Glossary of Terms



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Glossary of logistics terms


Logistics is defined as the process of planning, implementing and controlling the efficient and cost-effective flow and storage of raw materials, in-process inventory, finished goods and related information from the point of origin to the point of consumption, for the purpose of conforming to customer requirements.

More simply, it is the science (and art) of ensuring that the right products reach the right place in the right quantity, at the right time to satisfy customer demand.

Other definitions include “the time-related positioning of resource” or “the management of inventory in motion and at rest”.

Third Party Logistics “3PL” or “TPL”

Third Party Logistics or outsourced logistics; a 3PL is a specialised entity that operates and provides logistical services and as a Lead Logistics Partner (“LLP”), may also co-ordinate or integrate the services of others with complementary or supporting capabilities.

Fourth Party Logistics “4PL”

Fourth Party Logistics; supply chain co-ordination and management by an organisation that does not supply asset based logistical services. Rather it is an “integrator that assembles the resources, capabilities, and technology of its own organisation and other organisations to design, supply chain solutions”. 4PL’s are non-asset based, as far as logistics, transportation, and supply chain management assets are concerned. 4PL’s use 2PL’s and 3PL’s to supply service to customers, owning only computer systems and intellectual capital.

ABCActivity Based Costing: common accounting method used, for example, where there are a number of different clients in a shared warehouse (see also ABM, ZBB). Also “ABC Analysis” or “ABC Classification”: the classification of different stock items in a warehouse in accordance with their importance (e.g. individual sales volumes) – where Class A contains items with the highest volume and Class C the lowest (aka “Distribution by Value”).
ABPAsset-Based Provider
ADRAccord Dangereuse Routiers (in full: “Accord European Relatif au Transport International des Marchandises Dangereuses par Route”): regulations for the international movement of hazardous goods by road (see also IMDG, CDG, RID).
ASNAdvanced Shipping Notification or “Advance Ship Notice”: electronic pre-notification of an upcoming shipment to the next stage in the supply chain. Also known as an 856.
BISDepartment for Business Innovation and Skills
B2BBusiness-to-Business: e-commerce term for communications between companies and their suppliers.
B2CBusiness-to-Consumer: e-commerce term for communications between companies and their customers (see also B2B).
BIFABritish International Freight Association: UK trade association.
B/LBill of Lading.
BOLBill of Lading. Usually B/L.
BOMBill of Material
BPIBusiness Process Improvement: business improvement practice using performance measurement to reduce or eliminate non-value added activities or costs, while at least maintaining quality, productivity, etc.
BPOBusiness Process Optimization – or Outsourcing. Sub-contracting of high level business application services (see also eBPO).
BPRBusiness Process Re-engineering: redesign of business processes to achieve dramatic improvements in quality, speed, service and cost.
BRFBritish Road Federation Ltd: UK trade association for those concerned with construction and use of roads.
BSBritish Standard: e.g. BS5750 (a quality standard, now known as ISO9000).
BSIBritish Standards Institution: UK standards organisation responsible for British Standards.
BWABonded Warehousekeepers’ Association: UK trade association.
BWSBeers, Wines and Spirits
CCLTCranfield Centre for Logistics & Transportation: at the Cranfield School of Management (UK).
CDCCross-Dock Centre: a stockless (or virtual) distribution centre where goods are generally not placed into storage for subsequent picking, but arrive and depart relatively quickly – by passing ‘across the dock’. This is achieved by suppliers delivering individual store orders. Also Consolidated Distribution Centre and Combined Distribution Centre. See also PBL.
CHEPCommonwealth Handling Equipment Pool: a pallet (strictly a pooling system for pallets and automotive crates). CHEP is a division of the ‘new’ Brambles Group – a combination of Australia’s Brambles Industries Limited and the support services division of its former joint-venture partner, GKN plc.
CIPSChartered Institute of Purchasing & Supply: UK-based international education and qualification body.
CITChartered Institute of Transport: UK professional body – now merged with the Institute of Logistics to form the Institute of Logistics and Transport (see ILT, MCIT, FCIT).
CLMCouncil of Logistics Management
CMRCustomer Managed Relationship: a self-service approach to customer management, enabling people to obtain the services or information they need themselves. The acronym also denotes an international convention for the carriage of goods by road.
CPCCertificate of Professional Competence: a professional standard for UK road haulage operators, administered by the DfT 
CPFRCollaborative Planning, Forecasting & Replenishment (also CPFaR).
CPGConsumer Packaged Goods: see also FMCG.
CRContinuous Replenishment: a modification of QR which eliminates the need for replenishment orders – individual customer’s purchases trigger manufacturing and distribution. See also AR and VMI.
