Expert Insight: Sorting it Out
By Cliff Holste
Rerun Date: November 23, 2009

Logistics News: Upgrading Older DC Operations Begins on the Receiving Dock

Maintaining a Competitive Receiving Operation is Key to Higher Productivity and Customer Service Levels

With so much focus on Picking and Shipping, it’s easy to forget that Receiving and Putaway operations are starting line activities. It's here that businesses begin the race to beat competitors. It's the first few miles of a marathon to save time, to cut costs, to trim inventory, and to speed up service to customers. However, along with these goals, there also are somewhat conflicting, yet concurrent demands to meet in receiving, i.e., not to damage incoming raw materials or finished goods and not to sacrifice accuracy or performance.


Receiving and putaway operations should not be confused with unloading, which is for some DCs a totally separate operation, provided under contract by a Lumper provider company or by independent contractors. Distribution Digest will report on unloading and Lumper services in the near future.


Get Rid Of the Paper

Receiving and putaway are where the physical flow of materials and the parallel flow of information on received items join and must be efficiently and swiftly routed downstream in synchronization with one another. For example, continuing to rely on manual receipt of goods with paper and pencil steps in the information flow - such as reading a purchase order, checking quantity received, or assigning a stocking location is way too slow. Paper shuffling on the receiving dock increasingly is a factor that marks a second or third rate competitor compared to the top performers.


In order to remove the first speed-bump receiving must proceed with both the greater speed and higher degree of accuracy provided by the automatic data capture and electronic information processing technologies.


A competitive receiving and putaway operation begins with employees on the dock equipped with bar code scanners and radio frequency data communication (RFDC) terminals. RFDC units mounted on the lift trucks used in receiving and putaway will further expedite paperless processing.


All the data collected electronically must be managed electronically as well for greater efficiency. Even the most basic warehouse management system (WMS) can do so readily. Within the receiving department, WMS software, fed data from bar code scanning and RFDC units, perform such functions as identifying and recording receipts by SKU, updating inventory, directing putaway, and assigning storage locations.


Even with WMS capability internally, your facility's receiving operations need to be linked externally by electronic means to upstream members of your supply chain. With electronic data interchange (EDI) links to inbound shippers and transportation companies, the receiving dock will know ahead of time what's due when, and in what quantities. With the type of EDI transaction known as an advanced shipping notice (ASN), moreover, dock managers can preplan how they'll handle the inbound materials
flow for highest efficiency.

Work With Vendors as Partners

Consider asking your major suppliers to add pallet tags that can be scanned to identify a pallet, a carton, or a product to your receiving system. This can then be linked to either an EDI or an identifying number in your purchasing/receiving system. Although you may not get every vendor to comply, you will find that many are set up to do this already.


Think about scheduling your deliveries at times when your order picking operation is normally slow, rather than at peak periods. You can do this with parcel carriers as well as with full truckload carriers.


Keep a scorecard on your vendors to give them feedback and to identify those that regularly fail to measure up. Work with vendors to solve problems, and consider changing vendors if you find resistance, or a failure to improve.

Automate and Streamline Your Loose Case Receiving Process

Today, most product manufactures utilize automated UPC bar code print and apply case labeling methods to identify SKUs. By ceasing on that opportunity, the receiving process for the top DC performers takes on a new look.


For container and common carrier loose bar-coded carton receipts, an integrated conveyor system process can automate and streamline receiving.

Product is placed on a conveyor (that extends into the receiving trailer) at the receiving dock, scanned, and electronically assigned to an outbound order/shipment. A bar-coded shipping label is automatically printed and applied to the carton. The material handling system routes the carton to the shipping sortation system. The shipping label is scanned and the product is sorted by customer and/or shipment and routed directly to the shipping dock where it is taken from the conveyor and palletized or floor-loaded directly into the shipping trailer.

This practice is commonly referred to as flow-through or cross-dock and works well for many retailers, especially door-per-store operations. The carton is handled once at the receiving dock and once at the shipping dock. Except for cartons which are rejected for some reason, the carton/order/shipment does not require any operator intervention within the distribution center. In addition to minimizing handling, the inventory is never waiting for processing in the distribution center. Instead it is on its way to the retail outlets where it will be available for sale.


Loose case product that is not needed immediately to fill orders is conveyed to the shipping sorter where the cases are scanned and automatically sorted by SKU to palletizing stations for staging and/or putaway into inventory.


Checking and inspection of case goods or full pallet loads can be limited to random audits except for vendors that have known quality issues.


The use of printer/applicators expands on the benefits that material handling equipment provides. While printer/ applicators are by no means a new technology, advances have been made that allow this automation to generate and apply labels with more data at higher throughput rates over a wider range of package sizes.

Final Thoughts

Above all else, think of ways to facilitate the fastest journey from receiving to shipping. Every stop, every move, and every item dropped in a temporary storage/staging area takes space, takes time, increases the chances for damage, makes stock hard to find, increases errors, and costs you labor. Think all the way through the supply chain to figure out ways to minimize the time from the receiving dock to your customer.

Agree or disgree with Holste's perspective? What would you add? Let us know your thoughts for publication in the SCDigest newsletter Feedback section, and on the website. Upon request, comments will be posted with the respondent's name or company withheld.

You can also contact Holste directly to discuss your material handling or distribution challenges at the Feedback button below.

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profile About the Author
Cliff Holste is Supply Chain Digest's Material Handling Editor. With more than 30 years experience in designing and implementing material handling and order picking systems in distribution, Holste has worked with dozens of large and smaller companies to improve distribution performance.
Visit SCDigest's New Distribution Digest web page for the best in distribution management and material handling news and insight.

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Above all else, think of ways to facilitate the fastest journey from receiving to shipping.

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