Industry Terms

ABI - Automated Brokerage Interface: Is a system available to U.S. Customs Brokers with the computer capabilities and customs certification to transmit and exchange customs entries and other information, facilitating prompt release of imported cargo.

Ad Valorem ("according to the value"): A fixed percentage of the value of goods that is used to calculate customs duties and taxes.

Automated Brokerage Interface (ABI): An electronic system allowing customhouse brokers and importers to interface via computer with the US Customs Service for transmitting entry and entry summary data on imported merchandise.

Automated Commercial System (ACS): The electronic system of the US Customs Service, encompassing a variety of industry sectors, that permits on-line access to information in selected areas.

Automated Manifest System (AMS): The electronic system allowing a manifest inventory to be transmitted to the US Customs Service data center by carrier, port authority or service centre computers

Bonded Warehouse: A warehouse storage area or manufacturing facility in which imported goods may be stored or processed without payment of customs duties.

Brussels Tariff Nomenclature Number (BTN): The customs tariff number used by most European nations. The United States does not use the BTN, but a similar system known as the Harmonised Tariff Schedule.

C.C.E.F.: Is a Customs Centralised Examination Facility.

Certificate of Analysis: Is a certificate required by some countries as proof of the quality and composition of food products or pharmaceuticals. The required analysis may be made by a private or government health agency. The certificate must be legalized by a foreign consul of the country concerned, as is the case with such similar certificates as the phytosanitary certificate.

Certificate of Inspection: A document certifying that the goods were in apparent good condition immediately prior to shipment.

Certificate of Manufacture: A statement in which a producer specifies where his goods were manufactured, certifies that manufacturing has been completed, and confirms that the goods are at the buyer's disposal.

Certificate of Origin: A statement signed by the exporter, or his agent, and attested to by a local Chamber of Commerce, indicating that the goods being shipped, or a major percentage of them, originated and were produced in the exporter's country.

CES: Is a Customs Examination Station

Classification: Is a customs term. The placement of an item under the correct number in the customs tariff for duty purposes. At times this procedure becomes highly complicated; it is not uncommon for importers to resort to litigation over the correct duty to be assessed by the customs on a given item.

Collective Paper: All documents (commercial invoices, bills of lading, etc.) submitted to a buyer for the purpose of receiving payment for a shipment.

Commodity Specialist: An official authorized by the U.S. Treasury to determine proper tariff and value of imported goods.

Confiscation: The taking and holding of private property by a government or an agency acting for a government. Compensation may or may not be given to the owner of the property.

Countervailing Duties: Is a special duties imposed on imports to offset the benefits of subsidies to producers or exporters of the exporting country.

Customs Bonded Warehouse: Is a warehouse where imported goods may be stored for a total of three years without the payment of duty or taxes.

Customhouse Broker: An individual or firm licensed to enter and clear goods through Customs.

Customs Court: Is the court to which importers might appeal or protest decisions made by Customs officers.

Customs Tariff: Is a schedule of charges assessed by the federal government on imported goods.

Customs Union: Is an agreement between two or more countries in which they arrange to abolish tariffs and other import restrictions on each other's goods and establish a common tariff for the imports of all other countries.

Destination Control Statement: Any of various statements that the U.S. government requires to be displayed on export shipments and that specify the destination for which export of the shipment has been authorized.

Drawback: A U.S. customs law that permits an American exporter to recover duties paid on imported foreign raw materials or components included in products that are subsequently exported out of the United States.

Export Declaration: A form to be completed by the exporter or their authorized agent and filed in triplicate by a carrier with the United State Collector of customs at the point of exit. It serves a twofold purpose: Primarily, it is used by the U.S. Bureau of Census for the compilation of export statistics on United States foreign trade (for this reason an export declaration is required for practically all shipments from the United States to foreign countries and the United States possessions, except for mail shipments of small value, or for those of a non commercial character); The declaration also serves as an export control document because it must be presented, together with the export license, to the United States Customs at the port of export. If the goods may be exported under general export license, this fact must be stated on the export declaration.

Export License: A document secured from a government, authorizing an exporter to export a specific quantity of a particular commodity to a certain country. An export license is often required if a government has place embargoes or other restrictions upon exports. See General Export License.

