But what are pool distribution logistics, what is the pool distribution strategy, and how can pool distribution help your business? Keep reading to learn more.
The pool distribution strategy combines less-than-truckload (LTL) shipments onto fewer trucks before delivering them to pool points instead of their final destination. Shipments get consolidated depending on their geographic region, with numerous delivery points occurring within that region. Once shipments have gotten reloaded, they get placed on different trucks for their final delivery journey.
There are several steps to the pool distribution process, and each one is vital in a shipment’s success. The steps come together to form an efficiently working supply chain.
There is a planning process that has to be undertaken. Many factors must be considered encompassing delivery dates, truck availability, and shipping schedules.
Shipments are pooled and consolidated from a single shipper at the shipper’s distribution center. Such processes enable maximum space to be utilized.
Products get offloaded and scanned accordingly. They are categorized according to their individual requirements.
Products get organized depending on their geographic destinations. They get reloaded onto local delivery trucks and vans before getting sent for final delivery. There are multiple delivery points along the route for individual shipments.
Products that usually get shipped through LTL shipping can get pooled or consolidated onto a full trailer. It is important to understand the difference between Pool Distribution Logistics and pool consolidation, as they refer to two different processes.
Pool consolidation is the beginning of a product’s trip. Multiple shipments get consolidated into a single shipment load.
Pool distribution refers to the end portion of a journey in which the shipment gets removed from the truck. The distribution portion of a product’s journey occurs when they get separated and sent to their final destination. Pool Distribution Logistics can be utilized at both the origin and destination of a product’s shipment.
Sometimes pool distribution and pool consolidation cannot get paired together. This happens when vendors sharing the same truckload are set to arrive at the same retailer or location. This eliminated the requirement for distribution at the end of the process.
Whilst there are similarities between the two processes, differences exist that need to get understood. Let’s take a look:
LTL shipping permits companies to pay for a segment of the trailer they require instead of the entire load space. The rest of the space gets stocked with goods from other businesses heading to the same location. A business still has to pay for their truck segment regardless of whether their product fills that space or not.
Similar to many parts of LTL, pooling has a lot of things in common, but there are also important differences. Pooling shipments allows businesses to pool their own products in multiple shipments instead of sharing their load with other companies.
Whilst it may seem like a straightforward option, there are several factors that must be considered to ensure that a business can fully utilize the shipping method. Companies that have a consistently high frequency of LTL shipments are typically best suited to pool distribution, but they need to have a certain volume for it to be valuable to a business.
If a company does not have enough shipments for a full truckload, then it is more beneficial for them to continue utilizing LTL shipment methods.
There are many benefits to Pool Distribution Logistics it gets compared with other shipment methods and processes. Each benefit can affect a business in various ways.
Pooling shipments allows a business to significantly cut its costs. There is a diminished need for multiple destination stops on a journey. There is no complex calculation formula that gets used either, as costs get based on the weights and measurements of the shipment instead.
With fewer stops required, there are quicker delivery times. Shipments are also more reliable and consistent, as they do not have to undergo a complex transit.
Less product handling makes for a more secure way of managing and delivering products. The number of overall shipments also gets greatly reduced making it a more simple and straightforward practice.
The simplicity and ease of the shipment process mean that there is more visibility. A product’s entire shipment journey is able to get simply tracked and monitored.
Reduced shipments mean fewer trucks are on the road, leading to decreased carbon emissions. The equipment that gets used is also more durable, as it sustains less wear and tear.
There are fewer workers required to unload a single shipment. Fewer receiving staff members are needed too, as everything arrives in one place.
Pooling distribution advantages must get considered alongside other factors which need to be thought about. It is not a simple decision to opt for pooling distribution without thinking about all aspects.
A lot of change has to be undertaken in reference to shipment processes, schedules, and product volumes. All changes are necessary to facilitate effective pooling distribution, but some companies may not want to make them.
It is vital that a company ensures their pooled shipments can consistently fill a truck, or they will end up operating at a loss. If it is not possible for a company to fill their truck, then pooling distribution has minimal value for them.
Some products may require special attention. Companies should consider if it is sensible for their products to get pooled onto the same truck.
When choosing a partner to work with, it is important to consider their success. It should also be considered what they can offer your company.
Implementing effective pooling distribution can initially be a lot of hot work, but it pays off in the end. An experienced partner is vital, as they will already have sufficient systems and personnel in operation. This means that specialized equipment can get used correctly, and the best volume growth strategy can be utilized.
Onsite Global Logistics is a leading freight forwarding company with decades of knowledge and experience that is able to offer premium logistic solutions to various businesses.
Now you know all there is to know about pool distribution logistics and the important facts that should get considered. Contact us today to find out how we can help your business and get a quote.
Onsite Global Logistics is a third party logistics provider 3PL helping companies with innovative global logistics and supply chain solutions
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