The definitive reference for warehousing, fulfillment, and supply chain terminology.
This glossary of warehousing, fulfillment, and logistics terminology is a curated collection of industry terms, acronyms, and abbreviations you may encounter on 3PLhub.co or while researching a third-party logistics (3PL) or fulfillment provider.
The definitions are based on our real-world experience in warehousing, order fulfillment, shipping, supply chain management, and eCommerce logistics. While we strive for accuracy, these explanations are intended to be educational and informative rather than legally definitive.
If you have suggestions, corrections, or would like clarification on any term, please contact us at hello@3PLhub.co.
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| 2D Barcode | A two-dimensional barcode that stores data in both vertical and horizontal directions, allowing for more information to be encoded compared to 1D barcodes. |
| 3D Barcode | A three-dimensional barcode that uses geometric shapes and patterns to encode data, providing even greater capacity and security than 2D barcodes. |
| 3PL (Third-Party Logistics) | An outsourced logistics provider that handles aspects of shipping, ranging from warehousing and fulfillment to freight bills and transportation. |
| 4PL (Fourth-Party Logistics) | A provider that assumes many of the same roles as 3PL providers but has a much broader role within the supply chain, overseeing and managing the entire logistics process for a company. |
| 80-20 Rule (Pareto Principle) | A principle stating that roughly 80% of effects come from 20% of causes, applied to inventory management to identify the most important items. |
A | |
| A/B Testing | A method of comparing two versions of a webpage, email, or other marketing material to determine which performs better. |
| ABC Analysis | A method of categorizing inventory based on value and importance, helping prioritize resources for high-value items. |
| ABC Inventory Control | A method of inventory control that uses ABC Analysis to manage inventory levels and ensure that high-value items are given more attention than low-value items. |
| Absolute Minimum Charge (AMC) | The minimum charge applied to a shipping order after all pricing terms have been considered. |
| Acceptable Quality Level (AQL) | The maximum number of defective items or errors that are considered acceptable in a batch of products. |
| Accessibility | The ability of carriers to provide service between an origin and destination location. |
| Accumulation Bin | A storage bin or container used to temporarily store items that are frequently used or needed in a particular area. |
| Accounts Payable (A/P) | Money owed by a company to its suppliers or vendors for goods or services received but not yet paid for. |
| Accounts Receivable (A/R) | Money owed to a company by its customers for goods or services delivered but not yet paid for. |
| Active Stock | Products stored in readily accessible areas for easy order fulfillment. |
| Actual Time of Arrival (ATA) | The time a vessel/ship/plane is determined to arrive at its destination. |
| Actual Time of Departure (ATD) | The exact time a shipment is dispatched from its origin. |
| Actual Weight | The physical weight of an item or package. (see: Scale Weight) |
| Advanced Shipping Notice (ASN) | A notification sent to a recipient (usually a large retailer) indicating an upcoming shipment's details like purchase order number, SKUs, UPC, quantity, and carton number. |
| Affiliate Marketing | A marketing arrangement where an online retailer pays commission to an external website for traffic or sales generated from its referrals. (see: eCommerce terms) |
| After-Sale Service | Support provided to customers after they have purchased a product or service, such as repairs, maintenance, or technical assistance. |
| AEO (Authorized Economic Operator) | A company or organization involved in the international movement of goods that has been approved by a national Customs administration as compliant with supply chain security standards and granted benefits such as simplified customs procedures. |
| Agile Manufacturing | A manufacturing methodology that emphasizes flexibility, collaboration, and rapid response to change. |
| Air Waybill (AWB) | A document that accompanies goods shipped by air and provides details of the shipment, including origin, destination, and carrier information. |
| Alibaba | A Chinese multinational technology company specializing in e-commerce, retail, Internet, and technology. |
| Amazon Standard Identification Number (ASIN) | A unique block of 10 letters and/or numbers that identify items on Amazon. |
| Amazon's Best Sellers Ranking (BSR) | A ranking system on Amazon that shows how well a product is selling compared to other products in its category. |
| Ambient Storage | Storage of goods at normal room temperature without needing special heating or cooling. |
| Any-Quantity (AQ) Rate | A shipping rate that applies to any quantity of goods shipped, regardless of the total weight or volume of the shipment. |
| API (Application Programming Interface) | A set of programming instructions and standards that allow different software applications to interact with each other. |
| Apparel Fulfillment | The process of picking, packing, shipping, and managing returns for apparel products, often evolving with the fashion industry. |
| Arbitrage | The practice of buying and selling the same product in different markets to take advantage of price differences. |
| Arrival Notice | A message, usually automated, notifying the appropriate party that a shipment has arrived. |
| Assemble to Order | A manufacturing strategy in which products are assembled from pre-made components or sub-assemblies, based on customer orders or demand. |
| Audit Trail | A chronological record of system activities that allows for reconstruction, review, and examination of the sequence of events surrounding or leading to each transaction from its inception to the final results. |
| Automatic Targeted Ads | Online ads that are targeted to specific audiences based on their interests, demographics, or other factors. |
| Autonomous Car | A vehicle capable of sensing its environment and navigating without human input. (Also known as: self-driving car, robot car, driverless car) |
| Available-to-Promise (ATP) | The quantity of a product that is available for sale or shipment to customers within a specific time frame. |
| Agile Supply Chain | A supply chain that is highly flexible and can quickly respond to changes in demand and supply. |
| Automated Guided Vehicle (AGV) | A mobile robot used in industrial applications to move materials around a manufacturing facility or warehouse. |
| Augmented Reality (AR) | Technology that overlays digital information on the real world, used in logistics for things like picking assistance. |
B | |
| B/L (Bill of Lading) | A detailed list of a ship's cargo. (see: BOL) |
| B2B (Business-to-Business) | Transactions where one business purchases products from another. |
| B2C (Business-to-Consumer) | Transactions where an end customer purchases products from a business. |
| B2R (Business-to-Retailer) | Transactions where a retailer purchases products from a business. |
| Backhaul | Finding freight loads for a return trip after a delivery to avoid empty travel. (See also: Fronthaul) |
| Backorder | When an order can't be fulfilled due to lack of inventory and is put on hold until new stock arrives. |
| Bale | A large compressed bundle often used to wrap goods such as hay, paper, wool, or cotton. |
| Barcode | A square or rectangular image consisting of machine-readable parallel black lines and white spaces, representing numerals and characters. Barcodes are applied to products as a means of quick identification and data retrieval. |
| Barcoding | Using optical machine-readable labels (barcodes) to represent data about products, inventory, or assets for quick scanning and retrieval. |
| Base Currency | The transaction currency assigned the value of 1 when calculating exchange rates. |
| Base Stock Method | An inventory valuation method that maintains a constant base stock level, and the cost of goods sold is based on the average cost of the units in the base stock. |
| Basing-Point Pricing | A pricing method where the seller designates a specific location as a basing point and charges all customers the same price, regardless of their distance from that point. |
| Batch Fulfillment | Fulfilling a large number of orders at the same time. (see: Batch Picking) |
| Batch Picking | Picking multiple orders at the same time, often using open boxes or carts with dividers. (see: Batch Fulfillment) |
| Batch Terminal Communications | The communication between a computer terminal and a host computer, allowing for the exchange of data and information in batches. |
| Beauty & Cosmetics Fulfillment | The process of picking, packing, shipping, and managing returns for beauty and cosmetics products, including lot tracking, expiry tracking, and potentially utilizing FEFO. |
| Benefit-Cost Ratio | A financial metric used to assess the overall value of a project or investment, calculated by dividing the total benefits by the total costs. |
| Big and Bulky | Refers to large, heavy items requiring special handling and storage. |
| Big Data | A term used to describe extremely large and complex datasets that cannot be easily analyzed using traditional data processing methods. |
| Bill of Lading (BOL) | A detailed list of a ship's cargo, or a legal document used to detail the type, quantity, and destination of goods being transported, serving as both a receipt and a contract between the shipper and the carrier. (see: B/L) |
| Bill of Materials (BOM) | A comprehensive list of the materials, components, and parts required to manufacture or repair a product, showing names, quantities, descriptions, and cost. |
| Billing Schedule | A schedule used by 3PLs to define the billing frequency for a sale over a specific time or contract term. |
| Blind Counts | Counting inventory without revealing existing quantities from the warehouse management system. |
| Blind Receiving | The process of receiving a shipment without a purchase order or invoice, requiring manual entry of details. |
| Blind Shipment | A direct shipment where the supplier's identity is hidden from the end customer. |
| Blockchain in Logistics | Using blockchain technology to improve transparency, security, and traceability in the supply chain. |
| Blockchain Technology | A decentralized ledger system that can be used to track transactions and assets in the supply chain. |
| Bonded Warehouse | A warehouse authorized by customs to store imported goods before duties or taxes are paid. |
| BOPP (Biaxially-Oriented Polypropylene) | A type of plastic film used in packaging and labeling due to its strength, clarity, and moisture resistance. |
| Box | A container used for holding goods. (See also: Carton, Case, Corrugate, Gaylord) |
| Bracing | Securing or reinforcing cargo to prevent shifting during transport. |
| Break bulk Cargo | Cargo carried in unitized forms (pallets, bags, drums, etc.) that cannot fit in standard shipping containers or cargo bins. |
| Break-bulk | When goods are transported by container ship, it is called break bulk shipping. |
| Buffer Stock | A reserve inventory of goods or materials held to prevent shortages or stockouts. |
