Glossary of supply chain and logistics terms and abbreviations

Welcome to the dynamic world of logistics, where efficiency and precision reign supreme. Navigating the do’s and don’ts of receiving and shipping within Australia and internationally, requires a good understanding of supply chain terms and abbreviations. As the backbone of ecommerce, logistics operates in a language all its own. Whether you’re a seasoned professional looking to brush up on industry jargon or a newcomer eager to decode the alphabet soup of abbreviations, this glossary is for you. So, buckle up and embark on a journey through this comprehensive guide, where we demystify the terminology that keeps the wheels of ecommerce turning smoothly.

• 3PL (Third-Party Logistics): 3PL involves outsourcing logistics and supply chain functions to an external provider, encompassing services such as transportation, warehousing, and distribution.Commonly, these are warehouse based businesses who will receive, store and ship your orders for you for a fee. Many will integrate with your eCommerce platform.

• 4PL (Fourth-Party Logistics): 4PL is an integrated supply chain management model where a single entity oversees and manages the entire logistics network, often acting as a consultant orchestrating multiple 3PLs. For a global business who wants to ship and distribute stock in different countries, a 4PL might be a good option to look into.

• API (Application Programming Interface): API is a set of protocols and tools that allows different software applications to communicate and share data, enabling seamless integration between logistics systems. For example, ReadyToShip uses an API to connect to your stores and marketplaces and carriers to fetch information needed to complete the shipping process. All data is sent and received electronically via the API.

• B2B (Business-to-Business): B2B refers to transactions and interactions between businesses, involving the exchange of goods, services, or information between two or more companies. A business might sell to consumers (B2C) and to other businesses as well.

• B2C (Business-to-Consumer): This is the standard model of most online businesses – selling direct to consumer. B2C involves the direct sale of goods or services from a business to individual consumers, often occurring through online platforms or retail channels. B2C is sometimes also known as DTC or Direct To Consumer.

• Barcode: A barcode is a machine-readable representation of data in a visual format, typically used for tracking and identifying products in logistics and supply chain management. There are different types and styles of barcodes but most carriers now use a QR code (square type) to scan parcels and provide tracking to customers. This barcode is automatically printed on each label in ReadyToShip

• Bill of Lading (BOL): The Bill of Lading is a legal document that serves as a receipt for shipped goods, detailing the type, quantity, and destination of the cargo, and it also acts as a title of ownership during transit.

• Bundle: In ecommerce, a bundle refers to a group of items or products that are packaged together for shipment or sale as a single unit.

• Air Freight: Air freight involves the transportation of goods by air, offering a faster shipping option for time-sensitive or high-value shipments. Some carriers will use air freight for express delivery, especially when parcels need to travel overnight to a remote location.

• Actual Weight / Dead Weight: Actual weight (sometimes known as Dead Weight) is the physical weight of a shipment (ignoring the package’s cubic volume) used  to calculate shipping costs. Most carriers use the greater of Dead Weight or Cubic Weight to calculate freight costs. 

• Backorder: Backorder occurs when a customer places an order for an item that is temporarily out of stock, and the product will be shipped once it becomes available.

• Batch Fulfilment: Batch fulfilment is the process of picking and processing multiple orders at once to improve efficiency. This is a central part of the processing via ReadyToShip which allows you to batch print many invoices, picklists and labels at once, improving efficiency.

• Blind Shipping: Blind shipping, also known as drop shipping, involves shipping products directly from the manufacturer or supplier to the end customer without revealing the original source to the customer.

• Carrier: A carrier is a company or individual responsible for actually transporting goods from one location to another, by way of picking up orders (or accepting parcels that are dropped off at locations) then delivering them to the end customer. Examples of well known carriers in Australia are Australia Post, Aramex, Couriers Please and more (see carriers ReadyToShip supports here )

• Collect/Cash On Delivery (COD): COD is a payment method where the customer pays for goods upon delivery, usually by cash

• Commercial Invoice: A commercial invoice is a document that provides details about a shipment, including the type and quantity of goods, their value, and other essential information for customs clearance. For most carriers, the ‘commercial invoice’ is created and provided electronically and does not have to be created by hand separately. International shipment may require commercial invoices for delivery in foreign countries. 

• Consignment: A consignment is another term for a shipment. A consignment might have one or more articles/parcels going to the same destination/customer.

