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Impact of combining cross-docking and vendor managed inventory in a retail supply chain

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  • Yassine Benrqya

Abstract

The objective of this paper is to examine the impact of combining the cross-docking strategy (XD) and vendor managed inventory (VMI) in a retail supply chain. Particularly, the impact of combining XD and VMI, compared to VMI is investigated. The presented work is based on a case study research methodology. The research was done in collaboration with a fast moving consumer goods company and a French grocery retailer. A cost model has been developed to compare three different scenarios: 1) VMI scenario; 2) a XD scenario; 3) a combination of XD and VMI. The case study provides two main observations: 1) compared to VMI, XD is more economical: a 13% reduction of the cost; 3) combining XD and VMI reduces the supply chain cost by 28%. This paper fills a gap by proposing a cost analysis based on a real case study and by analysing the advantages of implementing different scenarios in the retail supply chain context. Furthermore, the cost model may be used to help managers choose the right distribution strategy for their supply chain.

Suggested Citation

  • Yassine Benrqya, 2022. "Impact of combining cross-docking and vendor managed inventory in a retail supply chain," International Journal of Logistics Systems and Management, Inderscience Enterprises Ltd, vol. 42(4), pages 469-483.
    • Handle: RePEc:ids:ijlsma:v:42:y:2022:i:4:p:469-483
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