Glossary of Terms
Logistics and Supply Chain Management Glossary of Terms
3rd Party Logistics (3PL): A company that provides logistics services to customers who outsource part of, or all of, their supply chain management functions (i.e. transportation, warehousing, freight forwarding, distribution, cross docking, packaging, etc.).
Accounts Payable (AP or A/P): An accounting entry that represents an entity's obligation to pay off a short-term debt to its creditors. The accounts payable entry is found on a balance sheet under the heading current liabilities.
Accounts Receivable (AR or A/R): Money owed by customers (individuals or corporations) to another entity in exchange for goods or services that have been delivered or used, but not yet paid for. Receivables usually come in the form of operating lines of credit and are usually due within a relatively short time period, ranging from a few days to a year.
Advance Commercial Information (ACI): The ACI program is about providing CBSA officers with electronic pre-arrival information so that they are equipped with the right information at the right time to identify health, safety and security threats related to commercial goods before the goods arrive in Canada.
Advance Shipment Notice (ASN): A document transmitted (by courier, fax, or email) to a consignee in advance of delivery detailing the contents and particulars of a shipment. The particulars may include such items as shipment date, method of transport, carrier, expected date and time of arrival and a full listing of contents.
Air Cargo: Goods/cargo transported, or to be transported, by an air carrier.
Air Carrier: An organization transporting passengers and/or cargo by aircraft.
Air Freight Forwarder: A freight forwarder for shipments by air. Air freight forwarders serve a dual role. The air freight forwarders are, to the shipper, an indirect carrier because they receive freight from various shippers under one tariff, usually consolidating the goods into a larger unit, which is then tendered to an airline. To the airlines, the air freight forwarder is a shipper. An air freight forwarder is ordinarily classed as an indirect air carrier; however, many air freight forwarders operate their own aircraft.
Air Waybill (AWB): A shipping document used by the airlines for air freight. It is a contract for carriage that includes carrier conditions of carriage including such items as limits of liability and claims procedures. The air waybill also contains shipping instructions to airlines, a description of the commodity and applicable transportation charges. Air waybills are used by many truckers as through documents for coordinated air/truck service.
Automated Commercial Environment (ACE): The Automated Commercial Environment (ACE) is the U.S. Customs and Border Protection (CBP) commercial trade processing system designed to automate border processing, to enhance border security and foster our Nation's economic security through lawful international trade and travel.
Automated Commercial System (ACS): The comprehensive system used by U.S. Customs and Border Protection to track, control, and process all commercial goods imported into the United States. Through the use of Electronic Data Interchange (EDI), ACS facilitates merchandise processing, significantly cuts costs, and reduces paperwork requirements for both Customs and the importing community.
Automated Export System (AES): The system used by U.S. exporters to electronically declare their international exports, known as Electronic Export Information (EEI), to the Census Bureau to help compile U.S. export and trade statistics. This information is also shared with the Bureau of Industry and Security, the Directorate of Defense Trade Controls, and other federal agencies involved in monitoring and validating U.S. exports. Formerly, this declaration was only made on paper on the Shipper's Export Declaration form.
Automated Manifest System (AMS): The Automated Manifest System (AMS) handles manifest information provided by the carrier (rather than the importer) and notifies the carrier when the merchandise can be transported from the port of entry.
Barcode: A barcode is an optical machine-readable representation of data relating to the object to which it is attached.
Barcode Scanner: An electronic device for reading printed barcodes.
Batch Optimization: With batch optimization, orders and their associated pick-up/delivery date and times are either known in advance through master routes and/or placed throughout the day in dynamic environments. Typically route planning for the next day is then done by sending all the work in batch to the route optimization system.
Batch Processing: Executing a series of non-interactive jobs all at one time.
Bill of Lading (BOL): A legal document between the shipper of a particular good and the carrier detailing the type, quantity and destination of the good being carried. The bill of lading also serves as a receipt of shipment when the good is delivered to the predetermined destination. This document must accompany the shipped goods, no matter the form of transportation, and must be signed by an authorized representative from the carrier, shipper and receiver.
Bonded Carrier: a) a carrier licensed to transport goods in bond. b) A carrier, licensed by the customs authority of a country to transport imported goods past the customs border of the country to another customs office in the same country where duties and taxes are then paid by the importer.