• Consignee: The consignee is the customer to whom goods are shipped and delivered, typically the buyer or receiver of the products.

• Cost and Freight (CFR): Cost and Freight is an Incoterm where the seller covers the cost of the goods and transportation to the named destination port.

• Cubage: Cubage refers to the volume or space occupied by a shipment, often used to calculate shipping costs based on the dimensional weight.
• Cubic Weight – Cubic weight refers to the weight of a consignment or parcel that is calculated using the parcel’s dimensions. Typically this would be Length (cm) x Width (cm) x Height (cm) x 250.

• Customs: Customs involves the government authorities responsible for regulating and controlling the flow of goods in and out of a country, ensuring compliance with import and export regulations. All international shipments go through customs in other countries. It is important to provide correct information about your parcels to the Carrier who is shipping and delivering your item, so it can go through customs efficiently.

• Customs Clearance: Customs clearance is the process of obtaining permission from customs authorities to import or export goods, involving documentation and payment of duties. Typically a merchant will need to provide accurate descriptions of items that are included in a shipment, and perhaps a Harmonised System Code (HS code) so correct duty can be calculated. ReadyToShip supports the provision of HS Codes for items, to ensure smooth delivery of goods to end customers. 

• Dangerous Goods: Dangerous goods are products or substances that, due to their nature, pose a risk to health, safety, property, or the environment during transportation. Typically this includes items that might contain batteries, chemicals and so on. Most carriers prefer not to carry Dangerous Goods, but some do and will have guides to refer to eg Australia Post Dangerous Goods Guide.

• Dimensional Weight: Dimensional weight is a pricing technique used by carriers, considering the volume of a package in relation to its actual weight to determine shipping costs.

• DirectPrint: DirectPrint is a SaaS you can install to streamline printing from the browser. Once installed, labels, invoices, pick lists and manifests can go directly to the printer in one easy step.

• Dispatch: Dispatch refers to the process of sending out goods for delivery or transportation.

• Domestic Courier: A domestic courier is a shipping service that operates within the borders of a single country.

• Delivery Duty Paid (DDP): DDP is an Incoterm indicating that the seller is responsible for all costs, including duties and taxes, up to the delivery destination.

• DDU Shipping: Delivered Duty Unpaid (DDU) shipping means the seller is responsible for shipping costs, and the buyer is responsible for duties and taxes upon delivery.

• Drop Shipping: Drop shipping is a retail fulfilment method where a store doesn’t keep the products it sells in stock, instead, it purchases the products from a third party and has them shipped directly to the customer.

• Duty-Free Zone: A duty-free zone is an area where goods can be stored, handled, or processed without the payment of customs duties or taxes.

• Ex-Works: Ex-Works is an Incoterm indicating that the buyer is responsible for all costs and risks associated with transporting goods from the seller’s premises.

• First-Mile Delivery: First-mile delivery involves the movement of goods from the point of origin, such as a manufacturer or supplier, to the first distribution center or carrier.

• Free Carriers (FCA): Free Carriers is an Incoterm indicating that the seller delivers the goods, cleared for export, to the carrier nominated by the buyer at the named place.

• Free on Board (FOB): Free on Board is a term indicating that the seller is responsible for all costs and risks until the goods are loaded onto the vessel at the named port.

• Freight Aggregator: A freight aggregator is a platform that consolidates shipping services from various carriers, providing users with options and cost comparisons.

• Freight Forwarding: Freight forwarding involves the organization and coordination of shipments on behalf of shippers, managing various logistics aspects such as transportation, documentation, and customs clearance.

• Freight Shipment: A freight shipment is a consignment of goods transported by a carrier, often involving multiple items or pallets.

• GTIN (Global Trade Item Number): GTIN is a unique identifier used to identify and manage products in the supply chain, commonly associated with barcodes.

• HS Tariff Code: The Harmonized System (HS) Tariff Code is an international nomenclature for the classification of products, used for customs and trade purposes. Tariff codes for items are becoming far more important these days and for some destination countries they are a requirement. ReadyToShip will import tariff codes from stores/platforms that support them, or you can add them yourself in our app before generating labels. Find out more.

• Incoterms®: Incoterms are standardized international trade terms published by the International Chamber of Commerce, defining the responsibilities of buyers and sellers in terms of transportation, risk, and costs.

• International Courier: An international courier is a shipping service that operates across borders, facilitating the transportation of goods between countries.

