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Freestyle FAQs: FAQs

Glossary

Acceptance

This term has several related meanings such as :

  1. A time draft (or bill of exchange) that the drawee has accepted and is unconditionally obligated to pay at maturity. The draft must be presented first for acceptance — the drawee becomes the “acceptor” — then for payment. The word “accepted” and the date and place of payment must be written on the face of the draft;
  2. The drawee’s act in receiving a draft and thus entering into the obligation to pay its value at maturity;
  3.  Broadly speaking, any agreement to purchase goods under specified terms. An agreement to purchase goods at a stated price and under stated terms.
Acceptance credit

Documentary credit which requires, amongst the documents stipulated, provision of a term bill of exchange.  The bill is then generally accepted by the bank on which it is drawn or discounted.  The practical result is that the beneficiary is paid promptly at a discount.

Accessibility

A carrier's ability to provide service between an origin and a destination.

Accessorial charges (Assessorial charges)

A carrier's charge for accessorial services such as loading, unloading, pickup, and delivery, or any other charge deemed appropriate.

Accounts Payable (AP or A/P)

An accounting entry that represents an entity's obligation to pay off a short-term debt to its creditors. The accounts payable entry is found on a balance sheet under the heading current liabilities

Accounts Receivable (AR or A/R)

Money owed by customers (individuals or corporations) to another entity in exchange for goods or services that have been delivered or used, but not yet paid for. Receivables usually come in the form of operating lines of credit and are usually due within a relatively short time period, ranging from a few days to a year.

Accreditation

Certification by a recognized body of the facilities, capability, objectivity, competence, and integrity of an agency, service, operational group, or individual to provide the specific service or operation needed. 

Act of God

Marine insurance term meaning an act beyond man's control, e.g., lightning, flood, earthquake, etc. The carrier is not legally responsible under most circumstances for such damage

Ad Valorem Tariff

A tariff calculated “according to value,” or as a percentage of the value of goods cleared through customs; for example, 15 percent ad valorem means 15 percent of the value of the entered merchandise.

Advance against documents

Loan made on the security of the documents covering the shipment. 

Advance payment guarantee/bond

Guarantee that advance payments will be returned if the party having received such payments does not perform its part of the contract. 

Advance Shipment Notice (ASN)

A document transmitted (by courier, fax, or email) to a consignee in advance of delivery detailing the contents and particulars of a shipment. The particulars may include such items as shipment date, method of transport, carrier, expected date and time of arrival and a full listing of contents

Advised letter of credit

Credit the opening of which the beneficiary is informed by a local bank. 

Advising bank

Bank, operating in the exporter’s country, which handles letters of credit for a foreign bank by notifying the export firm that the credit has been opened in its favor. The advising bank fully informs the exporter of the conditions of the letter of credit without necessarily bearing responsibility for payment. 

Advisory capacity

Term indicating that a shipper’s agent or representative is not empowered to make definitive decisions or adjustments without approval of the group or individual represented. 

Affreightment (Contract of):

Agreement between a steam ship line (or similar carrier) and an importer or exporter in which cargo space is reserved on a vessel for a specified time and at a specific price. The importer/exporter is obligated to make payment whether or not the shipment is made.

After date (A/d):

Payment on a negotiable instrument, such as a bank draft, becomes due a specified number of days after presentation of the draft. 

After sight

Phrase indicating that the date of maturity of a draft or other negotiable instrument is due a specific number of days after presentation of the draft to the drawee or payee. 

Agent / Agency agreement

Agent is an independent person or legal entity which acts on behalf of another (the ‘principal’).  In international transactions, generally refers to a sales representative who prospects on behalf of a foreign principal, earning commission on sales eventually concluded between the principal and the ultimate client.  

Air Cargo

Goods/cargo transported, or to be transported, by an air carrier.

Air Cargo Agent

An agent appointed by an airline to solicit and process international airfreight shipments.

Air Cargo Containers

Containers designed to conform to the inside of an aircraft. There are many shapes and sizes of containers. Air cargo containers fall into three categories:

  1. Air cargo pallets;
  2. Lower deck containers;
  3. Box type containers.
Air Carrier

An organization transporting passengers and/or cargo by aircraft.

Air Freight Forwarder

An air freight forwarder provides pickup and delivery service under its own tariff, consolidates shipments into larger units, prepares shipping documentation and tenders shipments to the airlines. Air freight forwarders do not generally operate their own aircraft and may therefore be called "indirect air carriers". Because the air freight forwarder tenders the shipment, the airlines consider the forwarder to be the shipper.

Air Waybill (AWB)

A shipping document used by the airlines for air freight. It is a contract for carriage that includes carrier conditions of carriage including such items as limits of liability and claims procedures. The air waybill also contains shipping instructions to airlines, a description of the commodity and applicable transportation charges

All Risks Clause

An insurance provision which provides additional coverage to an Open Cargo Policy, usually for an additional premium. Contrary to its name, the clause does not protect against all risks. The more common perils it does cover are theft, pilferage, non-delivery, fresh water damage, contact with other cargo, breakage, and leakage. Inherent vice, loss of market, and losses caused by delay are not covered.

All Water

Term used when the transportation is completely by water.

All-in

Freight quotation including all charges, often in one lump sum rather than broken down. 

Alliance

Group of airlines or ocean carriers who coordinate and cross list schedules, and sell capacity on each other’s flights/voyages.

Alongside

Side of a ship. Goods to be delivered “alongside” are to be placed on the dock or barge within reach of the transport ship’s tackle so that they can be loaded aboard the ship. 

Any-Quantity (AQ) rate

A rate that applies to any size shipment tendered to a carrier; no discount rate is available for large shipments.

Applicant

In the documentary credit process, normally the buyer or importer, who applies (thus, the applicant) for a letter of credit in favor of the beneficiary, the seller. 

Arbitrage

Process of buying foreign exchange, stocks, bonds, and other commodities in one market and immediately selling them in another market at higher prices. 

Arbitrary

Stated amount over a fixed rate to one point to make a rate to another point. 

Arbitration

Process of dispute resolution in which a neutral third party (arbitrator) renders a decision after a hearing at which both parties have an opportunity to be heard.  Arbitration may be voluntary or contractually required. 

Arrival Notice (AN)

Notice sent by the carrier informing the consignee, notify party, and also notify party of the arrival date of the cargo. Other pertinent information for shipment may be included, such as bill of lading number, weight, charges due and location of cargo. 

At sight

Phrase indicating that payment on a draft or other negotiable instrument is due upon presentation or demand.

ATA Carnet

An ATA Carnet (a. k. a. "Merchandise Passport") is a document that facilitates the temporary importation of products into foreign countries by eliminating tariffs and value-added taxes (VAT) or the posting of a security deposit normally required at the time of importation.

Authority to pay

A document comparable to a revocable letter of credit but under whose terms the authority to pay the seller stems from the buyer rather than from a bank.

Awkward cargo

Cargo of irregular size that is either containerized or un-containerized. It requires prior approval, depending on the circumstances, before confirmation of booking. 

Back-to-back credit

Commercial device under which a middleman uses a documentary credit to open a second credit in favor of a supplier. It should be distinguished from a transferable credit. 

Backorder

This term has several related meanings such as :

  1. The act of retaining a quantity to ship against an order when other order lines have already been shipped. Backorders are usually caused by stock shortages ;
  2. The quantity remaining to be shipped if an initial shipment(s) has been processed. Note: In some cases, backorders are not allowed. This results in a lost sale when sufficient quantities are not available to completely ship an order or order line.
Backsourcing

Pulling a function back in house as an outsourcing contract expires.

Bag

Flexible packaging made of paper, plastic film, textiles, woven material or other similar materials.

Bale

A large compressed, bound, and often wrapped bundle of a commodity, such as cotton or hay.

Bank guarantee

Assurance obtained from a bank by a buyer that the bank will pay the seller the stated amount of the guarantee should the buyer default on payment. 

Bank release

Negotiable time draft drawn on and accepted by a bank which has added its own credit to that of the buyer. 

Banker's draft

Draft drawn by or on behalf bank itself. Regarded as cash, it is payable on demand and cannot be returned unpaid.

Banker’s acceptance

Draft drawn on and accepted by a bank.  Depending on the bank’s creditworthiness, it can be a financial instrument that can then be discounted. 

Barge

The cargo-carrying vehicle which may or may not have its own propulsion mechanism for the purpose of transporting goods. Primarily used by Inland water carriers, basic barges have open tops, but there are covered barges for both dry and liquid cargoes.

Base Currency

The currency whose value is "one" whenever a quote is made between two currencies.

Beneficiary

The person in whose favor a letter of credit is issued or a draft is drawn. 

Berth

Location alongside a quay (pier) where a ship ties up to load or discharge cargo. 

Best in Class

An organization, usually within a specific industry, recognized for excellence in a specific process area.

Bill of Lading (B/L)

Document that establishes the terms of a contract between a shipper and a transportation company under which freight is to be moved between specified points for a specified charge. Usually prepared by the shipper and actuated by the carrier, it serves as a document of title, a contract of carriage, and a receipt for goods.

It may also be used as an instrument of ownership, which can be bought, sold or traded while the goods are in transit. 

Bill of Lading (exceptions)

The terms and conditions of most bills of lading release transportation providers from liability for loss or damage arising from: an act of God; a public enemy; the authority of law or; the act or default of the shipper. In addition, except in the case of negligence, a transportation provider will not be liable for loss, damage, or delay caused by:  the property being stopped and held in transit at the request of the shipper, owner or party entitled to make such request; lack of capacity of a highway, bridge or ferry; a defect or vice in the property; or riots or strikes.

Bill of Lading (Through)

A bill of lading to cover goods from point of origin to final destination when interchange or transfer from one carrier to another is necessary to complete the journey.

Bill of Lading Number

The number assigned by the carrier to identify the bill of lading.

Billing

A carrier terminal activity that determines the proper rate and total charges for a shipment and issues a freight bill.

Blanket Purchase Order

A long-term commitment to a supplier for material against which short-term releases will be generated to satisfy requirements. Oftentimes, blanket orders cover only one item with predetermined delivery dates. 

Blanket Rate

A rate that does not increase according to the distance a commodity is shipped.

BOLERO

Originally a system for transmission of electronic bills of lading. In the process of being expanded by Swift into an electronic platform for transmission of all trade documents.

Bonded Carrier

This term has several related meanings such as :

  1. A carrier licensed to transport goods in bond ;
  2. A carrier, licensed by the customs authority of a country to transport imported gods past the customs border of the country to another customs office in the same country where duties and taxes are then paid by the importer.
Bonded warehouse

Warehouse authorized by a customs authority for storage of goods on which payment of duties is deferred until the goods are removed for entry into the commerce of the country or exported from the country. 

Bonded Warehouse

A building authorized by customs authorities for the storage of goods without payment of duties until removal.

Booking

The act of requesting space and equipment aboard a vessel or air plane for cargo which is to be transported.

Booking Number

The number assigned to a certain space reservation by the carrier or the carrier's agent.

Box

Packaging with complete rectangular or polygonal faces, made of metal, wood, plywood, reconstituted wood, fiberboard, plastic, or other suitable material. Alternate meaning: Slang term for an ocean container for cargo. 

Break Bulk

A term used to describe goods that must be loaded individually, and not in intermodal containers nor in bulk. Ships that carry this sort of cargo are often called general cargo ships. The term break bulk derives from the phrase breaking bulk—the extraction of a portion of the cargo of a ship or the beginning of the unloading process from the ship's holds. These goods may not be in shipping containers. Break bulk cargo is transported in bags, boxes, crates, drums, or barrels. Unit loads of items secured to a pallet or skid are also used.

Break-bulk Cargo

Cargo in-between bulk and containerized, that must be handled piece-by-piece by terminal workers (stevedores). Often stored in bags or boxes and stacked onto pallets. Smaller lift equipment (forklifts, small cranes) used than for containerized cargo, but more labor intensive.

Broker

There are 3 definitions for the term Broker :  

  1. An enterprise that owns and leases equipment ;
  2. An enterprise that arranges the buying & selling of transportation of, goods, or services ;
  3. A ship agent who acts for the ship owner or charterer in arranging charters.
Brokerage

A business whose main responsibility is to be an intermediary that puts buyers and sellers together in order to facilitate a transaction. Brokerage companies are compensated via commission after the transaction has been successfully completed.

Bulk Area

A storage area for large items which at a minimum are most efficiently handled by the palletload.

Bulk Cargo

Cargo that is stowed loose on transportation vehicles, in a tank or hold without specific packaging, and handled by pump, scoop, conveyor, or shovel. Examples: grain, coal, petroleum, chemicals.

Bunker Adjustment Factor (BAF)

Surcharge levied in addition to the freight rate to compensate the carrier for differentials in the cost of purchasing fuel (bunkers) to power the ship’s engines. 

Bunker surcharge (BSC)

Extra charge by carrier to adjust for temporarily higher fuel costs. Also called fuel surcharge. 

Bunkers

Ship’s fuel carried in the ship’s tanks to power the engines. 

Buyer

An enterprise that arranges for the acquisition of goods or services and agrees to payment terms for such goods or services.

Buying Agent

An agent who buys in this country for foreign importers, especially for such large foreign users as mines, railroads, governments, and public utilities. Synonymous with "purchasing agent".

Cargo

Merchandise carried by a means of transportation.

Carnet

Customs document permitting the holder to carry or send merchandise temporarily into certain foreign countries (for display, demonstration, or similar purposes) without paying duties or posting bonds or undertaking the usual customs formalities typically required for the entry of goods. 

Carrier

A firm that provides transportation services, typically owning and operating transportation equipment. Examples include: trucking company, railroad, airline, steamship line, parcel/express company.