CRMCustomer Relationship Management: software to manage and control relationships with customers (employs a management concept founded on the fact that a 5% increase in customer retention can increase profitability by 25—125%). See also SRM.
CRPCapacity Requirements Planning: the process of establishing, measuring and adjusting limits or levels of capacity – e.g. to determine the human and machine resources required for production. Also “Continuous Replenishment Programme” – customer-driven replenishment.
CSDFCold Storage and Distribution Federation: UK trade body.
CSRCorporate Social Responsibility. 
CVCommercial Vehicle: a truck.
CVOCommercial Vehicle Operations
DCDistribution Centre. Also RDC, NDC, EDC, IDC.
DCMDistribution Channel Management: strategic management of direct and indirect supply channels. Also Demand Chain Management.
DETRDepartment of the Environment, Transport and the Regions: former UK government department covering transport, part of which was itself previously known as the Department of Transport. Subsequently known as the DTLR  but now divided again (see DfT).
DfTDepartment for Transport: UK government department for transport, previously known variously as the DoT, DTp, DETR and DTLR .
DGSADangerous Goods Safety Advisors: DGSAs are required under European Commission Directive 96/35 for hauliers loading or transporting dangerous goods.
DMDepot Manager or “Depot Maintenance”.
DoTIDepartment of Trade & Industry: UK government department.
ECREfficient Consumer Response: logistics discipline involving the synchronisation of supplers’ and retailers’ supply chains to reduce stocks. If stocks are cut then supply chains must be able to respond more efficiently to changes in consumer demand – i.e. they must make an “efficient consumer response”. (See also AR, CR, ER, QR, etc.)
EDCEuropean Distribution Centre: see also RDC, NDC, IDC. Also “Electronic Data Capture”.
EDIElectronic Data Interchange: electronic transfer of data – especially sales volumes, stocks, orders, etc. See also FEDI, TEDIS.
EDIFACTElectronic Data Interchange for Administration, Commerce & Transport: a UN initiative (see UN/EDIFACT directory).
ELIEmployers’ Liability: insurance.
EPoSElectronic Point of Sale: system for capturing sales data at the checkout.
ERPEnterprise Resource Planning: integration of technology to run all manufacturing and related processes across an entire enterprise. Also “Electronic Road Pricing”.
ETAEstimated Time of Arrival
FCDFirst Class Distribution: logistics standard introduced by major retailers in the UK.
FCITFellow of the Chartered Institute of Transport: chartered fellow of the UK Institute of Logistics and Transport. See also ILT, MILT, MCIT, FILT.
FCLFull Container Load
F/CPGFood/Consumer Packaged Goods: see also FMCG.
FEUForty-Foot Equivalent Unit: a standard measure for containers (see also TEU).
FFFreight Forwarder
FGPFactory Gate Pricing: price excludes delivery. By taking over responsibility for primary transport, retailers aim to reduce empty running.
FILogFellow of the Institute of Logistics: old designation for fellows of this UK Institute (now known as the Institute of Logistics and Transport). See also ILT, FILT, FCIT.
FILTFellow of the Institute of Logistics and Transport: fellow of UK professional body. See also ILT, MILT, FCIT, MCIT.
FMCGFast Moving Consumer Goods: i.e. food, drink, pharmaceuticals, household products, etc.
FTAFreight Transport Association: UK trade association. Also “Free Trade Agreement”.
FTLFull Truck Load or Full Trailer Load. Also former name of TBG’s IT department.
GF-XGlobal Freight eXchange: proprietary electronic trading platform for airlines and forwarders.
GKNA pallet (see CHEP).
GMGeneral Maintenance: routine or scheduled maintenance (see also IM, OM).  “General Manager” and General Merchandise 
GOHGarments on Hanger
GPSGlobal Positioning System: satellite based location system, used in vehicle positioning.
GRNGoods Returned Note or Goods Received Note
GVWGross Vehicle Weight: maximum rated weight of a truck, including its cargo. See also TW.
H&SHealth & Safety. Also HSE: Health & Safety Executive.
HGVHeavy Goods Vehicle: a truck. See also LGV.
HPTHand Pallet Truck
IATAInternational Air Transport Association
IDCInternational Distribution Centre
IIPInvestors In People
ILIntegrated Logistics
ILSIntegrated Logistics Support. Also “Inbound Logistics Services” (formerly Nominated Carrier Services), 
ILTInstitute of Logistics and Transport: UK-based professional body, combining the Institute of Logistics and the Chartered Institute of Transport (tel.: +44 (0)1536 740100; fax: +44 (0)1536 740101; e-mail: See also MILT, FILT, MCIT, FCIT.
IoLInstitute of Logistics: former name of UK-based professional body, now known as the Institute of Logistics and Transport – see ILT.
IOMInstitute of Operations Management (UK).
IoTAInstitute of Transport Administration: UK trade association.
ISInformation System
ISCInternational Supply Chain Ltd
ISDNIntegrated Services Digital Network: standard medium for transmitting voice, video and data over networks.
ISOInternational Standards Organisation. Geneva-based standards organisation, represented in the UK by the BSI and in the USA by ANSI . Also “ISO container” (a standard stackable container) and, for example, ISO9000 (a quality standard).
ITInformation Technology: computer hardware, software, the Internet, etc. Also Industrial Tribunal.
ITTInvitation to Tender