| Bulk | Large quantities of raw materials (coal, grains) transported or stored together. Meaning can vary by industry. |
| Bulk Area | Designated area in a warehouse for storing large quantities of goods. |
| Bullwhip Effect | The amplification of demand variability as it moves upstream in the supply chain, causing issues like excess inventory and poor service. |
| Bundling | Combining multiple products or services and selling them together as a package at a discounted price. |
| Business Logistics | The process of planning, implementing, and controlling the efficient and effective flow and storage of goods, services, and related information from the point of origin to the point of consumption to meet customer requirements. |
| Business Performance Measurement (BPM) | The process of monitoring and evaluating a company's performance against predetermined goals and objectives, often using key performance indicators (KPIs). |
| Business Process Outsourcing (BPO) | The practice of contracting out non-core business activities to a third-party provider. |
| Business Process Reengineering (BPR) | The fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical measures of performance, such as cost, quality, service, and speed. |
C | |
| Cage | A secure storage area within a warehouse or distribution center for high-value or sensitive items. |
| Caged | Refers to items stored in a secure cage. |
| Capacity Requirements Planning (CRP) | A process used to determine the production capacity needed to meet demand. |
| Cargo | Merchandise being carried by a means of transportation. |
| Carrier | A company or person that legally transports goods by land, water, or air. |
| Carrier Liability | The legal responsibility of a carrier for loss or damage to goods during transit, with exceptions like acts of God or public authority. |
| Carrier Limitations | The maximum amount of money a carrier is legally liable for in case of loss or damage to cargo. |
| Cartage | The process of transporting goods over short distances, typically within a city or local area. |
| Carton | A standard quantity of items packed in a sealed corrugated box. (See also: Box, Case, Corrugate) |
| Carton Flow Rack | A type of shelving system that uses rollers or gravity to move cartons from the back to the front. |
| Case Erector | A machine that automatically forms, folds, and seals corrugated cartons. |
| Case Picking | The process of picking a product in full case or carton quantities to fill a customer order. |
| Cash Conversion Cycle | A metric that measures the time it takes for a company to convert its investments in inventory and other resources into cash flow from sales. |
| Cash-to-Cash Cycle Time | The time it takes for a company to convert cash paid for raw materials into cash received from customers. |
| Catch Weight | A method of inventory measurement used for goods that are sold by weight but may vary in weight from unit to unit. |
| Centralized Inventory Control | A system where inventory management decisions are made from a central location. |
| Certificate of Origin | A document that verifies the country of origin of goods being shipped. |
| Change Order | A written order that changes the scope, schedule, or cost of a project or contract. |
| Changeover | The process of switching a production line or machine from one product to another. |
| Channel | A method that a business distributes its products, such as a retail or distribution channel, call center, or web-based electronic storefront. |
| Channel Conflict | A situation in which different distribution channels for a product or service compete with each other, rather than complementing each other. |
| Channel Partners | Companies or individuals that work together to produce and sell a product or service. |
| Chargeable Weight | The weight used to calculate shipping charges for air and sea freight shipments. |
| Claim | A request by a customer for compensation or reimbursement for loss, damage, or delay in the delivery of goods or services. |
| Clear Height | Vertical space in a warehouse from floor to lowest obstruction. |
| Clearing and Forwarding Agent (CFA) | A government agent that deals with all the documentation related to international freight transport. |
| Click-Through-Rate (CTR) | The percentage of people who click on a link in an email or advertisement. (see: eCommerce) |
| COGS (Cost of Goods Sold) | The total cost of products sold in a specific period. |
| Co-Packer | A company that provides packaging services for other businesses. |
| Code 128 | A type of barcode often used in logistics for product identification. |
| Cold Chain | A temperature-controlled supply chain for products like pharmaceuticals and food. |
| Cold Storage | Warehouses that store products with strict temperature and/or moisture requirements. |
| Collaborative Planning, Forecasting, and Replenishment (CPFR) | A business practice where trading partners (manufacturers, suppliers, and retailers) collaborate to improve supply chain efficiency by jointly planning, forecasting, and replenishing inventory. This process aims to enhance the accuracy of demand forecasts, optimize inventory levels, and reduce supply chain costs through better coordination and sharing of information. |
| Commercial Invoice | A document created by the seller with their contact information, and information on the products being shipped such as their value for customs and insurance. |
| Commercial Shipping | Transporting goods by sea for trade and commerce. |
| Commercial Zone | Any part of a city or town containing land used for commercial activities (e.g., central business district, shopping centers). |
| Commodity Code | A code used to classify products for import/export tariffs and duties. |
| Compliance | The state of adhering to rules, policies, standards, and laws. |
| Compliance Labels | Standardized labels used for shipping and product identification. |
| Competitive Benchmarking | Comparing a company's performance to that of its competitors to identify areas for improvement. |
| Competitive Bid | A process in which multiple vendors or suppliers compete to provide goods or services at the lowest price. |
| Consignee | The end recipient of an order, scheduled to receive goods from the consignor. |
| Consignment Inventory | Inventory held by the customer but owned by the supplier. |
| Consignor | An independent owner who transfers goods to the consignee for sale on their behalf, retaining ownership until transferred or sold. |
| Consolidation | Combining multiple smaller shipments into one larger shipment to reduce shipping costs. |
| Consumer Goods | Products sold directly to consumers (clothing, food, etc.). |
| Consumer Packaged Goods (CPG) | Merchandise ready for sale to consumers. |
| Container | Large, standardized shipping containers for intermodal transport, or packaging used in shipping, such as cartons, cases, boxes, bundles, and bags. |
| Containerization | A shipment method in which goods are placed in containers and then unloaded at the destination. |
| Continuous Flow Distribution | A logistics system in which goods are continuously moved from one stage of the supply chain to the next without interruption. |
| Continuous Production Manufacturing | Like batch production, continuous production manufacturing is a process manufacturing method where the raw materials being processed are gasses, liquids, powders, or slurries, rather than solid materials. |
| Contract Manufacturing | Sourcing strategy where a company will outsource parts of their manufacturing process. |
| Contract Packaging | A strategic business arrangement in which a company outsources its packaging and other related services to a third-party provider. |
| Contract Warehouse | Type of public warehouse that provides you guaranteed storage space. These contract warehouses can also provide value-added fulfillment services. |
| Conveyor | A mechanical device used to move materials or goods from one location to another. |
| Corrugate | A type of packaging material made of corrugated fiberboard. (See also: Box, Carton, Case) |
| Costing Method | The way inventory cost is calculated (e.g., Average Cost, Standard Cost, Landed Cost). |
| Cost-Per-Click (CPC) | An online advertising model where advertisers pay each time a user clicks on their ad. |
| Cost-Per-Mille (CPM) | An online advertising model where advertisers pay per thousand impressions of their ad. |
| Counting Scale | A scale for determining inventory quantities based on weight. |
| Courier Service | A door-to-door delivery service, usually local. |
| Critical Stock | Inventory items that are essential to a company's operations and require careful management to ensure that they are always in stock. |
| Critical Success Factors (CSF) | The key elements or activities that are necessary for a company or project to achieve its goals. |
| Cross-border Fulfillment | Storing, packing, and shipping products across countries. |
| Cross-Border Logistics | The management of logistics operations that involve shipping goods across international borders. |
| Customer Order Cycle Time | The total time it takes from when a customer places an order until they receive the product. |
| Cross-docking | Directly transferring goods from inbound to outbound shipments without storage. (see: X-Docking) |
| Crowdfunding Fulfillment | The process of managing orders and shipping products for projects funded through crowdfunding platforms. |
| Crowdfunding Partner | A company that specializes in providing fulfillment and logistics services to crowdfunding campaigns. |
| Cubage | The total volume or capacity of a shipment, usually expressed in cubic feet or cubic meters. |
| Cube Out | When a container is full by volume, not weight. |
| Currency Adjustment Factor (CAF) | A surcharge imposed by a carrier on ocean freight charges to offset foreign currency fluctuations. |
| Current-Demand Inventory | Inventory that is currently in demand by customers. |
| Customer Integration | The integration of customer data and systems with a company's own systems to improve customer service and satisfaction. |
| Customer Relationship Management (CRM) | A system for managing a company's interactions with current and future customers. |
| Customer Returns | Items that are returned to a business by customers after purchase. |
| Customs | The authorities or the official department that collects duties levied by a country on imports and exports of goods. |
| Customs Broker | A professional who helps importers and exporters navigate customs regulations and procedures. |
| Customs Clearance | The process of getting permission for taking or importing goods/merchandise from another country into the importing nation. |
| Customs Value | The value of imported goods on which duties will be assessed. |
| CWT (Hundredweight) | An abbreviation for Hundredweight, which is equivalent to 100 pounds. |
| Cycle Count | An inventory auditing procedure, where a company follows a regularly repeated sequence of checks on a small amount of their inventory. |
| Cycle Time | The amount of time required to complete one cycle of a production or supply chain process. |
D | |
| Dashboard | A tool or board to capture a summary of key performance indicators or a monitoring system for e-commerce fulfillment business. |
| Dangerous Goods | Substances or articles that pose a risk to people, property, or the environment due to their chemical or physical properties. (See also: Hazardous Cargo) |
