December 31, 2015
Improperly managed warehouse and facility yards can quickly turn into messy operations. Obvious signs include uncoordinated live or staged trailer moves, lack of proper loading dock visibility as well as time-consuming and costly backups at the gate.
More critical though is a much less obvious problem: inefficiency at the dock doors themselves. And the worst part about that issue is its hidden nature. Over time, dock inefficiency can result in several financially draining outcomes, such as exceptionally higher fuel costs and a significant loss of productivity.
Rest assured though that inefficiency at the dock is not an insurmountable problem. For example, in Western Canada, one of the world’s largest retailers faced a serious productivity issue that was affecting the time it took to ship product from a distribution center (DC) to retail stores.
First, trailers were spending too much time at the loading dock. Second, the Canadian Food Inspection Agency (CFIA) requires that food distributors have a trailer present and secured at their dock before opening the door. The retailer’s management was aware of the problems and the CFIA regulations; however, they did not have access to the data necessary to show the cause of these problems and provide an effective solution. The primary problem was trucks spending too much time at the loading dock after unloading was complete.
Dock Management System to the Rescue
The retailer opted to install a dock management system (DMS) to source the pertinent data to optimize logistics and comply with CFIA regulations. A variety of sensors now gather this real-time data which allows the DC’s management team to monitor and manage trailer activity.
Prior to installation, management had no way to track dock utilization, the time a trailer is being loaded/unloaded compared to how long the trailer has sat idle at that dock door. With their new DMS, the retailer was able to determine that their existing utilization rate was only 30%.
After using the data, the retailer experienced a 66% increase in dock utilization, which means they’ve become more efficient with their dock door assets and have gained the capability to reduce labor costs, trailer and personnel idle time, fuel consumption, detention charges, security or environmental breaches and maintenance.
Most importantly to the facility, the system’s dock management capabilities provides optimal use of all of the loading dock positions and ensures compliance with the regulations developed by the CFIA.
More Doors Is Not Always the Solution
In an effort to improve dock efficiency, many companies try to implement what end up as costly, inappropriate attempts at a solution. Building new or expanding existing warehouses or facilities results in adding more doors, more square footage, more people and more fork lift trucks. That also means throwing money at the symptom of their problem rather than addressing the key solution to their problem: improve efficiency at the dock through better dock utilization.
It pays to ask yourself a very simple question, “How much time do we spend loading or unloading the trailers at our dock doors?” Typically, most companies have an efficiency of 30 to 40 % or even less. Dropped trailers are even lower at 10 to 20%. In contrast, one large retail operation in the U.S. is actually achieving a dock utilization rate of more than 90% using a DMS.
Clearly, if you work on optimizing your dock turns—and it’s done properly with the help of a DMS that monitors, communicates and manages loading dock status—you can easily increase your utilization from 30 to 90%.
Some companies might even argue, “I have plenty of dock doors, so I don’t have to turn them around very fast.” There’s still room for improvement if you’re interested in saving money in the long term. One approach to better dock utilization is to optimize a select group of doors at your facility that can in turn make a significant impact on your bottom line.
Say your warehouse or facility has 100 dock doors. Why not make a concerted effort to optimize the 50 that are closest to your product and shipping office? You would then focus all your turns on those 50 so drivers don’t have to travel the extra quarter mile back and forth across all 100 dock doors. If you did that for every load for the next 30 days, imagine how much you’d save in diesel fuel as well as time and labor costs?
So why throw money at increasing the number of dock doors when maximizing door efficiency is really the solution you need? Those companies that have given this approach serious consideration have actually delayed (i.e. given second thought to) and even eliminated plans to expand their volume of dock doors.
Don’t be afraid to admit that you don’t necessarily need another warehouse or two. Instead, implement a proven DMS to become more efficient with the dock doors you already have.