Carrier Assets

Items that a carrier owns (technically or outright) to facilitate the services they provide.

Carrier certificate and release order

Used to advise Customs of the details of the shipment, its ownership, port of lading, etc. By means of this document, the carrier certifies that the firm or individual named in the certificate is the owner or consignee of the cargo. 

Carrier liability

Air and ocean carriers are normally liable for all damage, delay, and loss of cargo except those arising from act of God, act of the shipper, and inherent nature of the goods from acceptance of cargo through its delivery or release. Air carriers are usually liable under Warsaw convention, and ocean carriers under Hague convention.

Cash Against Documents (CAD)

A method of payment for goods in which documents transferring title are given to the buyer upon payment of cash to an intermediary acting for the seller.

Cash In Advance (CIA)

Payment for goods in which the price is paid in full before shipment is made. This method is usually used only for small purchases, initial purchases, or when the goods are built to order. 

Cash With Order (CWO)

A method of payment for goods where cash is paid at the time of order, and the transaction becomes binding on both buyer and seller.

Certificate of Compliance

A supplier's certification that the supplies or services in question meet specified requirements.

Certificate of Free Sale

Document issued by a government entity stating that the goods specified thereon comply with the exporting country's laws for distribution and sale within that country. This document provides assurance to the importing country that the goods meet certain prescribed standards. Most often issued for food product, cosmetics, drugs, and medical devices.

Certificate of Inspection

A document in which certification is made as to the good condition of the merchandise immediately prior to shipment. The buyer usually designates the inspecting organization, usually an independent inspection firm or government body.

Certificate of Insurance

A negotiable document indicating that insurance has been secured under an open policy to cover loss or damage to a shipment while in transit.

Certificate of Manufacture

Documents used with letters of credit when drafts are paid/negotiated on presentation of a certificate stating that goods have been completed and are being held for shipment. 

Certificate of Origin (COO or C/O)

A document attesting to the country of origin of goods. A certificate of origin is often required by the customs authorities of a country as part of the entry process. A certificate of origin may be required even though the commercial invoice contains the information.

Certificated Carrier

A for-hire air carrier that is subject to economic regulation and requires an operating certification to provide service.

Certified Supplier

A status awarded to a supplier who consistently meets predetermined quality, cost, delivery, financial, and count objectives. Incoming inspection may not be required.

CF (Freight Carriage paid to)

Means that the seller pays the freight for the carriage of the goods to the named destination. However, the risk of loss of or damage to the goods, as well as the risk of any cost increases, is transferred from the seller to the buyer when the goods have been delivered into the custody of the first carrier and not at the ship's rail.

CFR (Cost and Freight):

Indicate that the seller will deliver the goods onto a vessel and pay all the normal charges to get the cargo to the named seaport. The buyer assumes all risks from the time the cargo is placed onto the vessel at the seaport of loading.

CFS / CFS

Cargo movement delivered loose at origin point, devanned by carrier at destination, and picked up loose at destination terminal. 

CFS / CY

Loose cargo received at origin point, loaded in a container by carrier, then delivered intact at destination. 

Change Order

A formal notification that a purchase order or shop order must be modified in some way. This change can result from a revised quantity, date, or specification by the customer; an engineering change; a change in inventory requirement data; etc.

Chargeable Weight

The shipment weight used in determining freight charges. The chargeable weight may be the dimensional weight or, for container shipments, the gross weight of the shipment less the tare weight of the container.

Charging Area

A warehouse area where a company maintains battery chargers and extra batteries to support a fleet of electrically powered materials handling equipment. The company must maintain this area in accordance with government safety regulations.

Charter Party

Written contract, usually on a special form, between the owner of a vessel and a “charterer” who rents use of the vessel or a part of its freight space. The contract generally includes the freight rates and the ports involved in the transportation. 

CIF (Cost, Insurance, and Freight) :

A pricing term under which the seller pays all expenses involved in the placing of merchandise on board a carrier and in addition prepays the freight and insures the goods to an agreed destination.

CIP (Carriage and Insurance Paid to )

Exporter’s price includes the cost of the merchandise, all shipping costs to the named point (inland city) and insurance.

Claim

A legal demand by a shipper or consignee to a carrier for financial reimbursement for a loss or damage of a shipment.

Classification

An alphabetical listing of commodities, the class or rating into which the commodity is placed, and the minimum weight necessary for the rate discount; used in the class rate structure.

Claused Bill of Lading

Claused (or foul) bill of lading contains notations or remarks as to defects in the goods and/or packaging. 

Clean draft

Draft to which no documents have been attached.

Clean report of findings

Certificate of inspection of goods and verification of selling price issued by an inspection company (usually required by the buyer’s country). 

CleanBill of Lading

Receipt for goods issued by a carrier that indicates that the goods were received in “apparent good order and condition,” without damages or other irregularities. 

Clearance

A document stating that a shipment is free to be imported into the country after all legal requirements have been met.

Collect Freight

Freight payable to the carrier at the port of discharge or ultimate destination. The consignee does not pay the freight charge if the cargo does not arrive at the destination.

Collecting bank

In a documentary collection, the bank acting as an agent for the seller’s bank in collecting payment or acceptance of a time draft from the buyer to be forwarded to the seller’s bank (the remitting bank). 

Combi Aircraft

An aircraft specially designed to carry unitized cargo loads on the upper deck of the craft, forward of the passenger area.

Commercial Attach

The commercial expert on the diplomatic staff of his country's embassy or large consulate in a foreign country.

Commercial Invoice (C/I or CI)

A commercial invoice is a document used in foreign trade. It is used as a customs declaration provided by the person or corporation that is exporting an item across international borders. Although there is no standard format, the document must include a few specific pieces of information such as the parties involved in the shipping transaction, the goods being transported, the country of manufacture, and the Harmonized Tariff System codes for those goods. A commercial invoice must also include a statement certifying that the invoice is true, and a signature.

Commodities Clause

A clause that prohibits railroads from hauling commodities that they produced, mined, owned, or had an interest in.

Commodity

Any article exchanged in trade but most commonly used to refer to raw materials, including such minerals as tin, copper, and manganese, and bulk-produced agricultural products such as coffee, tea, and rubber.

Commodity Buying

Grouping like parts or materials under one buyer's control for the procurement of all requirements to support production.

Commodity Code

A code describing a commodity or a group of commodities pertaining to goods classification. This code can be carrier tariff or regulating in nature.

Competent Authority

National agency responsible under its national law for the control or regulation of a particular aspect of the transportation of hazardous materials (dangerous goods).

Compliance

Meaning that products, services, processes, and/or documents comply with requirements.

Concealed loss

Shortage or damage not evident at delivery.

Conditional free

Merchandise free of duty under certain conditions, provided they are met.

Conference Carrier

An ocean carrier who is a member of an association known as a "conference." The purpose of the conference is to standardize shipping practices, eliminate freight rate competition, and provide regularly scheduled service between specific ports.

Confirmed export letter of Credit

Letter of credit, issued by a foreign bank, the validity of which has been confirmed by another bank usually in the seller’s country. An exporter presenting conforming documents against a confirmed letter of credit is assured of payment by the confirming bank, even if the buyer or the opening bank defaults. 

Confirming bank

In letter of credit transactions, the bank which adds its own irrevocable undertaking for payment in addition to that given by the issuing bank. Usually located in the exporter’s country. 

Confirming Order

A purchase order issued to a supplier listing the goods or services and terms of an order placed orally or otherwise before the usual purchase document.

Conformance

An affirmative indication or judgment that a product or service has met the requirements of a relevant specification, contract, or regulation. 

Connecting Carrier

Intermediary carrier utilized to connect cargo to/from the mother vessel. Also known as "feeder service." 

Consignee

The person, firm, or representative to whom a seller or shipper sends merchandise and who, upon presentation of the necessary documents, is recognized as the owner of the merchandise for the purpose of the payment of customs duties. This term is also used as applying to one to whom goods are shipped, usually at the shipper's risk, when an outright sale has not been made. 

Consignment

The act of consigning, which is placing any material in the hands of another, but retaining ownership until the goods are sold or person is transferred. This may be done for shipping, transfer of goods to auction, or for sale in a store. Consignment goods are sent to the agent for the purpose of sale and the ownership of these goods remains with the sender. The agent sells the goods on behalf of the sender, according to his/her instructions. The sender of goods is known as consignor and the agent is known as the consignee.

Consignor

The individual, company or entity that ships goods (shipper), or gives goods to another for care. The consignor is usually the exporter or his agent.

Consolidation

Cargo shipping method in which a freight forwarder at the port of origin combines several individual consignments to make up a full container load. This arrangement allows the goods to be shipped as containerized-cargo that offers greater security at lower shipping rates. At the port of destination, the consolidated shipment is separated (deconsolidated or ungrouped) back into the original individual consignments for delivery to their respective consignees.

Consolidator

An enterprise that provides services to group shipments, orders, and/or goods to facilitate movement.

Consolidator's Bill of Lading

A bill of lading issued by a consolidator as a receipt for merchandise that will be grouped with cargo obtained from other shippers. See also House Air Waybill.

Consortium

Group of carriers pooling resources in a trade lane to maximize their resources efficiently. 

Consular Declaration

Formal statement, made to the consul of a foreign country, describing goods to be shipped. 

Consular Documents

Special forms signed by the consul of a country to which cargo is destined.

Consular Invoice

Document, required by some foreign countries, describing a shipment of goods and showing information such as the seller, buyer, and value of the shipment. Certified by a consular official of the foreign country, it is used by the country’s customs officials to verify the value, quantity, and nature of the shipment. 

Consularization

Approval of export documents by a foreign consulate.

Consumption Entry

An official Customs form used for declaration of reported goods, also showing the total duty due on such transaction.

Consumption entry

Type of customs entry admitting goods into the commerce of the United States. May be formal or informal. 

Container

A single, rigid, sealed, reusable metal box in which merchandise is shipped by vessel, truck, or rail. Container types include standard, high cube, hardtop, open top, flat, platform, ventilated, insulated, refrigerated, or bulk. Usually 8 ft x 8 ft in width and height, 20 to 55 ft long. Specialized containers also exist for air transportation modes, but are much smaller and cannot be directly transferred to truck or rail.

Container Chassis

A vehicle built for the purpose of transporting a container so that, when a container and chassis are assembled, the produced unit serves as a road trailer.

Container Depot

The storage area for empty containers.

Container Freight Station (CFS)

The location designated by carriers for receipt of cargo to be packed into containers/equipment by the carrier. At destination, CFS is the location designated by the carrier for unpacking of cargo from equipment/containers.

Container freight station (CFS)

Where less-than-container-load ocean shipments are brought to be loaded into a container (export) or unloaded from containers and made available for customs clearance (import). 

Container Freight Station Charge

The charge assessed for services performed at the loading or discharge location.

Container I.D

An identifier assigned to a container by a carrier.

Container load plan (CLP)

Document prepared to show all details of cargo loaded in a container, e.g. weight (individual and total), measurement, markings, shipper, the origin of goods and destination, as well as location of the cargo within the container. 

Container on Flat Car (COFC)

A container that is transported on a rail flatcar. It can be shipped via tractor/trailer using a chassis as the wheel section.

Container Terminal

An area designated to be used for the stowage of cargo in containers that may be accessed by truck, rail, or ocean transportation.

Container Vessel

A vessel specifically designed for the carriage of containers.

Container Yard (CY)

The location designated by the carrier for receiving, assembling, holding, storing, and delivering containers, and where containers may be picked up by shippers or redelivered by consignees.

Container Yard to Container Yard (CY /CY)

A type of shipping-line service in which freight is transported from origin container yard to destination container yard.

Containerization

A shipment method in which commodities are placed in containers, and after initial loading, the commodities, per se, are not rehandled in shipment until they are unloaded at the destination.

Containership

Ocean vessel specifically designed to carry ocean cargo containers. It's fitted with vertical cells for maximum loading/discharge efficiency.

Contract

An agreement between two or more competent persons or companies to perform or not to perform specific acts or services or to deliver merchandise. A contract may be oral or written. A purchase order, when accepted by a supplier, becomes a contract. Acceptance may be in writing or by performance, unless the purchase order requires acceptance in writing.

Contract Carrier

A for-hire carrier that does not serve the general public but serves shippers with whom the carrier has a continuing contract. The contract carrier must secure a permit to operate.

Contract of Affreightment

A contract between a cargo shipper and carrier for the transport of multiple cargoes over a period of time. Contracts are individually negotiated and usually include cargo description, quantities per shipment and in total, load and discharge ports, freight rates and duration of the contract.

Conventional tariff

Tariff established in agreements resulting from tariff negotiations under the GATT. 

Convertible currency

Currency that can be bought and sold for other currencies at will.

Correspondent

Bank, Customs Broker, freight forwarder, etc. working with others in another city or country to expediate transactions. 

Correspondent Bank

A bank which is a depository for another bank, accepting deposits and collecting items for its bank depositor.

Country of destination

Country where the goods are to be consumed, further processed or manufactured, as known to the shipper at time of export. If the country of ultimate destination is unknown, the shipment is credited to the last country in which the shipper knows that the merchandise will be shipped in the same form as when exported.

Country of origin

Country where an article was wholly grown, manufactured or produced, or, if not wholly grown, cultivated or produced in one country, the last country in which the article underwent a substantial transformation. Duty rates vary according to the country of origin. 

Country of Transshipment

Name of the country, where goods will be discharged, from a vessel or aircraft, and transit through that country to reach their final country of destination.

CPT (Carriage Paid to)

Incoterm indicates that the seller assumes most of the cost of transportation of the goods including export fees, carriage charges, and fees at the port of destination. Seller does not pay for insurance - that is the buyer’s obligation.