| Data-Driven Decision Making (DDDM) | Using data analysis and interpretation to guide decisions in supply chain management. |
| Digital Twins | Virtual replicas of physical devices or systems used to simulate and optimize supply chain processes. |
| Data Analysis | The process of examining and interpreting data to draw conclusions and make informed decisions. |
| Data Mining | The process of discovering patterns and relationships in large datasets. |
| Data Synchronization | A data transfer process between a handheld device and a desktop computer. |
| DC (Distribution Center) | A warehouse focused on order fulfillment, not long-term storage. |
| DDP (Delivered Duty Paid) | Shipping term where the seller covers all costs, including duties and taxes, to deliver goods to the buyer's destination. |
| DDU (Delivered Duty Unpaid) | Shipping term where the seller delivers goods, but the buyer pays duties and taxes. |
| Dead Stock (or Dead Inventory) | Inventory that hasn't been sold or used for a long time and is unlikely to be sold in the future. |
| Deadweight Tonnage (DWT) | The total weight a ship can carry when fully loaded, including cargo, fuel, crew, and provisions. |
| Deep Induction | The practice of moving a product deeper into a distribution network, closer to the end customer, to reduce lead times and increase responsiveness to demand fluctuations. This can involve moving goods from central warehouses to regional distribution centers or even directly to retail stores. |
| Delivery Appointment | A pre-arranged time and date for the delivery of goods or services. |
| Delivery Confirmation | A message sent by the carrier confirming the delivery of a shipment. |
| Delivery Order | A document from a shipper or owner of freight authorizing the release of cargo to another party. |
| Delivery Time | The amount of time it takes for goods to arrive at their destination after being purchased. |
| Demand-Chain Management | A customer-centric approach to supply chain management, focusing on understanding and meeting customer demand. |
| Demand Forecasting | Predicting future sales using historical data to make informed business decisions about inventory, production, etc. |
| Demand Planning | The process of forecasting demand to ensure products are delivered reliably and customers are satisfied. |
| Demurrage | Charges applied when rail freight cars and ships are retained beyond a specified loading or unloading time. |
| Deregulation | Revisions or elimination of economic regulations controlling transportation. |
| Destination | The location where goods are sent. |
| Destock | To reduce the quantity of stock held. |
| Detention | Costs incurred for using equipment beyond the given free time, typically outside of a terminal. |
| Destuffing | The process of unloading goods from a container or other transport vehicle. Destuffing typically refers to floor-loaded containers, but not always. (see: Devanning) |
| Devanning | The process of unloading goods from a container or other transport vehicle. Devanning typically refers to floor-loaded containers, but not always. (see: Destuffing) |
| DFZ (Duty Free Zone) | An area where goods can be stored without paying import customs duties while awaiting further transport. |
| Differential | A discount offered by a carrier facing a service time disadvantage over a route. |
| Digitalization | The adoption or increase in use of digital or computer technology in various aspects of a business or process. |
| Digitization | The conversion of analog data into digital form. |
| Dim Factor (Dimensional Factor) | A representation of the amount of space one unit of weight occupies in the carriers transportation network. (see: Dim Divisor) |
| Dim Divisor (Dimensional Divisor) | A representation of the amount of space one unit of weight occupies in the carriers transportation network. (see: Dim Factor) |
| Dim Weight (Dimensional Weight) | A pricing method for commercial freight transport using an estimated weight calculated from package dimensions (L x W x H) and then divided by the transportation providers Dim Factor or Dim Divisor. Most transportation providers charge customers the higher value between scale weight and dimensional weight. |
| Direct Cost | A price directly associated with producing services or goods. |
| Direct Fulfillment | A logistics strategy where products are shipped directly from the manufacturer or supplier to the end customer. |
| Discrete Manufacturing | A manufacturing process where distinct items are produced, often in batches or custom orders. |
| Discrete Picking | A picking method where each order is picked individually. |
| Dispatch | To send off a shipment to a certain destination. |
| Dispatch Confirmation | A message sent by the warehouse confirming that an item has left the facility. |
| Distributed Inventory | Splitting goods across geographically dispersed fulfillment centers. |
| Distribution | All logistics from the end of production to shipment to the end user. |
| Distribution Channel | A company or person participating in the distribution of goods. |
| Distribution Warehouse | A warehouse used for the storage and distribution of goods to retail stores, wholesalers, or end customers. |
| Distributor | A business that purchases and resells products. |
| Dock Door | An opening in a warehouse for loading and unloading goods. |
| Dock Receipt | A document acknowledging receipt of goods by a carrier at a shipping dock. |
| Dock Scheduling | The use of optimization and scheduling tools to automate dock door and yard schedules. |
| Dock-to-Dock | A term used to indicate that a shipment will be picked up and delivered to loading docks, implying no need for a liftgate. |
| Dock-to-Stock Time | The duration between a shipment's arrival at the dock and its placement in storage. |
| Drayage | Transporting goods over a short distance (e.g., port to warehouse). |
| Driverless Car | A vehicle capable of sensing its environment and navigating without human input. (Also known as: self-driving car, robot car, autonomous car) |
| Drop Ship | The process by which a third-party logistics (3PL) company ships goods for the original manufacturer, then labels and documents the shipment on their behalf. |
| Drop-shipping (Dropshipping) | A fulfillment method where stores don't hold inventory, but buy from a third party who ships directly to the customer. |
| Drum-handling Attachments | Forklift accessories for handling drums. |
| Dry Sampling | Sending product samples home with consumers to try. |
| DSD (Direct Store Delivery) | A method of distribution in which products are delivered directly to retail stores from the manufacturer or supplier. |
| DTC (Direct-to-Consumer) | Refers to marketing and delivering merchandise directly to individual consumers, usually to their home address. |
| DUNS Number | A unique nine-digit identification number for businesses, used to establish a business credit file. |
| Dunnage | Packing materials used to protect goods in transit. (see: Void Fill) |
| Duty Tax | A tax imposed on goods imported or exported. |
E | |
| Each | A unit of measure used to indicate individual items. |
| EBC (Enhanced Brand Content) | A feature on Amazon that allows brand owners to enhance their product listings with additional images, videos, and text descriptions. |
| eCommerce Fulfillment (e-commerce Fulfillment) | The entire process of receiving, processing, and delivering online orders. |
| eCommerce Fulfillment Services (e-commerce Fulfillment Services) | Services that handle all aspects of the fulfillment process for e-commerce businesses, including warehousing, picking, packing, and shipping. |
| Economy of Scale | Cost advantages when production increases. |
| EDI (Electronic Data Interchange) | The computer-to-computer exchange of business documents in a standardized electronic format between business partners. |
| Education Fulfillment | The process of fulfilling orders for educational materials and books, often with specific requirements like temperature control. |
| Effective Lead Time | Total time from recognizing the need for an order until inventory is available. |
| Elastic Logistics | Supply chains adapting to demand changes. |
| Electronic Commerce (eCommerce or e-commerce) | The buying and selling of goods or services using the internet. |
| Electronic Funds Transfer (EFT) | The electronic transfer of money from one bank account |
| Electronic Product Code (EPC) | A unique identifier used to track individual products throughout the supply chain. EPCs are typically used in conjunction with radio frequency identification (RFID) technology. |
| Emergency Stock | A particular quantity of product stocked and used in emergencies, such as unplanned catastrophic events. |
| Employer Identification Number (EIN) | A unique nine-digit number assigned by the IRS to businesses for tax purposes. |
| End Item | A completed item or product sold. |
| End-of-Life Inventory | Products that have reached the end of their useful life and can no longer be sold or used. |
| Engineer-to-Order | A manufacturing process where a product is designed and built to meet specific customer requirements. |
| EOQ (Economic Order Quantity) | A formula to calculate the optimal order quantity for minimizing inventory costs. |
| ERP (Enterprise Resource Planning) System | A software system that integrates and manages various business processes, such as finance, human resources, and supply chain management. |
| ERS (Evaluated Receipts Settlement) | A payment process where a buyer pays for goods based on the receipt of goods rather than an invoice. |
| EVA (Economic Value Added) | A measure of a company's financial performance based on the residual wealth calculated by deducting its cost of capital from its operating profit, adjusted for taxes on a cash basis. |
| Excess Inventory | Stock levels exceeding the current demand or specified thresholds, potentially leading to waste or inefficiency. |
| Experiential Marketing | A marketing approach that focuses on creating engaging and memorable experiences for consumers to promote a brand or product. |
| Expiration Date | The last date a product, like food, medicine, or beauty products, should be used before it's considered spoiled or ineffective. |
| Export | Sending goods and services to another country. |
| Export Broker | An agent who acts as an intermediary between buyer and seller for a fee. |
| Export Processing Zone | A designated area within a country used for manufacturing and exporting goods, often offering tax incentives and simplified customs procedures. |
| Extensible Markup Language (XML) | A flexible way to create information formats and electronically share structured data via the public Internet, as well as via corporate networks. |
F | |
| FaaS (Fulfillment as a Service) | A service model where fulfillment services are offered on to clients. This term is often used by companies with many lines of business (freight forwarding, trucking, software/SaaS etc.) |
| Facilities | The physical plant, distribution centers, service centers, and related equipment used in logistics and supply chain operations. |
| Fashion Accessories Fulfillment | The process of picking, packing, shipping, and managing returns for fashion accessories, often involving high inventory turnover rates. |