Foreign Trade Zone: A free port in the United Stated divorced from Customs authority but under Federal control. Merchandise, except that which is prohibited, may be stored in the zone without being subjected to the United States tariff regulation. Also called Free Trade Zone.

Foreign Trade Zone Entry: A form declaring goods which are brought duty free into a Foreign Trade Zone for further processing or storage and subsequent exportation.

Free Port: A port which is a foreign trade zone, open to all traders on equal terms; more specifically a port where merchandise may be stored duty-free, pending re-export or sale within that country.

Free trade area: is used when countries wish to bring together their economies but not to integrate them or turn them into a single economy. Some free trade areas include the European Economic Area (EEA) and European Free Trade Association (EFTA), and the North American Free Trade Agreement (NAFTA) between the USA, Canada and Mexico, Mercosur in Latin America and Caricom in the Caribbean.

Free Trade Zone: A port designated by the government of a country for duty-free entry of any non-prohibited goods. Merchandise may be stored, displayed, used for manufacturing, within the zone and re-exported 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.

GATT: General Agreement on Tariffs and Trade, a multilateral treaty intended to help reduce trade barriers and promote tariff concessions.

General Export License: Any of various export licenses covering export commodities for which validated export licenses are not required. No formal application or written authorization is needed to ship exports under a general export license.

General Order: Government contract warehouse for the storage of cargoes left unclaimed for ten working days after availability. Unclaimed cargoes are auctioned publicly after one year.

Code: An internationally accepted and uniform description system for classifying goods for customs, statistical and other purposes.

Harmonized Systems: A key provision of the recently signed trade bill, effective Jan. 1, 1989, that establishes international uniformity for product classifications. Most U.S. Trading partners adopted it a year earlier, and it was drafted in Brussels a decade ago with U.S. representatives' input. In essence, it is a new tariff schedule in that it changes methods of rating some items.

Import License: A certificate, issued by countries exercising import controls, that permits importation of the articles stated in the license. The issuance of such a permit frequently is connected with the release of foreign exchange needed to pay for the shipment for which the import license has been requested.

In-Bond: A customs program for inland ports that provide for cargo arriving at a seaport to be shipped under a Customs bond to a more conveniently located inland port where the entry documents have been filed. Customs clears the shipment there, and the cargo is trucked to its destination, which normally is close to the inland port.

Inspection Certificate: A document certifying that merchandise (such as perishable goods) was in goods condition immediately prior to shipment.

Liquidation: The finalization of a customs entry.

MFN (Most Favored Nation): Designation for countries which receive preferential tariff rates. This is no longer the best tariff structure available.

No Objection Certificate: Document provided by scheduled or national airlines of many countries declaring no objection to a proposed charter flight operated by another airline. Often demanded by government authorities before they grant permission for a charter flight to take place.

No Objection Fee: Sum of money paid by a charter airline normally to a scheduled airline in order that it waives its right of objection to its government, thus allowing a charter to take place. Tantamount to a bribe. The amount is usually a fixed percentage of the gross cost of a charter. Common practice in the Middle East and Africa.

Non-Tariff Barriers (NTB): Economic, political, administrative or legal impediments to trade other than duties, taxes and import quotas

Paired: Port of Arrival Immediate Release and Enforcement Determination. A U.S. Customs program that allows entry documentation for an import shipment to be filed at one location, usually an inland city, while the merchandise is cleared by Customs at the port of entry, normally a seaport. May be ineffective with certain types of high-risk cargoes, such as quota-regulated textiles or shipments from drug-production regions. Cities where there is a natural flow of cargo are actually "paired" in the program; e.g., Atlanta, an inland city, is linked with Savannah, a seaport. Tested in '87-'88, it became generally available in mid- '88.

Paperless Release: Under ABI, certain commodities from low-risk countries not designated for examination may be released through an ABI-certified broker without the actual submission of documentation.

Phytosanitary Inspection Certificate: A certificate issued by the U.S. Department of Agriculture indicating that a shipment has been inspected and is free of harmful pests and plant diseases.

Power of Attorney: A document that authorizes a customs broker to sign all customs documents on behalf of an importer.

Protest: Customs form 19 allows for a refund of an overpayment of duty if filed within 90 days of liquidation.

Reciprocity: A practice by which governments extend similar concessions to one another.

