Glossario
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3PL
Describes businesses that provide one or many of a variety of logistics-related services. Types of services would include public warehousing, contract warehousing, transportation management, distribution management, freight consolidation. A 3PL provider may take over all receiving, storage, value added, shipping, and transportation responsibilities for a client and conduct them in the 3PL's warehouse using the 3PL's equipment and employees, or may manage one or all of these functions in the client's facility using the client's equipment, or any combination of the above. Another term, 4PL is sometimes used to describe businesses that manage a variety of logistics related services for clients by using 3PLs. A warehouse distribution center that performs all or part of its client’s supply chain logistics activities. These activities include the care and control of the client’s products; distribution of products according to client specifications; and special services such as repackaging and transportation.
3PL, Third-party logistics
Describes businesses that provide one or many of a variety of logistics-related services. Types of services would include public warehousing, contract warehousing, transportation management, distribution management, freight consolidation. A 3PL provider may take over all receiving, storage, value added, shipping, and transportation responsibilities for a client and conduct them in the 3PL's warehouse using the 3PL's equipment and employees, or may manage one or all of these functions in the client's facility using the client's equipment, or any combination of the above. Another term, 4PL is sometimes used to describe businesses that manage a variety of logistics related services for clients by using 3PLs. A warehouse distribution center that performs all or part of its client’s supply chain logistics activities. These activities include the care and control of the client’s products; distribution of products according to client specifications; and special services such as repackaging and transportation.
ABC stratification
Method used to categorize inventory into groups based upon certain activity characteristics. Examples of ABC stratifications would include ABC by velocity (times sold), ABC by sales dollars, ABC by quantity sold / consumed, ABC by average inventory investment, ABC by margin. ABC stratifications are used to develop inventory planning policies, set count frequencies for cycle counting, slot inventory for optimized order picking, and other inventory management activities.
ABC, Activity based costing
Usually refers to costing method that breaks down overhead costs into specific activities (cost drivers) in order to more accurately distribute the costs in product costing. Has also been applied to customer and vendor management.
Accessorial
A supplemental activity or material, outside normal handling and storage, that is billable in accordance with the clients contract.
Accessorial Charge
The amount charged to the client for providing accessorial service or materials.
Airbag
An inflatable bag used to fill empty space on a load of product to keep the product from shifting.
Allocations
Allocations in inventory management refer to actual demand created by sales orders or work orders against a specific item. The terminology and the actual processing that controls allocations will vary from one software system to another. A standard allocation is an aggregate quantity of demand against a specific item in a specific facility, I have heard standard allocations referred to as normal allocations, soft allocations, soft commitments, regular allocations. Standard allocations do not specify that specific units will go to specific orders. A firm allocation is an allocation against specific units within a facility, such as an allocation against a specific location, lot, or serial number. Firm allocations are also referred to as specific allocations, frozen allocations, hard allocations, hard commitments, holds, reserved inventory. Standard allocations simply show that there is demand while firm allocations reserve or hold the inventory for the specific order designated.
ASN
An Advance Shipping Notice (ASN) is received from the client to inform Nexus of the contents of an inbound shipment prior to its arrival. The ASN is referred to in the Phoenix System as an In-transit (i.e. on its way not yet arrived). It can be communicated by telephone, fax, e-mail or EDI, then is entered into the Phoenix System as an In-transit.
ASN, Advanced shipment notification
Advanced shipment notifications are used to notify a customer of a shipment. ASNs will often include PO numbers, SKU numbers, lot numbers, quantity, pallet or container number, carton number. ASNs may be paper-based, however, electronic notification is preferred. Advanced shipment notification systems are usually combined with bar-coded compliance labeling which allows the customer to receive the shipment into inventory through the use of bar-code scanners and automated data collection systems.
Available Inventory
The amount of shippable product in the warehouse; does not include product designated as damaged, on hold, or pending shipment.
Back Haul
When an outbound shipment is delivered, instead of coming back empty, a load is picked up from a destination close to the final stop-off and then delivered either back to the warehouse or a Consignee location near the warehouse. A Back Haul creates revenue as opposed to coming back empty which would be an expense.
Bar Code
A UPC code that identifies product. It consists of a series of black bars and is scannable. The bar code represents an identification number that is stored in the computer system along with other information about the product.
Batch picking
Order picking method where orders are grouped into small batches, an order picker will pick all orders within the batch in one pass. Batch picking is usually associated with pickers with multi-tiered picking carts moving up and down aisles picking batches of usually 4 to 12 orders, however, batch picking is also very common when working with automated material handling equipment such as carousels. See also Zone picking, Wave picking. Article Order Picking
Bill of Lading
The Bill of Lading (BOL) is an official document that accompanies every shipment. The Bill of Lading is created in the Phoenix System (OE.06 screen) and given to the carrier prior to the vehicle departing. When an outside carrier signs the Bill of Lading, he/she accepts responsibility for the shipment.
Blind counts
Describes method used in cycle counting and physical inventories where you provide your counters with item number and location but no quantity information. See article on Cycle Counting, also check out My book on inventory accuracy.
Bubble Wrap
Sheet of plastic with air bubbles that is used as a packing material.
Bulkhead
A movable railcar partition that is used to secure a load.
Cantilever Rack
Racking system in which the shelving supports are connected to vertical supports at the rear of the rack. There are no vertical supports on the face of the rack allowing for storage of very long pieces of material such as piping and lumber. Also see Racking Pics Page.
Carousel
Type of automated material handling equipment generally used for high-volume small-parts order-picking operations. Horizontal carousels are a version of the same equipment used by dry cleaners to store and retrieve clothing. They have racks hanging from them that can be configured to accommodate various size storage bins. Vertical carousels consist of a series of horizontal trays on a vertical carousel. Vertical carousels are frequently used in laboratories and specialty manufacturing operations. More info on carousels on Automated Equipment Pics Page. See article on Order Picking.
Carrier
The carrier transports goods from the client to Nexus and from Nexus to the consignee. The carrier can be Nexus (Nexus owned truck), a transportation company, or the railroad. Responsibilities include carrying the goods safely, in good condition and in a timely manner.
Carrying cost
Also called holding cost, carrying cost is the cost associated with having inventory on hand. It is primarily made up of the costs associated with the inventory investment and storage cost. For the purpose of EOQ calculations, if the cost does not change based upon the quantity of inventory on hand it should not be included in carrying cost. See article on EOQ for more detailed info on carrying cost.
Chassis
A frame with wheels that supports a container that is being transported over land.
Chock
To use a wood or metal wedge to block the wheels of a truck while it is being loaded or unloaded.
Clamp
An attachment to a forklift that allows it to encircle and grasp product.