Bonded Warehouse: A Customs bonded warehouse is a building, or other secured area, in which imported dutiable merchandise may be stored, manipulated, or undergo manufacturing operations without payment of duty for up to 5 years from the date of importation.
Booking: The act of recording arrangements for the movement of goods by vessel.
Booking Number: The number assigned to a certain space reservation by the carrier or the carrier's agent.
Broker: A company that arranges for the truck transportation of cargo belonging to others, utilizing for-hire carriers to provide the actual truck transportation. However, the Broker does not assume responsibility for the cargo and usually does not take possession of the cargo.
Brokerage: A business whose main responsibility is to be an intermediary that puts buyers and sellers together in order to facilitate a transaction. Brokerage companies are compensated via commission after the transaction has been successfully completed.
Bundling: A marketing strategy that involves offering several products for sale as one combined product.
Canada Border Services Agency (CBSA): The Canada Border Services Agency (CBSA) ensures the security and prosperity of Canada by managing the access of people and goods to and from Canada.
Cargo: Goods or produce transported by ship, aircraft, or other intermodal vehicles such as trains, vans or trucks.
Carrier: A person, business, or organization, that deals in the transport of passengers or goods.
Carrier Liability: Air and ocean carriers are normally liable for all damage, delay, and loss of cargo except those arising from act of God, act of the shipper, and inherent nature of the goods from acceptance of cargo through its delivery or release. Air carriers are usually liable under Warsaw convention, and ocean carriers under Hague convention.
Certificate of Origin (COO or C/O): A document attesting to the country of origin of goods. A certificate of origin is often required by the customs authorities of a country as part of the entry process. A certificate of origin may be required even though the commercial invoice contains the information.
Claim: A legal demand by a shipper or consignee to a carrier for financial reimbursement for a loss or damage of a shipment.
Commercial Invoice (C/I or CI): A commercial invoice is a document used in foreign trade. It is used as a customs declaration provided by the person or corporation that is exporting an item across international borders. Although there is no standard format, the document must include a few specific pieces of information such as the parties involved in the shipping transaction, the goods being transported, the country of manufacture, and the Harmonized Tariff System codes for those goods. A commercial invoice must also include a statement certifying that the invoice is true, and a signature.
Commodity: A basic good used in commerce that is interchangeable with other commodities of the same type. Commodities are most often used as inputs in the production of other goods or services. The quality of a given commodity may differ slightly, but it is essentially uniform across producers.
Commodity Code: A system for identifying a given commodity by a number in order to establish its commodity rate in freight transport.
Consignee: The person or firm named in a freight contract to whom goods have been shipped or turned over for care.
Consignment: The act of consigning, which is placing any material in the hands of another, but retaining ownership until the goods are sold or person is transferred.
Consignor: The individual, company or entity that ships goods, or gives goods to another for care. The consignor is usually the exporter or his agent.
Consolidation: Cargo shipping method in which a freight forwarder at the port of origin combines several individual consignments to make up a full container load. This arrangement allows the goods to be shipped as containerized-cargo that offers greater security at lower shipping rates. At the port of destination, the consolidated shipment is separated (deconsolidated or ungrouped) back into the original individual consignments for delivery to their respective consignees.
Container Freight Station (CFS): A carrier-designated facility at which (export) less than container load (LCL) cargo is received from consignors for consolidation and loading into containers or at which (import) LCL cargo is unloaded from containers and delivered to consignees.
Cross docking: The immediate transfer of cargo from one transport vehicle to another, eliminating the intervening steps of receiving and shipping, thus facilitating the flow of product and reducing costs.
[U.S.] Customs and Border Protection (CBP): One of the Department of Homeland Security’s largest and most complex components, with a priority mission of keeping terrorists and their weapons out of the U.S. It also has a responsibility for securing the border and facilitating lawful international trade and travel while enforcing hundreds of U.S. laws and regulations, including immigration and drug laws.
Customs Brokerage: A profession that involves the "clearing" of goods through customs barriers for importers and exporters (usually businesses). This involves the preparation of documents and/or electronic submissions, the calculation and payment of taxes, duties and excises, and facilitating communication between government authorities and importers and exporters.
Customs Clearance: The documented permission to pass that a national customs authority grants to imported goods so that they can enter the country or to exported goods so that they can leave the country. The custom clearance is typically given to a shipping agent to prove that all applicable customs duties have been paid and the shipment has been approved.