Retaliation: Action taken by a country to restrain its imports from another country that has increased a tariff or imposed other measures that adversely affects the firsts country's exports.

Sanitary and Health Certificate: A statement signed by a health organization official certifying the degree of purity, cleanliness, or spoilage of goods, and the health of live animals.

Schedule B: Refers to "Schedule B, Statistical Classification of Domestic and Foreign Commodities Exported from the United States." Being replaced under the Harmonized System.

Standard International Trade Classification (SITC) : A standard numerical code system developed by the United Nations to classify commodities used in international trade.

Tariff: A general term for any listing of rates, charges, etc. the tariffs most frequently encountered in foreign trade are: tariffs of the international transportation companies operating on sea, on land, and in the air; tariffs of the international cable, radio, and telephone companies; and the customs tariffs of the various countries, which list goods that are duty free and those subject to import duty, giving the rate of duty in each case. There are various classes of customs duties

VAT (Value-Added Tax): A sales or consumption tax which the end user pays. Typically, this is a "hidden" tax, added to the list price of the goods in question.

Visa: An invoice properly validated by the Minister of Trade in regard to quota entries. 

Transport & Logistics

Assemble-to-Order (ATO)
Strategy allowing a product or service to be made to specific order, where a large number of products can be assembled in various forms from common components. This requires sophisticated planning processes to anticipate changing demand for internal components or accessories while focusing on mass customization of the final products to individual customers.

Asset Management A competency that encompasses the specification, purchasing, managing, maintaining and disposing of vehicles at the appropriate time, all to increase return on investment.

Asset Rationalization A process that audits a company's transportation and distribution assets and compares them against an optimum supply chain design.

ABI - Automated Brokerage Interface: Is a system available to U.S. Customs Brokers with the computer capabilities and customs certification to transmit and exchange customs entries and other information, facilitating prompt release of imported cargo.

Ad Valorem ("according to the value"): A fixed percentage of the value of goods that is used to calculate customs duties and taxes.

Advisory Capacity: A term indicating that a shipper's agent or representative is not empowered to make definite decisions or adjustment without the approval of the group or individual represented.

Agency Agreement: The steamship line appoints the steamship agent and defines the specific duties and areas of responsibility of that agent.

Air Cargo Agent: Is a type of freight forwarder who specialises in air cargo and acts for airlines that pay him a fee (usually 5%). He is registered with the International Air Transport Association, IATA (See also Air Freight Forwarder; Forwarder, Freight Forwarder, Foreign Freight Forwarder)

Air Freight Forwarder: Is a type of freight forwarder who specialises in air cargo. He usually consolidates the air shipments of various exporters, charging them for actual weight and deriving his profit by paying the airline the lower consolidated rate. He issues his own air waybills to the exporters, is licensed by the CAB (Civil Aeronautics Board) and has the status of an indirect air carrier (See also Air Cargo Agent, Forwarder, Freight Forwarder, Foreign Freight Forwarder.)

Air Waybill: A bill of landing that covers both international and domestic flights transporting goods to a specified destination. This is a non-negotiable documents of air transport that serves as a receipt for the shipper, indicating that the carrier has accepted the goods listed and obligates itself to carry the consignment to the airport of destination according to specified conditions.

AITA: International Air Transport Association, IATA, (French, German).

Alongside: A phrase referring to the 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 abroad the ship.

Arbitration Clause: Is a standard clause to be included in the contracts of exporters and importers, as suggested by the American Arbitration Association. It states that any controversy or claim will be settled by arbitration in accordance with the rules of the American Arbitration Association.

A.T.: American Terms (Marine Insurance) A term used to differentiate between the conditions of American Policies from those of other nations, principally England.

Automated Brokerage Interface (ABI): An electronic system allowing customhouse brokers and importers to interface via computer with the US Customs Service for transmitting entry and entry summary data on imported merchandise.

Automated Commercial System (ACS): The electronic system of the US Customs Service, encompassing a variety of industry sectors, that permits on-line access to information in selected areas.

Automated Manifest System (AMS): The electronic system allowing a manifest inventory to be transmitted to the US Customs Service data center by carrier, port authority or service center computers

BAA: British Airports Authority

BACA: Baltic Air Charter Association

B/B: (See Break-Bulk Cargo)

Belly Cargo: Freight accommodation below the main deck.

