Glossary of Logistical Terms

ABC, ABC Classification - A strategy for classifying inventory or parts within a warehouse or system. Typically fastest movers are categorized as A items, though classification can be based on other factors as well such as margin.

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.

Allocated Inventory - Any inventory item that is reserved for specific customers or promotional events that is not to be used for standard order fulfillment reasons. 

Allocation - Inventory is allocated to a specific order.

Anniversary Billing - Method of billing where the client is billed for one month of storage once inventory is received. If this product remains in inventory, it will be billed an additional monthly charge each month on the anniversary of its arrival.

Annual Inventory - The physical count of all products in the warehouse performed on a yearly basis.

Apron - The area outside the dock door which is used by delivery vehicles to park or position for loading and unloading. The Apron is specifically designed to a depth that will allow trailer floors to match with the warehouse floor in a way that facilitates loading and unloading.

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. 

Assembly Area - Location in the warehouse where products and loads are collected and combined.

Available Inventory - The amount of shippable product in the warehouse; does not include product designated as damaged, on hold, or pending shipment.

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.

Back Haul - When an outbound shipment is delivered, instead of coming back empty, a load is picked up from a destination near the final stop-off and then returned either back to the warehouse or a Consignee location near the facility. 

Banding - A type of plastic or metal strapping that helps support a load and hold it together. Can be used to strap and secure product on a pallet or skid.

Batch Picking - A picking method whereby one SKU is picked one time for all applicable orders and then distributed across multiple orders in a staging or packing location.

Bay - An area in the warehouse designated by markings on the columns or floor.

Bay Storage - Bay used for storage.

Beginning Inventory - Inventory level and count at the beginning of a period.

Bill of Lading - The Bill of Lading (BOL) is an official document that accompanies every shipment. It serves as the contract between the party that owns the freight and the carrier. 

Bin - A four-sided structure that is mounted on a pallet. A bin may or may not have a cover.

Blind Counts - Blind counts are used during physical inventories to prevent counter bias. The location and item code are provided to the counter, but the counter must provide the quantity of the item found in the given location without knowledge of the desired quantity according to inventory records.

Bonded Warehouse - A bonded warehouse is one that has been approved by the U.S. Treasury Department who, due to observance of revenue laws, has put the warehouse under bond or guarantee. 

Bottleneck - Traffic or congestion in an area of the warehouse due to poor planning or insufficient resources.

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.

Bulk Storage - Storage of large quantities of product in shipping containers.

Carousel - Material Handling Equipment designed to bring product to picker so that the picker can remain stationed in a designated picking location without traveling. Ideally, order information is loaded or automatically transferred into the carousel system, and multiple orders are picked by multiple pickers at one time. Types of carousels include horizontal and vertical.

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.

Carton - A unit of product, a protective casing around a product.

Chassis - A frame with wheels that supports a container that is being transported over land.

Chock - Using 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.

Clear Height - The height pallets can be stacked while leaving clearance for product movement or for lights, sprinklers, etc., hanging from a ceiling.

Client - The stock that arrives at our Distribution Centers is owned by the client, the companies that have made arrangements with Nexus to store and distribute their products.

Commodity - Product identified with specific clients.

Concealed Damage - Damage to product that is not obvious until the product is examined or the condition becomes apparent during storage or transfer.

Consignee - The client’s customers are referred to as the consignee. Just think of the consignee as the “end user” or the company where Nexus ships the stock.

Consignment inventory - Inventory that is in the possession of the customer, but is still owned by the supplier.

Consolidate - Combine two or more shipments going in the same direction or to the same destination on a single trailer.

Container - A container is a box that is used to transport product, and is widely used for international shipments. Marine containers or intermodal containers can travel on ocean liners, railroads, and on truck frames (chassis).

Contract - A binding agreement between Nexus and a client stating terms of the agreement, storage fees, transportation rates, and accessorial charges.

Contract Warehouse - A warehouse operation managed by a third party logistics provider for a specified period of time. 

Cross Dock - Product or orders that are brought into the warehouse but not put-away. Instead of the stock arriving and being placed into storage, the stock is temporarily stored at the dock to be delivered or goes out immediately on another vehicle to be shipped. This stock is usually shipped immediately or within a day and does not go into storage.

Cross Training - Allowing employees to have experience in multiple tasks, job functions, or across multiple accounts in order to increase productivity and provide backup.

Cube Utilization - The space utilized versus space available.

Customer Pick Up - A load that is picked up on the same day purchased at the warehouse by the customer.

Cycle Counting - Physically count of your inventory on an on going basis. After a period of time all products have been counted. A cycle is then defined as the time it takes to count all inventory once.

Date Code - A label that shows when a product was manufactured.

Dead Stock - Product that has been in inventory for an extended period of time without being moved or ordered.

Deep-Lane Storage - Product is stored more than one unit deep in an aisle.

Dock - A warehouse door with an extending platform where trailers are loaded and unloaded.

Dock Face - Outer wall of dock door.

Dock Leveler - A plate at the dock door entrance that raised and lowered either manually or hydraulically to accommodate trailer floor heights.