Crane

A materials handling device that lifts heavy items. There are two types: bridge and stacker.

Credit Agreement

Agreement between carrier and shipper for release of cargo with promise to pay ocean freight within specified time. 

Credit Level

The amount of purchasing credit a customer has available. Usually defined by the internal credit department and reduced by any existing unpaid bills or open orders.

Credit Risk Insurance

A form of insurance which protects the seller against loss due to default on the part of the buyer. 

Credit Terms

The agreement between two or more enterprises concerning the amount and timing of payment for goods or services.

Cross Dock

Transportation terminal in which received items transferred directly from inbound to the outbound shipping dock, with storage only occurring temporarily during unloading and loading. No long-term storage is provided. Usually used only for vehicle transfers. Often owned and operated by large shippers. Examples: Home Depot, food service companies, hub passenger airports.

Cross Docking

A distribution system in which merchandise received at the warehouse or distribution center is not put away, but instead is readied for shipment to retail stores. Cross docking requires close synchronization of all inbound and outbound shipment movements. By eliminating the put-away, storage, and selection operations, it can significantly reduce distribution costs.

Cross Sell

The practice of attempting to sell additional products to a customer during a sales call. For example, when the CSR presents a camera case and accessories to a customer that is ordering a camera.

Cross Shipment

Material flow activity where materials are shipped to customers from a secondary shipping point rather than from a preferred shipping point.

Cubage

Cubic volume of space being used or available for shipping or storage.

Cube Out

The situation when a piece of equipment has reached its volumetric capacity before reaching the permitted weight limit.

Cube Utilization

Can means :

  1. Loading a truck or other transportation vehicle with merchandise in order to fill as much of the horizontal and vertical space as possible ;
  2. In warehousing, a measurement of the utilization of the total storage capacity of a vehicle or warehouse.
Cubic Capacity

The carrying capacity of a piece of equipment according to measurement in cubic feet.

Cubic Space

In warehousing, a measurement of space available, or required, in transportation and warehousing.

Currency Adjustment Factor (CAF)

A surcharge imposed by a carrier on ocean freight charges to offset foreign currency fluctuations.

Customhouse broker

Individual or firm licensed to enter and clear goods through customs.

Customs

Authorities designated to collect duties levied by a country on imports and exports. The term also applies to the procedures involved in such collection. 

Customs bonded warehouse

Authorized by Customs to store or manufacture goods while deferring payment of duties until goods are moved into Customs territory. These goods are not subject to duties if reshipped to foreign ports.

Customs Broker

A firm that represents importers/exporters in dealings with customs. Normally responsible for obtaining and submitting all documents for clearing merchandise through customs, arranging inland transport, and paying all charges related to these functions.

Customs Brokerage

A profession that involves the "clearing" of goods through customs barriers for importers and exporters (usually businesses). This involves the preparation of documents and/or electronic submissions, the calculation and payment of taxes, duties and excises, and facilitating communication between government authorities and importers and exporters.

Customs Clearance

The documented permission to pass that a national customs authority grants to imported goods so that they can enter the country or to exported goods so that they can leave the country. The custom clearance is typically given to a shipping agent to prove that all applicable customs duties have been paid and the shipment has been approved.

Customs Clearance

The act of obtaining permission to import merchandise from another country into the importing nation.

Customs Declaration

An oral or written statement attesting to the correctness of description, quantity, value, etc., of merchandise offered for importation.

Customs Duty

Is a tariff or tax imposed on goods when transported across international borders. The purpose of Customs Duty is to protect each country's economy, residents, jobs, environment, etc., by controlling the flow of goods, especially restrictive and prohibited goods, into and out of the country.

Customs House Broker

A business firm that oversees the movement of international shipments through Customs, and ensures that the documentation accompanying a shipment is complete and accurate.

Customs Invoice

A document that contains a declaration by the seller, the shipper, or the agent as to the value of the shipment.

Customs Tariff

Charges imposed by governments on imported and/or exported goods.

Customs Union

Association between two or more countries whereby they eliminate tariffs and other import restrictions on each other’s goods and establish a common tariff on the goods from all other countries. 

Customs Value

The value of the imported goods on which duties will be assessed.

CY/ CFS

Cargo loaded in a full container by a shipper at origin, delivered to pier facility at destination, and then devanned by carrier for loose pick up. 

DAF(Delivered at Frontier)

Incoterm that means the seller's obligations are fulfilled when the goods have arrived at the frontier, but before "the customs border" of the country named in the sales contract. The term is primarily intended to apply to goods by rail or road but is also used irrespective of the mode of transport. 

Dangerous Goods

Are solids, liquids, or gases that can harm people, other living organisms, property, or the environment. They are often subject to chemical regulations. Dangerous goods include materials that are radioactive, flammable, explosive, corrosive, oxidizing, asphyxiating, biohazardous, toxic, pathogenic, or allergenic. Also included are physical conditions such as compressed gases and liquids or hot materials, including all goods containing such materials or chemicals, or may have other characteristics that render them hazardous in specific circumstances. 

DDP (Delivered Duty Paid)

Incoterm for when the seller bears all obligations, risk and costs to delivers the goods, cleared for export and import, at the named point in the country of destination. 

DDU (Delivered Duty Unpaid)

Incoterm for when the seller bears all obligations, risk and costs to delivers the goods, cleared for export, at the named point in the country of destination.The buyer arranges and pays for customs formalities upon import into the destination country.  

Dead Head

A portion of a transportation trip in which no freight is conveyed; an empty move. Transportation equipment is often dead-headed because of imbalances in supply and demand. 

Dead on Arrival (DOA)

A term used to describe products which are not functional when delivered. 

Deadfreight

Freight charge to be paid even when shipment was not made, owing to failure by shipper or charterer to actually ship goods in the shipping space for which a reservation was made. 

Deadweight

The number of long tons that a vessel can transport of cargo, supplies and fuel. It is the difference between the number of tons of water a vessel displaces “light” (empty) and the number of tons it displaces when submerged to the “load line”.

Deck Cargo

Goods shipped on the deck of a ship rather than in its holds.

Deck Trailers

Trailers with rows of tracking on each sidewall and deck load bars. The load bars fit into the tracks to form temporary "decks" on which goods can be loaded. Decks allow more goods to be loaded in the trailer, reduce damage and speed loading and unloading.

Declaration of Dangerous Goods

To comply with authorities  exporters are required to provide special notices to inland and ocean transport companies when goods are hazardous.

Declared Value

The value of goods declared to the carrier by the shipper for the purposes of determining charges, or of establishing the limit of the carrier’s liability for loss, damage, or delay.

Declared Value for Carriage

The value of the goods, declared by the shipper on a bill of lading, for the purpose of determining a freight rate or the limit of the carrier's liability.

Dedicated Contract Carriage

A third party service that dedicates equipment (vehicles) and drivers to a single customer for its exclusive use on a contractual basis.

Defective Goods Inventory (DGI)

Those items that have been returned, have been delivered damaged and have a freight claim outstanding, or have been damaged in some way during warehouse handling.

Delivery Appointment

An agreement between two companies whereby goods are scheduled to arrive at a specified time and location.

Delivery Instructions

These instructions provide specific information to the inland carrier about the merchandise to the particular pier or shipping line. 

Delivery Order (D/O)

Order, commonly addressed to a terminal superintendant or warehouse manager, directing the release of specified cargo to a particular receiver. 

Delivery receipt

Document a consignee or its agent dates and signs at delivery, stating the condition of the goods at delivery. The driver takes the signed delivery receipt to the terminal for retention. The customer retains the remaining copy.

Delivery-Duty-Paid

Supplier/manufacturer arrangement in which suppliers are responsible for the transport of the goods they've produced, which are being sent to a manufacturer. This responsibility includes tasks such as ensuring that products get through Customs.

Demurrage

Penalty for exceeding free time allowed for loading/unloading under terms of railroad/ocean tariffs; detention is used to mean the same thing for motor carriers. Excess time taken for loading or unloading of a vessel not caused by the vessel operator, but due to the acts of a charterer or shipper. Also refers to imported cargo not picked up within prescribed time. 

DEQ (Delivered ex Quay)

Incoterm for when the seller bears all obligations, risk and costs to delivers the goods, cleared for export, on the quay in the port of destination; offloaded from the delivering vessel.  

DEQ (Delivered Ex Quay)

Indicates that the seller must deliver the goods onto the quay (dock or wharf), having cleared the goods for import and paid all taxes, duties, etc. applicable to that clearance.

DES (Delivered ex Ship)

Incoterm for when the seller bears all obligations, risk and costs to delivers the goods, cleared for export, on board the named vessel in the port of destination, not offloaded. 

Detention

Penalty charges assessed by a carrier to a shipper or consignee for holding transportation equipment, i.e. trailers, containers, railcars, longer than a stipulated time for loading or unloading.

Devaluation

Official lowering of the value of one country’s currency in terms of one or more foreign currencies. For example, if the U.S. dollar is devalued in relation to the euro, one dollar will “buy” fewer euros than before. 

Dimensional Weight (DimWt)

A term used in shipping and freight - a billing technique which takes into account the length, width, and height of a package.

Distribution

Outbound logistics, from the end of the production line to the end user. The activities associated with the movement of material, usually finished goods or service parts, from the manufacturer to the customer. These activities encompass the functions of transportation, warehousing, inventory control, material handling, order administration, site and location analysis, industrial packaging, data processing, and the communications network necessary for effective management. It includes all activities related to physical distribution, as well as the return of goods to the manufacturer. In many cases, this movement is made through one or more levels of fieldwarehouses. The systematic division of a whole into discrete parts having distinctive characteristics.

Distribution Center (DC)

Is a warehouse or other specialized building, often with refrigeration or air conditioning, which is stocked with products (goods) to be redistributed to retailers, to wholesalers, or directly to consumers. A distribution center is a principal part, the order processing element, of the entire order fulfillment process.

Distribution Warehouse

A finished goods warehouse from which a company assembles customer orders.

Distributor

Foreign company or person who purchases directly from a supplier and maintains an inventory of the supplier’s products. 

Dock

A platform, generally the same height as the trailer floor, where trucks are loaded and unloaded.

Dock Receipt

A receipt issued by an ocean carrier or its agent, acknowledging that a shipment has been delivered and received at the dock or warehouse of the carrier.

Document of title

Evidence of entitlement or ownership, such as a carrier's negotiable bill of lading, which allows a party to claim title to the goods in question. 

Documentary collection

Method of payment under which the shipping documents relating to a particular cargo are released to the importer on payment (documents against payment D/P) or acceptance (documents against acceptance D/A) of a documentary draft drawn on him by the exporter. 

Documentation

The papers attached or pertaining to goods requiring transportation and/or transfer of ownership.

Documents against acceptance (D/A)

Instructions given by a shipper to a bank indicating that documents transferring possession rights and/or title to goods should be delivered to the buyer (or drawee) only upon the buyer’s acceptance of the attached draft. 

Documents Against Payment (D/P)

A type of payment for goods in which the documents transferring title to the goods are not given to the buyer until he has paid the value of a draft issued against him.

Door to Door

Transport service covering carriage from the seller’s premises to the buyer’s premises. Note that this term refers to a freight charge in a carriage contract between a carrier and a shipper and thus is distinct from the issue of the Incoterm chosen in the contract of sale (an agreement between seller and buyer). 

Draft (or Bill of Exchange)

The same as a "bill of exchange." A written order for a certain sum of money, to be transferred on a certain date from the person who owes the money or agrees to make the payment (the drawee) to the creditor to whom the money is owed (the drawer of the draft).

Drawee

Individual or firm on whom a draft is drawn and who owes the stated amount.

Drawer

Individual or firm that issues or signs a draft and thus stands to receive payment of the stated amount from the drawee. 

Drayage

The service offered by a motor carrier for pick-up and delivery of ocean containers or rail containers. Drayage agents usually handle full-load containers for ocean and rail carriers.

Drop

A situation in which an equipment operator deposits a trailer or boxcar at a facility at which it is to be loaded or unloaded.

Drop Ship

To take the title of the products but not actually handle, stock, or deliver it, e.g., to have one supplier ship directly to another or to have a supplier ship directly to the buyer's customer.

Drop Shipment

A shipment of goods from a manufacturer directly to a dealer or consumer, avoiding shipment to the wholesaler (drop shipper). The wholesaler, however, is compensated for taking the order.

Dunnage

Wood and packaging materials used to keep cargo in place inside a container or transportation vehicle.

Duty

Tax imposed on imports by the customs authority of a country. Duties are generally based on the value of the goods (ad valorem duties), some other factor such as weight or quantity (specific duties), or a combination of value and other factors (compound duties). 

Duty Drawback

A refund of duty paid on imported merchandise when it is exported later, whether in the same or a different form.

Duty Free Zone (DFN)

Bounded and bonded area where foreign merchandise is brought in without import duties, for further processing or re-exporting. Import-duty must be paid on these goods if they are released in the local market.

Duty Rates

Tax imposed by Customs on imported merchandise. There are three basic types:

  1. Ad valorem - based on the entered value ;
  2. Specific - an amount per unit of quantity ;
  3. Compound - combination of ad valorem and specific rates. 
EDIFACT

Electronic Data Interchange for Administration, commerce, and Transport. The United Nations' EDI standard.

Electronic Data Interchange (EDI)

Intercompany, computer-to-computer transmission of business information in a standard format. For EDI purists, computer to computer means direct transmission from the originating application program to the receiving or processing application program. An EDI transmission consists only of business data, not any accompanying verbiage or free-form messages. Purists might also contend that a standard format is one that is approved by a national or international standards organization, as opposed to formats developed by industry groups or companies.

