Cross-Docking disadvantages

One of the biggest retail fashion industry giants entered Ukraine a few months ago. I had a chance to talk with logistics managers of the company. If I understood correctly they have only one distribution warehouse(DC) for Europe located in Europe. Merchandise is received from suppliers and delivered to Cross-Docking areas across the world from this DC. The advantages of this system: low cost of logistics operations in the neighboring countries. The company acts very quick to fashion industry changes and most of the suppliers for the trendy items are from Europe or neighboring countries. Suppliers are able to produce the apparel from a scratch in a few weeks and in small quantities. They able to make repeat orders. So the company has little risk while making orders of merchandise. If a merchandise has a good selling rate they make repeat orders so they actually minimize holding risks of stocks in DC.

In Ukraine two deliveries are done per a week from that DC. There are flat items and items on hangers. Items on hangers received on special boxes where items are hang. Items are in boxes and every box is for a particular store and labeled according to it. Travel time takes 4 days, the planned customs clearance time is 3 hours. For a delivery consisting of 5000 pieces and 800 different models it is quite challenging time period for customs. Generally truck leaves DC on Friday and arrives next week Tuesday and in the evening if everything OK the goods delivered to Kiev store. Another truck leaves on Monday and on Thursday evening it is in the Kiev store. Store has to wait 4 to 3 days between the delivery.