Different Types of Distribution and Delivery Schemes

It is essential that your business operates with the best type of delivery scheme for its needs. Failure to do so can result in profit loss and delivery delays. This article takes a look at some of the most popular types of delivery schemes and it explains what each of their benefits are.

Step Systems

There are three main types of traditional delivery step systems, these are: zero step, one step and two step methods. Zero step refers to when the products are shipped directly from the manufacturer to the customer. One step involves the products being delivered from the manufacturer to a distributer and then on to the customer. The two step process refers to the system of shipping products from the manufacturer to an agent to a wholesaler and then on to the customer.

Cross Docking

Cross docking is a type of logistics procedure which involves shipping products from the supplier directly to the retailer. Goods are delivered in a truck that typically contains two doors to allow the delivery personnel to unload and reload the trucks in the shortest amount of time possible. The products are unloaded onto a large space which is known as a cross docking terminal. It is in the docking terminal that the products are unloaded, screened and sorted. Once this process has been done the products are then loaded onto outbound trucks which are located near to the docking terminal. The products are typically transported using forklift trucks or cargo carriers.

Cross docking is particularly beneficial for products that are easily perishable, such as foodstuffs, as it allows them to be transported quickly and efficiently from the supplier to the retailer.

Drop Shipping

Drop shipping is when you pass a customers order onto the manufacturer or wholesaler who will then directly post the products to the customer. Drop shipping means that you do not have to stock any products or supplies in a warehouse, instead you are just a middleman between the customer and the retailer. Drop shipping is great if you want to start a business without having to invest in purchasing products and storage facilities. The downside is that the drop shipping retailers will often sell the products to you for a much higher price compared to when you buy them in bulk directly from a wholesaler.

How to Pick the Right Distribution Methods for Your Business

Is is essential that you choose the right distribution methods in order maximize your company's profitability. Choosing a distribution method is a complex task which requires a lot of thought. Some things that you will need to consider include examining the costs of each of the distribution channels, determining what options best match your marketing strategies, and analyzing the strengths, opportunities and threats to your business. Once you have chosen a distribution method for your products you will want to continuously analyze it to ensure that it is the most appropriate choice for your business.

Are you looking for the best warehouse management systems? Click here for more information!