Customs Declaration: An oral or written statement attesting to the correctness of description, quantity, value, etc., of merchandise offered for importation into the United States.
Customs Duty: A tariff or tax imposed on goods when transported across international borders. The purpose of Customs Duty is to protect each country's economy, residents, jobs, environment, etc., by controlling the flow of goods, especially restrictive and prohibited goods, into and out of the country.
Customs Self Assessment (CSA) Program [Canada]: Is designed for low-risk, pre-approved importers, carriers and registered drivers. To take advantage of the program, CSA-approved importers and carriers must use a registered driver to carry CSA-eligible goods into Canada in the highway mode. The CSA program simplifies many of the import border requirements so that low-risk shipments can be processed more quickly and efficiently at the border, saving businesses time and money.
Customs-Trade Partnership Against Terrorism (C-TPAT): “Begun in November 2001, C‐TPAT seeks to safeguard the world's vibrant trade industry from terrorists, maintaining the economic health of the U.S. and its neighbours. The partnership develops and adopts measures that add security but do not have a chilling effect on trade, a difficult balancing act.
Dangerous Goods: Solids, liquids, or gases that can harm people, other living organisms, property, or the environment. They are often subject to chemical regulations. Dangerous goods include materials that are radioactive, flammable, explosive, corrosive, oxidizing, asphyxiating, bio hazardous, toxic, pathogenic, or allergenic. Also included are physical conditions such as compressed gases and liquids or hot materials, including all goods containing such materials or chemicals, or may have other characteristics that render them hazardous in specific circumstances. (Also referred to as Hazardous Materials)
Declared Value: The value of goods declared to the carrier by the shipper for the purposes of determining charges, or of establishing the limit of the carrier’s liability for loss, damage, or delay.
Demurrage: a) The detention of a freight car or ship by the shipper beyond time permitted (grace period) for loading or unloading; b) The extra charges a shipper pays for detaining a freight car or ship beyond time permitted for loading or unloading.
Denied Parties List (DPL): A list of individuals and entities that have been denied export privileges. Any dealings with a party on this list that would violate the terms of its denial order are prohibited.
[U.S.] Department of Defense (DOD): The Department of Defense provides the military forces needed to deter war, and to protect the security of the United States.
[U.S.] Department of Homeland Security (DHS): Formed in 2002 from the combination of 22 departments and agencies, the Department of Homeland Security works to improve the security of the United States. The Department's work includes customs, border, and immigration enforcement; emergency response to natural and manmade disasters; antiterrorism work; and cyber security.
[U.S.] Department of Transportation (DOT): The Department of Transportation is responsible for planning and coordinating federal transportation projects. It also sets safety regulations for all major modes of transportation.
Dispatch: A procedure for assigning workers or vehicles to customers. With vehicle dispatching, clients are matched to vehicles according to the order in which clients called and the proximity of vehicles to each client's pick-up location.
Distribution Center (DC): A warehouse or other specialized building, often with refrigeration or air conditioning, which is stocked with products (goods) to be redistributed to retailers, to wholesalers, or directly to consumers. A distribution center is a principal part, the order processing element, of the entire order fulfillment process.
Distributor: A person or company that supplies stores or businesses with goods.
Drayage: The transportation of goods over short distances, often as part of a longer overall move and is typically completed in a single work shift. Some research defines it specifically as "a truck pickup from or delivery to a seaport, border point, inland port, or intermodal terminal with both the trip origin and destination in the same urban area.
Drop Shipment: A shipment of goods from a manufacturer directly to a dealer or consumer, avoiding shipment to the wholesaler (drop shipper). The wholesaler, however, is compensated for taking the order.
Duty: (Customs) Duty is a tariff or tax imposed on goods when transported across international borders. The purpose of Customs Duty is to protect each country's economy, residents, jobs, environment, etc., by controlling the flow of goods, especially restrictive and prohibited goods, into and out of the country.
Duty Free Zone: “Bounded and bonded area where foreign merchandise is brought in without import duties, for further processing or re-exporting. Import-duty must be paid on these goods if they are released in the local market.
e-commerce: A type of industry where the buying and selling of products or services is conducted over electronic systems such as the Internet and other computer networks. Electronic commerce draws on technologies such as mobile commerce, electronic funds transfer, supply chain management, Internet marketing, online transaction processing, electronic data interchange (EDI), inventory management systems, and automated data collection systems.
