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Pool distribution has been around for 30 years or so but has not been high on most logistics priority lists. Time to take another look? Pool distribution, the practice of distributing freight from multiple shippers from distribution centers to store locations using a network of specialized truckers, is not new. Nor is it generally on many logistics radar screens. But with brick-and-mortar retailers continually challenged to cut costs and improve store service, the potential value of pool distribution might be worth a closer look. The model is as elementary as it is somewhat long in the tooth: Specialty retailers, companies that hold all their stock-keeping units (SKUs) in their stores as opposed to mass-market retailers that have physical store space to hold inventory, arrange for their cartons to be moved from their DCs to pool distribution points. The pool distributor receives the shipments, processes and sorts the packages based on their final destination, and then loads up trucks for deliveries to the customers’ stores within specific geographies. Because distributors “pool” a sufficient density of freight from multiple retailers to build full truckloads, each retailer achieves economies of scale it couldn’t get with less-than-truckload (LTL) or parcel service. The pooling model extends those efficiencies to regional deliveries, which benefits retailers whose store count in an individual market isn’t dense enough to justify full trailerloads. For example, by leveraging eight regional pooling nodes that each feed multiple individual markets, a specialty retailer can have national coverage at a significant discount to using other forms of transport or utilizing a private truck fleet. The pool distribution model is built around the concept of catering to the unique needs of each specialty retail customer. A pool distributor can deliver into multiple time windows. It can move merchandise in the morning and non-merchandise such […]