Logistics & Supply Chain Glossary

A shipment that fills an entire truck trailer (typically 48-53 feet). The shipper pays for the whole trailer regardless of whether it's completely full.

Example: "We need an FTL from Dallas to Chicago - 42,000 lbs of auto parts."

A shipment that doesn't fill a full truck. Multiple shippers share trailer space, and pricing is based on weight, dimensions, and freight class.

Example: "This is only 4 pallets, so we'll ship it LTL to save money."

A standardized classification (50-500) used to categorize LTL shipments based on density, handling, stowability, and liability. Lower class = lower rate.

Example: "Class 85 freight is denser than Class 150, so it costs less per pound to ship."

An enclosed trailer used for shipping non-perishable goods. The most common type of trailer, typically 53 feet long.

A temperature-controlled trailer used for shipping perishable goods like food, pharmaceuticals, and flowers.

Example: "Frozen foods require a reefer set to -10°F with team drivers."

An open trailer with no sides or roof, used for oversized cargo, construction materials, and machinery that can't fit in an enclosed trailer.

Shipping that uses multiple transportation modes (typically truck + rail) using standardized containers that transfer between modes.

Example: "For coast-to-coast, intermodal is 30% cheaper than FTL if you have 5+ days."

Short-distance trucking, typically moving containers from ports or rail yards to nearby warehouses or distribution centers.

When a truck drives empty (no freight). Carriers try to minimize deadhead miles because they don't generate revenue.

Example: "The backhaul rate is low because the carrier needs to deadhead back anyway."

The main transportation charge for moving freight from origin to destination, excluding accessorial charges.

Additional charges beyond basic linehaul, such as liftgate service, inside delivery, detention, or appointment scheduling.

Example: "Add $85 for liftgate delivery since they don't have a loading dock."

A charge applied when a driver is kept waiting beyond the allotted free time (usually 2 hours) for loading or unloading.

The legal document between shipper and carrier that details the shipment contents, origin, destination, and terms. Serves as a receipt and contract.

Documentation (usually signed) confirming that a shipment was delivered to the consignee. Required for billing and claims.

Progressive or tracking number assigned by the carrier to identify and track a shipment.

A variable charge added to freight rates to account for fluctuating fuel costs. Typically expressed as a percentage of linehaul.

Example: "Current fuel surcharge is 28% on top of the base rate."

A one-time rate negotiated for a specific shipment, as opposed to contracted rates. Usually higher than contract rates.

A pre-negotiated rate agreed upon for a specified period, typically in exchange for committed volume. Lower than spot rates.

A specific origin-destination pair for freight movement. Rates are often quoted and managed by lane.

Example: "The Dallas-to-Phoenix lane runs $1,800 for FTL."

The deadline by which a shipment must be delivered, often with penalties (chargebacks) for late delivery.

A company that provides outsourced logistics services including warehousing, fulfillment, and transportation management.

Example: "Walker Logistics is our 3PL - they handle all our storage and shipping."

A warehouse focused on receiving, storing, and shipping products to customers or retail locations. Emphasizes throughput over long-term storage.

A logistics practice where incoming shipments are unloaded and directly loaded onto outbound trucks with minimal storage time.

The warehouse process of selecting items from inventory (picking) and packaging them for shipment (packing).

Picking individual units rather than full cases or pallets. More labor-intensive and typically costs more per unit.

Picking full cases/cartons from inventory rather than individual units or full pallets.

A storage space for one standard pallet (typically 48" x 40"). Storage fees are often charged per pallet position per month.

A unique identifier for each distinct product in inventory. Used to track inventory levels and movements.

An inventory management method where the oldest stock is shipped first. Critical for perishable goods.

An inventory method where items closest to expiration are shipped first, regardless of when they were received.

Tracking inventory by production lot or batch number for traceability, quality control, and recall management.

A partial inventory count done on a regular schedule, rather than counting all inventory at once (physical inventory).

Loss of inventory due to theft, damage, administrative errors, or other causes. Measured as a percentage of total inventory value.

The process of moving received goods from the dock to their assigned storage location in the warehouse.

Organizing warehouse storage locations to optimize picking efficiency - placing fast-moving items in easily accessible locations.

Additional services beyond basic storage and shipping, such as kitting, labeling, assembly, or returns processing.

Combining multiple SKUs into a single sellable unit or package. Common for promotional bundles or product sets.

Software that manages warehouse operations including inventory tracking, picking, receiving, and shipping.

Software that manages transportation operations including carrier selection, rate shopping, shipment tracking, and freight audit.

Software that tracks orders from placement through fulfillment, managing inventory allocation and order status.

A standardized format for exchanging business documents electronically between trading partners (orders, invoices, ASNs).

Example: "We receive orders via EDI 940 and send ship confirmations via EDI 945."

Warehouse Shipping Order - instructs a 3PL to ship inventory to a customer.

Warehouse Shipping Advice - confirms that a shipment has been sent from the warehouse.

Electronic notification sent before a shipment arrives, detailing contents, carrier, and expected arrival.

Invoice - electronic billing document sent from seller to buyer.

A modern method for systems to communicate and share data in real-time, often replacing or supplementing EDI.

Handheld devices used in warehouses to scan barcodes and communicate with the WMS in real-time.

Money owed to a company by its customers for goods or services delivered but not yet paid for.

Money a company owes to its vendors or suppliers for goods or services received but not yet paid for.

Payment terms requiring full payment within 30 days of the invoice date. Common terms include Net 15, Net 30, Net 45.

A report showing outstanding invoices categorized by how long they've been unpaid (current, 1-30 days, 31-60 days, etc.).

A deduction taken by a retailer from a vendor's payment for non-compliance (late delivery, labeling errors, etc.).

Example: "Walmart hit us with a $500 chargeback for missing the MABD."

The process of reviewing carrier invoices to verify charges are accurate and match contracted rates.

A measure of inflation often used as a basis for annual rate adjustments in logistics contracts.

A document sent to potential vendors inviting them to submit a proposal for services. Used to compare and select providers.

A request for pricing on specific services or shipments, typically less formal than an RFP.

Documented step-by-step instructions for completing routine operations consistently.

Metrics used to measure performance, such as on-time delivery rate, order accuracy, or inventory turns.

A regular meeting between a company and its customers or vendors to review performance, discuss issues, and plan ahead.

A contract defining the expected level of service, including metrics and penalties for non-compliance.

The person or company receiving a shipment (the "ship to" party).

The person or company sending a shipment (the "ship from" party). Also called consignor.

A company that transports freight, such as a trucking company, railroad, or airline.

An intermediary that arranges transportation by connecting shippers with carriers, without owning trucks.

The process of setting up a new customer in a 3PL's systems, including configuration, testing, and documentation.

The date when a new customer or system becomes operational and starts processing real transactions.