DC Bypass
By Splatty • May 3rd, 2007 • Category: Integrators, Misc Logistics, Supply Chain Management
With today’s low cost labor options in China, many retailers are looking for ways to further reduce costs in their suppy chains. One potential area of focus that is becoming increasingly prevalent is the concept of DC bypass.
Under the DC bypass program goods are sorted, labeled, and boxed in store ready packages prior to departing the manufacturers facility in the source country. The products are then shipped to the U.S. where they are de-consolidated and sorted at a 3PL warehouse prior to final delivery to the end customer.
As I mentioned in an earlier post, we are definitely seeing a change in the way companies are moving their products throughout the supply chain and many 3PL’s are adapting their services to meet those needs. Case in point are new services such as UPS’ Trade Direct program, DHL’s CDS (Consolidation Distribution Services), and APL/Conway’s OceanGuaranteed service.
These types of services allow companies to bypass their own distribution centers and eliminate extra days in their distribution cycles.
Other benefits include:
1. Inventory reduction.
2. Decreased handling costs.
3. Decreased transportation and fuel costs.
In presenting these types of services to potential customers, I have found that these types of services work well with companies who:
1. Can allocate store specific product at origin prior to shipping.
2. Product can be packaged in “store ready” packaging at origin.
3. Do not require an abundance of merge-in-transit shipments from product that is already in the U.S with the inbound product from overseas.
If you are interested in these types of services, check with your provider to see how they can help.
Stumble it!
Related Posts:
Splatty is Co-Contributor
Email this author | All posts by Splatty
© 2008