A recent report suggests that the global trend for the Cross Docking services market, including international cross docking will continue to increase at a fast pace over the next few years. The global market in 2021 added up to $200 billion and by 2030, it is expected to reach $342 billion. The trend for North America is expected to be consistent with the global trend. International Cross Docking services are solving continuing supply chain and logistics issues for companies that need to import a variety of products for their manufacturing process.
Cross Docking is a process where a company will use a distribution center to create full truckloads of goods that are coming from different places or companies. The use of Cross Docking eliminates the need for large amounts of storage, as goods are taken directly from an inbound delivery, and put directly on an outgoing truck with other goods and materials.
International Cross Docking has other logistical advantages as well. For example, a manufacturer in Windsor, Ontario Canada may import materials and goods from the United States through Detroit. Despite the two cities being just across a river from each other, the international border, and constant traffic makes for an arduous materials journey.
Without Cross Docking, this would require additional freight traffic and border crossing paperwork. With Cross Docking, there is the advantage of consolidation. Shippers still need to complete customs paperwork and clear customs at the border, but if smaller U.S. shipments are consolidated into one larger load, and goods are precleared when possible, there is a corresponding reduction in logistical issues and potentially reduced shipping time and costs.
Increasing Demand
What is driving this increase in the popularity of outsourced Cross Docking services? From inflation to increased demand, just about every critical supply chain issue caused by the changes in the post-pandemic economy has companies and manufacturers scrambling to find new ways to get their products finished and to their customers that are more efficient and cost-effective. And the cross-docking traffic is not just one way. For example Canadian shippers are using Cross-Docking to consolidate shipments and distribution of goods heading to the United States.
Unprecedented cargo logjams
While the supply chain issues of early 2022 are easing up some, the problems that surfaced during the pandemic and directly afterward have companies counting on the global supply chain for pieces to their manufacturing puzzle switching from a Just-In-Time stocking (ordering and receiving manufacturing elements just as they are needed) to Just-In-Case (ordering materials early, to avoid any delays in manufacturing due to supply chain issues). Companies don’t want to risk running out of supplies and materials as was experienced during the height of the unprecedented cargo logjams in 2021 and 2022. This has increased the pressure on the freight industry and increases in Cross Docking are a direct result of a combination of new pressures.
Supply Chain impacted by workforce shortages
The piece of the supply chain that involves trucking has not been immune to workforce shortages plaguing many industries. The Minnesota Trucking Association suggests the U.S. currently needs around 60,000 additional truckers to meet demand. With fewer trucks available, companies that rely on ground freight are turning to options such as Cross Docking to take up the slack. The shortage of trucks and the people to operate them is impacting traditional storage and warehousing schemes, leading to the use of outsourced Cross Docking facilities.
It's a New World
While the supply chain issues of the last few years are beginning to subside, companies across the globe are determined not to be hit the same way they were during and just after the COVID-19 pandemic. Through the use of alternative sources, Just In Case vs. Just In Time stocking and Cross Docking services, manufacturers and the shippers they rely on have made permanent changes to their business processes.
Mayer Alloys Corporation brings together the resources to meet your manufacturing, assembly and supply chain needs. From warehousing and crossdocking services, metal distribution specializing in tin and lead products to mil-spec, contract and hazmat packaging, warehouse and distribution services and electronic waste and scrap metal recycling. Contact us today to see how we can meet your needs!