The language of logistics
Each industry has a language of its own. The world of logistics, too. Whether stowage plan or piggyback traffic – here you can find a clear, brief explanation of the most relevant terms.
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ABC Analysis
ABC analysis is an inventory categorisation technique often used in materials management, purchasing, warehousing, production, sales and marketing. When carrying out an ABC analysis, inventory items are assigned a value and structured according to their economic significance. The results are then ranked. “A” class inventory will typically contain items that account for 80% of total value, or 20% of total items.
Accident procedures sheet
Accident procedures sheets usually have to be carried along with hazardous goods transports. They list material names, properties of the loaded goods, hazards presented by loaded goods, required protection equipment, emergency steps in cases of emergency, provisions for leakage or fire, as well as first aid procedures.
There are three types of accident procedures sheets:
- Substance-specific accident procedures sheets (referring to a specific substance, e.g. petrol)
- Group accident procedures sheets (for substances with similar chemical properties)
- Groupage accident procedures sheet (describes substances of different sorts with their respective emergency procedures)
ADR
Accord européen relatif au transport international des marchandises dangereuses par route: European Agreement concerning the International Transport of Dangerous Goods by Road. The ARD also applies to hazardous goods transports on German roads.
ADSp
German Freight Forwarders' Standard Terms and Conditions. The ADSp apply to all contracts for the transportation of goods, irrespective of whether they concern freight forwarding, carriage, warehousing or other services common to the forwarding trade; these also include logistical services commonly provided by freight forwarders in connection with the carriage or storage of goods.
Air waybill (AWB)
An air waybill is a contractual document for air freight forwarding.
Allocation point
The allocation point is a good's point of consumption.
Area contract freight forwarder
An area contract freight forwarder carries out all the forwarding of goods for their client or for a defined area.
Article
The term “article” refers to the quantity of goods which have been assigned a specific ID number (e.g. article, parts or packaging reference number).
Auxiliary packing aids
Additional returnable packaging with a specific name (e.g. inlets, small load carrier coverings)
Balanced Scorecard (BSC)
The Balanced Scorecard (BSC) is a strategic performance management tool for measuring whether the smaller-scale operational activities of a company are aligned with its larger-scale objectives in terms of vision and strategy. This method has also recently come into use for logistics controlling and supply chain management.
Barcode
A barcode (also bar code) is an optical machine-readable labelling of consignments and loading units. The most common bar code systems are EAN and NVE codes.
Bimodal traffic
Refers to transports for which complete transport units (e.g. swap bodies, containers) are transported on at least two different modes of transportation. The freight carrier is responsible for procurement only.
Bulky cargo
Larger goods (approx. 3 t or more) which do not necessarily have to fill a complete vehicle.
Carrier
Carriers carry out transports.
Cartage note
A cartage note is a list of the unloading points/recipients to be approached by the lorry driver during on-carriage transportation.
CMR
Convention relative au contract de transport international de marchandises par route: Convention on the Contract for the International Carriage of Goods by Road. The CMR relates to various legal issues concerning cross-border transportation of cargo, predominantly by lorries on European roads.
Co-load forwarder
Goods collected by a co-load forwarder are sent on to the groupage service of another forwarder.
Combined shipping (ADR, GGVSE)
With reference to dangerous goods, combined shipping refers to a situation in which various dangerous goods are combined into one package.
Consigner
The consigner is the forwarder's client.
Consignment
A consignment refers to goods which a shipping agent delivers to a recipient at a specific point in time.
Consolidator
A consolidator combines individual goods from various senders into a group consignment, which the deconsolidator then delivers to the recipients.
Container
A container is a solid type of packaging meant to be filled, e.g. small load carriers, pallet cages.
Container (Types)
There are various types of containers. Here are some examples:
- Standard container: 20’ or 40’
- High cube container, hardtop container
- Open top container, ventilated container
- Insulated shipping container, refrigerated container
- Bulk container, tank container, flat, platform
Containers
Containers are standardised receptacles which can be used on all means of transportation. They form the basis for bimodal and multimodal transportation.