Backhaul The return movement of a vehicle from its destination back to its point of origin with a payload.

Belly Cargo: Freight accommodation below the main deck.

Benchmarking The process of comparing performance against the practices of other leading companies for the purpose of improving performance. Companies also benchmark internally by tracking and comparing current performance with past performance.

Berth: Is the place beside a pier, quay or wharf where a vessel can be loaded or discharged.

Berth Liner Service: Is a regular scheduled steamship line with regular published schedules (port of call ) from and to defined trade areas.

Berth or Liner Terms: Is an expression covering assessment of ocean freight rates generally implying that loading and discharging expenses will be for ship owner's account, and usually apply from the end of ship's tackle in port of loading to the end of ship's tackle in port of discharge.

Best Practice The top-performing operation or application in a given industry.

Bill of Lading (BOL or B/L) A contract of carriage between a shipper (the consignor) to consign a load to a carrier for delivery to another party (the consignee).

Bonded Warehouse: A warehouse storage area or manufacturing facility in which imported goods may be stored or processed without payment of customs duties.

Brussels Tariff Nomenclature Number (BTN): The customs tariff number used by most European nations. The United States does not use the BTN, but a similar system known as the Harmonised Tariff Schedule.

Break-Bulk The separation of a single consolidated bulk load into smaller individual shipments for delivery to the ultimate consignees.

Business Intelligence Tools Software that enables business users to see and use large amounts of complex data. The following three types of tools are referred to as Business Intelligence Tools:
1. Multidimensional Analysis Software - Software that gives the user the opportunity to look at the data from a variety of different dimensions (also known as OLAP or Online Analytical Processing).
2. Query Tools - Software that allows the user to ask questions about patterns or details in the data.
3. Data Mining Tools - Software that automatically searches for significant patterns or correlations in data.

CAA: Is the Civil Aviation Authority. Government body responsible for regulating U.K. airlines.

Cabotage: Is where cargo is carried on what is essentially a domestic flight and therefore not subject to international agreements that fix set rates. Cabotage rates are negotiable between shipper and airline and apply on flights within a country and to its overseas territories.

Cage: The transporting of goods by truck to or from a vessel, aircraft, or bonded warehouse, all under customs custody.

Cargo: Is merchandise/commodities/freight carried by means of transportation.

Cargo Receipt: Is a receipt of cargo for shipment by a consolidator (used in ocean freight).

Carnet: A customs document permitting the holder to carry or send merchandise temporarily into certain foreign countries (for display, demonstration, or similar purpose) without paying duties or posting bonds.

C-Commerce Refers to collaborative, electronically enabled business interactions among an enterprise's internal personnel, business partners and customers throughout a trading community. The trading community could be an industry, industry segment, supply chain or supply chain segment.

Capacity Planning Capacity planning specifies the level of resources (e.g. facilities, fleets, equipment, systems hardware and labor force size) that best supports the enterprise's competitive strategy for production.

Collaborative Planning Forecasting and Replenishment (CPFR) Data and process model standards developed for collaboration between suppliers and an enterprise with proscribed methods for planning (agreement between the trading partners to conduct business in a certain way); forecasting (agreed-to methods, technology and timing for sales, promotions, and order forecasting); and replenishment (order generation and order fulfillment). The Voluntary Inter-Industry Commerce Standards (VICS) committee, a group dedicated to the adoption of bar-coding and EDI in the department store/mass merchandise industries, has established CPFR standards for the consumer goods industry that are published by the Uniform Code Council (UCC).

Continuous Moves The process of keeping loaded trucks moving with different loads and driver crews.

Consolidation Combining two or more shipments in order to realize lower transportation rates. Inbound consolidation from vendors is called make-bulk consolidation; outbound consolidation to customers is called break-bulk consolidation.

Continuous Replenishment Planning (CRP) A program that triggers the manufacturing and movement of product through the supply chain when the identical product is purchased by an end user.

Contract Carrier A for-hire carrier that serves only shippers with which the carrier has a continuing contract, and not the general public.

Contract Logistics The use of a third-party provider to plan, implement and control the efficient, cost-effective flow and storage of raw materials, in-process inventory, finished goods and related information from the point of origin to the point of consumption.