JITJust in Time: logistics discipline requiring increased frequency and regularity of deliveries to reduce stocks in the supply chain. Frequently used in manufacturing to cut or even eliminate component stocks. See also MRP.
JITDJust in Time Delivery: see JIT.
KPHKilometres per hour
KPIKey Performance Indicator
LCLLess than Container Load: container groupage. Also “Less than Carload”: a railfreight term.
LGVLight Goods Vehicle. See also “HGV”.
LLLean Logistics: also L² – efficient logistics.
LLPLead Logistics Partner: a 3PL  that controls other outsourced supply chain elements.
LMSLogistics Management Systems
LSPLogistics Service Provider: logistics contractor
LTLead Time
LTLLess Than Truckload: part load.
LXLogistics Exchange
MBOManagement Buy Out. 
MCITMember of the Chartered Institute of Transport: now a chartered member of the UK Institute of Logistics and Transport. Also ILT, MILT, FCIT, FILT.
MILogMember of the Institute of Logistics: former designation of this UK Institute (now known as the Institute of Logistics and Transport). Now see MILT, ILT.
MILTMember of the Institute of Logistics and Transport: member of UK professional body. Also ILT, FILT, MCIT, FCIT.
MISManagement Information System
MoCManagement of Change
MRPManufacturing Requirements Planning (aka “Manufacturing Resource Planning”): production-led planning technique seen as precursor to JIT. Now revived as MRP II. See also DRP.
MUMerchandisable Unit: usually a dolly or wheeled carrier that is loaded with pre-merchandised product straight off the production line, but which travels right through the supply chain to the store sales area.
NCSNominated Carrier Scheme: retailer specifies which carrier(s) should be used by suppliers to transport merchandise into its distribution centres. Also “Nominated Carrier Services” (see ILS).
NDCNational Distribution Centre: same as RDC , but with distribution on a national rather than regional basis. See also EDC, IDC.
OOperator: as in “O-Licence” – a licence to operate commercial vehicles.
OAOOwn Account Operator: e.g. the in-house road haulage sector
OBOpen Book: contractor accounting system that is transparent to clients.
OCOrder Cycle: time and/or operations between order placement and final delivery.
OEOrder Entry. See also OP.
PDMPhysical Distribution Management: aka logistics. Also “Product Development & Management”.
PIPerpetual Inventory
POPurchase Order
PODProof of Delivery
POSPoint of Sale: see also EPoS and EFTPoS.
QCQuality Control: also “QCP” – Quality Control Program(me).
QSHEQuality, Safety, Health and Environment
RDCRegional Distribution Centre: one of a network of large warehouses operated for a single retailer where merchandise is consolidated prior to delivery to its local stores. See also NDC, EDC, IDC.
RFIRequest For Information: precursor to an ITT.
RFPRequest For Proposal: document that invites bids or quotations from suppliers.
RFQRequest For Quote: see RFP.
RFxRequest For…: simultaneous request for information (RFI) and request for proposal/quotation (RFP/RFQ).
RHARoad Haulage Association: UK trade association.
RH&DReceipt, Handling and Despatch
Ro/RoRoll-on/Roll-off: drive on ferry service for accompanied trailers. See also Lo/Lo.
SCSupply Chain
SCCSupply Chain Collaboration
SCESupply Chain Execution: see also SCP.
SCEMSupply Chain Event Management. Often refers to software for monitoring, controlling and measuring supply chain activity.
SCISupply Chain Integration: supply chain elements working together for maximum efficiency.
SCMSupply Chain Management. Often refers to software for automating the supply chain. 
SCOSupply Chain Optimisation
SCPSupply Chain Planning: see also SCE.
SKUStock Keeping Unit: individual stock item.
SMESmall to Medium Enterprise: not a big company.
SMGSlow Moving Goods: Can also refer to a distribution centre for such merchandise.
SRMSupplier Relationship Management: see also CRM.
T&C’sTerms and conditions
TEUTwenty-Foot Equivalent Unit: a standard measure for containers (see also FEU).
TIRTransport International Routiers: system of road transport where trailers are sealed at departure and opened at the destination, with free access across borders. No longer in use within the EC.
TMOTransport Manager & Optimiser: a module within the i2 transportation and distribution management software suite.
TMSTransport Management System
TPLThird Party Logistics: outsourced logistics. Also “3PL”.
TPPThird-Party Provider: logistics contractor (see also LSP).
TQMTotal Quality Management: business management techniques designed to systematically reduce errors and raise service quality.
TUPETransfer of Undertakings (Protection of Employment) Act, 1981: UK regulations which protect employees’ rights when ownership of a business or enterprise changes hands.
VADSValue-Added Data Services. See also VAN.
VANValue Added Network: also “Value Added Network Services”. See also VADS.
VASValue Added Services
VCAValue Chain Analysis. Also “Vehicle Certification Agency”: undertakes type approval tests on vehicles, components and systems.
VCMValue Chain Management
VLVirtual Logistics
VMIVendor managed inventory
WAMBAMWeb Application Meets Bricks & Mortar: see also DOTBAM.
WANWide Area Network: network with a geographical spread of more than a mile – often comprising connected LANs .
WIPWork In Progress
WMSWarehouse Management System: software to manage inventories.
WTDWorking Time Directive: EC Directive covering, inter alia, drivers’ hours.