GLOSSARY
A
AIRFREIGHT
Air freight refers to the transportation of goods by aircraft, allowing for rapid delivery over long distances. This method is commonly used for high-value, time-sensitive, or perishable goods that require quick transit times.
B
BACKORDER
A backorder occurs when a customer places an order for a product that is currently out of stock but is expected to be restocked soon. The order is accepted with the understanding that the item will be shipped to the customer once it becomes available.
BARCODE
A barcode is a visual representation of data in a series of parallel lines and spaces, typically printed on a label. It can be scanned using a barcode reader to quickly retrieve information about a product, such as its price, manufacturer, and inventory status.
BILL OF LADING (BOL)
A Bill of Lading is a legal shipping document issued by a carrier that outlines the details of a freight shipment. It includes information such as the shipper, the recipient, the type and quantity of goods being transported, and the destination. In fulfillment and warehousing, a Bill of Lading serves as a receipt for inventory, a contract for transportation, and a record that verifies what was shipped and received.
BLIND SHIPPING
Blind shipping is a shipping method where the identity of the sender or receiver is intentionally concealed. This practice is often used in drop shipping and third-party logistics to prevent the buyer or recipient from knowing the origin of the shipment.
C
COMMERCIAL SHIPPING
Commercial shipping refers to the transportation of goods and cargo for business purposes. It involves moving products from manufacturers or suppliers to retailers, distribution centers, or directly to customers.
CUSTOMS CLEARANCE
Customs clearance is the process of documenting, inspecting, and approving goods for import or export across international borders. This process involves preparing necessary documents, paying applicable duties or taxes, and ensuring compliance with customs regulations to allow smooth entry or exit of goods.
D
DELIVERED DUTY PAID (DDP)
Delivered Duty Paid (DDP) is an international shipping agreement where the seller is responsible for all costs and risks involved in transporting goods to the buyer's location, including shipping charges, duties, taxes, and customs clearance.
E
EXPEDITED SHIPPING
Expedited shipping is a faster-than-normal shipping service designed to deliver goods more quickly than standard delivery methods. It often involves prioritizing shipments to ensure they reach their destination in a shorter time frame, typically at an additional cost.
EXPORT
Sending goods to another country.
EXPORT BROKER
A company in the supply chain that intermediates between a buyer and seller. They require a fee for their services.
EXPORT TARIFF
An export tariff is a tax imposed by a government on goods and services exported out of a country. This tax is typically applied to specific products and is intended to generate revenue for the government, regulate trade, or protect domestic industries.
F
FLAT RATE SHIPPING
Flat rate shipping is a shipping method where a fixed fee is charged for shipping regardless of the package's weight, size, or destination.
FREIGHT CLASS
Freight class is a system used to categorize freight based on its characteristics such as weight, dimensions, density, and ease of handling. It helps determine the cost of shipping and the appropriate transportation method.
FREIGHT CONSOLIDATION
Freight consolidation is the process of combining multiple smaller shipments into a single, larger shipment to optimize space, reduce transportation costs, and improve efficiency.
FREIGHT FORWARDING
Freight forwarding is the process of coordinating the shipment of goods from one location to another on behalf of the shipper. A freight forwarder acts as an intermediary between the shipper and various transportation services, organizing the logistics of moving goods by air, sea, rail, or road.
G
GROUND SHIPPING
Ground shipping refers to the transportation of goods over land using trucks, vans, or trains. It is a cost-effective method for delivering packages and freight within a region, country, or continent.
H
HARMONIZED TARIFF SCHEDULE (HTS) CODE
The Harmonized Tariff Schedule (HTS) is a standardized system used to classify imported and exported goods created by the World Customs Organization (WCO) and adopted by various countries.
I
IMPORT
Goods brought into one country from another.
INVENTORY MANAGEMENT
Inventory management is the process of overseeing, controlling, and optimizing a company's stock of goods, materials, or products. It ensures the right amount of inventory is available at the right time to meet customer demand while minimizing costs and preventing excess or shortages.
K
KITTING
Kitting is the process of assembling multiple individual products into a single packaged unit that is sold or shipped as one item. In fulfillment, this often involves bundling several SKUs together, adding inserts or promotional materials, and packaging everything into a ready-to-ship configuration before orders are processed. Kitting is commonly used for subscription boxes, product bundles, limited drops, and promotional sets, and it requires precise inventory tracking and quality control to ensure accuracy.
L
LANDED COST
Landed cost refers to the total expense of acquiring a product, including the purchase price, shipping costs, customs duties, taxes, insurance, and other fees involved in getting the item to its final destination.
LAST MILE DELIVERY
Last-mile delivery refers to the final stage of the shipping process, where goods are transported from a distribution center or local hub to the customer's doorstep.
LESS-THAN CONTAINER (LCL)
Less Than Container Load (LCL) refers to a shipping method where multiple shipments from different customers share a container.
LESS-THAN TRUCKLOAD (LTL)
Small freight shipments that do not require a full trailer; they share space with other shippers.