Contract logistics
Defines an integrated, individualised package of logistics services with a considerable contract volume, based on a long-term contractual relationship, and put down in writing.
Co-pack
An additional article is enclosed with a delivery unit possessing a code number (sample part, parts in a plastic bag).
Courier service
A courier service transports documents, valuables and express deliveries. The deliveries tend to be quite light (very few kg).
Deconsolidator
The deconsolidator takes over the consolidated shipment from a groupage agent and delivers the individual consignments to the recipients.
Delivery
A delivery is a consignment, or part of a consignment, made up of one or several articles ordered by the recipient (= contents of the delivery note).
Delivery date / time
The delivery date / time refers to the date or time when a delivery was made.
Delivery documents
Collective term for all documents required for the execution of a delivery.
Delivery flexibility
Refers to the ability to respond to individual customer requests.
Delivery note
The delivery note is a document created by the supplier regarding the contents of a delivery. The description of the delivery items is usually executed by using keywords with article and packing data (incl. supplementary packing materials).
Delivery period
Refers to the time period between the placement of an order and the delivery of the goods to the client.
Delivery quality
The delivery quality characterises delivery performance according to type, quantity and quality (condition upon delivery).
Delivery reliability
Describes the probability that the given delivery period will be adhered to (also called delivery dependability or delivery schedule adherence).
Delivery unit
A delivery unit is a physical unit which is created for a transport and which is not disassembled during the transportation process.
Direct load
A direct load refers to the load of goods carried in a direct transport.
Direct transport
A direct transport is transportation from one or several loaders directly to a recipient without the goods being handled by a forwarder.
Distribution structure
The distribution structure determines the number of warehousing steps (vertical distribution structure) required for a distribution system, the number of warehouses set up on each step (horizontal distribution structure) as well as to which distribution areas each warehouse is allocated.
EAN
European Article Number: barcode used for marking products in order to facilitate materials management.
EDI
Electronic Data Interchange (EDI) refers to the structured transmission of data between organisations by electronic means. It is used to transfer electronic documents from one computer system to another. Part of the transmitted data can be automatically processed at the computer.
EDI delivery note (VDA-4912)
Standard delivery receipt on paper, activated via remote data transmission, for goods which have been delivered. It can be used as a registration receipt if the transport data could not be transmitted electronically.
EDIFACT
Electronic Data Interchange For Administration, Commerce and Transport is an international EDI standard.
EDIFACT
Electronic Data Interchange For Administration, Commerce and Transport is an international EDI standard.
EEV
Enhanced environmentally friendly vehicles, abbreviated as EEV, refers to the EU's currently strictest emission standard. Apart from threshold values for carbon monoxide (1.5 g/kWh) and nitrogen oxides (2.0 g/kWh) fine particulate emission limits for hydrocarbon at 0.25 g/kWh lie even below the Euro V Norm of 0.46 g/kWH. From 31st December 2012 the Euro VI Norm will lower the threshold values for particulates by an additional 66 percent and for nitrogen oxides by 80 percent.
Efficient Consumer Response (ECR)
ECR is a digital business strategy for integrating information about business and warehouse stock as well as the sales data of a salesperson with information about transport capacities, distribution centres and lorries of a logistics service provider as well as production capacity data, delivery time and a manufacturer’s product information. Its goal is to minimise warehousing and delivery time along the complete logistics chain and to increase customer satisfaction.
Electronic business, e-business
Electronic business, commonly referred to as "e-business", may be defined as the utilisation of information and communication technologies (ICT) in support of all the activities of business. Due to the digitalisation of business processes it is used e.g. in inventory management, accounting and controlling. One variety of e-business is e-commerce.