Cross-Docking The direct flow of merchandise through a facility from the receiving function to the shipping function, eliminating the need for storage.

Cubed Out A term that refers to the percentage of a vehicle’s cubic hauling capacity that is utilized. If a particular vehicle is 100% "cubed out," it has no additional space in which to carry freight.

Cycle Time The time it takes for a business to receive, fulfill and then deliver an order to a customer. Once measured only in days, many industries now measure cycle time in hours. 


Dedicated Contract Carriage A third-party contractual service that dedicates vehicles and drivers to a single customer for its exclusive use, usually done in a closed loop or fixed route situation.

Demand Chain Another name for the supply chain, with emphasis on customer or end-user demand pulling materials and product through the chain.

Demand Planning (DP) The process of forecasting and managing the demand for products and services by end users, as well as by intermediate supply chain members.

Distribution Center A post-production warehouse for finished goods.

Distribution Channels The selling channels supported by an enterprise. These may include retail sales, distribution partner (e.g., wholesale) sales, original equipment manufacturer (OEM) sales, Internet exchange or marketplace sales, and Internet auction or reverse auctions sales.

Distribution Requirements Planning (DRP) A system of determining demands for inventory at distribution centers and consolidating demand information in reverse as input to the production and materials system. 


Economic Value Added (EVA) A measurement of shareholder value as a company’s operating profits after tax, less an appropriate charge for the capital used in creating the profits.

Efficient Consumer Response (ECR) A supermarket or grocery retailing industry initiative designed to replenish stock on store shelves based on actual consumer demand rather than by demand forecasting.

Electronic Data Interchange (EDI) A standard format for exchanging business data. The standard is ANSI X12 and it was developed by the Data Interchange Standards Association. ANSI X12 is closely coordinated with an international standard, EDIFACT. An EDI message contains a string of data elements, each of which represents a singular fact, such as a price, product model number, and so forth, separated by delimiter. The entire string is called a data segment. One or more data segments framed by a header and trailer form a transaction set, which is the EDI unit of transmission (equivalent to a message). A transaction set often consists of what would usually be contained in a typical business document or form. The parties who exchange EDI transmissions are referred to as trading partners.

ERP (Enterprise Resource Planning) An industry term for the broad set of activities supported by multi-module application software that helps a manufacturer or other business manage the important parts of its business, including product planning, parts purchasing, maintaining inventories, interacting with suppliers, providing customer service, and tracking orders. ERP can also include application modules for the finance and human resources aspects of a business. Typically, an ERP system uses or is integrated with a relational database system. The deployment of an ERP system can involve considerable business process analysis, employee retraining and new work procedures.

Fill Rate The percentage of order items that the picking operation actually fills within a given period of time.

Finance Lease Often, a full-payout agreement in which the customer, at the end of the lease term, assumes ownership of the vehicle or is provided with a purchase option. The lessee is usually responsible for maintenance, taxes and insurance.

Finished Goods Inventory (FGI) Products completely manufactured, packaged, stored and ready for distribution.

Flow-Through Distribution A process in which products from multiple locations are brought into a central facility (sometimes called a cross-dock), re-sorted by delivery destination and shipped on the same day. This eliminates warehousing, reduces inventory levels and speeds order turn-around time.

Full Service Vehicle Lease Is a system that provides the customer with a vehicle and a variety of support services for a single monthly lease payment. Full service leases may include features such as preventive maintenance, emergency roadside repairs, equipment evaluations and specifications, fuel, administrative support, driver support and safety programs.

Geo-Coding Identifying locations by the use of three-, four- or five-digit ZIP codes or other identifiers (depending on country) to allow mapping, planning and execution of deliveries.

Handling Unit Goods or aggregation of goods bundled together for distribution and logistics purposes. May include an individual item in a carton, combined items on pallets and skids, or items transferred in independently identified containers, such as ocean containers, rail cars or truck trailers.

Harmonized Tariff Code A code to numerically describe all articles in international trade managed by the World Customs Organization. This code is used by countries to determine duties and taxes for shipping across international borders.

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 individual functions being managed separately.

Intermodal Transportation Transporting freight by using two or more transportation modes. An example would be freight in containers which might first be taken to a port by truck, transported by ship, then carried by rail, and finally be transferred back to a truck for delivery to its final destination.