Electronic Data Interchange (EDI): a) The transfer of structured data, by agreed message standards, from one computer application to another by electronic means and with a minimum of human intervention; b) The electronic exchange of documents between businesses and organizations, or between businesses and government agencies.
Electronic Data Interchange for Administration, commerce, and Transport (EDIFACT): The United Nations' EDI standard.
Electronic Funds Transfer (EFT): Is the electronic exchange, transfer of money from one account to another, either within a single financial institution or across multiple institutions, through computer-based systems.
European Free Trade Association (EFTA): An intergovernmental organization set up for the promotion of free trade and economic integration to the benefit of its four Member States: Iceland, Liechtenstein, Norway and Switzerland. The Association manages the EFTA Convention; EFTA’s worldwide network of free trade and partnership agreements, and the European Economic Area (EEA) Agreement.
Export: A function of international trade whereby goods produced in one country are shipped to another country for future sale or trade.
Export Control Classification Number (ECCN): A key in determining whether an export license is needed from the Department of Commerce is finding out if the item you intend to export has a specific Export Control Classification Number (ECCN). ECCNs are five character alpha-numeric designations used on the Commerce Control List (CCL) to identify dual-use items for export control purposes.
Exporter Identification Number: An identification number given to good exporters in the United States. The identification number is required to be displayed on all shipments and is shown on the Shipper's Export Declaration.
Flatbed: A type of trailer on a truck that consists of a floor and no sides or roof.
Foreign Trade Zone: Foreign-Trade Zones (FTZ) are secure areas under U.S. Customs and Border Protection (CBP) supervision that are generally considered outside CBP territory upon activation. Located in or near CBP ports of entry, they are the United States’ version of what are known internationally as free-trade zones.
Free Trade Zone (FTZ): A free trade zone (FTZ) or export processing zone (EPZ), also called foreign-trade zone, formerly free port, is an area within which goods may be landed, handled, manufactured or reconfigured, and re-exported without the intervention of the customs authorities. Only when the goods are moved to consumers within the country in which the zone is located do they become subject to the prevailing customs duties.
Freight Forwarder (FF): A freight forwarder, forwarder, or forwarding agent, is a person or company that organizes shipments for individuals or corporations to get goods from the manufacturer or producer to a market, customer or final point of distribution. Forwarders contract with a carrier to move the goods. A forwarder does not move the goods but acts as an expert in supply chain management.
Fulfillment: Is the term used to describe the complete process used by a company from the point of sale onward to the delivery of a product to a customer.
Fulfillment House: A company that specializes in product fulfillment services, on behalf of the product owner.
Full Container Load (FCL): A shipment of cargo that fills a given container either by bulk or maximum weight.
Gateway: Point at which freight moving from one territory to another is interchanged between transportation lines.
Global Positioning System (GPS): The Global Positioning System (GPS) is a space-based satellite navigation system that provides location and time information in all weather conditions, anywhere on or near the Earth where there is an unobstructed line of sight to four or more GPS satellites.
Global Trade Management: The total optimization of the end-to-end international Supply-Chain, from product conception to final delivery — with focus on the integration of key cross-border regulatory, strategic and system components — to ensure a seamless, secure, and cost-effective flow of goods, data and payments, across international borders.
Goods and Service Tax (GST): [Canada] A value-added tax levied on most goods and services sold for domestic consumption. The tax is levied in order to provide revenue for the federal government. The Goods and Services Tax is paid by consumers, but it is levied and remitted to the government by businesses.
Handling Costs: Costs related to moving, transferring, or preparing inventory for shipment, but not the shipping charges themselves.
Harmonized Sales Tax (HST): [Canada] A consumption tax in Canada. It is used in provinces where both the federal Goods and Services Tax (GST) and the regional Provincial Sales Tax (PST) have been combined into a single value added sales tax.
Harmonized System/Harmonized Schedule (HS): An internationally standardized system of names and numbers for classifying traded products developed and maintained by the World Customs Organization (WCO).