| FBM/Fulfillment by Merchant | A method of selling on platforms like Amazon where the seller manages storage, shipping, and customer support themselves or through a third party. |
| FEFO (First Expired, First Out) | An inventory management method where products with the earliest expiration dates are shipped or sold first. |
| FEU (Forty-Foot Equivalent Unit) | A standard unit for measuring the capacity of cargo ships and terminals, equal to one 40-foot shipping container. |
| FIFO (First In, First Out) | An inventory management method where the oldest items are shipped or sold first. |
| Fill Rate | The percentage of customer orders that are fulfilled from available stock without backorders or delays. |
| Finished Goods Inventory (FG or FGI) | Products completely manufactured, packaged, stored, and ready for distribution. |
| Fixed Costs | Costs that do not change with the level of production or sales volume. |
| Fixed Order Quantity | An inventory control system with fixed maximum and minimum inventory levels, or a system where orders are generated for a predetermined fixed quantity. |
| Floor Loaded Container | A shipping container stacked with freight loaded from the floor up without using pallets. |
| Floor Stacking | A LIFO (Last In, First Out) storage method where pallets are placed on the floor in organized rows. |
| Flow Rack | A storage method where products are presented to picking operations at one end and replenished from the other. |
| Flow Wrap | Product packaging where a product is wrapped in transparent or printed plastic film. |
| Food and Drug Administration (FDA) | A U.S. government agency responsible for regulating food, drugs, and medical devices. |
| Forecast | An estimation of future demand for products using quantitative or qualitative methods. |
| Forecast Error | The difference between forecasted and actual sales. |
| Foreign-Trade Zone (FTZ) | An area near a port or airport, under customs control, for holding goods duty-free pending customs clearance. |
| Forklift/Lift Truck | A vehicle for lifting and moving loads in warehouses. |
| Forward Logistics | The forward movement of goods from raw materials to end consumers. |
| Forward Picking | A storage area designed for picking, replenished from reserve storage. |
| Fourth-Party Logistics (4PL) | A provider that offers broader supply chain management than 3PLs, often involving strategic partnerships and shared risks/benefits. |
| FOB (Free on Board) | A shipping term indicating the seller is responsible for goods until they are loaded onto the transport vehicle at the shipping point. |
| Freight | Goods transported in bulk by truck, train, ship, or aircraft. |
| Freight Broker | An intermediary between shippers and carriers, negotiating rates and arranging cargo movement. |
| Freight Forwarder | A company that arranges the transportation of products on behalf of a seller or buyer. |
| Freight Forwarding | The coordination and shipment of goods from one place to another via single or multiple carriers. |
| Freight Shipment | Any shipment over 150 lbs and/or with dimensions larger than 30" L x 30" W x 30" H. |
| Fronthaul | The primary leg of a transportation route, where goods are transported from their origin to a destination. (See also: Backhaul) |
| Freight Management | The process of overseeing and managing the transportation of goods, often involving multiple carriers and modes of transport. |
| Full Truckload (FTL) | A shipment that fills an entire truck, as opposed to less-than-truckload (LTL) shipments. |
| Fuel Surcharge | An additional fee added to the base shipping rate to offset fluctuations in fuel costs. |
| Fulfilled by Amazon (FBA) | A program by Amazon where third-party sellers use Amazon's fulfillment and delivery network. |
| Fulfillment | The process of preparing and delivering customer orders. |
| Fulfillment Center (FC) | A warehouse or distribution center where products are stored, processed, and shipped to customers. |
| Fulfillment Network Stock Keeping Unit (FNSKU) | A unique identifier used by Amazon to track products within its fulfillment network. |
| Fulfillment Service | A service that handles the storage, packing, and shipping of products on behalf of a seller. |
| Fulfillment Services Provider | A third-party company that provides order fulfillment services on behalf of another party (e.g., online sellers). |
| Full Container Load (FCL) | A shipment that occupies an entire shipping container. |
| Full-Service Leasing | A leasing agreement where the lessor provides a range of services, including maintenance, insurance, and taxes, in addition to the leased asset. |
| Functional Acknowledgement (FA) | An electronic message that acknowledges the receipt of an EDI (Electronic Data Interchange) message and confirms its successful processing. |
| Functional Group | A group of related business functions or departments within a company, such as sales, marketing, or operations. |
| Furniture Warehousing | Specialized warehousing for home furnishings, often involving climate control and special handling equipment. |
G | |
| GATT (General Agreement on Tariffs and Trade) | A legal agreement between many countries, aimed at expanding international trade and eliminating trade barriers. |
| Gated Category | A category of products on Amazon that requires sellers to obtain approval from Amazon before they can list their products. |
| Gaylord | A large, corrugated container designed to fit on a pallet, commonly used for bulk storage and transport of goods. (See also: Box) |
| General Merchandise Warehouse | A warehouse used to store a variety of non-specialized goods. |
| General Order (GO) | A customs term referring to a warehouse where merchandise not entered within five working days after the carriers arrival is stored at the risk and expense of the importer. |
| Geofencing | A technology that uses GPS or RFID to create a virtual geographic boundary, enabling software to trigger a response when a device enters or leaves a particular area. |
| Global Product Sourcing | A procurement strategy in which a business buys goods from the international market. |
| Global Trade Item Number (GTIN) | An all-numeric system for assigning globally unique codes to trade items (products and services). |
| Glue Tipping | A method of attaching a product, sample, or gift card to printed material using adhesive glue. |
| Goods | Merchandise or materials used to satisfy demands. |
| Government Bill of Lading (GB/L) | A bill of lading issued by a government agency for the transportation of goods. |
| Grandfather Clause | A provision in a law or contract that allows existing situations or practices to continue even after new rules or regulations are introduced. |
| Green Logistics | The effort within logistics and supply chain management to minimize the environmental impact of operations. |
| Gross Margin | The difference between total revenue and the cost of goods sold. |
| Gross Profit | The profit a company makes after deducting the costs associated with making and selling its products, or the costs associated with providing its services. |
| Gross Weight | The total weight of a shipment, including goods, packaging, and container. |
| GSM (Grams per Square Meter) | A specification that describes the thickness of paper. |
| GTIN (Global Trade Item Number) | An all-numeric system for assigning globally unique codes to trade items (products and services). |
H | |
| Handling Costs | The costs involved in moving, transferring, preparing, and otherwise handling inventory. |
| Handling Rates | Fees charged for fulfillment-related activities like picking, packing, and shipping. |
| Haulage | The commercial transport of goods. |
| Hazardous Cargo | Substances transported that present a risk to health, safety, property, or the environment. (See also: Dangerous Goods) |
| Hazardous Material | A substance or material capable of posing a risk to health, safety, and property when stored or transported. |
| Headline Search Ad | A type of online advertisement that appears at the top of search engine results pages (SERPs). |
| Healthcare Vertical | A specialized segment of the logistics industry that focuses on the transportation and storage of medical supplies, pharmaceuticals, and other healthcare-related products. |
| Hedge Inventory | Inventory held as a buffer against potential price increases or supply disruptions. |
| Holding Cost | The cost of storing inventory, including rent, utilities, insurance, and taxes. |
| Household Good Fulfillment | The process of fulfilling orders for household goods, often requiring special handling for fragile items or temperature control for certain products. |
| House Air Waybill (HAWB) | A document issued by a freight forwarder to cover a consolidated shipment, detailing individual consignments within the shipment. |
| Hub Airport | A central airport with many flight connections, used for transferring passengers and cargo. |
| Hundredweight (CWT) | A unit of weight equal to 100 pounds, used in transportation pricing. |
| Hyperlocal Fulfillment | The strategy of fulfilling orders from locations that are very close to the customer, often using small, local warehouses or retail stores. |
I | |
| Import | To bring goods or services into a country from abroad for sale. |
| In-Bond Shipment | A shipment of goods that is transported under customs bond, meaning that the goods are not subject to customs duties or taxes until they are released from bond. |
| In-House Fulfillment | A fulfillment option where the seller handles all operations internally, including warehousing, inventory management, and shipping. |
| Inbound Logistics | The management of materials and goods flowing into a company, from suppliers to manufacturing or storage facilities. |
| Inbound Order Accuracy | A metric that measures the percentage of inbound orders that are received without errors or discrepancies. |
| Inbound Order Cycle Time | The duration from placing a purchase order with a supplier to receiving the goods at the warehouse. |
| INCOTERMS | International Commercial Terms that define the responsibilities of buyers and sellers for the delivery of goods under sales contracts. |
| Incentive Rate | A discounted rate offered by a carrier to encourage shippers to use their services. |
| Inland Bill of Lading | A bill of lading used for the transportation of goods over land, typically within a country. |
| Insurance Certificate | A document issued to the consignee to certify that insurance is provided to cover loss or damage to cargo while in transit. |
| Integrated Logistics | A comprehensive view of the entire supply chain as a single process from raw materials to finished goods distribution. |
| Intermodal Transportation | The use of multiple modes of transportation (e.g., truck, rail, ship) for a single shipment. |
| International Standards Organization (ISO) | A non-governmental organization that develops and publishes international standards. |
| Internet of Things (IoT) in Logistics | The use of interconnected devices and sensors to collect and exchange data to improve logistics operations. |
| Interstate Commerce | Trade, traffic, or transportation of goods between different states or across state lines. |
| Intrastate Commerce | Trade, traffic, or transportation of goods within the boundaries of a single state. |
| Inventory | Goods, products, or materials that a company holds in stock and intends to sell or use in its operations. |