Dock Light - A light used to illuminate the inside of a trailer in order to aid in the loading and unloading processes.

Dock Plate - A moveable metal plate that is placed between the warehouse dock door and a trailer or railcar and makes it easier/smoother to access a trailer or railcar with a forklift or similar equipment.

Double-Deep Storage Lane - Storing products two loads deep on a single warehouse aisle.

Drayage - A container or piggyback is moved from a rail yard to another location) and then returning that container back to the initial pick-up point, is known as a dray. It is important that these containers get unloaded quickly and returned back to the original point so not to incur detention charges.

Drive In Rack - Storage racking equipment that has side rails to enable warehouse operators to stack product high in deep rows. It provides access only from aisles.

Drive-Through Rack - Storage racking equipment with side rails to enable warehouse operators toe stack product high in deep rows. Unlike Drive-In Rack, Drive-Through Rack allows access from either end of the row, as opposed to only being accessible from the aisle.

Dunnage - Refers to packing materials such as cardboard, empty pallets, air bags, air pillows, packing peanuts, or other materials utilized to protect freight.

EDI (Electronic Data Interchange) - Electronic Data Interchange refers to a computerized exchange of information with the client through the warehouse management system. It is a method of exchanging orders, invoices, shipping forms and other documents over the computer.

Emergency Order - Also known as an expedited order, this order is placed and processed to be picked and shipped in an expedited manner.

Ending Inventory - Inventory levels at the end of a specified period.

Expiration Date - Date when merchandise is no longer able to be shipped.

Facility - The physical warehouse or plant where storage takes place.

FIFO (First In, First Out) - Inventory allocation method whereby the first product stored is the first product that is utilized or allocated for the fulfillment of orders.

FILO - First-in, last-out system of inventory.

Finished Goods Inventory - Products that are ready to ship.

Finished Product Inventory - Available products ready to ship to customers.

Floor Load - Refers to product stacked directly onto the floor of a trailer without pallets or slip sheets; product must be unloaded manually without the use of a forklift.

Flow Rack - Racking equipment that allows for the product to be stocked in through one side and removed for order fulfillment purposes from the other side. Product stored in Flow Rack is naturally allocated via FIFO based on the racking equipment design.

Forklift - A warehouse vehicle, also called a lift truck, which is used for lifting and transporting pallets of product. A forklift may have a special attachment on the front for specialized handling of product.

Forks - Lift-truck attachment used to move stock on pallets.

Freight Bill - An invoice for transportation charges generated when a load is delivered.

Freight Charge - Compensation paid to Nexus by the client for transportation services performed.

Freight Cost - This is the compensation paid to the contracted carrier by Nexus for the transportation services performed.

Fulfillment - The picking and processing of orders for shipping from a distribution or warehouse.

Full Truckload - This term refers to a shipment comprising a full or almost full load on a truck. A full or almost full load is considered to be 39,000 – 44,000 pounds.

Gaylord - Large corrugated carton that has the same length and width as a pallet.

Gravity Conveyor - Type of conveyor that uses gravity to move materials.

Gross Weight - The total weight without deduction for tare (includes packaging and container.

Handling - The labor involved in moving product received from the trailer into the warehouse dock and then into the storage location on the “IN” and moving the product out of the storage location and into a staging location to then be loaded onto a trailer on the “OUT”.

Handling Charge - Charge for normal warehouse handling (inbound or outbound, or both) to customer.

Handling Costs - Cost to warehouse or 3PL for all handling operations.

Hand Truck - Western hand truck is a device used to transport goods manually with wheels within the side rails. The Eastern hand-truck is similar except the wheels are outside the side rails.

Hazmat - Short for “hazardous material.” Material is deemed hazardous by the government or a carrier. Hazmat may require special handling or special facilities.

Hi-Lo - AKA Forklift. References the ability of the truck to lift and put down freight.  

Honeycombing - The situation that occurs when a lot (see Lot) is partially depleted and the remaining space is wasted because it cannot be utilized.

Housekeeping - Keeping the warehouse presentable, organized, and safe for all parties.

In-House Damage - Damage to product that occurred while in the warehouse (i.e. water leak, dropped product, etc.).

Intermodal - Intermodal means using 2 or more, modes of transportation: rail, truck or ship. The stock can move over sea by ship, over land by rail and then, at the main rail switch, the container is removed and put on truck chassis. The stock is then carried by truck to our Distribution Centers.

Initial Storage - Warehouse storage charge for the month when product is received; it is typically billed when product is received.

Inner Packaging - Also known as “Dunnage,” includes materials such as foam, paper, or wood used to minimize movement within the container.

Inventory Turns - The number of times inventory turns is calculated using the following method:

a) Sum the Inventory In and the Inventory Out, and then divide by 2 to arrive at the Throughput.

b) The number of Inventory Turns is equal to the Throughput divided by the Average Inventory.

Just-in-Time - An inventory system that aims to coordinate the arrival of materials or supplies at a facility at the moment that they are needed in an effort to reduce storage and holding costs.

Kitting - Assembly of product or parts within the warehouse.