Cross-Docking in D365 Supply Chain Management


If you run a warehouse with just-in-time fulfillment strategies and not using cross-docking, you create significant receiving inefficiencies for your warehouse teams and your business.

Cross-docking is a logistics strategy that moves inbound products, or production items, to outbound staging areas with no storage in between.

This order fulfillment strategy makes your warehouse more efficient by eliminating over processing and the unnecessary movement of goods around your warehouse. When implemented correctly, products move seamlessly from the inbound truck to an outbound truck for customer delivery.

D365 Supply Chain Management helps you manage cross-docking to ensure you’re accurately tracking products, orders, and shipments.

Cross docking is ideal for customized products that fulfill a single order as well as manufactures that need to ship finished products from the production lines.

In D365, Cross-docking does require planning. It doesn’t see that you have inbound product that will fulfill demand automatically. Here’s how to make sure you properly pan cross-docking in D365.  

Planning Cross-Docking in D365

Managing cross-docking in D365 takes some planning and configuration, but the flexibility you may think you’re losing in preparation is rewarded with the ability to track the cross-docked goods.

In D365, you must identify which demand (or sales order) will be fulfilled through cross-docking. When the supply (or purchase order) arrives at the warehouse, the receiving teams execute inbound receiving work. With cross-docking configured, work will direct them to put-away at either the outbound shipping or staging locations.

The Planned cross docking form displays the planned cross-docking work/orders.

Planned Cross Docking

On the Load line, Planned cross docking quantity displays the quantity of the Load line that will be cross-docked.

Load Lines

Initiating Cross-Docking in D365

There are three ways you can setup cross-docking in D365.

Note: The additional configuration of Location directives and Work templates are required for cross-docking to work.


Marking links the demand to the supply before release. Inventory on the purchase order is marked to the inventory on the sales order. If there is no marking, cross-docking is not triggered.

Marking is the most stringent cross-docking requirement; it requires that an association between the supply and demand order lines is created, which is called “Marking”. Marking can be created several ways in D365, one way to do this would be to create a Purchase order from a Sales order. This creates a “marked transaction” that associates the supply to the demand.

When to use marking

You’re receiving custom inventory, like personalized clothing or custom kitchen cabinets, that is for a specific outbound order. This inventory cannot be used for another order.

Order Reservation

Order Reservation requires order demand to be reserved against the supply prior to release. The sales inventory is reserved against the purchase order inventory, but it’s not marked.

When to use order reservation

You’re receiving inventory to fulfill immediate demand but the products are flexible enough so they could be used in the future. An example could include a specific shirt color/size.


None supports cross-docking where the demand looks for any incoming supply that could fulfill the demand. There is no link between the supply and demand orders.

When to use none

The sales order includes items that you order consistently and could be used interchangeably on any order. There is nothing atypical about the inbound product and cross-docking would make your processes more efficient. Examples for this type of product would be, filling napkin and disposable tableware for restaurants.  

Cross-Docking in D365 Supply Chain Management

Cross-docking in D365 Supply Chain Management gives you the options to quickly transfer products in your warehouse without losing tracking capabilities.

Additional resources to help you improve your logistics capabilities with D365 Supply Chain Management include:

System Directed Picking with D365

Cycle Count Plans in D365

Inbound Inventory Quality with D365

How to Set Work Header Breaks in D365 

Cluster Picking with D365

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