Electronic commerce, e-commerce
Electronic commerce, commonly known as (electronic marketing) e-commerce, consists of the buying and selling of products or services over electronic systems such as the Internet and other computer networks to private and business customers.
Electronic procurement (e-procurement)
The processes of procurement marketing are carried out through the internet or other information and networking systems, such as Electronic Data Interchange and Enterprise Resource Planning.
Electronic tracking
Electronic tracking refers to logistics tracking systems. Forwarded goods are electronically confirmed at different points along the delivery channel. Usually, the customer can track the current location of the delivery via a website (internet or intra-net).
Enterprise resource planning (ERP)
Enterprise Resource Planning (ERP) is a company-wide computer software system used to manage and co-ordinate all the resources, information, and functions of a business (material management, warehousing, production planning and control, accounting, HR) from shared data stores, e.g. via standard software packages such as SAP R/3, Oracle Applications or Peoplesoft.
Express service
An express service offers rapid delivery of goods, usually via a separate transport network.
Forwarder
Forwarders are transportation traders. The sell a service to their client (sender or recipient) concerning the organisation of consignments, their transportation and logistical services.
Forwarding contract
A forwarding contract works out the organisation of freight transportation. This includes the assignment of a carrier, consolidator and intermediate forwarders as well as the performance of any ancillary services.
Freight carrier
The freight carrier carries out transportation over land, by sea or by air.
A freight carrier is another term for a haulier.
Freight charge
The freight charge refers to the price for delivering goods.
Freight contract
The subject of a freight contract is the reception, transport and delivery of goods to the recipient against payment of the agreed-upon price.
Freight village (cargo transport centre)
Freight villages are location-based communities of independent logistics service providers in industrial parks with good transport connections. A freight village is responsible for the handling of integrated transport chains, especially combined road-rail freight transports. The transport connection is usually provided for by road and rail, often via inland waterway transportation as well.
Full load
A full load is the amount of freight of a direct transport which utilizes the means of transportation to capacity.
Goods
Goods are movable items which are transported or forwarded.
Goods tags
Transport labels can also be called goods tags.
Groupage
Groupage refers to consignments which are picked up from various senders
Groupage consignment
Groupage consignment is another word for groupage, whereby consignments are picked up from various senders.
Groupage service
Groupage service refers to the combination of individual consignments (unit loads) into groupage consignments as well as the distribution of the unit loads to their recipients.
Groupage transport
Groupage transport is a synonym for groupage service.
Handling
Handling refers to the reloading of goods to another means of transportation.
Handling
Handling refers to the reloading of goods to another means of transportation.
Hazard label
Hazard labels serve to mark hazardous goods according to their class. There are standardised danger symbols to indicate the main danger presented by the goods.
Hazardous goods classification
Classification of Hazardous goods are classified according to their basic properties (e.g. flammable, gaseous, toxic, etc.)
IATA International Air Transport Association
The International Air Transport Association (IATA) is an international industry trade group of national and international airlines. IATA's mission is to:
- standardise tariffs and terms of transportation
- standardise documents
- develop guidelines for the licensing of IATA agents.
For further information visit www.iata.org.
ICAO International Civil Aviation Organization
The International Civil Aviation Organization (ICAO), an agency of the United Nations, codifies the principles and techniques of international air navigation and fosters the planning and development of international air transport to ensure safe and orderly growth.
For further information visit www.icao.int.
IMDG Code
International Maritime Dangerous Goods (IMDG) Code is accepted as an international guideline to the safe transportation or shipment of dangerous goods or hazardous materials on ships (maritime traffic). In Germany, the IMDG Code has been adopted into German legislation as the regulation concerning the transport of dangerous goods.
Incoterms (International commercial terms)
Incoterms, or international commercial terms, are a series of international sales terms widely used in international commercial transactions. They are used to divide transaction costs and responsibilities between buyer and seller and reflect state-of-the-art transportation practices.
