What is consolidation?
Consolidation as a process is used in logistics when goods and shipments are bundled or reorganized. The aim behind this process is always to make both the transportation and storage of these goods as uniform as possible. This should save costs and time and increase efficiency.
In transportation, consolidation means combining several individual loads into one groupage load. The shipments of several customers are therefore packed together on one truck and treated as a single shipment.
Consolidation can provide a number of advantages:
- Lower operating costs
- Better service quality
- Better utilization of space (during transport and in the warehouse)
What is the difference between consolidation and order picking?
In warehouse logistics, the grouping of different parts is called order picking. It differs from consolidation, however, because the aim here is not to standardize, but to put together a shipment precisely according to customer requirements.