Hazardous Materials: Solids, liquids, or gases that can harm people, other living organisms, property, or the environment. They are often subject to chemical regulations. Hazardous Materials include materials that are radioactive, flammable, explosive, corrosive, oxidizing, asphyxiating, bio hazardous, toxic, pathogenic, or allergenic. Also included are physical conditions such as compressed gases and liquids or hot materials, including all goods containing such materials or chemicals, or may have other characteristics that render them hazardous in specific circumstances.
Import: A good brought into a jurisdiction, especially across a national border, from an external source. The purchaser of the exotic good is called an importer.
Import Duty: A tax collected on imports and some exports by the customs authorities of a country.
Importer Security Filing (ISF): Under the new rule, before merchandise arriving by vessel can be imported into the United States, the 'Importer Security Filing (ISF) Importer,' or their agent (e.g., licensed customs broker), must electronically submit certain advance cargo information to U.S. Customs and Border Protection (CBP) in the form of an Importer Security Filing. This requirement only applies to cargo arriving in the United States by ocean vessel; it does not apply to cargo arriving by other modes of transportation.
In Bond: [U.S.] A procedure under which goods are transported or warehoused under customs supervision until they are either formally entered into the customs territory of the United States and duties paid, or until they are exported from the United States.
Inbound Logistics: The entire process of planning, acquiring and controlling the flow of raw materials, components, parts, sub-assemblies and components from outside sources (vendors, suppliers, and subsidiaries) into a production process. Inbound logistics can occur directly from the outside supplier to the production floor or indirectly through intermediate storage facilities.
Intermodal Transport: The coordinated transport of freight, especially in connection with relatively long-haul movements using any combination of freight forwarders, piggyback, containerization, air freight, ocean freight, assemblers, or motor carriers.
International Commercial Terms (Incoterms): The Incoterms rules are an internationally recognized standard and are used worldwide in international and domestic contracts for the sale of goods. First published in 1936, Incoterms rules provide internationally accepted definitions and rules of interpretation for most common commercial terms. The rules have been developed and maintained by experts and practitioners brought together by the International Chamber of Commerce (ICC) and have become the standard in international business rules setting.
Invoice: A commercial document issued by a seller to a buyer, relating to a sale transaction and indicating the products, quantities, and agreed prices for products or services the seller has provided the buyer. Payment terms are usually stated on the invoice.
Just in Time (JIT): An inventory strategy companies employ to increase efficiency and decrease waste by receiving goods only as they are needed in the production process, thereby reducing inventory costs. This method requires that producers are able to accurately forecast demand.
Key Performance Indicators (KPI): A type of performance measurement. An organization may use KPIs to evaluate its success, or to evaluate the success of a particular activity in which it is engaged.
Kitting: The assembly or packaging of components, parts or finished products into a new single item. This light assembly operation is sometimes performed in foreign trade zones or special economic zones. The term refers to the making of a kit (collection of items).
Landed Cost: The total cost of a landed shipment including purchase price, freight, insurance, and other costs up to the port of destination. In some instances, it may also include the customs duties and other taxes levied on the shipment.
Last Mile: Transporting goods via freight rail networks and container ships is often the most efficient and cost-effective manner of shipping. However, when goods arrive at a high-capacity freight station or port, they must then be transported to their final destination. This last leg of the supply chain is often less efficient, comprising up to 28% of the total cost to move goods. This has become known as the last-mile problem. The last-mile problem can also include the challenge of making deliveries in urban areas where retail stores, restaurants, and other merchants in a central business district often contribute to congestion and safety problems.
Leg: The part of a transportation route that is between two successive stops, positions, or changes in direction or carriers.
Less-than-Container Load (LCL): A shipment that is not large enough to fill a standard cargo container.
Less-than Truckload (LTL): The transportation of relatively small freight. The alternatives to LTL carriers are parcel carriers or full truckload carriers.
Letter of Credit (LOC): A letter from a bank guaranteeing that a buyer's payment to a seller will be received on time and for the correct amount. In the event that the buyer is unable to make payment on the purchase, the bank will be required to cover the full or remaining amount of the purchase.
Logistics: The process of planning, implementing and controlling the flow of raw materials, work in progress or finished products from the point of origin to the point of destination (either to a factory for further processing, to a warehouse for storage or to the marketplace for sale) at the required time and in the desired condition.
Manifest: A document giving the description of a ship’s cargo or the contents of a car or truck.
