Warehouse Terminology
ASN (Advance Ship Notice) – Detailed shipment information transmitted to a customer or consignee in advance of delivery, designating the contents (individual products and quantities of each) and nature of the shipment. May also include carrier and shipment specifics including time of shipment and expected time of arrival
Back Order – Product ordered but out of stock and promised to ship when the product becomes available
Bar Code – A symbol consisting of a series of printed bars representing values. A system of optical character reading, scanning, and tracking of units by reading a series of printed bars for translation into a numeric or alphanumeric identification code
Bin – A storage device designed to hold small discrete parts. A shelving unit with physical dividers separating the storage locations. a bulk storage location inside a warehouse
Bin Move – Moving inventory from one bin to another.
Break–Bulk – The separation of a single consolidated bulk load into smaller individual shipments for delivery to the ultimate consignees
Carrier – A firm which transports foods or people.
Code Date – An alternate date (Ex. expiration date)
Consignee – The party to whom goods are shipped to and delivered. The receiver of a freight shipment.
Consignor – The party who originates a shipment of goods (shipper). The sender of a freight shipment, usually the seller.
Consolidation – Combining two or more shipments in order to realize lower transportation rates. Inbound consolidation form vendors is called make–bulk consolidation: outbound consolidation to customers is called break–bulk consolidation
Container – A box typically 10 to 40 feet long, which is primarily used for ocean freight shipments. For travel to and from ports, containers are loaded onto truck chassis or on railroad flatcars. The packaging such as a carton, case, box, bucket, drum, bin, bottle, bundle, or bag that an item is packed and shipped in.
Container Stripping – To unload a shipping container, Also called De-stuffing
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 putaway, storage and selection operations, it can significantly reduce distribution costs. The act of unloading product off a trailer/container and loading the product directly onto an outbound load without putting the freight into storage
Distribution Center – A post–Production warehouse for finished goods
EDI (Electronic data interchange) – 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”
ERP (Enterprise Resource Planning) – An ERP System is an application that contains a set of tools to manage a business and a variety of departments. This can include accounting, manufacturing, distribution, order management, asset management, and other components.
Fill Rate – The percentage of order items that the picking operation actually fills within a given period of time
Floor Loaded – Description of how the trailer is loaded. Merchandise is loaded onto the floor of a trailer without pallet
Finished Goods Inventory (FGI) – Products completely manufactured, packaged, stored, and ready for distribution
Fixed Costs – Costs which do not fluctuate with business volume in the short run
Foreign Trade Zone (FTZ) – An area or zone set aside at or near a port or airport, under the control of the U.S. Customs Service, for holding goods duty–free pending customs clearance
Handling Costs – The cost involved in moving, transferring, preparing, and otherwise handling inventory.
Hazardous Material – A substance or material which the Department of Transportation has determined to be capable of posing a risk to health, safety, and property when stored or transported in commerce
Hundredweight (cwt) – A pricing unit used in transportation (equal to 100 pounds).
Intermodal Transportation – Transporting freight by using two or more transportation modes.
Inventory – Any type of freight or product stored within a warehouse for consumption in manufacturing or distribution
Inventory Management – The process of ensuring the availability of products through inventory administration
Inventory Turns – The speed with which inventory moves through a defined cycle (i.e., from receiving to shipping)
Kitting – Light assembly of components or parts into defined units, Kitting reduces the need to maintain an inventory of pre-built completed products, but increases the time and labor consumed at shipment. Light assembly of components or parts into a defined Finished Product.
Less–Than–Truckload (LTL) Carriers – Trucking companies that consolidate and transport smaller (less than truckload) shipments of freight by utilizing a network of terminals and relay points.
Logistics – The process of planning, implementing and controlling the efficient, effective flow and storage of goods, services, and related information from point of origin to point of consumption for the purpose of conforming to customer requirements
Materials Handling – The physical handling of products and materials between procurement and shipping.
M.F.C (National Motor Freight Classification) – A tariff which contains descriptions and classifications of commodities and rules for domestic movement by motor carriers in the U.S.
Order Cycle – The time and process involved from the placement of an order to the receipt of the shipment
Order Fill Rate – The percentage of orders that are fulfilled completely
Order Processing – Activities associated with filling customer orders.
Outsource – To utilize a third–party provider to provide services previously performed in–house.
Pick/Pack – Picking of product from inventory and packing into boxes or shipment containers.
Picking Ticket – Tells what items are to be included in each order and the items and the items location in the warehouse including the aisle, shelf or pallet location, and even the bin number of the merchandise. A report that displays item information required to fulfill an order including Item #, Quantity, and location in the warehouse.
Prepaid – A freight term which indicates that charges are to be paid by the shipper.
Proof of Delivery (P.O.D.) – 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
Replenishment – The process of moving or resupplying inventory form a reserve storage location to a primary picking location or to another mode of storage in which picking is performed.
Reverse Logistics – Specialized logistics focused on the return of products from a consumer.
Safety Stock – The inventory a company holds as a buffer to cover average demand during the lead time of resupply
Shipper – The party which tenders goods for transportation
Stock Keeping Unit (SKU) – Numbering system which makes a product or item distinguishable from all others.
Supply Chain – The physical, financial and information networks that involve the movement of materials, funds, and related information through the full logistics networks that involve the movement of raw materials to delivery of finished products to the end user. The supply chain includes all vendors, service providers, customers, and intermediaries.
Supply Chain Management (SCM) – The management and control of all materials, funds, and related information in the logistics process from acquisition of raw materials to the delivery of finished products to the end user.
Tare weight – The weight of the empty packaging, by itself. The weight of a PLT, Carton, or container without freight or product
Tariff – A tax assessed by a government on goods entering or leaving a country. The term is also used in transportation in reference to the fees and rules applied by a carrier for its services.
Third Party Logistics – Transportation, warehousing, and other logistics related services provided by companies employed to assume tasks that were previously performed in–house by the client. A logistics organization that provides outsourced logistics services to various companies but does not take ownership of the product through the supply chain.
Transit Time – The total time that elapses between a shipments pickup and delivery.
Truckload Carriers (TL) – Trucking companies which move full truckloads of freight directly from the point of origin to destination
Unit Cost – The cost associated with a single unit of product. The total cost of producing a product or service divided by the total number of units.
Variable Cost – A cost that fluctuates with the volume or activity level of business.
Warehousing – The storage (holding) of goods
Work–in–Process (WIP) – Parts and sub-assemblies in the process of becoming completed finished goods.