International Trade Systems (ITS) Execution systems designed to automate the import/export business process. The basic functional components are trade documentation generation and transmission, and regulatory compliance validation.

Inventory Carrying Costs A financial measurement that calculates all the costs associated with holding goods in storage, usually expressed as a percentage of the inventory value. It includes inventory-in-storage, warehousing, obsolescence, deterioration or spoilage, insurance, taxes, depreciation and handling costs.

Inventory Deployment A technique for strategically positioning inventory to meet customer service levels while minimizing inventory and storage levels. Excess inventory is replaced with information derived through monitoring supply, demand, and inventory at rest as well as in motion.

Inventory Management The process of ensuring the availability of products through inventory administration activities such as planning, stock positioning, and monitoring the age of the product.

Inventory Turns The cost of goods sold divided by the average level of inventory on hand. This ratio measures how many times a company’s inventory has been sold during a period of time. Operationally, inventory turns are measured as total throughput divided by average level of inventory for a given period.

Inventory Velocity The speed with which inventory moves through a defined cycle (e.g., from receiving to shipping).

ISO 9001 Certification The internationally recognized standard that establishes the requirements for a Quality Management System for a service company. ISO 9001 is an approach to managing a business with regard to quality. Achieving ISO 9001 certification is a rigorous process, with over 130 requirements the operation must meet.

Just-In-Time (JIT) An inbound manufacturing strategy that smoothes material flow into assembly and manufacturing plants. JIT minimizes inventory investment by providing timely, sequential deliveries of product exactly where and when it is needed, from a multitude of suppliers. Traditionally an automotive strategy, it is being introduced into many other industries.

Kitting Light assembly of components or parts into defined units.

Lead Logistics Management (LLM) A total end-to-end solution that manages the flow of materials, products and information for a company’s global supply chain. Typically, it involves a single point of contact, managing and synchronizing multiple third party service providers, supply chain planning/network optimization, IT capabilities and transportation and distribution functions.

Less-Than-Truckload (LTL) Carriers Trucking companies that consolidate and transport small shipments of freight by utilizing a network of terminals and relay points.

Logistics According to the Council of Logistics Management (CLM), logistics is 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.

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.

Manufacturing Planning Definition of the weekly or daily production and machine schedules across multiple plants or lines to meet orders and forecast demand. Some manufacturing planning modules also incorporate materials planning.

Manufacturing Scheduling The generation of plant-level execution schedules by product and resource (e.g., line and machine) and resolution of day-to-day capacity bottlenecks. Scheduling applications normally include a more granular level of resource information, and will provide such functionality as sequence dependent set up, tank scheduling and point-of-use material availability.

N.M.F.C. (National Motor Freight Classification) A tariff that contains descriptions and classifications of commodities and rules for domestic movement by motor carriers in the U.S.

Optimization Routines Routines used to determine the optimal solution for a particular problem. Included in supply chain execution and supply chain planning applications to reduce costs or time in the supply chain. Usually tactically focused for use in current operations.

Order Cycle The time and process involved from the placement of an order to the receipt of the shipment.

Outbound Consolidation (Break-Bulk) Consolidation of a number of small shipments for various customers into a larger load. Shipped to a location near the customers; then the small shipments are distributed to the customers (also know as Pool Distribution).

Outsourcing Subcontracting business functions or processes such as logistics and transportation services to an outside firm, instead of doing them in-house.

Pick/Pack The process of picking of product from inventory and packing into shipment containers.

Postponement The planned delay of final activities (e.g. assembly, production, packaging, etc.) until the latest possible time in the distribution channel.

Quick Response A business strategy for reducing inventory in the pipeline and shortening the cycle time for a product to be made, distributed and sold. Point of sale information is electronically transmitted back to the store supplier, who is responsible for adequate supply at the store.

Rental Day The basic unit used to measure fleet utilization rates by companies that are in the business of renting vehicles. The total number of rental days recorded by commercial truck rental companies is an indicator that measures businesses' incremental need to ship products.

Replenishment The process of moving or resupplying inventory from a reserve storage location to a primary picking location, or to another mode of storage at which picking is performed.

Reverse Logistics A specialized segment of logistics focusing on the return of products or shipments after the sale and delivery to the customer.