Electronic Funds Transfer (EFT)

A computerized system that processes financial transactions and information about these transactions or performs the exchange of value. Sending payment instructions across a computer network, or the company-to-company, company-to-bank, or bank-to bank electronic exchange of value.

Equipment

The rolling stock carriers use to facilitate the transportation services that they provide, including containers, trucks, chassis, vessels, and airplanes, among others.

Equipment I.D

An identifier assigned by the carrier to a piece of equipment.

Equipment Positioning

The process of placing equipment at a selected location

ETA

Estimated time of arrival.

ETD

Estimated time of departure.

ETS

Estimated time of sailing.

Ex (Point of Origin)

A pricing term under which the seller's only responsibility is to clear the goods for export and make them available to the buyer at an agreed upon location (factory, warehouse, ship, etc.). The buyer then bears the full cost and risk involved in transporting the goods to his desired location. Other terms used are "Ex Works," Ex Ship," and "Ex Quay."

Ex Number

Number preceded by the prefix “EX”, assigned by the DOT, to an item that has been evaluated and classified as an explosive material.

Exceptions

An exception is any delivery in which the recipient or driver notes a problem on the delivery receipt before signing it. Typically, exceptions concern shortage and/or damage.

Exchange Permit

Permit sometimes required by the importer’s government to enable the import firm to convert its own country’s currency into foreign currency with which to pay a seller in another country. 

Exchange Rate

Price of one currency in terms of another, that is, the number of units of one currency that may be exchanged for one unit of another currency. 

Exclusive Use

A shipper pays a premium rate for the sole use of a trailer. The trailer will be sealed at loading, and the seal number is recorded on the manifest. The seal number is verified before the trailer is unloaded at destination. When a shipper requests an exclusive-use trailer, no other freight may be added to the unit even if space permits.

Expiration Date

The final date upon which the presentation of documents and drawing of drafts under a letter of credit may be made.

Export

A function of international trade whereby goods produced in one country are shipped to another country for future sale or trade. The sale of such goods adds to the producing nation's gross output. If used for trade, exports are exchanged for other products or services. Exports are one of the oldest forms of economic transfer, and occur on a large scale between nations that have fewer restrictions on trade, such as tariffs or subsidies.

Export Broker

One who brings together the exporter and importer for a fee and then withdraws from the transaction.

Export Compliance

Complying with rules for exporting products, including packaging, labeling, and documentation.

Export Credit Insurance

Exporter’s insurance provided either by a private supplier or government agency against non-payment by importer and certain other risks depending on the type of policy. 

Export Declaration

A document required by authorities and completed by the exporter to show the value, weight, consignee, destination, etc., pertinent to the export shipment. The document serves two purposes: to gather trade statistics and to provide a control document if the goods require a valid export license.

Export License

A document secured from a government authorizing an exporter to export a specific quantity of a controlled commodity to a certain country. An export license is often required if a government has placed embargoes or other restrictions upon exports.

Export management company

Private firm that serves as the export department for several producers of goods or services, either by taking title or by soliciting and transacting export business on behalf of its clients in return for a commission, salary, or retainer plus commission. 

Export Merchant

A producer or merchant who sells directly to a foreign purchaser without going through an intermediate such as an export broker.

Export Quota

Restriction or set objective on the export of specified goods imposed by the exporting country's government. May be intended to protect domestic producers and consumers from temporary shortages of certain materials or as a means to moderate world prices of specified commodities. Commodity agreements sometimes contain explicit provisions to indicate when export quotas should go into effect among producers. 

Export Sales Contract

The initial document in any international transaction; it details the specifics of the sales agreement between the buyer and seller.

Export Trading Company

A firm that buys domestic products for sale overseas. A trading company takes title to the goods; an export-management company usually does not.

Exports

Goods and services produced in one country and sold in other countries in exchange for goods and services, gold, foreign exchange, or settlement of debt. Countries devote their domestic resources to exports because they can obtain more goods and services with the international exchange they earn from the exports than they would from devoting the same resources to the domestic production of goods and services.

Express

It Means :

  1. Carrier payment to its customers when ships, rail cars, or trailers are unloaded or loaded in less than the time allowed by contract and returned to the carrier for use;
  2. The use of priority package delivery to achieve overnight or second-day delivery.
Extended Enterprise

The notion that supply chain partners form a larger entity which works together as though it were a single unit.

EXW (Ex Works)

Incoterms rule for when the seller is required to make the goods available at seller’s premises, which commonly is at his factory or warehouse, but may be any place on the seller’s side of the transaction. All other obligations, risk and costs are borne by the buyer including export formalities from the origin country.

Facilities

The physical plant, distribution centers, service centers, and related equipment.

Factor

Agent appointed to sell goods on commission, also known as a commission merchant.

FAS Free (Alongside Ship -named port of export-)

Under Incoterms FAS, the seller bears obligations, risk and costs for delivery of the goods alongside a vessel at the port of departure. The costs and risk of loading, unloading, ocean transportation, and insurance are borne by the buyer. This Incoterm rule may be used only for ocean and inland waterway transport.

FCA (Free Carrier -named place-)

Under Incoterm FCA, the seller is responsible to make the goods available to the buyer at a named place within the seller’s country. Once delivery by the seller to the named place has been completed, the buyer bears all further obligations, risks, and costs in taking the goods to whatever final destination of the buyer’s choosing. FCA is applied to all modes of transport. 

FCL (Full Container-Load)

An ocean-shipping and intermodal industry term; a full container-load shipment is when a shipper contracts for the transportation of an entire container. The vast majority of intermodal and ocean freight is contracted in this manner. Historically, FCL also stands for full carload which is the primary business of all modern railroads, and is the railroad equivalent of TL trucking.

FEU (Forty-Foot equivalent Unit)

Method of measuring vessel load or capacity, in units of forty-foot long containers.

Field Warehouse

A warehouse that stores goods on the goods' owner's property while the goods are under a bona fide public warehouse manager's custody. The owner uses the public warehouse receipts as collateral for a loan.

Flight Number

An identifier associated with the air equipment (plane). Typically a combination of two letters, indicating the airline, and three or four digits indicating the number of the voyage.

Float

The time required for documents, payments, etc. to get from one trading partner to another.

FOB (Free-on-Board) Point

Point at which ownership of freight changes hands from shipper to consignee. FOB origin indicates that consignee owns the goods in transit; FOB-destination indicates that shipper owns goods in transit. Owner of goods in transit is liable for loss and damage to freight, and thus should provide insurance.

FOB Destination

Under this arrangement, title and risk remain with the seller until it has delivered the goods to the location specified in the contract.

FOB Origin

Title and risk pass to the buyer at the moment the seller delivers the goods to the carrier. The parties may agree to have title and risk pass at a different time or to allocate shipping charges by a written agreement.

FOB Origin

Title passes at origin, and buyer has total responsibility over the goods while in shipment.

For-Hire Carrier

A company that provides truck transportation of cargo belonging to others and is paid for doing so. There are two types of for-hire carriers, common carriers and contract carriers. A for-hire carrier may be both a common and a contract carrier, but must file separate registrations to obtain both licenses.

FOR/FOT (FOR and FOT)

Mean "Free on Rail" and "Free on Truck." These terms are synonymous since the word "truck" relates to the railway wagons. They should only be used when the goods are to be carried by rail.

Force Majeure

Title of a standard clause in marine contracts exempting the parties for nonfulfillment of their obligations as a result of conditions beyond their control, such as earthquakes, floods, or war.

Foreign Exchange

Currency or credit instruments of a foreign country. Also, transactions involving purchase or sale of currencies. 

Foreign Freight Forwarder

Corporation carrying on the business of forwarding who is not a shipper or consignee. The foreign freight forwarder receives compensation from the shipper for preparing documents and arranging various transactions related to the international distribution of goods. Also, a brokerage fee may be paid to the "forwarder" from shipping lines if the forwarder performs at least two of the following services:

  1. Coordination of the movement of the cargo to shipside ;
  2. Preparation and processing of the Ocean Bill of Lading ;
  3. Preparation and processing of dock receipts or delivery orders ;
  4. Preparation and processing of consular documents or export declarations ;
  5. Payment of the ocean freight charges on shipments. 
Foreign Sales Agent

Individual or firm that serves as the foreign representative of a domestic supplier and seeks sales abroad for the supplier. 

Foreign Trade Agreement

Agreement between countries to reduce and eventually eliminate tariff and non-tariff barriers between them. 

Foreign Trade Zone (FTZ)

An area or zone set aside at or near a port or airport under the control of the Customs Service, for holding goods duty-free pending Customs clearance.

Fourth Party Logistics (4PL)

Differs from third party logistics in the following ways:

  1. 4PL organization is often a separate entity established as a joint venture or long-term contract between a primary client and one or more partners;
  2. 4PL organization acts as a single interface between the client and multiple logistics service providers;
  3. All aspects (ideally) of the client's supply chain are managed by the 4PL organization;
  4. It is possible for a major third party logistics provider to form a 4PL organization within its existing structure.
Franco

Non-standard term meaning “free delivered”: shipper pays all charges to a particular point. 

Free In (FI)

Pricing term indicating that the charterer of a vessel is responsible for the cost of loading goods onto the vessel. 

Free In and Out (FIO)

Pricing term indicating that the charterer of a vessel is responsible for the cost of loading and unloading goods from the vessel. 

Free of Particular Average (FPA)

Title of a clause used in marine insurance, indicating that partial loss or damage to a foreign shipment is not covered. (Note: Loss resulting from certain conditions, such as the sinking or burning of the ship, may be specifically exempted from the effect of the clause. 

Free Out (FO)

Pricing term indicating that the quoted prices include the cost of unloading the goods from the vessel. 

Free Port

An area generally encompassing a port and its surrounding locality into which goods may enter duty-free or subject only to minimal revenue tariffs.

Free Time

The period of time allowed for the removal or accumulation of cargo before charges become applicable.

Free Trade

A theoretical concept that assumes international trade unhampered by government measures such as tariffs or nontariff barriers. The objective of trade liberalization is to achieve “freer trade” rather than “free trade,” it being generally recognized among trade policy officials that some restrictions on trade are likely to remain in effect for the foreseeable future.

Free Trade Zone (FTZ)

Area designated by the government of a country for duty-free entry of any nonprohibited goods. Merchandise may be stored, displayed, used for manufacturing, etc., within the zone and reexported without duties being paid. Duties are imposed on the merchandise (or items manufactured from the merchandise) only when the goods pass from the zone into an area of the country subject to the customs authority. 

Freight

Goods being transported from one place to another.

Freight All Kinds (FAK)

Freight rate applicable to all types of goods.

Freight Bill

Shipping document YRC Freight prepares to confirm shipment delivery and indicate payment terms (prepaid or collect). The document describes the shipment, its weight, the amount of charges and taxes and whether the bill is collect or prepaid. If the bill is prepaid, the shipper pays the shipping charges. If the bill is collect, the consignee pays the shipping charges.

Freight Broker

Any person that  sells transportation without actually providing it. The term usually refers to an agent for truckload shipments, matching small shippers with carriers. Freight brokers often do not accept any responsibility for their shipments.

Freight Brokerage

Commission paid to a licensed Freight Forwarder or Custom House Broker by the steamship line concerning export transactions. Commission is paid either as a percentage or the freight charges or as a lump sum amount per container, depending on the carrier and/or trade lane. 

Freight Carriers

Companies that haul freight, also called "for-hire" carriers. Methods of transportation include trucking, railroads, airlines, and sea borne shipping.

Freight Charge

The rate established for transporting freight.

Freight Collect

A term used in the freight moving business that means that the freight will be paid by the person receiving the freight. If you tell the shipper that you will pay the cost when it arrives, then they will ship it ‘freight collect’, meaning the trucking company will need a check payable to them when they deliver your item. If you have an account with a certain trucking company, then you can request that the shipper use that company so that you may be billed. It will still be ‘Freight Collect’, but will be automatically billed to you by the company that you use.

Freight Consolidation

The grouping of shipments to obtain reduced costs or improved utilization of the transportation function. Consolidation can occur by market area grouping, grouping according to scheduled deliveries, or using third party pooling services such as public warehouses and freight forwarders.

Freight FOB Terms-of-Sale

Indicates : 

  1. Who arranges for transport and carrier;
  2. Who pays for transport;
  3. Where/when does title (ownership) of goods transfer from seller to buyer (FOB point). Freight charges: collect, prepaid, prepaid and charged back. Collect: Buyer pays the freight charges. Prepaid: seller pays. Prepaid and charged back: seller prepays (bears), bills buyer for the charges.

Examples:

  1. FOB-origin, freight collect: consignee pays freight charges and owns goods in transit ;
  2. FOB-destination, freight prepaid: shipper pays freight charges and owns goods in transit ;
  3. FOB-destination, freight prepaid and charged back: shipper owns goods in transit, pays for freight but bills consignee for the charges.
Freight Forwarder

A freight forwarder, forwarder, or forwarding agent, is a person or company that organizes shipments for individuals or corporations to get goods from the manufacturer or producer to a market, customer or final point of distribution. Forwarders contract with a carrier to move the goods. A forwarder does not move the goods but acts as an expert in supply chain management. A forwarder contracts with carriers to move cargo ranging from raw agricultural products to manufactured goods. Freight can be booked on a variety of shipping providers, including ships, airplanes, trucks, and railroads. It is not unusual for a single shipment to move on multiple carrier types. International freight forwarders have additional expertise in preparing and processing customs and other documentation and performing activities pertaining to international shipments.

Freight Prepaid
The freight and charges to be paid by the consignor.
Freight Quotation

A quotation from a carrier or forwarder covering the cost of transport between two specified locations.