| Inventory Cost | The cost associated with holding and managing inventory. |
| Inventory Forecasting | Predicting future inventory levels based on historical data and trends. |
| Inventory Management | The process of overseeing and controlling the flow of goods, materials, and resources into and out of a business or organization. |
| Inventory Management System (IMS) | Software for tracking inventory levels, orders, sales, and deliveries. |
| Inventory Master File | A database containing detailed information about a company's inventory. |
| Inventory Planning | Determining the optimal quantity and timing of inventory to align with sales and production. |
| Inventory Turnover Rate | The number of times inventory is sold or used in a period. |
| Inventory Visibility | The ability to track and monitor inventory levels across the supply chain in real-time. |
| Invoice | A document that itemizes goods or services and specifies payment terms. |
| ISO 13485 | An international standard for quality management systems in the medical device industry. |
| Issuing Carrier | The transportation company that issues a bill of lading for a shipment. |
| Item Alias | An alternative name for an item, different from the one used in the warehouse. |
| Item Coding | A system for assigning codes to items for tracking and identification. |
| Item Number | A unique identifier assigned to a specific product type, which is used to track inventory levels, sales, and other product-related data. (see also: SKU) |
J | |
| JIT (Just In Time) | A manufacturing and inventory strategy that aims to minimize waste by receiving goods only as they are needed in the production process, thereby reducing inventory costs and improving efficiency. |
| Job Shop Manufacturing | A type of manufacturing process characterized by small batches of custom products, often using general-purpose machines and skilled labor. |
| Job Shop Production | A manufacturing process in which small batches of a variety of custom products are made. |
K | |
| Kanban | A visual system for managing production and inventory, where cards or signals indicate when to replenish materials or produce goods. |
| Kaizen | A Japanese term meaning 'continuous improvement,' used in lean manufacturing to describe activities that continuously improve all functions. |
| Kata | A structured methodology for continuous improvement, often used in lean manufacturing environments to identify and eliminate waste. |
| KPI (Key Performance Indicator) | A measurable value that demonstrates how effectively a company is achieving key business objectives. |
| Kitting | Assembling different products and components as a single SKU into custom packaging. (See also: Bundling) |
L | |
| LASH Vessel (Lighter Aboard Ship) | A type of ship designed to carry barges or lighters, which can be loaded and unloaded from the ship without the need for cranes or other heavy equipment. |
| Logistics as a Service (LaaS) | A service model where logistics services are offered on a subscription or on-demand basis. |
| Last Touch Logistics | The final step in the logistics process, focusing on the delivery of goods to the end customer. |
| Last In First Out (LIFO) | An inventory costing method where the last items added to inventory are assumed to be the first ones sold. |
| Last Mile (Delivery) | The final stage of delivery, where the shipment is delivered to the customer. (See also: White Glove Delivery, Final Mile Delivery) |
| Landed Cost | The total cost of a product, including the purchase price, transportation costs, duties, taxes, and other expenses incurred to get it to its final destination. |
| Landing Page | A standalone web page created specifically for a marketing or advertising campaign. |
| LCL (Less-Than-Container Load) | A shipment that is too small to fill a standard shipping container and is consolidated with other LCL shipments. (See also: Less-Than-Truckload (LTL)) |
| Lead Logistics Provider (LLP) | A company that oversees the logistics operations of another company, integrating multiple logistics functions and often managing relationships with other service providers. |
| Lead Time | The time it takes for a product to be ordered, produced, and delivered to the customer. |
| Lean Logistics | A philosophy that focuses on eliminating waste and improving efficiency in logistics operations. |
| Lessee | A person or company that leases an asset from another party. |
| Lessor | A person or company that leases an asset to another party. |
| Less-Than-Carload (LCL) | A shipment that is too small to fill a standard railroad car and is consolidated with other LCL shipments. |
| Less-Than-Container Load (LCL) | A shipment that is too small to fill a standard shipping container and is consolidated with other LCL shipments. |
| Less-Than-Truckload (LTL) | A shipment that does not require a full truckload of space. (See also: Less-Than-Container-Load (LCL)) |
| 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. |
| Lien Rights | The legal right of a 3PL to retain possession of goods until payment for services is received. |
| Limited Liability Company (LLC) | A business structure in the United States that combines the pass-through taxation of a partnership or sole proprietorship with the limited liability of a corporation. |
| Liquidation | The process of selling off a company's assets to pay off debts. |
| Load Meter (Load Metre) | 1 linear meter of loading space in a truck or trailer for calculating freight cost. Used when goods cannot be stacked. One europallet is 0.4 load meters. |
| Loading Dock | A raised platform where goods are loaded onto and unloaded from trucks. |
| Local Area Network (LAN) | A computer network that interconnects computers within a limited area such as a residence, school, laboratory, university campus or office building. |
| Locator System | An inventory tracking system that assigns locations to inventory within a warehouse. |
| Logistics | The process of planning, implementing, and controlling the efficient and effective flow and storage of goods, services, and related information from the point of origin to the point of consumption to meet customer requirements. |
| Logistics Center | A facility where goods are received, sorted, stored, and shipped. |
| Logistics Data Interchange (LDI) | An automatic system that electronically transmits logistics information. |
| Long Ton | A unit of weight equal to 2,240 pounds. |
| Lost Sales | The revenue lost due to insufficient inventory to meet customer demand. |
| Lot | A specific quantity of a product or material produced or packaged together. |
| Lot Sizing | Determining the optimal quantity of items to produce or order. |
| Lot-for-Lot | A lot-sizing technique that produces or orders exactly the quantity needed to meet demand. |
| LTL (Less-Than-Truckload) | A shipment that does not require a full truckload of space. (See also: Less-Than-Container-Load (LCL)) |
M | |
| Machine Downtimes | Periods when a machine is not operational due to maintenance, repairs, or breakdowns. |
| Maintenance, Repair, and Operating Supplies (MRO) | Items used in the production process but not part of the finished product, such as lubricants, cleaning supplies, and repair parts. |
| Make-or-Buy Decision | The decision of whether to manufacture a product in-house or purchase it from an external supplier. |
| Make-to-Assemble (MTA) | A production strategy where components are produced in advance but the final product is assembled based on customer orders. |
| Make-to-Order (MTO) | A production strategy where products are made only after a customer order is received. |
| Make-to-Stock (MTS) | A production strategy where products are manufactured and stocked in advance based on demand forecasts. |
| Management Information System (MIS) | A system that collects, processes, and distributes information to support management decision-making. |
| Manifest | A document that lists the details of a shipment, including the contents, origin, destination, and other relevant information. |
| Manufacturers | Companies that transform raw materials and components into finished products. |
| Manufacturing | The process of producing goods from raw materials or components. |
| Manufacturing Execution System (MES) | A software system that manages and controls the production process onthe factory floor. |
| Manufacturing Resource Planning (MRP-II) | A method for the effective planning of all resources of a manufacturing company. Ideally, it addresses operational planning in units, financial planning in dollars, and has a simulation capability to answer "what-if" questions and extension of closed-loop MRP. |
| Marginal Cost | The cost of producing one additional unit of a product or service. |
| Market-Positioned Warehouse | A warehouse located near a specific market to reduce transportation costs. |
| Marketing Activations | The execution of specific marketing tactics aimed at engaging consumers. |
| Marketing Funnel | A model that illustrates the customer journey from awareness to purchase. |
| Master Air Waybill (MAWB) | A document issued by an airline to cover a consolidated shipment, detailing individual consignments within the shipment. |
| Master Carton | A large carton containing multiple units of the same SKU. |
| Material | Any physical substance or product used or processed in manufacturing or distribution. |
| Material Flow | The movement of goods, materials, and components through a production or distribution system. |
| Material Handling | The movement, storage, and control of materials and products within a facility. |
| Maximum Order Quantity | A limit on the quantity that can be ordered at one time. |
| Merge-In-Transit | Combining shipments from multiple suppliers into a single shipment to the buyer. |
| Micro-Fulfillment Center (MFC) | A small-scale warehouse located close to urban areas designed to speed up the delivery process for e-commerce orders. |
| Micro-Land Bridge | A shipping route that combines ocean and rail transportation. |
| Minimum Order Quantity (MOQ) | The smallest amount a supplier will sell. |
| Minimum Weight | The minimum weight required for a shipment to qualify for a certain rate. |
| MIS (Management Information System) | A system that controls the flow of information throughout an organization to ensure proper functioning. |
| Mispick | Picking the wrong item for an order. |
| Multi-Channel Fulfillment (MCF) | A method where sellers can sell items through various sales channels and have Amazon handle the packaging and shipping aspects for them. |
| Multi-Currency | The ability to process an order using various currencies. |
| Multi-Sales Channel | Selling merchandise on more than one sales channel. |
| Multi-warehousing | Using multiple warehouse facilities to store inventory. |
| Multimodal | Shipping using multiple transportation modes under one contract. |
N | |
| National Motor Freight Classification (NMFC) | A standard system used to classify freight based on its commodity, density, stowability, handling, and liability. |
| Nearshoring | The practice of transferring a business operation to a nearby country rather than a more distant one, often to reduce costs and improve logistics. |
| Negotiable BOL (Bill of Lading) | A bill of lading that can be transferred to another party by endorsement and delivery. |
