Applying Cross-Docking

Objective

After completing this lesson, you will be able to use cross-docking.

Basics of Cross-Docking

Cross-docking helps you reduce your warehouse stock and transportation costs, and helps optimize the movements in your warehouse. It can shorten the required delivery time.

Using cross-docking, you may have just a single movement in the warehouse: from the GR-zone into the GI-zone.

Cross-docking process: goods from multiple suppliers are received, sorted, and directly shipped to customers, minimizing storage and speeding up distribution.

SAP differentiates between planned and opportunistic cross-docking. Five forms of cross-docking are available:

  • Transportation cross-docking

  • Merchandise distribution

  • Push deployment

  • Pick from goods receipt (PFGR)

  • EWM-triggered opportunistic cross-docking

Overview of cross-docking scenarios in SAP EWM, showing planned and opportunistic types, with subtypes like transportation, merchandise, push deployment, and pick from receipt.

Planned Cross-Docking

You must decide the cross-docking relevance before the products arrive in the warehouse and before you release the outbound delivery.

Transportation Cross-Docking

Transportation cross-docking (TCD) means that goods are not delivered directly from the delivering warehouse to a ship-to-party. Instead, the ordered goods are moved (with other purchased goods) to an interim warehouse and that is the cross-docking warehouse.

This is ideal if you have different warehouses in your company, which are on pre-defined routes and are supplied regularly with transports. It might not be ideal to transport the outbound delivery directly to the ship-to-party. It might be more logical to use a standard transport from one warehouse to another, and then deliver the customer order from the interim-warehouse. If the truck arrives in the interim cross-docking warehouse and is unloaded, the HU for the ship-to-party can be forwarded to the GI-zone. If the items are packed on a consolidated HU, you can use the process-oriented storage control to move the HU to the de-consolidation station, where it can be unpacked and repacked. From the de-consolidation station, the HU for the outbound delivery is moved to the GI-zone and the other HU is put away.

Cross-docking Routes

The decision to use transportation cross-docking is made during SAP EWM route determination for the outbound delivery order. Using this scenario, special cross-docking routes are required. These are the opposite of linear routes, which map the direct route from the delivery plant to the ship-to-party. Cross-docking routes are created for a specific location, and two linear routes (the incoming route and the outgoing route) are assigned to the cross-docking route.

As a result, two deliveries are created: an inbound delivery into the cross-docking warehouse and an outbound delivery from the cross-docking warehouse to the customer (the final ship-to-party). Both deliveries are assigned a TCD process-number. These deliveries are transferred to ERP and a transfer posting is made for the respective goods from the issuing storage location to a TCD storage location. The issuing plant retains ownership until the goods issue is posted for the outbound delivery of the final ship-to-party.

A variant of TCD is supplier cross-docking. In this case, the supplier sends the purchased goods to at least one cross-docking warehouse (instead of sending the goods directly to the receiving warehouse). The goal is to optimize transportation and keep deliveries in a single transport. As a prerequisite, you must use and develop a BAdI.

Merchandise Distribution

With merchandise distribution, you plan and control the flow of merchandise from a vendor through to a recipient. The merchandise can pass through a distribution center or, several distribution centers. The recipient is known at the time of procurement. Merchandise distribution is planned either using an allocation table (push) or a collective purchase order (pull). If the merchandise goes through a distribution center, three processing methods are possible:

  • Cross-docking
  • Flow-through
  • Putaway

Hint

To use merchandise distribution with decentral EWM, the following are the prerequisites on the ERP side: SAP ERP 6.0 with EhP 4, Business Function Retail CD/FT_EWM Integration and Solution SAP Retail.

Merchandise Distribution Cross-Docking

The process starts in ERP. Based on customer orders or stock transport orders, you create collective purchase orders or stock transport orders. Customer orders or purchase orders are created based on an allocation table. In both cases merchandise distribution data is updated and ERP creates the inbound and (the planned) outbound deliveries, and then transfers them to SAP EWM.

After the physical goods arrive on the GR-zone, the goods are forwarded to the GI-zone and the goods issue is posted.

If the incoming goods are packed in a HU, you can use the process-oriented storage control for the internal movements. Merchandise distribution cross-docking is only possible when the delivered goods are forwarded directly to the ship-to-party.