• Last-Mile Delivery: Last-mile delivery is the final leg of the delivery process, involving the transportation of goods from a distribution center to the end customer’s doorstep.

• Logistics: Logistics encompasses the management of the flow of goods, services, information, and resources throughout the supply chain, from production to consumption.

• Logistics Channel: A logistics channel is the route or pathway through which goods move from the point of origin to the final destination within the supply chain.

• Manifest: A manifest is a document listing the details of orders to be shipped, including the contents, quantities, and destination. Typically these are submitted electronically in ReadyToShip but some carriers will also provide a printer copy during the Manifest process.

• Marketplace: A marketplace is an online platform where buyers and sellers can connect to exchange goods and services.

• Multi-currency: Multi-currency refers to the capability of a system or platform to handle transactions and payments in multiple currencies.

• Multi-Sales Channel: Multi-sales channel refers to the distribution of products through various platforms and channels, such as online marketplaces, retail stores, and direct sales.

• Net Weight: Net weight is the actual weight of the goods excluding packaging and other materials.

• Omni-channel: Omni-channel refers to a retail strategy that provides a seamless shopping experience for customers across various channels, including online, in-store, and mobile.

• Order: An order is a request to purchase goods or services from your store.

• Order Fulfilment: Order fulfilment is the process of receiving, processing, and delivering customer orders, often involving picking, packing, and shipping.

• Order Tracking: Order tracking allows customers to monitor the status and location of their shipments in real-time.

• Package: A package is a box or satchel used to protect and transport goods during shipping.

• Packing/Pick Slip: A packing slip is a document included with a shipment, listing the contents and quantities of the package.

• Parcel: A parcel is a package or piece of mail (see Package).

• Picklist: A picklist is a document or electronic record that guides warehouse staff in picking items for order fulfilment.

• Pick/Pack: Pick/Pack is the process of selecting and packing items from inventory to fulfill customer orders.

• ReadyToShip: ReadyToShip is a shipping software platform, designed to automate the shipping label printing process by integrating with your ecommerce platforms/marketplaces and your carriers.

• Return Label: A return label is a shipping label provided by the seller for customers to return products. A seller can choose to pre-pay or the customer pays for the return.

• Return Merchandise Authorization (RMA): RMA is a process that authorizes the return of defective or unwanted products, often required before returning items to the seller.

• Satchel: A satchel is a small bag used for transporting goods.

• Self-Fulfilment/In-House Fulfilment: Self-fulfilment or in-house fulfilment involves an online store managing its own order fulfilment process rather than outsourcing it to a third party.

• Shipping Courier: A shipping courier is a company that provides shipping services, transporting packages from the seller to the buyer.

• Shipping Label: A shipping label is a sticker attached to a package containing information such as the destination address and tracking number.

• Shipping Method: Shipping Method refers to the shipping options set up in your store, provided as an option for your customers to choose when completing an order. For example, Standard or Express Shipping. 

• Shipping Notifications: Shipping notifications inform customers about the status of their orders, providing details such as shipping date and expected delivery time. Can be delivered via email, sms or status update in the customer account. (see Tracking)

• Shipping Rates: Shipping rates are the charges associated with transporting goods from one location to another, often based on factors like weight, distance, and shipping speed.

• Shipping Runs: Shipping runs refer to scheduled routes or trips taken by carriers to deliver goods to specific destinations.

• Shipping Zones: Shipping zones are geographic regions used to determine shipping rates based on the distance between the seller’s location and the destination.

• Split Shipment: Split shipment occurs when a single order is divided into multiple shipments, each sent separately.

• Supply Chain: A supply chain is the network of organisations, people, activities, information, and resources involved in the creation and delivery of goods and services.

• Tariff: A tariff is a tax or duty imposed on goods during international trade, often collected by customs authorities.

• Tracking ID: A tracking ID is a unique identifier assigned to a shipment, allowing customers and carriers to monitor its progress.

• White-Glove Delivery: White-glove delivery involves a premium service where the delivery team provides extra care and services, such as installation or assembly.

• White-Label Shipping: White-label shipping allows businesses to use a shipping service with their branding, providing a seamless and consistent experience for customers.

• Warehouse Management System (WMS): A Warehouse Management System is software that helps manage and optimize warehouse operations, including inventory tracking, order fulfilment, and shipping processes.