Freight Release

Evidence that the freight charges for the cargo have been paid. If in writing, it may be presented at the pier to obtain release of the cargo. (Normally, once the freight is paid, releases are usually arranged without additional documentation). 

Freight Size

Freight is most often measured by its weight, and transportation vehicles of varying sizes typically have weight capacities that cannot be exceeded due to engineering or regulatory reasons. Freight may also be measured by cube, which generally refers to the volume of the freight. A vehicle is said to cube-out if it does not exceed its weight capacity, but its volume is completely full.

Freight Weight Measures

Short ton (American) 2000 lbs. Long ton (English) 2240 lbs. Metric ton (1000 kg.) 2204.6 lbs.

Fuel Surcharge (FSC)

Additional charge in a carrier’s tariffs when the price of fuel increases. 

Full Truckload (FTL)

Same as Full Containerload, but in reference to motor carriage instead of containers.

Gateway

Principal airport, domestic or international, with many flights, offering maximum service and connections. 

General Agreement on Tariffs and Trade (GATT)

Was a multilateral agreement regulating international trade. According to its preamble, its purpose was the substantial reduction of tariffs and other trade barriers and the elimination of preferences, on a reciprocal and mutually advantageous basis. It was negotiated during the United Nations Conference on Trade and Employment and was the outcome of the failure of negotiating governments to create the International Trade Organization (ITO). GATT was signed in 1947 and lasted until 1994, when it was replaced by the World Trade Organization in 1995.

General Export License

Any of various export licenses covering export commodities for which Validated Export Licenses are not requires. No formal application or written authorization is need to ship exports under a General Export License. 

General Order (GO)

A customs term referring to a warehouse where merchandise not entered within five working days after the carrier's arrival is stored at the risk and expense of the importer.

General-Merchandise Warehouse

A warehouse used to store goods that are readily handled, are packaged, and do not require a controlled environment.

Goods

Inherently useful and relatively scarce articles or commodities produced by the manufacturing, mining, construction, and agricultural sectors of the economy. Goods are important economically because they may be exchanged for money or other goods and services

Gross Vehicle Weight (GVW)

The combined weight of the vehicle (tractor and trailers) and its goods.

Gross Weight or Gross Mass

Full weight of a shipment, including goods and packaging. 

Handling Charges (costs)

The forwarder's fee to his shipper client. They are related to moving, transferring, or preparing inventory for shipment, but not the shipping charges themselves.

Hard Currency

Currency of a nation which may be exchanged for that of another nation without restriction. Sometimes referred to as convertible currency. Hard currency countries typically have sizeable exchange reserves and surpluses in their balance of payments. 

Haulage

The inland transport service which is offered by the carrier under the terms and conditions of the tariff and of the relative transport document.

Hazardous Material

Substance or material that the DOT has determined is capable of posing an unreasonable risk to health, safety, and property when transported in commerce.  The term includes hazardous substances, hazardous wastes, marine pollutants, elevated temperature materials, materials designated as hazardous in the Hazardous Materials Table and materials that meet the defining criteria for one or more of the nine UN hazard classes and divisions.

Heavy Lift

Single commodities too heavy to be lifted by the ship's regular equipment. 

House Air Waybill (HAWB)

A bill of lading issued by a freight forwarder for consolidated air freight shipments. In documentary letter of credit transactions HAWBs are treated exactly the same as conventional air waybills, provided they indicate that the issuer itself assumes the liability as carrier or is acting as the agent of a named carrier, or if the credit expressly permits the acceptance of a HAWB.

House Bill of Lading (House B/L)

Bill of lading issued by a freight forwarder. Often covers a consignment of parcels from various shippers that has been grouped or consolidated by the forwarder. 

House to House

Terms generally refers to a container yard to container yard (CY/CY) shipment (in which case, it may be used merely to quote the rental rate for the container itself), but is also used in some cases, synonymously with “door to door” a term which more generally refers to overall transport services from seller’s premises to buyer’s premises. 

Hub Airport

An airport that serves as the focal point for the origin and termination of long-distance flights; flights from outlying areas meet connecting flights at the hub airport.

Hub-and-Spoke

A transportation system design in which large hub terminals are used for freight consolidation. Medium-volume services serve the spoke-to-hub collection and hub-to-spoke distribution tasks. Large-volume services are operated in the hub-top-hub markets. In most systems, all outbound/inbound freight for a spoke uses the same hub, and thus larger shipment sizes are realized. Many transportation systems oriented in this way. 

Hundredweight (CWT)

A unit of measurement for weight used in certain commodities trading contracts. In North America, a hundredweight is equal to 100 pounds and is also known as a short hundredweight. In Britain, a hundredweight is 112 pounds and is also known as a long hundredweight.

Immediate Transportation entry (IT)

Type of customs entry declaring goods for transportation by a bonded carrier from a port of entry to a bonded warehouse at an inland port, or another customs port where entry will be filed. 

Import

A good brought into a jurisdiction, especially across a national border, from an external source. The purchaser of the exotic good is called an importer. An import in the receiving country is an export from the sending country. Importation and exportation are the defining financial transactions of international trade. In international trade, the importation and exportation of goods are limited by import quotas and mandates from the customs authority. The importing and exporting jurisdictions may impose a tariff (tax) on the goods. In addition, the importation and exportation of goods are subject to trade agreements between the importing and exporting jurisdictions.

Import Letter of Credit

Used to finance importation of goods. 

Import License

A governmental document which permits the importation of a product or material into a country where such licenses are necessary.

Import Quota

Means of restricting imports by the issuance of licenses to importers, assigning each a quota, after determination of the total amount of any commodity which is to be imported during a period. Import licenses may also specify the country from which the importer must purchase the goods. 

Importation Point

The location where goods will be cleared for importation into a country.

Importer

Person or organization primarily liable for the payment of duties on the merchandise, or an authorized agent acting on the importer's behalf. The importer may be:

  1. A  consignee ;
  2. The importer of record ;
  3. The actual owner of the merchandise if the actual owner has filed with Customs a declaration acknowledging ownership along with a superseding bond. 
Imports

The inflow of goods and services into a country’s market for consumption. A country enhances its welfare by importing a broader range of higher-quality goods and services at lower cost than it could produce domestically. The expansion of world trade since the end of World War II has therefore been a principal factor underlying a general rise in living standards in most countries.

In Bond

A procedure under which goods are transported or warehoused under customs supervision until they are either formally entered into the customs territory of the country duties paid, or until they are exported from the country

Inbound Logistics

The entire process of planning, acquiring and controlling the flow of raw materials, components, parts, sub-assemblies and components from outside sources (vendors, suppliers, and subsidiaries) into a production process. Inbound logistics can occur directly from the outside supplier to the production floor or indirectly through intermediate storage facilities.

Incentive Rate

A rate that induces the shipper to ship heavier volumes per shipment.

Inconvertibility

The inability to exchange the currency of one country for the currency of another.

Incoterms

Set of rules which define the responsibilities of sellers and buyers for the delivery of goods under sales contracts for domestic and international trade. They are published by the International Chamber of Commerce (ICC) and are widely used in international commercial transactions. The most recent version of Incoterms, Incoterms 2010, was launched in September 2010 and became effective January 1, 2011.

The two main categories of Incoterms 2010 are now organized by modes of transport. Used in international as well as in domestic contracts for the first time, the new groups aim to simplify the drafting of contracts and help avoid misunderstandings by clearly stipulating the obligations of buyers and sellers.

  1. Group 1. Incotermsthat apply to any mode of transport are: EXW Ex Works ; FCA Free Carrier; CPT Carriage Paid To; CIP Carriage and ; Insurance Paid To; DAT Delivered at Terminal; DAP Delivered at Place; DDP Delivered Duty Paid;
  2. Group 2. Incoterms that apply to sea and inland waterway transport only: FAS Free Alongside Ship; FOB Free on Board; CFR Cost and Freight; CIF Cost, Insurance, and Freight
Independent Action

A carrier that is a rate bureau member may publish a rate that differs from the rate the rate bureau publishes.

Independent Action (IA)

Carrier can take an independent action within a conference resulting in a unique rate for that carrier, ability to file a rate independently of other carrier's action. 

Inherent Vice

Insurance term referring to any defect or other characteristics of a product which could result in damage to the product without external cause. Insurance policies may specifically exclude losses caused by inherent vice. 

Inland bill of lading

Bill of lading used in transporting goods overland. Although a Through bill of lading can sometimes be used, it is usually necessary to prepare both an inland bill of lading and an ocean bill of lading for export shipments. 

Inland Carrier

Transportation line that hauls export or import freight between ports of entry and inland destinations.

Inland Clearance Depot (Inland Dry Port)

Combination transport terminal and customs clearance centre. 

Inland Point Intermodal (IPI)

Inland carriage by another mode of transportation after port discharge, cargo moving to/from an inland point. 

Inner Packaging

Packaging for which an outer packaging is required for transport. It does not include the inner receptacle of a composite packaging.

Inspection Certificate

Some purchasers and countries may require a certificate of inspection attesting to the specifications of the goods shipped, usually performed by a third party. Inspection certificates are often obtained from independent testing organizations. 

Institute Clauses

Standard international transport insurance clauses, published by the Institute of London Underwriters . The Institute Cargo Clauses are three sets of clauses providing different levels of protection:

  1. The “A” Clauses correspond to the general notion which is referred to in the trade as “all risks” coverage ;
  2. While clauses “B” and “C” indicate a lower level of coverage and a greater number of exclusions. 
Insurance

A system of protection against loss under which a number of parties agree to pay certain sums (premiums) for a guarantee that they will be compensated under certain conditions for specified loss and damage.

Insurance Certificate

A document issued by an insurance company, usually to order of shipper, under a marine policy and in cover of a particular shipment of merchandise.

Integrated Carrier

Carriers that have both air and ground fleets; or other combinations, such as sea, rail, and truck. Since they usually handle thousands of small parcels an hour, they are less expensive and offer more diverse services than regular carriers. 

Integrated Logistics

A comprehensive, system-wide view of the entire supply chain as a single process, from raw materials supply through finished goods distribution. All functions that make up the supply chain are managed as a single entity rather than managing individual functions separately.

Integrators

Companies that provide door-to-door domestic and international air freight service. Own and operate aircraft, as well as ground delivery fleets of trucks. In contrast, freight-hauling airlines typically do not provide door-to-door service. 

Interchange

Transfer of a container from one party to another. 

Interchange Agreement

Contract between carrier and trucker that legally permits interchange of equipment. 

Interline Service

Two or more carriers working together to haul a shipment to a destination. Carriers may interchange equipment but usually they rehandle the shipment without transferring the equipment.

Intermediate Consignee

Intermediate consignee is the bank, forwarding agent, or other intermediary (if any) that acts in a foreign country as an agent for the exporter, the purchaser, or the ultimate consignee, for the purpose of effecting delivery of the export to the ultimate consignee. For exports to foreign countries, the intermediate consignee shall be the person named as such on an export license. If there is no intermediate consignee, the word “none” shall be entered.

Intermediate Destination

A stopping point for a shipment prior to the final destination.

Intermediately Positioned Warehouse

A warehouse located between customers and manufacturing plants to provide increased customer service and reduced distribution cost.

Intermodal transport

Transportation that uses a specialized container that can be transferred from the vehicle of one mode to the vehicle of another; a single freight bill is used for the shipment. Example: Ocean shipping containers which can be hauled by trucks on chassis, railcars, ocean vessels, and barges. 

Intermodal Container Transfer Facility

A facility where cargo is transferred from one mode of transportation to another, usually from ship or truck to rail.

International Air Transport Association (IATA)

Established in 1945, is a trade association serving airlines, passengers, shippers, travel agents, and governments. The association promotes safety, standardization in forms (baggage checks, tickets, weigh bills), and aids in establishing international airfares. IATA headquarters are in Geneva , Switzerland .  IATA publishes its Dangerous Goods Regulations which are based on the ICAO Technical Instructions and which governs the movement of dangerous goods in domestic and international transport by air.

International Import Certificate

A document required by the importing country indicating that the importing country recognizes that a controlled shipment is entering their country. The importing country pledges to monitor the shipment and prevent its re-export, except in accordance with its own export control regulations.

International Maritime Dangerous Goods Code (IMDG)

Is an international guideline to the safe transportation or shipment of dangerous goods or hazardous materials by water on vessel. IMDG Code is intended to protect crew members and to prevent marine pollution in the safe transportation of hazardous materials by vessel. It is recommended to governments for adoption or for use as the basis for national regulations.

International Maritime Organization (IMO)

Established as a specialized agency of the United Nations in 1948. The IMO facilitates cooperation on technical matters affecting merchant shipping and traffic, including improved maritime safety and prevention of marine pollution. Headquarters are in London , England . 

Invoice

Is a commercial document issued by a seller to a buyer, relating to a sale transaction and indicating the products, quantities, and agreed prices for products or services the seller has provided the buyer. Payment terms are usually stated on the invoice. These may specify that the buyer has a maximum number of days in which to pay, and is sometimes offered a discount if paid before the due date. The buyer could have already paid for the products or services listed on the invoice.

Irregular Route Carrier

A carrier that may provide service utilizing any route.

Irrevocable

Most common designation of an instrument of credit in international trade. It carries an irrevocable obligation of the issuing bank to pay the beneficiary when drafts and documents are presented in accordance with the terms of the letter of credit. An irrevocable letter of credit, once issued, cannot be amended or canceled without the agreement of all named parties. As such, it must have a fixed expiration date. 

Issuing Bank

Bank which opens, issues, a straight or a negotiable letter of credit. This bank assumes the obligation to pay the beneficiary or a correspondent bank if the documents presented are in accordance with the terms of the terms and conditions of the documentary credit instrument. 