| Network Optimization | The process of designing and managing a supply chain network to ensure optimal performance and cost efficiency. |
| Net Profit (AKA Profit Margin) | The amount by which revenue from sales exceeds costs in a business. |
| Net Weight | The weight of the merchandise without packaging or containers. |
| New Product Introduction (NPI) | The process of bringing a new product to market, including design, development, testing, and launch. |
| Next Day Air | Generic term for overnight parcel delivery: tendered today, delivered the next business day. Business days only, so a Friday tender arrives Monday. |
| Node | A fixed point in a firm's logistics system where goods come to rest (e.g., plants, warehouses, supply sources, and markets). |
| Non-Negotiable BOL (Bill of Lading) | A bill of lading that is not transferable and is only valid for the original consignee. |
| Non-Vessel Operating Common Carrier (NVOCC) | A cargo consolidator that does not own or operate vessels but acts as a carrier by issuing its own bills of lading. |
| Non-stock Inventory | Inventory that is not tracked within the inventory system. It does not have an item-master record or internal SKU number. |
| Notify Party | The party to be notified by the carrier upon arrival of the shipment at the destination. |
O | |
| Obsolete Inventory | Inventory that is no longer useful or sellable due to being outdated, damaged, or unusable. |
| Ocean Bill of Lading | A document issued by a carrier for transport of goods by sea, serving as a receipt, contract of carriage, and document of title. |
| OFX (Open Financial Exchange) | A standard format for electronic exchange of financial data between banks and financial institutions. |
| Offshoring | The relocation of a business process from one country to another, typically to take advantage of lower costs. |
| Omni-Channel | A multichannel approach to sales that seeks to provide the customer with a seamless shopping experience whether the customer is shopping online from a desktop or mobile device, by telephone, or in a bricks and mortar store. |
| Omnichannel Fulfillment | A fulfillment strategy that integrates multiple sales channels (e.g., online, in-store, mobile) to provide customers with a seamless shopping experience. |
| Omnichannel Logistics | A logistics strategy that integrates various channels of distribution and sales to provide a seamless customer experience. |
| Online Arbitrage (OA) | Buying products from one online retailer at a lower price and reselling them on another online platform for a profit. |
| Operating Ratio | A financial metric that measures a company's operating expenses as a percentage of its revenue. |
| Opting In | The process of giving permission to receive marketing communications or other forms of communication from a company. |
| Order | A request by a customer to purchase goods or services. |
| Order Cycle | The time it takes from when an order is placed to when it is delivered to the customer. |
| Order Fulfillment | The process of receiving, processing, and delivering customer orders. |
| Order Management | The process of managing customer orders, including receiving, processing, inventory management, and fulfillment. |
| Order Management System (OMS) | The tools that help retailers track orders, inventory, and fulfillment. |
| Order Picking | The process of retrieving products from storage to fulfill customer orders. |
| Order Processing | The administrative tasks involved in fulfilling an order, including verifying payment, checking stock levels, and generating shipping labels. |
| Original Equipment Manufacturer (OEM) | A company that manufactures products or components that are used in other companies' products. |
| Outbound Logistics | The management of the flow of finished products from a company to its customers or distribution partners. |
| Outlier | A data point that is significantly different from other data points in a set. |
| Outpartnering | The process of collaborating with external partners to achieve business goals. |
| Outsourcing | The practice of contracting out business activities to external providers. |
| Over, Short, and Damaged (OS&D) | A report used to document discrepancies between the quantity or condition of goods shipped and received. |
| Over-the-Road | Refers to the transportation of goods over long distances by truck. |
| Overhead | Indirect costs of running a business, such as rent, utilities, and salaries. |
| Overwrap | A packaging method that wraps and heat-seals products with flat sides. |
P | |
| Packing | Preparing a container to ship or preparing products for an order. |
| Packing List | A document itemizing the SKU, description, and quantities of each item in an order. |
| Pallet | A standardized platform used for storing, handling, and moving materials and products. |
| Pallet In/Pallet Out (PIPO) | A material handling method where materials are received and shipped on pallets, not unpacked until the final destination. |
| Pallet Jack | A hand-operated tool used to lift and move pallets. |
| Pallet Picking | A method of picking where entire pallets of a single SKU are picked instead of individual cases or items. |
| Pallet Racks | Storage systems designed to store palletized goods. |
| Palletized | Goods or materials stacked or arranged on a pallet. |
| Palletized Shipping | Shipping multiple products or cases on pallets secured for bulk shipping. |
| Parcel Insurance | Third-party shipping insurance covering packages in case of loss or damage. |
| Parcel Manifest System | A system used to create a detailed list of parcels included in a shipment. |
| Parcel Shipment | Small packages handled by carriers like UPS, FedEx, or USPS. |
| Pay-Per-Click Advertising (PPC) | An online advertising model where advertisers pay each time a user clicks on their ad. |
| Pay-on-Use | A payment model where customers are charged based on their actual usage of a product or service. |
| Peak Demand | The time period with the highest customer demand. |
| Peer-to-Peer (P2P) | A decentralized network model where individual computers (peers) share resources directly with each other, without the need for a central server. |
| Pegging | Linking specific inventory items to customer orders or production schedules. |
| Perpetual Inventory | A system that continuously updates inventory records as goods are received and sold. |
| Physical Inventory | A periodic count and verification of all inventory items in a location. |
| Physical Supply | The movement of materials from a supplier to a warehouse or manufacturing facility. |
| Pick and Pack | The process of pulling products from storage for an order and packing them for shipment. (See also Pack and Ship) |
| Pick by Aisle | A picking method where items are picked from one aisle at a time. |
| Pick by Source | A picking method where items are picked from multiple locations based on their source or supplier. |
| Pick Instruction/Pick Ticket | A document or electronic record providing instructions for the picking process. |
| Picker | An employee who selects items from inventory to fulfill orders. |
| Picking | Selecting and removing items from inventory to fulfill customer orders. |
| Piece Picking | Picking individual items one by one to fulfill an order. |
| Planned Order Receipt | The scheduled delivery of goods or materials that have been ordered and planned for in advance. |
| Polyethylene (PE) | A thermoplastic polymer known for its flexibility, commonly used in packaging. |
| Polypropylene (PP) | A thermoplastic polymer known for its durability and strength, used in various applications including packaging. |
| Port Authority | A government agency responsible for managing and regulating port operations. |
| Port of Discharge | The port where cargo is unloaded from a vessel. |
| Port of Entry | A port where foreign goods are admitted into a country. |
| Portable Data Collection Terminal (PDT) | A handheld device used for scanning barcodes and collecting data in a warehouse or distribution center. |
| POS (Point of Sale) | The location where a retail transaction takes place. |
| Predictive Analytics | The use of data, statistical algorithms, and machine learning techniques to identify the likelihood of future outcomes based on historical data. |
| Pre-Kitting | Combining items at the end of manufacturing before sending them to a 3PL for storage and fulfillment. |
| Prepaid Freight | Freight charges paid by the shipper in advance. |
| Primary Packaging | The layer of packaging that comes into direct contact with the product. |
| Private Warehouse | A storage facility owned and operated by the company using it. |
| Print and Apply | A system that prints and automatically applies labels to products or packages. (See also Lick and Stick, Peel and Stick, Ships Alone, Ship In Original Carton) |
| Process Improvement | The ongoing effort to improve the efficiency and effectiveness of business processes. |
| Process Manufacturing | A type of manufacturing where goods are produced by combining raw materials through a chemical or biological process. |
| Process Yield | The percentage of usable output produced in a manufacturing process. |
| Procurement | The process of acquiring goods, services, or materials from external suppliers. |
| Product | A good or service offered for sale. |
| Product Catalog | Marketing material listing essential product details to aid buyer decisions. |
| Product Characteristics | Unique features or attributes of a product. |
| Product Description | Written or spoken information describing a product's features or benefits. |
| Product ID | A unique code or number assigned to a product for identification in inventory or marketplace systems. |
| Product Sampling | Offering goods or services to the audience in exchange for increased brand awareness, feedback, and other revenue-boosting user-generated content. |
| Profitability Analysis | A method of evaluating a business's financial performance by analyzing its revenues, costs, and profits. |
| Proof of Delivery (POD) | A document or electronic record that serves as evidence of the successful delivery of a shipment to its intended recipient. |
| Publishing Fulfillment | The process of fulfilling orders for published materials, such as books and magazines, often with specific requirements like temperature control. |
| Purchase Order (PO) | A commercial document issued by a buyer to a seller that specifies the products or services to be purchased, quantities, agreed prices, and delivery terms. |
| Putaway | The process of transferring newly received or manufactured goods from the receiving or production area to a designated storage location within a warehouse or distribution center. |
Q | |
| QA (Quality Assurance) | The process of ensuring that products or services meet or exceed customer requirements and quality standards. |
| QC (Quality Control) | The process of verifying that products or services meet established quality standards. |
| Quality Function Deployment (QFD) | A method used to translate customer requirements into specific design and manufacturing specifications. |
| Quarantine | A temporary hold or isolation of products or materials suspected of being defective, contaminated, or non-conforming, until they can be evaluated or corrected. |
| Queue Time | The amount of time that a product, order, or task spends waiting in a queue or line before being processed or completed. |