They exist of the so-called E, F, C and D groups:
- Group E: e.g. EXW – Ex Works (named place)
The seller makes the goods available at his premises. The buyer is responsible for all charges.
- Group F: e.g. Free On Board (named loading port)
The classic maritime trade term. The seller must load the goods on board the ship nominated by the buyer, cost and risk being divided at ship's rail. The seller must clear the goods for export. Maritime transport only.
- Group C: e.g. Cost and Freight (named destination port)
The seller must pay the costs and freight to bring the goods to the port of destination. However, risk is transferred to the buyer once the goods have crossed the ship's rail. Maritime transport only.
- Group D: e.g. DDP – Delivered Duty Paid (named destination place)
This term means that the seller pays for all transportation costs and bears all risk until the goods have been delivered and pays the duty. Also used interchangeably with the term "Free Domicile". The most comprehensive term for the buyer.
Inner packaging
Refers to packaging materials which have direct contact with the packed goods.
Intermediate forwarder
Intermediate forwarders are contracted by main or area-specific forwarders to carry out parts of a transportation order.
Inventory days (months)
The number of inventory days or months = the average stock / the daily or monthly stock turnover
Inventory turnover ratio
Inventory turnover ratio = inventory turnover per period (unit or value) / average inventory (unit or value)
Kanban system
The Kanban system is a signalling system used to support consumption-driven manufacturing resource planning. So-called Kanban cards (from the Japanese "kanban" = cards) are used to signal the need to move materials within a manufacturing or production facility or move materials from an outside supplier to the production facility.
Loading device
Loading devices, such as boards, beams, chains, tension belts, etc., are used for securing freight on to the means of transportation.
Loading list
Refers to a list of all the consignments loaded on a means of transportation.
Loading list
Refers to a list of all the consignments loaded on a means of transportation.
Loading plan
A loading plan defines when and where goods are to be stowed in a transport unit.
Loading point
The loading point is the location from which goods need to be picked up according to the forwarding instruction (e.g. loading platform, gate).
Loading sequence instructions
Instructions given to the loader of the transport unit, aiming to ensure an optimisation of the loading space and compliance with the requirements of packing regulations and cargo securing.
Loading tackle
Loading tackle makes possible or facilitates the handling of packaging materials, e.g. pallets, large load carriers, swap bodies, containers.
Loading unit
A loading unit is a handling unit created by the sender (e.g. carton, box, small or large load carrier, mixed pallet, etc.) which is not disassembled during transportation.
Logistics
There are a number of definitions for the term logistics. Here are two common definitions:
- Logistics refers to the integrated planning, concept, execution and controlling of warehousing and transportation processes within and in between businesses, from the business to the client. It also refers to reverse logistics.
- Logistics refers to all activities concerning the organisation, planning, controlling and execution of the flow of goods and information along the logistics chain. In this context there is a distinction between procurement logistics, production logistics, distribution logistics and reverse logistics.
Logistics controlling
Refers to an instrument which serves to support the logistical decision-making and controlling process by targeted information gathering, analysis and provision of relevant information. Logistics controlling is part of business controlling and the logistics management system, due to its interdivisional and cross-functional character.
Main carriage
Refers to groupage transportation from the groupage agent to the deconsolidator, or from the area contract freight forwarder to the local logistics service provider based in the vicinity of the manufacturer.
Manifest
Freight list of all consignments transported on a means of transportation
Material name
The material name describes a dangerous good by its name (colloquially or by its chemical technical term).
Means of transportation
A means of transportation is a technical device for forwarding people or goods (e.g. vessels, aeroplanes, lorries, trains).
Milk run
Delivery method for mixed loads from different suppliers. Instead of each of several suppliers sending a vehicle every week to meet the weekly needs of a customer, one vehicle visits each supplier on a daily basis and picks up deliveries for that customer.
Mixed loading (ADR, GGVSE)
Packages containing mixed hazardous goods are combined on the loading area of a vehicle or container.