Master Air Waybill (MAWB): An air waybill of lading that covers a consolidated shipment of goods and lists the consolidator as the shipper.
Memorandum of Understanding (MOU): A document describing a bilateral or multilateral agreement between two or more parties. It expresses a convergence of will between the parties, indicating an intended common line of action. It is often used in cases where parties either do not imply a legal commitment or in situations where the parties cannot create a legally enforceable agreement.
Multimodal: The transportation of goods under a single contract, but performed with at least two different means of transport; the carrier is liable (in a legal sense) for the entire carriage, even though it is performed by several different modes of transport (i.e. air, rail, sea, or road/land).
North American Free Trade Agreement (NAFTA): A free trade agreement that comprises Canada, the U.S. and Mexico. The objectives of the Agreement are to eliminate barriers to trade, promote conditions of fair competition, increase investment opportunities, provide protection for intellectual property rights and establish procedures for the resolution of disputes.
Ocean Bill of Lading (OBL): A document required for the transportation of goods overseas. An ocean bill of lading serves as both the carrier's receipt to the shipper and as a collection document. The document specifies the details of the goods being transported, such as quantity, type and destination.
Order Management System (OMS): A computer software system used in a number of industries for order entry and processing.
Original Equipment Manufacturer (OEM): a) The original definition: a company whose products are used as components in another company's product. The OEM will generally work closely with the company that sells the finished product (often called a "value-added reseller" or VAR) and customize the designs based on the VAR's needs; b) The more recent definition: a company that buys a product and incorporates or re-brands it into a new product under its own name.
Outbound Logistics: The entire process of planning and controlling the flow of products form the end of a production line to the end user. This includes both transportation and intermediate storage.
Packing List: A shipping document that accompanies delivery packages, usually inside an attached shipping pouch, or inside the package itself. It commonly includes an itemized detail of the package contents and does not include customer pricing. It serves to inform all parties, including transport agencies, government authorities, and customers, about the contents of the package.
Pallet: A flat transport structure that supports goods in a stable fashion while being lifted by a forklift, pallet jack, front loader, work saver or other jacking device. A pallet is the structural foundation of a unit load, which allows handling and storage efficiencies. Goods or shipping containers are often placed on a pallet secured with strapping, stretch wrap or shrink wrap and shipped.
Point of Purchase (POP): A place where sales are made. On a macro-level, a point of purchase may be a mall, market or city. On a micro-level, retailers consider a point of purchase to be the area surrounding the counter where customers pay.
Point of Sale (POS): A place where a retail transaction is completed. It is the point at which a customer makes a payment to the merchant in exchange for goods or services. At the point of sale the retailer would calculate the amount owed by the customer and provide options for the customer to make payment.
Port of Entry (POE): a) The port at which passengers or cargo enter the administrative or customs territory of a country; b) An officially designated port where a vessel may enter a country’s territory and discharge passengers and cargo; c) A port where the administrative functions of immigration and customs are handled.
Port of Export: The port, airport or customs point from which an export shipment leaves a country for a voyage to a foreign country.
Prepaid Freight: The freight charge is either included in the price of the product or being paid by the shipper.
Proof of Delivery (POD): Information provided to payor containing name of person who signed for the package with the date and time of delivery.
Purchase Order (PO): A commercial document and first official offer issued by a buyer to a seller, indicating types, quantities, and agreed prices for products or services the seller will provide to the buyer. Sending a purchase order to a supplier constitutes a legal offer to buy products or services. Acceptance of a purchase order by a seller usually forms a contract between the buyer and seller, so no contract exists until the purchase order is accepted. It is used to control the purchasing of products and services from external suppliers.
Quality Assurance (QA): A program for the systematic monitoring and evaluation of the various aspects of a project, service, or facility to ensure that standards of quality are being met.
Quality Control (QC): A process by which entities review the quality of all factors involved in production.
Quality Management (QM): The act of overseeing all activities and tasks needed to maintain a desired level of excellence. This includes creating and implementing quality planning and assurance, as well as quality control and quality improvement. It is also referred to as total quality management (TQM).
Radio Frequency Identification (RFID): A small integrated circuit (microprocessor) connected to an antenna, which can respond to an interrogating radio frequency (RF) signal with simple identifying information, or with more complex information depending on the size and complexity of the integrated circuit. Unlike barcodes which assign a number to a product or package, RFID tags attach a unique electronic code to each product, carton of products, pallet or shipping container.