| Quick Response (QR) | A supply chain management strategy that emphasizes rapid response to customer demand. |
| Quick Response (QR) Codes | Two-dimensional barcodes that can be scanned to quickly access information or track items in the supply chain. |
| Quota | A government-imposed restriction on the quantity or value of goods that can be imported or exported. |
R | |
| Radio Frequency (RF) | A wireless communication technology used in logistics operations to transmit data. |
| Radio Frequency Identification (RFID) | A technology that uses radio waves to identify and track objects, such as products or inventory. |
| Random-Location Storage | A method of inventory storage where items are placed in any available space. |
| Rate of Supplier Returns | The percentage of inbound shipments returned to the supplier due to damage, errors, or other issues. |
| Rate Sheet | A document listing rates or fees charged for shipping or transportation services. |
| Rate Shopping | Comparing shipping rates from multiple carriers to find the most cost-effective option. |
| Raw Materials (RM) | The basic materials used to manufacture products. |
| Real-Time | Describes a system or process that operates or provides information immediately, without delay. |
| Receiving | The process of accepting and documenting the delivery of products or materials into a warehouse or distribution center. |
| Receiving Dock | The designated area of a warehouse where incoming products are received and processed. |
| Receiving Report | A document that records the details of an inbound shipment. |
| Recurring Billing | A billing method used for products or services that are regularly provided or consumed, where the customer is charged automatically on a regular basis, such as monthly or annually. |
| Release-to-Start Manufacturing | A production scheduling method where work on an order begins only after all required materials and components are available. |
| Re-Order Point (ROP) | The inventory level at which a new order should be placed. |
| Reorder Level | The minimum quantity of inventory that must be maintained in stock to ensure that products or materials are available when needed, without causing delays or stockouts. |
| Repetitive Manufacturing | A manufacturing process where the same products are produced over a long period at a fixed rate. |
| Replenishment | The process of restoring or replenishing stock levels. |
| Request for Information (RFI) | A document used to gather information from potential suppliers about their products or services. |
| Request for Proposal (RFP) | A document used to solicit proposals from vendors or suppliers for a specific product or service. |
| Reserve Storage | An area in a warehouse for storing surplus inventory used to replenish forward pick locations. |
| Retail Arbitrage (RA) | The practice of buying products from retail stores and reselling them online for a profit. |
| Retail Distribution | The process of distributing goods from a manufacturer or wholesaler to retail stores. |
| Retail Inventory Method | An accounting method used to estimate the value of ending inventory. |
| Retailer | A business that sells goods or services directly to consumers. |
| Return Goods Handling | The process of managing and processing returned items from customers. |
| Return Merchandise Authorization (RMA) | A numbered authorization allowing customers to return a product for a refund, replacement, or repair. |
| Return on Investment (ROI) | A financial metric measuring the profitability of an investment. |
| Returns/Reverse Logistics | Logistics for managing products after delivery to the customer, such as returns management and repairs. |
| Return-to-Vendor (RTV) | The process of returning unsold or defective products to the supplier or vendor. |
| Reverse Auction | An auction where sellers compete to offer the lowest price for a product or service. |
| Reverse Engineering | The process of analyzing a product to determine its design, construction, and operation. |
| Reverse Logistics | The process of managing the flow of goods from the point of consumption back to the point of origin or to a new destination for the purpose of capturing value or proper disposal. |
| Rewarehousing | The process of moving goods from one warehouse to another. |
| Robot Car | A vehicle capable of sensing its environment and navigating without human input. (Also known as: self-driving car, autonomous car, driverless car) |
| Robotic Process Automation (RPA) | The use of software robots to automate repetitive tasks in logistics and supply chain operations. |
| Rolled Throughput Yield | A metric that measures the probability of a product making it through an entire manufacturing process without any defects. |
S | |
| Safety Lead Time | Additional lead time added to the standard lead time to account for unexpected delays or fluctuations in demand. |
| Safety Stock | Extra inventory held as a buffer to prevent stockouts due to unexpected demand or supply disruptions. |
| Salable Goods | Products that are in good condition and ready to be sold to customers. |
| Sales Order | A document that confirms a customer's order and includes details like product descriptions, quantities, prices, and shipping information. |
| Sales Support | A system or team that assists the sales force in improving productivity through continuous communication and support. |
| Sawtooth Diagram | A visual representation of inventory levels over time, showing the fluctuations caused by demand and replenishment. |
| Scanlon Plan | A gainsharing program that encourages employees to suggest and implement cost-saving ideas. |
| Search Engine Optimization (SEO) | The process of optimizing a website to rank higher in search engine results pages (SERPs). |
| Secondary Packaging | The outer layer of packaging that surrounds the primary packaging, providing additional protection and branding. |
| Electronic Data Interchange (EDI) | A protocol for secure credit card transactions over the internet. |
| Self-fulfillment | A fulfillment option where the seller picks, packs, labels, and ships orders themselves, rather than using a third-party logistics provider. |
| Seller Fulfilled Prime (SFP) | A program by Amazon that allows third-party sellers to fulfill and ship their own orders while still displaying the Prime badge. |
| Serial Number | A unique number used to identify a specific product or item. |
| Serial Shipping Container Code (SSCC) | A unique identification number used to track shipping containers throughout the supply chain. |
| Service Charges | Fees charged by a service provider for specific services or activities, such as shipping, handling, or installation. |
| Shipment Cut-off Time | The deadline for placing an order to have it shipped on the same day. |
| Shipper | The party that tenders goods for transportation. |
| Shipping | The process of transporting goods from one location to another. |
| Shipping Manifest | A document that lists all of the cargo or freight being transported on a ship, aircraft, or other vehicle. |
| Shipping Zones | Geographical regions to which a carrier will ship, each with its own shipping rates. |
| Shopping Cart Integration | The connection between a fulfillment software and an e-commerce platform to automate order processing. |
| Shrinkage | The loss of inventory due to theft, damage, or errors. |
| SKU (Stock Keeping Unit) | A unique identifier assigned to a specific product type, used to track inventory levels, sales, and other product-related data. (See also: Item Number) |
| SKU Rationalization | The process of reducing the number of SKUs in a company's product line to optimize inventory management and reduce costs. |
| Slotting | The process of assigning products to specific locations within a warehouse based on factors such as size, velocity, and picking frequency. |
| Small Parcel Shipping | The shipping of small packages or parcels, typically weighing less than 150 pounds. |
| Smart Warehouse | A warehouse that utilizes automation and technology to optimize operations. |
| SOP (Standard Operating Procedure) | A set of instructions or steps to be followed for a specific task or process. |
| Sourcing | The process of finding and selecting suppliers for goods and services. |
| Split Delivery | When an order is divided into multiple shipments. |
| Sponsored Ad | A paid advertisement that appears in search engine results or on social media platforms. |
| Spot Demand | Unpredictable or sudden changes in demand for a product or service. |
| Squeeze Page | A landing page designed to capture visitor information, typically through a lead capture form. |
| Staging | Preparing goods for shipment by picking, packing, labeling, and placing them in a designated area. |
| Staging Area | A designated area within a warehouse where goods are temporarily held before being loaded onto a truck or moved to their final destination. |
| Standard Costing | An accounting method that assigns a predetermined cost to each product based on estimated material, labor, and overhead expenses. |
| Statement of Work (SOW) | A document that outlines the scope of work, deliverables, and timelines for a project. |
| Statistical Process Control (SPC) | A method of quality control that uses statistical techniques to monitor and control a process. |
| Stock | All goods or merchandise stored in a warehouse and available for sale. |
| Stock-Keeping Unit (SKU) | A unique identifier assigned to a specific product type, used to track inventory levels, sales, and other product-related data. (See also: Item Number) |
| Stockout (Out of Stock) | A situation where an item is out of stock and unavailable to customers. |
| Stocktaking | The process of physically counting and verifying the quantity of goods in a warehouse or store. |
| Storage Billing | The process of invoicing customers for the storage of their goods in a warehouse or fulfillment center. |
| Storage Cost | The expenses associated with storing inventory, including rent, utilities, insurance, and security. |
| Storage Fees | The fees charged by a warehouse or fulfillment center for storing inventory. |
| Storage Location | A designated space within a warehouse or storage facility where specific goods or materials are kept. |
| Strap Loading | A method of securing cargo to a pallet or container using straps to prevent damage during transportation. |
| Subcontracting | The practice of hiring another company to perform a specific task or service. |
| Subhauler | A carrier that is hired by another carrier to transport a portion of a shipment. |
| Sub-Optimization | The optimization of a specific component or process of a system, without considering the impact on the overall system performance. |
| Sunk Cost | A cost that has already been incurred and cannot be recovered. |
| Supplier/Vendor | A company or individual that provides goods or services to another business. |
| Supply Chain | The network of organizations, people, activities, information, and resources involved in moving a product or service from supplier to customer. |
| Supply Chain Finance (SCF) | Financial practices that optimize cash flow by providing financing to suppliers based on the value of their receivables. |
| Supply Chain Management (SCM) | The active management of supply chain activities to maximize customer value and achieve a sustainable competitive advantage. |