Mixed loading prohibition (ADR,GGVSE)
Some hazardous goods of different hazardous goods classes may not be mixed in a load. This primarily applies to classes 1 and 5.2. The detailed regulations are from the ADR/GGVSE.
Modes of transportation (ADR/GGVSE)
- Loose bulk freight: Solid materials are transported without packaging (silo truck, loose bulk freight in containers)
- Unit load: Goods which are already prepared for dispatch (packages) are transported.
- Tanks: Containers exceeding a cubic metre in volume are used for transportation.
Multi-modal transport
For transport to be considered multi-modal, the following conditions must be met:
- Diverse means of transportation
- Varied contract procedures
Integrated, uniform transportation contract covering the entire distance.
Multiple sourcing
Multiple sourcing refers to all procurement transactions in which the procurement of an article is spread across several suppliers. The goal is to spread the risk in order to guarantee the supply.
On-carriage
Refers to the transportation from the deconsolidator to the recipient.
Outer package
Refers to the outer packaging of a good
Outer packing
The outer packing holds the delivery unit together through the use of packaging material.
Outsourcing
The term outsourcing is derived from the terms "outside" and "resourcing" and describes the sub-contracting of services. It can range from the external acquisition of individual services all the way to the transfer of the entirety of process responsibilities. Outsourcing is generally considered an acceptable alternative in the context of "make-or-buy" decisions.
Package
A package is the physical handling unit in the logistics process. Several packages can be combined (e.g. separately packed consumer packages can be combined in a delivery unit of 10).
Packaging
The packaging refers to the physical wrap around goods which keeps the various goods separate and / or secure and ready for presentation.
Packaging unit
A packaging unit refers to goods which are combined as one unit via a chosen packaging.
Packing material
Reusable transport packaging marked with its specific type
Pallet
A pallet is a stackable loading platform used in one-way or reusable packing systems for consolidating goods into one package.
Pallet types
Pallets are distinguished by the material they are made of (wood, steel) as well as by their size and design, with or without side construction (flat pallet, box pallet).
Parcel transportation services
Transport documents, valuables and express deliveries via a courier. Express services ensure a fast transportation of goods within a separate network. Parcel services transport goods weighing up to 30 kg.
Pick-to-light systems
A pick-to-light system is a paper-free system whereby the worker is guided visually by lights to the exact warehouse locations where the ordered articles are to be picked.
Pick-up date / time
The pick-up date / time is the date / time of pick-up / loading specified by the sender.
Piggyback traffic
A freight carrier transports its freight using another means of conveyance for his vehicle including its freight (e.g. the lorry is transported on a railcar).
Place of destination
The place of destination is an additional statement regarding the location where the goods are to be delivered, e.g. a branch or logistics service provider of the recipient listed in the transfer documents.
Point of consumption
Defines the location at which the material for the production is made available.
Pre-carriage
Refers to the transport of shipments of one or several senders to the forwarder’s reloading point.
Principal carrier
Takes over all transportation contracts from his client and takes all measures necessary for the complete execution.
Procurement
Procurement refers to all the activities required to ensure the provision of commodities. These activities include services and performance, financial resources, rights and information and stem from the procurement markets necessary for achieving the goals of an enterprise.
Procurement logistics
Procurement logistics refers to all logistical activities carried out in the context of procurement, such as planning, execution and controlling of the logistics activities concerning incoming goods, storage and supply.
Project management
Project management is a managing concept based on the solution of temporary interdisciplinary tasks which have a high degree of novelty and complexity.
Protective equipment (according to ADR/GGVSE)
The personal protective equipment required for hazardous goods transport is listed in the relevant accident procedure sheet for each material, e.g. adequate breathing protection, tightly sealing protective goggles, gloves, eye bath bottle, etc.
Recipient
The recipient is a person or business to whom or to which the goods are delivered, and that is listed in the forwarding instructions or transport document.