Real-time Visibility: The viewing of data/information in a business application as it happens - as contrasted with storing data for input at a later time (batch processing).
Receiving: The function encompassing the physical receipt of material, the inspection of the shipment for conformance with the purchase order (quantity and damage), the identification and delivery to destination, and the preparation of receiving reports.
Reefer: A Reefer or Refrigerated Container is an intermodal container (shipping container) used in intermodal freight transport that is refrigerated for the transportation of temperature-sensitive cargo.
Refrigerated Container: A Refrigerated Container or Reefer is an intermodal container (shipping container) used in intermodal freight transport that is refrigerated for the transportation of temperature-sensitive cargo.
Return on Investment (ROI): A performance measure used to evaluate the efficiency of an investment or to compare the efficiency of a number of different investments.
Reverse Logistics: The act of, and management systems associated with, the recovery of discarded products and packaging from the end user. Reverse logistics is based upon a heightened environmental consciousness, public policy and law. The concept is that reusable packaging, as well as out-dated, damaged or defective products, can best be recycled or reused by the original manufacturer.
Scan: A computer term referring to the action of scanning bar codes or RF tags.
Seal Number: A number located on the plastic or metal tamper seal or tag affixed to a loaded container or truck. Seals and seal numbers are not reused. A new seal and therefore a new seal number are used each time a container or truck is sealed.
Service Level Agreement (SLA): A part of a service contract where a service is formally defined. In practice, the term SLA is sometimes used to refer to the contracted delivery time (of the service or performance).
Shipment: Except as otherwise provided, cargo tendered by one shipper, on one bill of lading, from one point of departure, for one consignee, to one destination, at one time, via a single port of discharge.
Shipper: Someone who sends goods for shipment, by packaging, labeling, and arranging for transit, or who coordinates the transport of goods.
Shipper's Export Declaration (SED): A form required by the export authorities of many countries to document an export of goods. The form is prepared by a shipper indicating the value, weight, destination, and other basic information about the shipment. The shipper’s export declaration is used to control exports and compile trade statistics.
Shipper's Letter of Instruction (SLI): A form used by a shipper to authorize a carrier to issue a bill of lading or an air waybill on the shipper’s behalf. The form contains all the details of the shipment and authorizes the carrier to sign the bill of lading in the name of the shipper.
Shipping Lane: In general transportation, the logical route between the point of shipment and the point of delivery.
Skid: A type of pallet, a metal, wood or plastic platform for holding machinery or equipment. Some pallets have planks across the bottom level, flush with the floor, but a skid has no planks along the full length or width to form a bottom level on the floor.
Stock Keeping Unit (SKU): A store's or catalogue’s product and service identification code, often portrayed as a machine-readable bar code that helps the item to be tracked for inventory.
Supply Chain Management (SCM): The processes of creating and fulfilling demands for goods and services. It encompasses a trading partner community engaged in the common goal of satisfying end customers.
Tariff: A comprehensive list of ‘schedule’ of merchandise with applicable rates to be paid or charged for each listed article. (Customs) A schedule of duties or taxes assessed by a government on goods as they enter (or leave) a country. (Shipping) A schedule of shipping rates charged, together with governing rules and regulations. A tariff sets forth a contract of carriage for the shipper, the consignee, and the carrier. Individual carriers also publish their own tariffs covering special services.
Traceability: The ability to trace the history, application or location of that which is under consideration (ISO 9001).
Tracking: A carrier’s system of recording movement intervals of shipments from origin to destination.
Trading Partner: Companies that do business with each other via EDI (e.g., send and receive business documents such as purchase orders).
Trading Partner Agreement: An agreement drawn up by two parties that have agreed to trade certain items or information to each other. The agreement outlines the terms of the trade or trading process, such as compensation for the shorted party in an inequitable trade.
Transit Time: The total time that elapses between a shipment's pickup and delivery.
Transportation Planning: The process of defining an integrated supply chain transportation plan and maintaining the information, which characterizes total supply chain transportation requirements, and the management of transporters, both inter- and intra- company.
