers or distributors, thereby eliminating the need for storage at the manufacturer’s end. Several advantages of cross-docking have been mentioned below:
Inventory management at the manufacturer’s end is expensive. Keeping inventory results in delayed delivery of products. Cross docking eliminates storing time and improves efficiency in product delivery.
Cross docking prevents manual handling of products at the stores and hence restricts damage to the bare minimum.
Cross-docking improves the overall efficiency of the supply chain by reducing delivery time and minimising the cost of inventory management. Products get rolling on wheels faster. End customers get the privilege of getting products faster at reasonable prices.
Cross-docking facilitates both inbound and outbound sorting of products so that they are directed to their next destination in the most hassle-free manner.
Cross-docking requires lesser capacity warehouses because the products are not generally planned to be retained as inventory. As a result, the labour cost is also reduced.
Manufacturers who have incorporated a cross-docking system in the supply chain may always stay one notch above their competitors, who still maintain the conventional warehousing system.
Cross-docking is a must for those manufacturers who sell products with a limited life. The best examples may be food items, beverages etc. which are perishable in nature. These items must be shipped to the end users or the next business immediately by using this method.
Organisations that depend on many suppliers also take the route of cross-docking to reduce inventory expenses and time.
Nowadays cross-docking is supported by route planner software to maximise the efficiency in the supply chain.
Cross-docking works on automated software. There are no chances of errors that are frequent in manual operations.
Besides quicker delivery at a reasonable cost, cross-docking allows sellers to offer discounts to their buyers. This helps manufacturers to leverage their competitors.
Cross-docking reduces or eliminates the requirement of purchasing land and developing them into logistics hubs.
The manufacturers may also demand more discounts for volume purchases from their suppliers and ultimately pass on these benefits to their customers.
Cross-docking also helps distribution networks to obtain prior knowledge regarding what the manufacturers or suppliers have shipped to them and when they are expected to reach. All this information is triggered by its automation-based system.
Role of B2B Integration in Supply Chains
The objectives of the business-to-business integration are to gather useful data from all stakeholder organisations and then share them with all with the purpose of getting timely responses from all of them connected in the business network. The benefits are as follows -
This software digitises information and helps business houses to integrate their data in a common gateway to improve trading of mutual interest.
Its technical features are remarkable. It has powerful communication adaptors, an application integration system, format translation capabilities, accurate mapping, compression, encryption and data validation. It is capable of message tracking and real-time reporting.
The system gathers information from different sources and converts data into standard formats before sharing them with all stakeholders.
Integration may be availed through cloud services.
It eliminates the slow and inefficient manual system of inventory management in the supply chain and quickens up product delivery by sharing information faster with all stakeholders and drastically improving turn-around time for all sequences of processes.
B2B integration primarily serves the interests of the manufacturers who work hard on developing a trust-worthy, responsive and faster supply chain by sharing all real-time with the stakeholders.
In today’s world, supply chain and operations management has become the most trendy career-evolving prospect in India and abroad. The Supply Chain and Operations Officer course grooms a prospective candidate in the key topics of business, marketing, finance, logistics and operation.
The Global Chief Supply Chain and Operations Officer course at Imarticus will enable the prospective candidate to boost their career towards a bright future. The IIM Raipur supply chain management program is very popular amongst students. The duration of the course is 10 months.
After completing the IIM Raipur supply chain management program, the students become more empowered professionals in the field of supply chain and operations management.
Visit the official website of Imarticus for more course-related details.