Issuing Carrier

The carrier whose name is printed on the bill of lading and with whom the contract of carriage exists.

Joint Venture

A commercial or industrial enterprise in which principals of one company share control and ownership with principals of another.

Just in Time Logistics

The process of minimizing the times required to source, handle, produce, transport, and deliver products in order to meet customer requirements.

Lading

The cargo carried in a transportation vehicle.

Laydays/ Laytime

Time allowed by the ship-owner to the charterer or shipper in which to load or discharge the cargo. May be expressed in days or hours, or tons per day. Set in running days (every calendar day), working days (excludes Sundays and holidays observed by the port), or weather working days (in addition, excludes days where operations are prevented by bad weather). 

LCL (Less than Container Load)

An ocean-shipping and intermodal industry term; LTL equivalent in container shipping. Container freight stations at ports serve as consolidation and deconsolidation terminals. Historically, LCL also stands for less-than-carload. Before the prominence of interstate trucking, railroads offered less-than-carload (LCL) service but this business has largely disappeared.

LCL/FCL

Way of quoting container freight rates in which the carrier agrees to pack the container at the outset (LCL), but the unpacking at destination must be carried our by the receiver or consignee. 

Lead Logistics Provider (LLP)

An organization that organizes other third party logistics partners for outsourcing of logistics functions. 

Lead Time

The total time that elapses between an order's placement and its receipt. It includes the time required for order transmittal, order processing, order preparation, and transit.

Legal Weight

Weight of the goods plus any immediate wrappings which are sold along with the goods; e.g. the weight of a tin can as well as its contents.

Letter of Credit (L/C)

Financial document issued by a bank at the request of a buyer guaranteeing payment to the seller if certain terms and conditions are fulfilled. Normally it contains a brief description of the goods, documents required, a shipping date, and an expiration date after which payment will no longer be made.

There are different kinds of letter of credit such as :

  1. An Irrevocable Letter of Credit is one which obligates the issuing bank to pay the exporter when all terms and conditions of the letter of credit have been met. None of the terms and conditions may be changed without the consent of all parties to the letter of credit;
  2. A Revocable Letter of Credit is subject to possible recall or amendment at the option of the applicant, without the approval of the beneficiary;
  3. A Confirmed Letter of Credit is issued by a foreign bank with its validity confirmed by a other bank. An exporter who requires a confirmed letter of credit from the buyer is assured payment from the bank in case the foreign buyer or bank defaults;
  4. A Documentary Letter of Credit is one for which the issuing bank stipulates that certain documents must accompany a draft. The documents assure the applicant (importer) that the merchandise has been shipped and that title to the goods has been transferred to the importer. 
Letter of Credit Advice

Communication by the advising bank that a letter of credit has been issued. The primary responsibility of the advising bank is to take care in establishing the authenticity of the credit. 

Letter of Indemnity (LOI)

Document commonly used in international trade to allow a carrier to release goods to a receiver who is not yet in possession of the bill of lading. 

License Exception

Export Administration Regulations (EAR) provide that commodities which may be otherwise subject to an export license may not require one under certain circumstances. If the export meets the criteria of a particular license exception, then an export license will not be required. The exporter must make this decision having consulted the EAR.

Licensing

Business arrangement in which the manufacturer of a product (or a firm with proprietary rights over certain technology, trademarks, etc.) grants permission to some other group or individual to manufacture that product (or make use of that proprietary material) in return for specified royalties or other payment. 

Licensing Agreement

This term refers to a written agreement entered into by the contractual owner of a property or activity giving permission to another to use that property or engage in an activity in relation to that property. The property involved in a licensing agreement can be real, personal or intellectual. Almost always, there will be some consideration exchanged between the licensor and the licensee.

Lighter

A barge-type vessel used to carry cargo between shore and cargo ship. While the terms barge and lighter are used interchangeably, a barge usually refers to a vessel used for a long haul, while a lighter is used for a short haul.

Limited Quantity

Maximum amount of a hazardous material for which there is a specific labeling or packaging exception.  Dangerous goods in limited quantities must display either Limited Quantity or LTD. QTY. on the shipping papers.

Liner Shipping

Services provided by a shipping company or shipping line, under which cargo vessels operate according to a fixed schedule and publicly advertised freight rates. 

Liner Terms

Freight rates which include loading/unloading charges according to the custom of the respective ports which varies widely. “Liner terms” therefore is not a standard designation. ICC currently working on establishing a standard liner term. 

Link

The transportation method a company uses to connect nodes (plants, warehouses) in a logistics system.

Load Factor

A measure of operating efficiency used by air carriers to determine a plane's utilized capacity percentage or the number of passengers divided by the total number of seats.

Load Tendering

The practice of providing a carrier with detailed information and negotiated pricing (the tender) prior to scheduling pickup. This practice can help assure contract compliance and facilitate automated payments.

Loading Allowance

A reduced rate that carriers offer to shippers and/or consignees who load and/or unload LTL or Any Quantity shipments.

Loading Port

The port where the cargo is loaded onto the exporting vessel. This port must be reported on the Shipper's Export Declarationn.

Local Rate

A rate published between two points served by one carrier.

Local Service Carriers

A classification of air carriers that operate between less-populated areas and major population centers. These carriers feed passengers into the major cities to connect with major carriers. Local service carriers are now classified as national carriers.

Logistics

The process of planning, implementing, and controlling procedures for the efficient and effective storage of goods, services, and related information from the point of origin to the point of consumption for the purpose of conforming to customer requirements. This definition includes inbound, outbound, internal, and external movements. 

Logistics Channel

The network of supply chain participants engaged in storage, handling, transfer, transportation, and communications functions that contribute to the efficient flow of goods.

Logistics Costs

The factors associated with the acquisition, storage, movement, and disposition of goods.

Logistics Service Provider (LSP)

A company that provides management over the flow of goods and materials between points of origin to end-use destination. The provider will often handle shipping, inventory, warehousing, packaging, and security functions for shipments.

Loss and Damage (L&D)

Loss or damage of freight shipments while in transit or in a carrier-operated warehouse. Terms for the handling of claims  are usually stipulated in the freight bill. Shippers/consignees usually take out insurance against L&D with premiums a function of the value of goods shipped, and the likelihood of L&D.

LTL (Less Than Truckload)

A trucking industry term; a less-than-truckload (LTL) shipment is when a shipper contracts for the transportation of freight that will not require an entire truck. LTL shipments are priced according to the weight of the freight, its commodity class (which generally determines its cube/weight ratio), and mileage within designated lanes. An LTL carrier specializes in LTL shipments, and therefore typically operates a complex hub-and-spoke network with consolidation/deconsolidation points; LTL carriers carry multiple shipments for different customers in single trucks. Examples include: Yellow Freight, Consolidated Freightways, Roadway Express.

Main Carriage

Freight movement and cost from the seller’s side to the buyer’s side. Usually considered to be the international portion of the transport movement. 

Major Carrier

A for-hire certificated air carrier that has annual operating revenues of $1 billion or more; the carrier usually operates between major population centers.

Management of All Logistics

The effective management of all costs associated with logistics functions and activities so as to minimize their sum across the product supply chain.

Manifest

A document giving the description of a ship’s cargo or the contents of a car or truck.

Marine (Cargo) Insurance

Insurance covering loss of, or damage to, goods at sea. Marine insurance typically compensates the owner of merchandise for losses in excess of those which can be legally recovered from the carrier that are sustained from fire, shipwreck, piracy, and various other causes. Three of the most common types of marine insurance coverage are "free of particular average" (f.p.a.), "with average" (w.a.), and "All Risks Coverage." 

Marine Bill of Lading (Ocean Bill of Lading)

A document required for the transportation of goods overseas. An ocean bill of lading serves as both the carrier's receipt to the shipper and as a collection document. The document specifies the details of the goods being transported, such as quantity, type and destination. It Plays three potential roles:

  1. As receipt for the cargo and evidence that the goods have been received in apparent good order ;
  2. Evidence that the terms of the contract of carriage between the shipper and the ocean carrier ;
  3. And an instrument enabling transfer of control over delivery of the goods (negotiability) which allows the holder of the bill to trade the goods in transit by simple endorsement and physical transfer of the bill. 
Marks

A set of letters, numbers and/or geometric symbols, generally followed by the name of the port of destination, placed on packages for export for identification purposes.

Master Air Waybill (MAWB)

An air waybill of lading that covers a consolidated shipment of goods and lists the consolidator as the shipper.

Measurement Ton

Forty cubic feet, used in water transportation ratemaking.

Merger

The combination of two or more carriers into one company that will own, manage, and operate the properties that previously operated separately.

Metric Ton (M/T)

1,000 kilograms (2,204 pounds). 

Minimum B/L

Minimum amount one can charge per individual bill of lading. 

Minimum Charge

The lowest charge for which a shipment will be handled after discount and/or adjustment.

Minimum Weight

The shipment weight the carrier's tariff specifies as the minimum weight required to use the TL or CL rate; the rate discount volume.

Multi-Currency

The ability to process orders using a variety of currencies for pricing and billing.

Multimodal Transport Bill of Lading

Bill of lading used for carriage whenever there are at least two different forms of transport, such as shipping by rail and by sea. 

Multimodal Transport Operator (MTO)

Carrier who concludes multimodal transport contracts; i.e. contracts involving transport by more than one mode of carriage, and for which the MTO accepts liability as a carrier. 

Multimodal Transportation

Is the transportation of goods under a single contract, but performed with at least two different means of transport; the carrier is liable (in a legal sense) for the entire carriage, even though it is performed by several different modes of transport (i.e. air, rail, sea, or road/land).

Negotiable B/L

Provides for the delivery of goods to a named enterprise or to their order (anyone they may designate), but only upon surrender of proper endorsement and the bill of lading to the carrier or the carrier's agents. Also known as an order bill of lading.

Negotiable Instrument

Written document that can be used to transfer the rights embodied in it by mere delivery ( in the case of instruments made out to bearer) or by endorsement and delivery ( in the case of instruments made out to order). Some instruments, such as the bill of exchange and the cheque, are negotiable unless their negotiability is explicitly excluded while the bill of lading is negotiable only if made negotiable by the shipper. 

Negotiated Rate Agreement (NRA)

NRAs are written and binding arrangements between a shipper and a licensed non-vessel operating common carrier (NVOCC) to provide specific transportation service for a stated cargo quantity, from origin to destination, on and after a stated date or within a defined time frame. If an NVOCC uses NRAs and meets the conditions below, it does not have to publish its rate in the tariff it makes available to the public.

Non Conference Carrier

Independent ocean carrier who does not belong to any group or conference of ocean carriers and who establishes their own pricing and policies. 

Non Negotiable B/L

Copy of original Bill of Lading which cannot be negotiated with bank. 

Non Vessel Operating Common Carrier (NVOCC)

A firm that offers the same services as an ocean carrier, but which does not own or operate a vessel. NVOCCs usually act as consolidators, accepting small shipments (LCL) and consolidating them into full container loads. They also consolidate and disperse international containers that originate at or are bound for inland ports. They then act as a shipper, tendering the containers to ocean common carriers. They are required to file tariffs with the Federal Maritime Commission and are subject to the same laws and statutes that apply to primary common carriers.

Notify Party

Name and address appear in a bill of lading, who is to be notified by the shipping company of the arrival of goods at the discharge port. There is normally a box on the bill of lading where the details of the notify party are inserted. 

Ocean Conference

Cartel of vessel operators operating between specific trade areas. Set cargo rates for liners between ports.

Open Cargo Policy

Synonymous with "Floating Policy." An insurance policy which binds the insurer automatically to protect with insurance all shipments made by the insured from the moment the shipment leaves the initial shipping point until delivered at destination. The insuring conditions include clauses naming such risks insured against as "perils of the sea," fire, jettison, forcible theft, and barratry. 

Order Bill of Lading (B/L)

Bill of lading made out to the order of the shipper (also called a negotiable bill of lading). 

Origin

The place where a shipment begins its movement.

Original Bill of Lading (B/L)

Bill of lading that bears the original signature of the master of a ship or his agent. 

Outbound Logistics

The entire process of planning and controlling the flow of products form the end of a production line to the end user. This includes both transportation and intermediate storage.

Over, Short and Damaged (OS&D)

A report that details discrepancies between a bill of lading and a shipment at hand. Extra goods are ‘overs’, missing goods are ‘short’, and damaged goods are listed as ‘damaged’.

Overage

Number of units received is in excess of the quantity shown on shipping documents. Overages should not be delivered to a customer. They're returned to the terminal unless the terminal receives more information while the driver is making pickups and deliveries.

Overcharge Claims

The payor of the shipping charges files an overcharge claim to dispute a discrepancy in charges that can stem from overpayment, weight or description corrections, etc.

Packing List

A document containing information about the location of each Product ID in each package. It allows the recipient to quickly find the item he or she is looking for without a broad search of all packages. It also confirms the actual shipment of goods on a line item basis.

Pallet

Is a flat transport structure that supports goods in a stable fashion while being lifted by a forklift, pallet jack, front loader, work saver or other jacking device. A pallet is the structural foundation of a unit load, which allows handling and storage efficiencies. Goods or shipping containers are often placed on a pallet secured with strapping, stretch wrap or shrink wrap and shipped.

Payment

The transfer of money, or other agreed upon medium, for provision of goods or services.

Payment Terms

Generally, the shipper is responsible for payment for prepaid shipments, and the consignee is responsible for payment for collect shipments unless a third party is indicated as payor on the shipping papers.

Pickup and Delivery (P&D)

Local movement of goods between the shipper (or pickup point) and the origin terminal or between the destination terminal and the consignee (or delivery point).

Piggyback

Is transportation of goods where one transportation unit is carried on the back of something else. In rail transport, it is the practice of carrying trailers or semi-trailers on a train atop a flatcar.