Transportation Security Administration (TSA): Following September 11, 2001, the Transportation Security Administration (TSA) was created to strengthen the security of the nation’s transportation systems and ensure the freedom of movement for people and commerce. Today, TSA secures the nation’s airports and screens all commercial airline passengers and baggage. TSA uses a risk-based strategy and works closely with transportation, law enforcement and intelligence communities to set the standard for excellence in transportation security.
Transportation Management System (TMS): Used to plan freight movements, do freight rating and shopping across all modes, select the appropriate route and carrier, and manage freight bills and payments.
Truckload (TL): A shipment of cargo that fills a given truck either by bulk or maximum weight.
Twenty-Foot Equivalent Unit (TEU): a) standard 20-foot international ocean shipping container; b) A measure of a shipping container’s capacity using a standard 20-foot international ocean shipping container as a measuring unit.
U.S. Customs and Border Protection (CBP): One of the Department of Homeland Security’s largest and most complex components, with a priority mission of keeping terrorists and their weapons out of the U.S. It also has a responsibility for securing the border and facilitating lawful international trade and travel while enforcing hundreds of U.S. laws and regulations, including immigration and drug laws.
U.S. Department of Defense (DOD): The Department of Defense provides the military forces needed to deter war, and to protect the security of the United States.
U.S. Department of Homeland Security (DHS): Formed in 2002 from the combination of 22 departments and agencies, the Department of Homeland Security works to improve the security of the United States. The Department's work includes customs, border, and immigration enforcement; emergency response to natural and manmade disasters; antiterrorism work; and cyber security.
U.S. Department of Transportation (DOT): The Department of Transportation is responsible for planning and coordinating federal transportation projects. It also sets safety regulations for all major modes of transportation.
Value-Added Network (VAN): A private network provider hired by a company to facilitate electronic data interchange (EDI) and/or provide other network services such as message encryption, secure email and management reporting. A Value-Added Network (VAN) simplifies the communications process by reducing the number of parties with which a company needs to communicate. The VAN accomplishes this by acting as an intermediary between business partners that share standards based or proprietary data.
Value-Added Tax (VAT): The Value Added Tax, or VAT, in the European Union (EU) is a general, broadly based consumption tax assessed on the value added to goods and services. It applies more or less to all goods and services that are bought and sold for use or consumption in the Community.
Visibility: The ability to access or view pertinent data or information as it relates to logistics and the supply chain, regardless of the point in the chain where the data exists.
Warehouse Management System (WMS): A key part of the supply chain and primarily aims to control the movement and storage of materials within a warehouse and process the associated transactions, including shipping, receiving, put away and picking.
Waybill: A document issued by a carrier giving details and instructions relating to the shipment of a consignment of goods. Typically it will show the names of the consignor and consignee, the point of origin of the consignment, its destination, and route. Most freight forwarders and trucking companies use an in-house waybill called a house bill. These typically contain "conditions of contract of carriage" terms on the back of the form. These terms cover limits to liability and other terms and conditions.
World Customs Organization (WCO): Since 1952, the World Customs Organization (WCO), formally known by international convention as the Customs Co-operation Council (CCC), has provided leadership in expanding the avenues of international trade and security. The organization's successes include work in areas covering the development of global standards, the simplification and harmonization of Customs procedures, trade supply chain security, the facilitation of international trade, the enhancement of Customs enforcement and compliance activities, anti-counterfeiting and piracy initiatives, public-private partnerships, integrity promotion, and sustainable global Customs capacity building activities.
World Trade Organization (WTO): The World Trade Organization (WTO) is the only global international organization dealing with the rules of trade between nations. At its heart are the WTO agreements, negotiated and signed by the bulk of the world’s trading nations and ratified in their parliaments. The goal is to help producers of goods and services, exporters, and importers conduct their business.
Zone Picking: A method of order picking that involves dividing stock-keeping units (SKUs) into a series of different zones with each warehouse employee trained to pick within an assigned zone. An order may be moved down a conveying system from zone to zone to have items added. The goal is to create greater speed in the picking process. It also allows specialization based on skill level.
1. Wikipedia, Investopedia, Dictionary.com, Dictionary of International Trade, Merriam-Webster
2. Transportation Security Administration (TSA)
3. U.S. Customs and Border Protection (CBP)
4. Canada Border Services Agency (CBSA)
6. U.S. Department of Commerce
7. USA Government
8. U.S. Department of Transportation
Last modified: 15.01.2015