Tip and Tricks - September 24, 2021

Frequently used Logistics Terms in the Ecommerce Industry

Shipping and logistics companies have been continuously innovating themselves. Furthermore, both the business language and the logistics terminologies have evolved during this period to such an extent that it is significant to be aware of the major jargon and acronyms used in this industry so that your online business grows and can reach millions with ease. 

Your Go-to Glossary For Shipping

Listed below are a few further definitions that can help strengthen your business supply chain as well as helping you to gain a better understanding of customer and market needs, leading you at a faster pace:

1). Air Waybill (AWB)

Documents covering air transportation. It is issued by the carrier (whether it is an airline or a freight forwarder) as a non-negotiable document, as a receipt for the sender of the goods, and contains the conditions of carriage. It also displays the details of the recipient so that they can be contacted when the goods arrive

2). BOL or B/L

Also referred to as the bill of lading, this document is required to move a shipment. The delivery note contains all the information about the products, their quantities, etc. that are sent from the shipping party to the receiving party.

3). Carrier

It is an organization or company that transports goods for other companies. To ease the shipping process, these carriers assist shippers in shipping their items from one place to another.

4). Drop Shipping

This method of retail fulfillment involves a store not having any inventory of the products it sells. In most cases, when a store sells a product, it does so by purchasing it from a third party and having it shipped directly to the customer

5). Economy of Scale

A situation where the fixed costs of production are distributed over a larger quantity, thereby reducing unit cost.

6). Freight

A handling unit and the pieces on said handling unit. Essentially, a 'handling unit' is a carton, pallet, or another bundle of goods that have been bundled or unitized and are individually identifiable for distribution or transportation. An "item" is the container or packaging that is stacked and secured to a pallet or skid. 

7).. Gross Vehicle Weight (GVW)

 Total vehicle weight, including the weight of the vehicle itself and all accompanying containers.

8). Handling Costs

The cost involved in moving, transferring, preparing, and otherwise handling inventory.

9). Import

It refers to the movement of products and commodities from one country to another. 

10). Just-in-Time Logistics (or Quick Response)

 This procedure aims to reduce the time needed to source, handle, produce, transport, and deliver products to meet customer needs.

11).. Kitting

 Kitting refers to an act of assembling various products in one kit which is shipped to the customer. Kitting helps logistics companies in streamlining the shipment process, encourages low cost of shipping, and helps in delivering the orders on or before time.

12). Logistics Costs

Logistics cost is the cost associated with the factors like acquisition, storage, movement of goods, etc.

13). Manifest

A carrier is notified by this document. The form must be filled out before the end-of-day pickups. However, even if your carrier doesn't offer manifests, you should still provide one form for all shipments that are being picked up so you can provide the carrier with a list.

14). Negotiable BOL

Also known as a bill of lading order, allows goods to be delivered to the desired destination but only when the carrier or the carrier's representatives get valid endorsement and the bill of lading. Also known as a bill of lading order.

15). Obsolete Inventory

 A stock for which demand isn't expected in the future. Having an outdated date. An older property has suffered a loss of value due to a development that places it at a competitive disadvantage.  

16). Proof of Delivery

Proof of delivery is the information provided by the carrier which consists of information like the name of the one receiving the shipment along with the date and time of delivery. The process of printing material right before the shipment is also referred to as POD.

17). Quality Control

 This function ensures that the goods and services rendered by firms meet the specifications for the products they produce.

18). Reverse Logistics

A specialized segment of logistics is used to manage products and resources after they have been sold to a customer. Includes product returns for repair or credit.  

19). SKU

A unique number is assigned to a specific stock item. The Stock Keeping Unit is a unique numerical identifier for a specific stock item in a retailer's inventory or product catalog. An SKU is often used to identify the product, size or type of product, and its manufacturer. 

20). Third Party Logistics:

Outsourcing all or much of a company's logistics operations to a specialized company.

21). Unitize

Consolidating several packages into one unit; carriers attach the packages with bands, straps, or other means.

22). Value-of-Service Pricing

It refers to the pricing pattern as per the value of the product which a company is transporting; third-degree price discrimination; demand-oriented pricing; charging what the traffic will bear etc.

23). Waybill

 Documents containing descriptions of goods that are shipped by common carriers. This document contains the origin, destination, consignee/consignor, and the amount charged.

24). XYZ analysis

XYZ analysis is a method of classifying inventory items according to the variability of their demand.

25). Yield

 It refers to the ratio of usable output from a process to its input.

26). Zone Price

A constant price of a particular product in all the geographic locations

We hope these shipping terminology definitions have helped you feel more informed about the world of shipping!  This is the first edition, watch this space for more.

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