Point of Export

The port, airport or customs point from which an export shipment leaves a country for a voyage to a foreign country.

Political Risk

In export financing, the risk of loss due to such causes as currency inconvertibility, government action preventing entry of goods, expropriation or confiscation, and war. 

Port Authority

A state or local government that owns, operates, or otherwise provides wharf, dock, and other terminal investments at ports.

Port of Arrival

Location where imported merchandise is off-loaded from the importing aircraft or vessel. 

Port of Departure

In export, the final ocean port of aircraft where the shipment in the vessel or aircraft departs from the United States . 

Port of Discharge

Port where goods are unloaded from vessel. 

Port of Entry

A port at which foreign goods are admitted into the receiving country.

Port of Loading

Port where cargo is loaded aboard the vessel.

Postponement

A deliberate delay in committing inventory to shipment by a shipper. Usually, shippers utilize postponement in order to consolidate freight into larger shipments that have a lower unit transportation cost.

Pre-Carriage

Inland freight movement and cost on the seller’s side. 

Pre-Shipment Inspection (PSI)

Inspection of contract goods prior to shipment to ascertain their quality, quantity, or price. 

Prepaid

A freight term which indicates that charges are to be paid by the shipper. Prepaid shipping charges may be added to the customer invoice, or the cost may be bundled into the pricing for the product.

Private Carrier

A carrier that provides transportation service to the firm that owns or leases the vehicles and does not charge a fee. Private motor carriers may haul at a fee for wholly owned subsidiaries.

Private Trucking Fleets

Private fleets serve the needs of their owners, and do not ordinarily offer commercial trucking services to other customers. Private fleets typically perform distribution or service functions.

Private Warehousing

The storage of goods in a warehouse owned by the company that has title to the goods.

Pro Forma Invoice

An invoice, forwarded by the seller of goods prior to shipment, that advises the buyer of the particulars and value of the goods. Usually required by the buyer in order to obtain an import permit or letter of credit.

Product Characteristics

All of the elements that define a product's character, such as size, shape, weight, etc.

Product Family

A group of products with similar characteristics often used in production planning (or sales and operations planning).

Product ID

A method of identifying a product without using a full description. These can be different for each document type and must, therefore, be captured and related to the document in which they were used. They must then be related to each other in context.

Proforma

A type of quotation or offer that may be used when first negotiating the sales of goods or services. If the pro-forma is accepted, then the terms and conditions of the pro-forma may become the request.

Proof of Delivery (POD)

Information supplied by the carrier containing the name of the person who signed for the shipment, the time and date of delivery and other shipment delivery-related information. POD is also sometimes used to refer to the process of printing materials just prior to.

Proportional Rate

A rate lower than the regular rate for shipments that have prior or subsequent moves; used to overcome combination rates' competitive disadvantages.

Public Warehouse

The warehouse space that is rented or leased by an independent business providing a variety of services for a fee or on a contract basis.

Public Warehouse receipt

The basic document a public warehouse manager issues as a receipt for the goods a company gives to the warehouse manager. The receipt can be either negotiable or nonnegotiable.

Quay

Solid structure alongside a navigable waterway, used for loading and unloading of ships. Think pier or wharf. 

Quay crane/Portainer crane
Quota

Quantity of goods of a specific kind that a country permits to be imported without restriction or imposition of additional duties.

Quotation

Offer to sell goods at a stated price and under specified conditions. 

Railway Consignment Note

Freight document indicating that goods have been received for shipment by rail. 

Rate of Exchange

The basis upon which money of one country will be exchanged for that of another. Rates of exchange are established and quoted for foreign currencies on the basis of the demand, supply, and stability of the individual currencies. 

Rates

Ocean rates are classified in many ways, here is just a sampling:

  1. Class - Grouping of articles ;
  2. Commodity - Specific articles ;
  3. Arbitrary - Fixed rate according to port to port ;
  4. Minimum - Lowest charge ;
  5. Heavy lift charge - Extra charge for cargo which needs extra or heavy equipment to load or unload, charge assessed for cargo over a certain length;
  6. Charter - Use of an entire vessel ;
  7. Ad valorem - Based on value of cargo ;
  8. Refrigerated - Cargo which requires refrigeration equipment ;
  9. Dangerous cargo - Needs special handling or stowage ;
  10. On deck cargo - Cargo which must be shipped on the deck of the vessel
Reefer

A Reefer or Refrigerated Container is an intermodal container (shipping container) used in intermodal freight transport that is refrigerated for the transportation of temperature-sensitive cargo.

Remittance

Payment for goods or services received.

Remitting bank

Bank that sends a draft to an overseas bank for collection. 

Reverse Logistics

The act of, and management systems associated with, the recovery of discarded products and packaging from the end user. Reverse logistics is based upon a heightened environmental consciousness, public policy and law. The concept is that reusable packaging, as well as outdated, damaged or defective products, can best be recycled or reused by the original manufacturer. Reverse logistics, however, is much more than recycling. It involves both product and systems designs that make recovery and reuse possible, efficient and even profitable. In reverse logistics, a measure of what gets thrown away is a measure of the failure of the product design and recovery process.

Revocable Letter of Credit

Letter of credit that can be canceled or altered by the applicant (buyer) or its bank after it has been issued. 

Roll-On/ Roll-Off (Ro/Ro)

Combination of road and sea transport, where loaded road vehicles are driven on to a ferry or ship (Roll-On/Roll-Off Ship) and off at the port of destination. 

Sanitary Certificate

A certificate which attests to the purity or absence of disease or pests in the shipment of food products, plants, seeds, and live animals.

SCOR (Supply Chain Operations Reference Model)

This is the model developed by the Supply-Chain Council (SCC), and is build around six major processes: plan, source, make, deliver, return, and enable. The aim of the SCOR is to provide a standardized method of measuring supply chain performance, and to use a common set of metrics to benchmark against other organizations.

Sea Waybill

Transport document for maritime shipment, which serves as evidence of the contract of carriage and as a receipt for the goods, but is not a document of title. 

Seal Number

A number located on the plastic or metal tamper seal or tag affixed to a loaded container or truck. Seals and seal numbers are not reused. A new seal and therefore a new seal number are used each time a container or truck is sealed.

Seals on Containers

Attached to locking device on container to prevent pilferage and to certify no tampering; made of steel by customs or carrier. 

Serial Number

A unique number assigned for identification to a single piece that will never be repeated for similar pieces. Serial numbers are usually applied by the manufacturer but can be applied at other points by the distributor or wholesaler. Serial numbers can be used to support traceability and warranty programs.

Serial Shipping Container Code (SSCC)

The Serial Shipping Container Code (SSCC) is used to identify individual logistic unit. A logistic unit can be any combination of units put together in a case or on a pallet or truck where the specific unit load needs to be managed through the supply chain. The SSCC enables this unit to be tracked individually which brings benefits for order and delivery tracking and automated goods-receiving. As the SSCC provides a unique number for the delivery it can be utilized as a look-up number to provide not only detailed information regarding the contents of the load but also as part of an Advanced Shipping Notice (ASN) or Dispatch Advice process.

Service Contract

A contract between a shipper (or a shipper's association) and an ocean carrier (or conference) in which the shipper makes a commitment to provide a certain minimum quantity of cargo or freight revenue over a fixed time period, and the ocean common carrier or conference commits to a certain rate or rate schedule as well as a defined service level (such as assured space, transit time, port rotation, or similar service failures). The contract may also specify provisions in the event of nonperformance on the part of either party. 

Shipment

Except as otherwise provided, cargo tendered by one shipper, on one bill of lading, from one point of departure, for one consignee, to one destination, at one time, via a single port of discharge

Shipper

The party (as between exporter and importer) who enters into a contract of carriage for the international transport of goods. The party receiving the goods (the importer or buyer) may be called the receiver or the consignee. Depending on the Incoterm chosen, either the exporter or importer (or middleman) can be the shipper. 

Shipper's Export Declaration (SED)

A form required by the export authorities of many countries to document an export of goods. The form is prepared by a shipper indicating the value, weight, destination, and other basic information about the shipment. The shipper’s export declaration is used to control exports and compile trade statistics. 

Shipper's Letter of Instruction (SLI)

 A form used by a shipper to authorize a carrier to issue a bill of lading or an air waybill on the shipper’s behalf. The form contains all the details of the shipment and authorizes the carrier to sign the bill of lading in the name of the shipper.

Shipper-Carriers

Shipper-carriers (also called private carriers) are companies with goods to be shipped that own or manage their own vehicle fleets. Many large retailers, particularly groceries and "big box" stores, are shipper-carriers.

Shippers Association

Not-for-profit association of shippers using collective bargaining and freight consolidation to obtain lower, high-volume transportation rates; similar to freight forwarding w/o profit motive. Avoids premium charges paid to forwarders. Only non-competitive shippers may associate, due to monopoly restrictions.

Shipper’s agent

A shipper's agent is not a carrier, freight forwarder or broker. Shipper's agents generally arrange for truckload or container load shipment transportation. Shipper's agents commonly provide services related to warehousing or loading and unloading. (See also freight forwarder and broker)

Shipping

The function that performs the tasks for the outgoing shipment of parts, components, and products. It includes packaging, marking, weighing, and loading for shipment.

Shipping Conference

A group of vessel operators joined together for the purpose of establishing freight rates. A shipper may receive reduced rates if the shipper enters into a contract to ship on vessels of Conference members only.

Shipping Documents

Commercial invoices, bills of lading, insurance certificates, consular invoices, and related documents.

Shipping Lane

A predetermined, mapped route on the ocean that commercial vessels tend to follow between ports. This helps ships avoid hazardous areas. In general transportation, the logical route between the point of shipment and the point of delivery used to analyze the volume of shipment between two points.

Shipping Manifest

A document that lists the pieces in a shipment. A manifest usually covers an entire load regardless of whether the load is to be delivered to a single destination or many destinations. Manifests usually list the items, piece count, total weight, and the destination name and address for each destination in the load.

Shipping paper

Shipping order, bill of lading, manifest or other shipping document serving a similar purpose and prepared in accordance with the transport regulations.

Shipping Weight

Shipping weight represents the gross weight in kilograms of shipments, including the weight of moisture content, wrappings, crates, boxes, and containers (other than cargo vans and similar substantial outer containers). 

Ship’s manifest

Instrument in writing, signed by the captain of a ship, which lists the individual shipments constituting the ship’s cargo. 

Slotting

Warehouse slotting is defined as the placement of products within a warehouse facility. Its objective is to increase picking efficiency and reduce warehouse handling costs through optimizing product location and balancing the workload.

Specific Delivery Point

A point in sales quotations which designates specifically where and within what geographical locale the goods will be delivered at the expense and responsibility f the seller; e.g., F.A.S. named vessel at named port of export.

Specific Duty

Duty based on some measure or quantity, such as weight, length, or number of units. 

Spot rate

Rate of exchange quoted for purchases and sales of a foreign currency for immediate delivery and payment. 

Stevedore

Terminal operator who facilitates the operation of loading and discharging vessels and other terminal activities. 

Stowage

Placing of cargo in a ship’s hold in such a fashion as to assure safe and stable transport. 

Straddle Carrier

Mobile truck equipment with the capacity for lifting a container within its own framework, and transporting containers around yards. Containers stacked in rows one across.

Straight Bill of Lading

Nonnegotiable bill of lading in which the goods are consigned directly to a named party. 

Straight Truck

Straight trucks do not have a separate tractor and trailer. The driving compartment, engine and trailer are one unit.

Strategic Alliance

Business relationship in which two or more independent organizations cooperate and willingly modify their business objectives and practices to help achieve long-term goals and objectives.

Subcontracting

Sending production work outside to another manufacturer. This can involve specialized operations such as plating metals or complete functional operations. 

Supplier

That means :

  1. A provider of goods or services;
  2. A seller with whom the buyer does business, as opposed to vendor, which is a generic term referring to all sellers in the marketplace.
Supplier Certification

Certification procedures verifying that a supplier operates, maintains, improves, and documents effective procedures that relate to the customer's requirements. Such requirements can include cost, quality, delivery, flexibility, maintenance, safety, and ISO quality and environmental standards.

Supplier Relationship Management (SRM)

Is the discipline of strategically planning for, and managing, all interactions with third party organizations that supply goods and/or services to an organization in order to maximize the value of those interactions. In practice, SRM entails creating closer, more collaborative relationships with key suppliers in order to uncover and realize new value and reduce risk.

Supply

The quantity of an economic good that sellers will make available at a given price at a certain time in a specific market. A supply schedule indicates the quantity of an economic good that might enter the market at all possible prices at a particular time. Supply in a market economy is principally determined by the response of many individual entrepreneurs and firms to their perceptions of opportunities for earning profits.

Supply Chain

It means :

  1. Starting with unprocessed raw materials and ending with the final customer using the finished goods, the supply chain links many companies together ;
  2. The material and informational interchanges in the logistical process, stretching from acquisition of raw materials to delivery of finished products to the end user. All vendors, service providers, and customers are links in the supply chain.
Supply Chain Design

The determination of how to structure a supply chain. Design decisions include the selection of partners, the location and capacity of warehouse and production facilities, the products, the modes of transportation, and supporting information systems.

Supply Chain Event Management (SCEM)

SCEM is an application that supports control processes for managing events within and between companies. It consists of integrated software functionality that supports five business processes: monitor, notify, simulate, control, and measure supply chain activities.

Supply Chain Execution (SCE)

Supply chain execution (SCE) is focused on execution-oriented applications, including warehouse management systems (WMSs), transportation management systems (TMSs), global trade management (GTM) systems and other execution applications, such as real-time decision support systems (for example, dynamic routing and dynamic sourcing systems) and supply chain visibility systems within the enterprise, as well as throughout the extended supply chain.