Merchandise Distribution Flow-Through

When the HU that is received contains different products and the complete HU cannot be sent to the final ship-to-party, you must transfer the goods to a cross-docking storage type which is then used as a repacking area. You can repack based on the recipient or the product.

Recipient-Driven Flow-Through

After posting the goods receipt, and before creating the pick-warehouse task, the "quantity adjustment for the outbound delivery orders" is executed. (The menu path for this is: EWMDelivery ProcessingInbound DeliveryMerchandise Distribution: Maintain Quantity Adjustment Flow-Through).

The HU received is moved to the cross-docking storage type where it is unpacked and re-packed in customer-specific pick HUs. Recipient-driven flow-through means that the picker takes a customer specific pick-HU and packs the required products into that pick-HU. For each ship-to-party, an individual warehouse order is created to transfer the appropriate pick HU to the GI-zone.

Product-Driven Flow-Through

The difference with the product-driven flow-through is in the way that the picker packs the pick-HU. With product-driven flow-through, the picker prepares for product-specific HUs in advance and sends the products of each delivered HU to the product-specific handling unit. Completing the process step for the HU creates a warehouse task to transfer the pick-HUs to the GI-zone.

Opportunistic Cross-Docking

After the goods receipt posting or after the outbound delivery release, the cross-docking decision is made. Three methods of opportunistic cross-docking exist:

  • EWM-triggered opportunistic cross-docking

  • Pick from goods receipt (PFGR)

  • Push deployment (PD)

EWM-triggered Opportunistic Cross-docking

This is the only cross-docking method that does not need another application or system (such as ERP, APO, or CRM) for the cross-docking decision. This method is controlled by the product itself. It uses product groups and product group types assigned to the product master data. Additionally, it is necessary to activate a BAdI controlling the inbound respectively the outbound cross-docking.

During the creation of a putaway warehouse task, SAP EWM searches for a matching item in outbound delivery orders. If the required product, batch, and quantity is suitable, existing picking warehouse tasks can be deleted. If no warehouse tasks exist, SAP EWM creates new cross-docking warehouse tasks. Incoming goods are not putaway, but are directly transferred to the GI-zone. If the delivered quantity is greater than the required quantity, the remaining quantity is stored.

The process also works in the converse way, that is, when creating picking warehouse tasks, the respective BAdI checks if there is stock in the GR-zone that can be used instead of using stored stock.

Hint

EWM-triggered opportunistic cross-docking has prerequisites. You must implement the Business Add-Ins (BAdIs):

  • /SCWM/EX_CD_OPP_INBOUND (Activate and Adjust the Inbound-triggered Cross-docking Process)
  • /SCWM/EX_CD_OPP_OUTBOUND (Activate and the Adjust Outbound-triggered Cross-docking Process)

For both BAdIs, a sample implementation is available.

Push Deployment (PD) and Pick From Goods Receipt (PFGR)

PD is used for forecasted demands in other locations. PFGR is used for overdue customer orders and overdue stock transport orders. The usage is controlled by customizing the putaway delay setting. In this setting, you define a wait time for each warehouse process type and assigned stock type. This wait time is intended to delay the automatic creation of warehouse tasks.

The process starts with standard inbound deliveries and a standard goods receipt process. SAP EWM checks if the warehouse process type and stock type is relevant for the putaway delay. The goods receipt posting is transferred to SAP ERP and SAP APO. While the creation of putaway warehouse tasks is delayed by the defined time (putaway wait time delay), SAP APO checks if either forecasted demands in other locations or overdue SD-orders or overdue stock transport orders exist. If any of those exist, then SAP APO initiates an ERP-created outbound delivery for the respective demands or orders and transfers those outbound deliveries to SAP EWM. If the putaway wait time delay has passed, putaway warehouse tasks are created. In this case, since outbound deliveries for cross-docking exist, the goods are transferred directly to the GI-zone.

If you manually create warehouse tasks for putaway during the wait time, you receive a warning message. Ignoring the message means that you override the cross-docking process.

Using Push Deployment and PFGR is only possible in the integrated environment of SAP ERP, SAP APO, SAP CRM and SAP EWM.