Glossary - Generic Shipping Terms

Generic Shipping Terms | LTL Terms | UPS Terms

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

A

Assessorial Charges – These are components of freight costs that the freight carriers have added on to their base freight rates in recent years. Examples of these charges include:

Freight Surcharge
Dimensional Surcharge
Delivery to Residence
Address Corrections
Weight Errors
Insurance

B

Base Shipping Rate (also referred to as Base Rate) – The base freight expenses that apply to an individual shipment.

Bill of Lading – A document that must accompany each shipment that defines the contents of the shipment.

Business Rules – The internal business rules that have been defined by each company that determine freight carriers and shipping modes. These rules have a direct impact on freight expenses.

C

Carrier Agreement – The written agreement with a specific freight carrier that determines the prices and discounts, by shipping mode and service level, that apply for the term of the agreement. Most agreements are in effect for 1, 2 or 3 years.

Claim – A dispute on the freight expense incurred on an individual shipment, or a request for reimbursement for products damaged during the shipping process.

Consignee – A company that receives an individual shipment and acknowledges the receipt in writing.

D

E

F

FOB/Prepaid – The identification of which party is responsible for paying the freight expense. FOB refers to “Freight on Board” and indicates that the purchaser of the products is responsible for paying the freight expense, and Prepaid indicates that the supplier is responsible for paying for the freight expenses.

Freight Audit – The process of reviewing the current procedures for managing both inbound freight expenses and outbound freight expenses.

Freight Broker – A company that serves as a sales agent for a freight carrier.

Freight Carrier (also referred to as Carrier) – A company that provides any type of shipping service.

Freight Forwarder – A company that arranges for products to be shipped by international freight carriers, and picks up or delivers the product from either the company shipping the products, or from the company receiving the products.

Freight Invoice Approval – The process of approving invoices received from Freight Carriers.

Freight Policy – The internal policy defined by an individual company that defines when specific shipping modes, specific freight carriers, and specific service levels should be utilized. It can also define what personnel has the authority to make decisions that impact freight expenses.

Freight Spend – The total amount of expenses incurred for freight in a given time period, typically a year.

G

H

I

Imports – products that are purchased internationally.

Inbound Freight – The freight expense that is incurred on products purchased from vendors, typically related to incoming purchase orders.

J

K

L

M

N

O

Outbound Freight – The freight expense that is incurred on products shipped to a customer, typically related to outbound customer orders.

P

Packing List – A document that accompanies each shipment and contains the contents of each shipment.

Q

R

Returns – Shipments that are returned to the supplier.

S

Service Levels – The level of service options that are available for each shipping mode. As an example, the options that are typically available for parcel shipments are next day, second day, ground, etc. These options can vary by Freight Carrier.

Ship Via – The individual Freight Carrier to be used on an individual shipment.

Shipper – The Freight Carrier used on an individual shipment.

Shipping and Handling Charge – The amount on an individual invoice that identifies the freight expense, provided by a freight carrier, plus an allowance for the internal handling expenses.

Shipping Charge – The amount on an individual invoice that identifies the amount of freight expense, provided by a freight carrier, that is to be paid by the company receiving the products.

Shipping Charge Correction – A charge that appears on the freight carrier’s invoice, received after the actual shipment occurs, that identifies a correction to the amount of the freight expense.

Shipping Container – The package or container that products are typically shipped in.

Shipping Label – The bar coded label that must used on each shipping container.

Shipping Modes – These are the modes of shipping that most companies use for shipping their products. Common modes used include:

Small Parcel – the mode used to ship products shipped in individual packages.
Truck Load – the mode used to ship products in full truck loads.
LTL – the mode used to ship products in less than full trucks loads, typically in pallets. what is FAK?
International Export – the mode used to ship products internationally.
International Import – the mode used to purchase products internationally.
Trade Shows – the mode used to ship displays and sales materials to trade shows.
US Mail – the mode used to ship via the US post office.
Air – the mode used to ship via airplane.
Rail – the mode used to ship via the railroad.

Shipping Routing (also referred to as Routing) – The specific route determined by the freight carrier for the shipment of an individual shipment.

Shipping System – The computer system used to facilitate the shipping process. Typical functions performed are generation of bar coded shipping labels, generation of bills of lading, freight carrier selection, and freight cost calculation. They can also generate the required customs paperwork required for international shipments. These systems can be purchased from either individual freight carriers, if the company uses a single freight carrier for shipping their products, or from third party suppliers, if a company uses multiple freight carriers for shipping their products. These computer systems are separate systems from the company’s ERP systems, and may or may not be electronically interfaced with the ERP system.

Shipping Zones – Predetermined sections of the US that are determined and used by individual freight carriers to calculate freight expenses.

Strategic Sourcing Initiative – The process of documenting a company’s total shipping requirements and soliciting formal quotations from the applicable freight carriers.

T

Tracking Number – A unique number assigned by a freight carrier to an individual shipment that allows the end consumer to inquire about the status of the shipment anytime during the shipping process.