Logistics & supply chain terminology explained

ADR (European Agreement concerning the International Carriage of Dangerous Goods by Road) is the legal framework that regulates the transport of hazardous materials across Europe by road.

The aftermarket refers to the market for spare parts, replacement components, and accessories sold after a customer purchases the original product.

Air freight is the transport of goods by airlines across domestic and international routes.

An Airway Bill is the official shipping document and contract of carriage for air freight shipments.

An API is a set of rules that allows different software systems to communicate and share data automatically.

An Arrival Notice is a formal notification informing the consignee that their shipment has arrived at the destination port, airport, or border crossing and is ready for customs clearance.

B2B logistics refers to supply chain services for business-to-business transactions, where goods move between manufacturers, distributors, wholesalers and retailers in large, scheduled quantities.

B2C logistics refers to supply chain services designed for business-to-consumer transactions, where goods move directly from businesses to individual end customers.

Backhaul refers to the return journey of a transport vehicle that would otherwise travel empty after delivering cargo to its destination.

A back order occurs when a customer orders a product that is currently out of stock, and the order is held until inventory is replenished and the item can be shipped.

A barcode is a machine-readable image consisting of parallel lines and spaces that encode product or shipment information in a standardized format.

Barge transport is the movement of cargo via flat-bottomed vessels (barges) on inland waterways such as rivers, canals, and coastal areas.

A Bill of Lading is the primary shipping document and legal contract of carriage for ocean freight and some cross-border road shipments.

A blind shipment is a shipping arrangement where the shipper's identity is concealed from the consignee, and the shipment appears to originate from an intermediary such as a freight forwarder.

A bonded warehouse is a storage facility authorized by customs authorities where imported goods can be stored temporarily without paying customs duties or import taxes.

A booking number is a unique reference code or confirmation number issued by a carrier, freight forwarder, or logistics provider when a shipment is booked for transport.

The booking process is the sequence of steps a shipper follows to reserve transport capacity with a carrier or freight forwarder.

A bottleneck is a point in the supply chain where capacity constraints slow down the entire operation, preventing goods from flowing smoothly to the next stage.

A box trailer is an enclosed cargo container mounted on a wheeled chassis and towed by a truck or van for road freight transport.

Breakbulk refers to non-containerisable cargo items that are loaded individually onto a ship rather than packed in standardized containers.

Buffer stock is extra inventory held beyond immediate demand to protect against supply disruptions, unexpected demand spikes, or longer-than-expected lead times.

Bulk cargo refers to large quantities of unpackaged or loosely packaged goods such as liquids, powders, grains, ores, and chemicals transported in specialized vessels or containers.

A bulk carrier is any specialized vehicle or vessel designed to transport large quantities of loose or unpackaged cargo such as liquids, grains, powders, ores, and chemicals.

Bulk shipping is the transport of large quantities of unpackaged cargo—liquids, powders, grains, ores, chemicals—via bulk carriers such as ships, tanker trucks, rail cars, or barges.

Cabotage is the transport of goods within a country by a foreign carrier—essentially, a carrier registered in one country performing shipments entirely within another country's borders.

Cargo refers to goods or merchandise being transported from one location to another via any transport mode—road, sea, air, or rail.

Cargo damage refers to physical harm, deterioration, or contamination of goods during transport, storage, or handling.

A carrier is a transportation company licensed to move goods in bulk volumes via scheduled routes and regular services.

Carrier liability is the legal responsibility and financial obligation a carrier assumes for cargo damage, loss, theft, or delay during transport.

A certificate of origin is an official document certifying the country where goods were manufactured or produced.

CFR (Cost and Freight) is an Incoterm defining the seller’s obligations in international sea freight sales.

A charter vehicle is a vehicle hired exclusively for one shipper's cargo rather than sharing capacity with other shippers on a scheduled route.

CIF (Cost, Insurance and Freight) is an Incoterm defining the seller’s obligations in international sea freight sales.

CIP (Carriage and Insurance Paid To) is an Incoterm defining the seller’s obligations in international sales for any transport mode.

A claim is a formal request for compensation filed by a shipper against a carrier or insurer for cargo loss, damage, theft, or delay during transport.

CMR (Convention on the Contract for the International Carriage of Goods by Road) is an international legal framework governing road freight transport across borders.

A commercial invoice is the primary financial and trade document issued by a seller to a buyer for an international sale of goods.

A company card (or fleet card) is a payment card issued to logistics companies and drivers for purchasing fuel, tolls, parking, and other transport-related expenses during commercial operations.

A consignee is the person or company that receives goods at the final destination of a shipment.

A consignor is the person or company that ships goods and initiates a transport arrangement.

Consolidation is the process of combining smaller shipments from multiple shippers into a single large shipment for transport to the same or nearby destinations.

A container is a standardized metal box designed to hold cargo for transport via sea, rail, road, or multimodal combinations.

Containerization is the process of packing goods into standardized containers for transport via sea, rail, road, or multimodal combinations.

Contract rates are negotiated shipping prices offered by carriers to shippers committing to regular, high-volume business over a specified period (typically 6-12 months).

Country of origin is the country where goods were manufactured, produced, or substantially transformed.

A courier is an express delivery service specializing in fast, time-critical transport of individual packages and parcels.

Coverage refers to insurance protection that shields shippers and carriers from financial loss due to cargo damage, loss, theft, or liability claims during transport.

CPT (Carriage Paid To) is an Incoterm defining the seller’s obligations in international sales for any transport mode.

A cross-border consolidation point is a facility near an international border where goods from multiple shippers are received, sorted, and consolidated into outbound shipments to another country.

Cross-border logistics refers to the transport and movement of goods across international borders between countries.

Cross-docking is a warehouse operation where goods are received, sorted, and transferred directly from inbound to outbound vehicles with minimal or no storage time.

A customs broker is a licensed professional or company authorized to represent importers and exporters in customs clearance procedures.

Customs clearance is the process of obtaining official authorization from customs authorities to move imported or exported goods across international borders.

Customs duties are taxes imposed by governments on imported or exported goods, calculated based on the product’s tariff classification, declared value, and country of origin.

A cut-off time is the deadline by which a shipment must be received at a carrier’s facility to be included in a specific departure or delivery service level.