Supply Chain Integration (SCI)

Likely to become a key competitive advantage of selected e-marketplaces. Similar concept to the back-end integration, but with greater emphasis on the moving of goods and services.

Supply Chain Management (SCM)

Supply chain management encompasses the planning and management of all activities involved in sourcing and procurement, conversion, and all logistics management activites. Importantly, it also includes coordination and collaboration with channel partners, which can be suppliers, intermediaries, third party service providers, and customers. In essence, supply chain management integrates supply and demand management within and across companies. Supply chain management is an integrating function with primary responsibility for linking major business functions and business processes within and across companies into a cohesive, high-performing business model. It includes all of the logistics managment activities noted above, as well as manufacturing operations, and it drives coordination of processes and activities with and across marketing, sales, product design, finance, and information technology. 

Supply Chain Network Design Systems

The systems employed in optimizing the relationships among the various elements of the supply chain manufacturing plants, distribution centers, points of sale, as well as raw materials, relationships among product families, and other factors to synchronize supply chains at a strategic level.

Supply Chain Strategic Planning

The process of analyzing, evaluating, and defining supply chain strategies, including network design, manufacturing and transportation strategy, and inventory policy.

Supply Planning

The process of identifying, prioritizing, and aggregating, as a whole with constituent parts, all sources of supply that are required and add value in the supply chain of a product or service at the appropriate level, horizon, and interval.

Supply Warehouse

A warehouse that stores raw materials. Goods from different suppliers are picked, sorted, staged, or sequenced at the warehouse to assemble plant orders.

Surcharge

Charges added to ocean freight, variously, for bunker (fuel), currency fluctuation, congestion, port detention, or extra risk insurance. 

Surplus

The amount of a commodity that cannot be absorbed in a given market at the existing price.

Swap

Trading of almost identical products (such as oil) from different location to save transportation coasts. 

SWIFT Payment

International electronic funds transfer via the system known as SWIFT (Society for World-Wide Inter-bank Financial Telecommunications) offered by most major banks. 

Switching

Switching is a railroad term denoting the local movement of freight rail cars. Rail cars are switched from the private siding of a shipper to the terminal, or switched from the terminal to the private siding of the consignee. (Note: a siding is a section of rail line that runs from a railroad’s line into an industrial facility. If an industry using rail shipping does not have a siding, they will likely use :

  1. Intermodal containers;
  2. Or use a cartage service to transfer goods to/from a rail terminal.
Tare Weight

The weight of a substance obtained by deducting the weight of the empty container from the gross weight of the full container.

Tariff

A duty (or tax) levied upon goods transported from one customs area to another either for protective or revenue purposes. Tariffs raise the prices of imported goods, thus making them generally less competitive within the market of the importing country unless that country does not produce the items so tariffed.

Tariff Quotas

Application of a higher tariff rate to imported goods after a specified quantity of the item has entered the country at a lower prevailing rate. 

Tariff Schedule

Comprehensive list of the goods which a country may import and the import duties applicable to each product. 

Tarriff Barrier

Customs duties, which are one possible barrier to imports into a country by making them more expensive. 

Temporary Import Under Bond (TIB)

Procedure in which goods are imported without payment of duty, by posting a bond to guarantee that they will be exported. 

Tenor

The time fixed or allowed for payment, as in "the tenor of a draft".

Terminal

Transportation facility with one or more of the following roles:

  1. System access: terminals are points at which freight enters and leaves the transportation system;
  2. Freight consolidation/distribution;
  3. Mode transfer: freight may change from one mode to another, for example, rail to truck;
  4. Vehicle transfer: within a single mode, freight may transfer from one vehicle to another;
  5. Storage and warehousing;
  6. Fleet maintenance.
Terminal Handling Charge (THC)

Handling charges assessed for services rendered within container terminals or with respect to containers which will be processed through terminals. When delivery or pickup of the goods is expected to be at a container terminal, traders are well-advised to stipulate precisely which party will pay for all or part of the terminal handling charges. 

Terminal Receiving Charges (TRC)

Loading charges at origin port of a vessel or NVOCC. 

Terms and Conditions

All the provisions and agreements of a contract.

TEU (Twenty Foot Equivalent Unit)

Method of measuring vessel load or capacity, in units of containers that are twenty feet long. A 40’ long container measures 2 TEUs. Example: the maximum capacity for carrying 40’ containers for a 18000 TEU vessel is 9000 containers.

Theory of Constraints (TOC)

A production management theory which dictates that volume is controlled by a series of constraints related to work center capacity, component availability, finance, etc. Total throughput cannot exceed the capacity of the smallest constraint, and any inventory buffers or excess capacity at non-related work center is waste.

Third Party Logistics (3PL)

A firm which provides multiple logistics services for use by customers. Preferably, these services are integrated or bundled together, by the provider. These firms facilitate the movement of parts and materials from suppliers to manufacturers, and finished products from manufacturers, and finished products from manufacturers to distributors and retailers. Among the services they provide are transportation, warehousing, cross docking, inventory management, packaging, and freight forwarding.

Third Party

A party other than the shipper or consignee that is ultimately responsible for paying the shipment charges.

Through Bill of Lading

Single bill of lading converting both the domestic and international carriage of a shipment. 

Throughput

A measure of warehousing output volume (weight, number of units). Also, the total amount of units received, plus the total amount of units shipped divided by two.

Time Draft

Draft that matures either a certain number of days after acceptance or a certain number of days after the date of the draft. 

TIR Carnets

Transport documents used to cover international transport shipment on road vehicles such as trucks/lorries. TIR Carnets, issued pursuant to the 1949 TIR Convention, allow the truck or other vehicle to pass through all TIR-member countries without having to go through customs inspection until reaching the country of destination. 

TL / FTL (Truckload, Full Truckload)

A trucking industry term; a truckload shipment is when the shipper contracts an entire truck for direct point-to-point service. Truckload shipments are priced per mile within designated lanes, regardless of the size of the shipment provided it fits (weight, cube) within the vehicle. Less expensive per unit weight shipped than LTL. A truckload carrier is a trucking company specializing in point-to-point truckload shipments. 

TOFC (Trailer-On-Flatcar)

A term used in intermodal transportation in which truck trailers or container/chassis combinations are placed directly onto rail flatcars for the rail portion of the trip. TOFC trains are generally heavier and longer per unit ton shipped, but have the advantage that unloaded trailers can be moved out of the intermodal terminal without worrying about finding a chassis; thus, the equipment management issues are simpler.

Total Supply Chain Management Cost

Total cost to manage order processing, acquire materials, manage inventory, and manage supply chain finance, planning, and IT costs as represented as a percent of revenue. Accurate assignment of IT-related cost is challenging. It can be done using activity-based costing methods, or more traditional-based approaches. Allocation based on user counts, transaction counts, or departmental headcounts are reasonable approaches. The emphasis should be on capturing all costs, whether incurred in the entity completing the survey or in a supporting organization on behalf of the entity. Reasonable estimates founded in data were accepted as means to assess overall performance. All estimates reflected fully-burdened actuals inclusive of salary, benefits, space and facilities, and general and administrative allocations. 

Total Supply Chain Response Time

The time it takes to rebalance the entire supply chain after determining a change in market demand. Also, a measure of a supply chain's ability to change rapidly in response to marketplace changes.

Traceability

It means :

  1. The attribute allowing the ongoing location of a shipment to be determined ;
  2. The registering and tracking of parts, processes, and materials used in production, by lot or serial number.
Tracking and Tracing

Monitoring and recording shipment movements from origin to destination.

Trade Barriers

Government laws, regulations, policies, or practices that either protect domestic products from foreign competition or artificially stimulate exports of particular domestic products.

Trading Partner Agreement

An agreement drawn up by two parties that have agreed to trade certain items or information to each other. The agreement outlines the terms of the trade or trading process, such as compensation for the shorted party in an inequitable trade. Trading Partner The written contract that spells out agreed upon terms between. 

Tramp Shipping

An ocean carrier company operating vessels not on regular runs or schedules. They call at any port where cargo may be available. Sometimes used for bulk cargo shipping.

Tramp Vessel

Seagoing cargo vessel, available on a contract basis to carry cargoes to any given port. To be distinguished from liner ships, operating according to advertised routes, schedules, and rates. 

Transferable Letter of Credit

Allows the beneficiary to make part of all of his credit payable to another supplier; used in middleman/brokerage contexts; distinguishable from back-to-back L/Cs because the transferable credit requires the knowledge and authorization of the importer (applicant/principal). 

Transit Privileges / Stopoff Charges

Carriers may allow cargo to be stopped in transit from initial origin to final destination to be unloaded, stored, and/or processed before reloading and final shipment. Extra charges are imposed for these transit privileges. Stopoff charges are levied for when shippers request that a shipment may be partially loaded at several locations and/or partially unloaded at several locations en route.

Transit Time

The total time that elapses between a shipment's pickup and delivery.

Transmittal Letter

Contains a list of the particulars of the shipment, a record of the documents being transmitted, and instructions for disposition of these documents. Any special instructions are also included. 

Transportation Broker

An agency that obtains negotiated large-volume transportation rates from carriers, and resells this capacity to shippers. Unlike freight forwarders, will not handle freight and owns no pickup/delivery equipment or storage facilities.

Transship

To change carriers in a foreign port en route to a third port. Also used to refer to a country of transshipment.

Transshipment

Transfer of cargo from one carrier to another. 

Truck tonnage

The weight (in tons) of a shipment transported by truck.

Truckload (TL)

Large-volume shipment from a single customer that weighs more than 10,000 pounds or takes up all the trailer space so no other shipment can be loaded.

Truckload Lot

A truck shipment that qualifies for a lower freight rate because it meets a minimum weight and/or volume.

Ultimate Consignee

Person or organization located abroad who is the true party in interest, receiving the export for the designated end-use. 

Uniform Warehouse Receipts Act

The act that sets forth the regulations governing public warehousing. The regulations define a warehouse manager's legal responsibility and define the types of receipts he or she issues

Unit Load Device (ULD)

Refers to airfreight containers and pallets.

Unit of Measure (UOM)

The unit in which the quantity of an item is managed, e.g., pounds, each, box of 12, package of 20, or case of 144. Various UOMs may exist for a single item. For example, a product may be purchased in cases, stocked in boxes, and issued in single units.

Unit Train

An entire, uninterrupted locomotive, car, and caboose movement between an origin and destination.

Unitization

In warehousing, the consolidation of several units into larger units into larger units for fewer handlings.

Unitize

To consolidate several packages into one unit; carriers strap, band, or otherwise attach the several packages together.

Validated License

A government document authorizing the export of commodities within the limitations set forth in the document.

Valuation Charges

Transportation charges to shippers who declare a value of goods higher than the value of the carriers' limits of liability.

Voyage

The trip designation (trade route and origin/destination) identifier, usually numerically sequential.

War Risk

In marine insurance, damage or loss sustained as the result of acts of war. Usually written in a separate policy against current war like acts as well as former war leftovers, such as floating mines not detected, etc. War risk is not included in an all risk policy, but can be added by endorsement. Separate premium is usually paid. 

Warehouse

Storage place for products. Principal warehouse activities include receipt of product, storage, shipment, and order picking.

Warehouse Entry

Customs Entry permitting goods to enter a bonded warehouse. 

Warehouse Receipt (WR)

Receipt issued by a warehouse listing goods received for storage. 

Warehouse to Warehouse Clause

Insurance coverage of international cargo from export warehouse to import warehouse; coverage may also be substantially extended or limited according to time. 

Warehouse Withdrawal

Customs Entry permitting goods to leave a bonded warehouse. 

Waybill

Is a document issued by a carrier giving details and instructions relating to the shipment of a consignment of goods. Typically it will show the names of the consignor and consignee, the point of origin of the consignment, its destination, and route. Most freight forwarders and trucking companies use an in-house waybill called a house bill. These typically contain "conditions of contract of carriage" terms on the back of the form. These terms cover limits to liability and other terms and conditions.

Weight Break

The shipment volume at which the LTL charges equal the TL charges at the minimum weight.

Weight Confirmation

The practice of confirming or validating receipts or shipments based on the weight.

Weight Unit Qualifier

The unit of measure that the user wants to see for weight.

Weight-Point Plan

 A supplier selection and rating approach that uses the input gathered in the categorical plan approach and assigns weights to each evaluation category. A weighted sum for each supplier is obtained and a comparison made. The weights used should sum to 100% for all categories. 

Wharfage

A charge assessed by a pier or dock owner against the cargo or a steamship company for use of the pier or dock for the handling of incoming or outgoing cargo.

Wharfinger

Personnel in charge of receiving and registering goods in a port on behalf of the carrier. Wharfinger’s signature of the shipping note assures the shipper that it can proceed to draw up bills of lading pursuant to the terms of the note. (Also known as wharf inspector, wharf superintendent, dock superintendent). 

With Average (WA)

Marine insurance term meaning that a shipment is protected from partial damage whenever the damage exceeds 3 percent (or some other percentage). If the ship is involved in a major catastrophe, such as a collision, fire or stranding, the minimum percentage requirement is waived and the insurance company pays for all of the damage. 

Without Reserve

Term indicating that an agent or representative is empowered to make definitive decisions and adjustments abroad without approval of the group or individual represented. 

World Trade Organization (WTO)

Is the only global international organization dealing with the rules of trade between nations. At its heart are the WTO agreements, negotiated and signed by the bulk of the world’s trading nations and ratified in their parliaments. The goal is to help producers of goods and services, exporters, and importers conduct their business.

Worldscale

Scale for quoting freight rates for oil tankers.