Return on Investment (ROI) Is calculated by taking the value of the investment held at the beginning of the ROI period compared with the current value. In other words: ((Current Value) - (Beginning Value) + (Income)) / (Beginning Value), where (Current Value) = (the current total shares) * (the last price), (Beginning Value) = (number of shares held prior to the period - any shares sold) * (the closing price prior to the period) + the "Cost Basis" of any shares added in this period (Buys, Reinvest, Add Shares, etc), and (Income) = any income events such as Dividends/Interest (not Reinvested) and Realized gain/loss from Sells in this period.

Return on Web Investment (ROWI) Measurements complement traditional business case analysis of quantitative components (increased revenue, decreased costs) by allowing the Company to evaluate and quantify qualitative factors. This helps build a sound business case for e-Commerce initiatives, applying a framework for analyzing and measuring the ROI of an e-Business project at any point in the implementation.

Simulation Routines Various routines using historical information to simulate future alternatives for supply chain operations design. Usually strategically focused for use in future operations, these may then be optimized and/or prioritized.

Stock Keeping Unit (SKU) Numbering system that makes a product or item distinguishable from all others.

Supply Chain Movement of materials, funds, and related information through the full logistics process, from the acquisition 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 Execution (SCE) A subset of supply chain management, this is a framework of execution-oriented applications that enables the efficient procurement and supply of goods, services and information across enterprise boundaries to meet customer-specific demand. In its broadest sense, SCE includes the manufacturing execution system (MES), warehouse management system and other execution systems within the enterprise, as well as throughout the supply chain. The logistics-oriented elements of SCE include the transportation management system, warehouse management system, international trade systems (ITS), real-time decision support systems (e.g., dynamic routing and dynamic sourcing systems) and supply chain inventory visibility systems.

Supply Chain Management (SCM) The management and control of all materials, funds and related information in the logistics process from the acquisition of raw materials to the delivery of finished products to the end-user.

Supply Chain Planning (SCP) Typically involves activities such as creating a set of suppliers, responding to buyer forecasts, or generating internal forecasts of usage.

Third Party Logistics Transportation, warehousing and other logistics-related services provided by companies employed to assumer tasks that were previously performed in-house by the customer.

Third-Party Logistics Provider A firm that supplies goods and services such as transportation and logistics to another company.

Time-Based Competition A competitive marketing strategy based on a company's ability to deliver its products to customers faster than its competition.

Transportation Management System (TMS) System used to optimally plan freight movements, do freight rating and shopping across all modes, select the appropriate route and carrier, tender and provide visibility to shipments.

Transportation Planning and Scheduling Specifies how, when and where to transport goods. Transportation planning and scheduling applications may provide weight/size restrictions, merge-in-transit, continuous move, mode or carrier selection, and less than truckload (LTL)/full truckload (FTL) planning functionality.

Truckload (TL) Carriers Trucking companies that move full truckloads of freight directly from the point of origin to their destination.

Truck Rental A short-term transaction, generally under 12 months, that allows a customer the use of a truck for a specified period of time, generally measured in "rental days." Rental can be used to supplement a leased or privately owned fleet during short periods of peak need to execute rush orders or handle excess volume, or to test new routes and distribution channels.

Utilization Rate A fleet productivity measurement that tracks the percentage of time that a truck or vehicle is being used or rented.

Value Added Increased or improved value, worth, functionality or usefulness.

Value Chain A voluntary alliance of companies to create an economic benefit for customers and to share in the rewards thereof.

Vendor-Managed Inventory (VMI) In the VMI process, the vendor assumes responsibility for managing the replenishment of stock. Rather than a customer submitting orders, the vendor will replenish stock as needed. This process is sometimes referred to as supplier-managed inventory (SMI) or co-managed inventory.

Visibility The ability to access or view pertinent data or information as it relates to logistics and the supply chain.

Warehouse Management System (WMS) A software application that manages the operations of a warehouse or distribution center. Application functionality includes receiving, putaway, inventory management, cycle counting, task interleaving, wave planning, order allocation, order picking, replenishment, packing, shipping, labor management and automated material-handling equipment interfaces. The use of radio frequency technology in conjunction with bar codes provides the foundation of a WMS, delivering accurate information in real time.

Work-in-Process Parts and subassemblies in the process of becoming completed finished goods.