LINE HAUL
Line haul is the core segment of the logistics process where goods are moved from one major point to another, such as from a manufacturer to a distribution center. This phase occurs after the initial pickup (first mile) and before the final delivery (last mile).
LOGISTICS
Logistics refers to the planning, coordination, and movement of products from one point to another. In ecommerce and fulfillment, logistics includes receiving inventory, storing goods, managing inventory levels, picking and packing orders, shipping, and ensuring products reach customers accurately and on time.
Strong logistics systems help reduce delays, control costs, and create a reliable customer experience.
M
MERCHANT
A merchant in the context of shipping refers to any individual or business that engages in the buying, selling, or trading of goods. Merchants can operate on a local, national, or global scale, and they may be involved in various stages of the supply chain, from procurement to distribution.
MULTI-WAREHOUSE MANAGEMENT
Multi-Warehouse Management refers to the process of overseeing and optimizing the operations of several warehouses or distribution centers.
O
OCEAN FREIGHT
Ocean freight refers to the transportation of goods by sea using cargo ships
ORDER FULFILLMENT
Order fulfillment is the process of receiving, processing, and delivering customer orders. It includes all activities from the moment a customer places an order to the point when the product is delivered to their doorstep.
ORDER MANAGEMENT
Order management is the process of receiving, processing, and tracking customer orders from initiation to delivery. It involves overseeing the entire lifecycle of an order, ensuring that inventory is available, the order is accurately filled, and the customer is kept informed throughout the process.
P
PARCEL SHIPPING
Parcel shipping refers to the transportation of individual packages or parcels, typically weighing under 150 pounds, through a carrier for delivery to a specific destination. This method is integral to the e-commerce and retail industries.
PICK AND PACK
Pick and pack is the fulfillment process of selecting products from warehouse inventory (“picking”) and preparing them for shipment (“packing”) once an order is placed.After an order is received, warehouse staff locate the correct SKUs, verify quantities, package the items according to brand standards, apply shipping labels, and send the order out for delivery. Accurate pick and pack operations are essential for minimizing errors, protecting the customer experience, and ensuring orders ship on time.
PRO FORMA INVOICE
A pro forma invoice is a preliminary document provided by a seller to a buyer before the actual shipment of goods or services. It outlines the estimated costs, quantities, and specifications of the transaction but is not a legally binding invoice.
PRODUCT BUNDLING
Bundling in shipping refers to the process of combining multiple items or products into a single package for easier handling, reduced shipping costs, or promotional sales.
PROOF OF DELIVERY (POD)
Proof of Delivery (POD) is the confirmation that a shipment has been successfully delivered to the recipient. It can take various forms, such as a signed document, an electronic acknowledgment, or a photograph, to verify that the goods were received in good condition at the correct location.
S
SHIPPING MANIFEST
A shipping manifest is a detailed document or list that provides information about the goods being transported. It includes essential data such as descriptions of the cargo, its quantity, weight, and the shipper’s and consignee’s details.
STOCK KEEPING UNIT (SKU)
A Stock Keeping Unit (SKU) is a unique alphanumeric code assigned to a product to identify and track it in inventory and sales systems. SKUs are used by retailers, warehouses, and e-commerce businesses to manage stock and differentiate products.
STORAGE FEES
The cost to store inventory in a warehouse or fulfillment center.
SUPPLY CHAIN MANAGEMENT (SCM)
SCM, or Supply Chain Management, is the coordination and oversight of the flow of goods, information, and finances from raw material suppliers to the end consumer. It involves managing processes, including procurement, production, inventory management, transportation, and delivery, ensuring efficiency and cost-effectiveness.
T
THIRD PARTY LOGISTICS (3PL)
3PL (Third-Party Logistics), refers to outsourcing logistics and supply chain functions to a specialized provider. These services include warehousing, transportation, inventory management, order fulfillment, and more, allowing businesses to focus on their core operations.
TRANSIT TIME
Transit time is the duration for a shipment to travel from the point of origin to its final destination. It includes the entire journey, from pickup by the carrier to delivery, excluding potential delays like customs clearance or unforeseen disruptions.
U
UNIT COST
Unit cost refers to the cost incurred by a business to produce, store, or ship a single unit of a product. It includes all direct and indirect expenses related to production or delivery.
V
VALUE-ADDED SERVICES (VAS)
Additional services provided beyond storage, such as kitting, labeling, or special packaging.
W
WAREHOUSING MANAGEMENT
Warehouse management is the process of overseeing and controlling the day-to-day operations of a warehouse, including inventory storage, order fulfillment, and the movement of goods. It involves optimizing warehouse processes to ensure efficient storage, accurate inventory tracking, and timely distribution of products to customers.
WAYBILL
A waybill is a shipping document that serves multiple important functions in the transportation chain. Think of it as your shipment's passport and instruction manual combined into one. It's issued by a carrier (like a shipping company) when they take possession of your goods.