Remote data transmission
Remote data transmission and EDI (electronic data interchange) refers to the electronic exchange of structured messages between computers. Part of the transmitted data can be processed automatically at the computer.
Reusable transport packaging
Packaging for transportation which can be used multiple times.
Sales packaging
Refers to consumer packaging, the design of which is determined by amongst others marketing requirements regarding design and function.
Semi-trailer
A semi-trailer is a trailer without a front axle. A large proportion of its weight is supported by a road tractor. A single trailer licensed in Germany cannot exceed an inside length of 13.52 metres and a width of 2.48 metres.
Sender
The sender is the direct client of the freight carrier.
Shipment
A shipment is a consignment of goods given to the carrier for loading.
Shipment unit
A shipment unit is the smallest unit of goods which is not packed together with other goods (e.g. boxes, pallets, containers).
Shipper
The shipper hands over the goods to the freight carrier.
Shipping company
A shipping company carries out the organisational execution of maritime transportation using its own or third-party freight space.
Shipping note
A shipping note is an umbrella term for all documents required for the execution of a transport (e.g. bill of lading, delivery note, etc.).
A shipping note is a document referring to the conclusion of a freight contract between the consigner and the carrier. The shipping note serves as an accompanying document for a transport and serves as a record of the forwarding and for the title to sue.
Shipping order
A shipping order documents the subject and execution of a forwarding contract with reference to a consignment.
Single sourcing
With reference to procurement, single sourcing is the supply of goods or services that can only be purchased from one supplier because of their specialised or unique characteristics.
SLVS - forwarding, logistics and warehousing insurance certificate
The SLVS stands for Speditions-, Logistik- und Lagerversicherungsschein and refers to all forwarding contracts of a forwarder and presents a combination of a liability insurance for the forwarder and an indemnity insurance for the client.
Small goods
Refers to goods weighing up to 30 kg.
SSCC Serial Shipping Container Code
Barcode for marking a delivery unit
Storage cost rate
Storage cost rate = storage fee + interest for inventory
Total storage costs x 100 / average inventory
Storage utilisation ratio = used storage space x 100 / total storage space
Inventory quota = average inventory x 100 / annual turnover
Sub-forwarder
Refers to a forwarder contracted by the main forwarder to carry out a forwarding order.
Supply chain management (SCM)
Supply chain management is the management of a network of interconnected businesses involved in the ultimate provision of product, information and value flows.
Supply readiness
Supply readiness = immediately delivered units of an article x 100 / demand in units;
percentage of articles immediately deliverable ex stock as part of the total demand.
Traffic
Refers to a re-location of people, goods and vehicles.
Transport
Transport refers to the forwarding of goods. The term transport is also used as an umbrella term for e.g. direct, pre-, main- and on-carriage transportation.
Transport chain
A transport chain refers to the organisation and execution of several linked transport activities aided by information and control systems.
Transport label
A transport label is affixed to the loading unit/package so that all packages are identified.
Transport packaging
Transport packaging refers to the types of packaging whose nature is determined by the specific transport requirements (e.g. pallet wrapping, special transport racks, etc.)
Transport unit
Transport units are used for transportation, e.g. containers, swap bodies, railcars or semi-trailers, and allow for transport without reloading the goods.
UN numbers
UN numbers refer to the numbering system introduced by the United Nations (UN) for hazardous goods and substances.
Unit loads
A unit load is a term for goods which are smaller in size, shape or weight and must be loaded individually. These goods may be moved with the usual conveyers, such as forklifts or jack lifts.
Unloading point
An unloading point is a gate or loading platform at the recipient’s site where goods are delivered.
Wholesale unit pack
A wholesale unit pack describes the way in which a loading unit is secured. For example, loading units may be tied to a pallet with bands.
Without classification
If a hazardous material/item is without classification (e.g. because it is not explicitly listed in regulations regarding hazardous goods or because it falls under a collective name) it may be transported according to those regulations.