| Supply Warehouse | A warehouse used primarily for storing raw materials, parts, or components before they are used in the manufacturing process. |
| Supplement & Vitamins Fulfillment | The process of picking, packing, shipping, and managing returns for vitamins and supplements, often requiring temperature-controlled storage and specialized handling. |
| SWOT Analysis | A strategic planning technique used to identify the Strengths, Weaknesses, Opportunities, and Threats related to a business venture or project. |
T | |
| Taguchi Method | A statistical method for improving product design and manufacturing processes by identifying and reducing the sources of variation. |
| Takt Time | The average time between the start of production of one unit and the start of production of the next unit, used to synchronize production with demand. |
| Tare Weight | The weight of an empty container or vehicle, used to determine the net weight of the goods being shipped. |
| Tariff | A tax imposed on imported or exported goods. |
| Tariff Code | A product-specific code used for customs clearance, classifying the product and determining applicable duties and taxes. |
| TEU (Twenty-Foot Equivalent Unit) | A standard unit for measuring cargo capacity, equal to one 20-foot shipping container. |
| Theory of Constraints (TOC) | A management philosophy that focuses on identifying and addressing bottlenecks in a system to improve overall performance. |
| Third-Party Logistics (3PL) | An outsourced logistics provider that handles aspects of shipping, ranging from warehousing and fulfillment to freight bills and transportation. |
| Third-Party Payment Systems | Financial processes used in logistics where a third party, separate from the buyer and supplier, handles payment transactions. |
| Third-Party Warehousing | A type of warehousing in which a company outsources its warehousing and storage needs to a third-party logistics provider (3PL). |
| Throughput | The amount of product or material that a manufacturing or distribution system can process within a given period. |
| Total Cost Analysis | A decision-making approach that considers the total cost of ownership (TCO) of a product or service, including all direct and indirect costs. |
| Total Cost of Ownership (TCO) | The total cost of owning and operating an asset, including purchase price, maintenance, and disposal costs. |
| Total Productive Maintenance (TPM) | A holistic approach to equipment maintenance that aims to maximize equipment effectiveness and minimize downtime. |
| Touch Labor | The labor involved in physically handling and processing products in a warehouse or distribution center. |
| Track and Trace | The process of identifying the past and current locations of inventory items in the supply chain. |
| Tracking Shipment | The process of monitoring the movement of a shipment from origin to destination. |
| Transaction | Any exchange of goods or services between two parties. |
| Transit Time | The total time it takes for a shipment to travel from its origin to its destination. |
| Transloading | The process of transferring cargo from one mode of transportation to another. |
| Transportation Management System (TMS) | A software platform used to manage transportation operations and optimize the movement of goods through the supply chain. |
| Transportation Network Design | The process of creating a transportation system that efficiently moves goods from suppliers to customers. |
| Truck Stop Electrification (TSE) | The process of equipping truck stops with electrical outlets to allow trucks to plug in and power their systems while parked. |
| Truckload Carriers | Companies that specialize in transporting full truckload (FTL) shipments. |
U | |
| UNECE (United Nations Economic Commission for Europe) | A regional commission of the United Nations that promotes economic cooperation and integration in Europe. |
| Umbrella Rate | A rate offered by a carrier that covers a range of services or routes. |
| Unbundled Payment/Remittance | A payment method where individual payments are made for each service or product, rather than being combined into a single payment. |
| Uniform Product Code (UPC) | A 12-digit barcode used to identify products in retail settings. |
| Unique Parcel Identifier (UPI) | A unique code assigned to a parcel for tracking. |
| Unit | A single item or a group of items treated as one for inventory or tracking. |
| Unit Cost | The cost of producing or acquiring one unit of a product. |
| Unit Load | A single unit or multiple units moved together as one. |
| Unit of Measure (UOM) | Standard for measuring inventory quantity (pieces, cases, etc.). |
| Unitization | Grouping individual items into a single unit for easier handling. |
| Unloading | Removing goods from a vehicle or container. |
| Unverified Reviews | Product or service reviews that have not been verified as genuine by the platform or company. |
| UPS 2nd Day Air | UPS two business day air service. Not covered by the UPS Service Guarantee as of 2026; only 2nd Day Air A.M. is. |
| UPS Mail Innovations | UPS economy service for lightweight mail and flats. UPS handles collection and linehaul, USPS makes the final delivery. |
| UPS Next Day Air | UPS standard overnight service, the middle of three tiers. Residential commitments were extended to 12:00 p.m. in 2021. |
| Upsell | Trying to sell a higher-value product to the customer. |
| Upside Production Flexibility | The ability to increase production quickly to meet unexpected demand. |
| Urban Logistics | Strategies and solutions for managing the transportation and distribution of goods within urban areas. |
V | |
| Value Adding/Non-Value Adding | Value-adding activities directly contribute to a product or service's value for the customer, while non-value-adding activities do not. |
| Value-Added Network (VAN) | A private network provider that facilitates electronic data interchange (EDI) between businesses. |
| Value-Added Services (VAS) | Additional services offered by logistics providers beyond basic storage and transportation, such as kitting, labeling, and assembly. |
| Value Chain | The full range of activities that businesses go through to bring a product or service to their customers. |
| Value of Service Pricing | A pricing strategy based on the perceived value of a service to the customer, rather than solely on the cost of providing it. |
| Value Stream Mapping (VSM) | A lean management technique used to analyze the flow of materials and information required to bring a product or service to a consumer. |
| Variable Cost | A cost that varies with the level of production or sales volume. |
| Vendor-Managed Inventory (VMI) | A system where the supplier is responsible for managing the inventory levels of their products at a customer's location. |
| Vendor | A supplier or seller of goods or services. |
| Verified Reviews | Product or service reviews that have been confirmed as genuine by the platform or company. |
| Vertical Integration | When a company controls multiple stages of the supply chain, from raw materials to finished products. |
| Virtual Assistant (VA) | A self-employed worker who specializes in offering administrative services to clients from a remote location. |
| Visibility | The ability to track and monitor the movement of goods and materials through the supply chain in real-time. |
| Void Fill | Material used to fill empty space in packaging to protect products during shipping. (see: dunnage) |
| Volumetric Weight | A pricing technique for commercial freight transport that uses an estimated weight calculated from the length, width, and height of a package. (See also: Dimensional Weight/DIM Weight) |
W | |
| WAN (Wide-Area Network) | A computer network that covers a broad area (i.e., any network whose communications links cross metropolitan, regional, or national boundaries). |
| Warehouse | It's all in the name! A house (place) to store wares (goods, product). |
| Warehouse Occupancy Rate | The percentage of usable space in a warehouse that is occupied by inventory. |
| Warehouse Receipt | A document issued by a warehouse as proof of ownership of goods stored there. |
| Warehouse Utilization Rate | The degree to which warehouse space is effectively used. |
| Warehousing | The process of storing and managing goods in a warehouse. |
| Warranty Costs | Costs associated with repairing or replacing products under warranty. |
| Waterway Use Tax | A tax imposed on the use of waterways for transportation. |
| Wave Picking | A picking method where orders are grouped into waves and picked simultaneously. |
| Waybill | A document containing a description of goods, origin, destination, consignee/consignor, and the amount charged for transportation. |
| Web Portal | A website that provides a single point of access to information and services for authorized users. (see: Client Portal, OMS) |
| Weighted Average Cost | An inventory costing method that averages the cost of goods available for sale. |
| Weight Confirmation | The process of verifying the weight of a shipment. |
| Weight-Losing Raw Material | Raw materials that lose weight during the manufacturing process. |
| WES (Warehouse Execution System) | Software that manages and optimizes the operations of a warehouse, including inventory tracking and order fulfillment. |
| Wharfage | A charge assessed by a port or dock owner for the use of a wharf or pier. |
| White Glove Delivery | Premium delivery service that includes in-home setup and assembly. (See also: Last Mile (Delivery)) |
| White Label | A product or service produced by one company that other companies rebrand to make it appear as if they made it. |
| WIP (Work in Process) | Goods that are partially completed and still in the production process. |
| WMS (Warehouse Management System) | Software used for managing warehouse business processes (e.g., receiving, put away, picking, shipping, inventory cycle counts). 3PL Fulfillment companies typically utilize a WMS that has multi-client functionality. |
X | |
| X-Dock (Cross-Dock) | A warehouse or distribution center where goods are received, sorted, and immediately transferred to outbound transportation with minimal storage time. (See: Cross-Dock) |
| X-RFID | Extended RFID technology that provides more comprehensive tracking and data collection capabilities. (see: RFID) |
Y | |
| Yield | The percentage of usable output from a given input. |
| Yield Management | The process of analyzing and managing inventory to maximize profits, often used in the context of manufacturing and logistics. |
| Yield Rate | The percentage of products that pass quality control inspection and are deemed sellable. |
| YMS (Yard Management System) | Software for managing truck and trailer movements in a warehouse yard. |
Z | |
| Zero Defects | A quality management approach aiming for no defects in manufacturing or service processes. |
| Zone of Rate Freedom | A geographical area where carriers can set their own rates without regulatory constraints. |
| Zone of Reasonableness | A range of rates that are considered reasonable by regulatory agencies. |
| Zone Picking | Assigning pickers to specific warehouse zones. |
| Zone Price | The price of a product varies based on the customer's geographical location. |
| Zone-Batch Picking | Combining zone and batch picking, where multiple pickers pick portions of multiple orders within designated zones. |
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