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Freight Basics - Glossary - Terminology

Posted on 22 May 2018

Freight terminology can be confusing many of the phares we used have developed in different parts of the world at different times - you may even find the same active or document has different names just depending on whether the freight moves by road or air!

We've put together a list of some of the most commonly confusing terms here to help you out.

Air and Ocean Terminology

Cross Docking

Cross docking allows your products to arrive and then be distributed to the end user with minimal handling and storage time. We label and consolidate multiple international orders into a full container at origin, unload at a Mainfreight depot on arrival and deliver direct to your customers. This service reduces your inventory holding costs and improves delivery time and service to your customers.

 Buyer’s Consolidation

Consolidate multiple supplier orders at an international origin and deliver direct to you and your customer’s site on arrival; reducing administration time and associated costs.

Bonded Warehouse

A Customs approved facility that is used to store or manufacture goods on which payment of duties is deferred until the goods enter the Customs Territory. The goods are not subject to duties if re-shipped to foreign points

Carnet

A customs document permitting the owner of the goods to carry or send merchandise temporarily into certain foreign countries for display, demonstration or other purposes without paying import duties or posting bonds.

Chargable Weight

Freight charges are charged out on the chargeable weight of the shipment. This can either be the actual gross weight or the volumetric weight – whichever is greater. Working out the chargeable weight of a shipment is easy.

Airfreight – Take the cubic measurement of you shipment and multiply by 167
EG – Your shipment is 0.45cbm/25kgs, 0.45cbm X 167 = 75.15
The actual weight is 25kgs, the volumetric weight is 75.15kgs making the volumetric weight the chargeable weight 

Sea Freight - Ratio is 1CBM = 1 tonne

 

Commercial Invoice

A commercial invoice is a document used in foreign trade. It is used as a customs declaration provided by the person or corporation that is exporting an item across international borders

Consolidation

Collecting and packing a lot of smaller consignments from different suppliers to be moved as one shipment to one destination. Each consignment will have its own house-bill number which will then be listed under one Master House Bill. This will allow the receiver to have all shipments to be customs cleared

Demurrage

Import – The time between when the container is unloaded from the vessel to the pick up off the wharf.

Export – The time between when the loaded container is delivered to the port to the container being loaded on the vessel

The shipping lines give you a set amount of time for this to be done. Once this allotted time is up charges will apply per day thereafter

Detention

Import – The time between when the full container is taken from the port to the time is it returned empty

Export – The time between when the empty container is taken to the customer to its return to the port full

The shipping lines give you a set amount of time for this to be done. Once this allotted time is up charges will apply per day thereafter

Warehousing Terminology

Inventory Record Accuracy (IRA)

The measure of how closely official inventory records match the physical inventory.

Our team break each customer’s products into groups. Each group IRA is completed once a week to ensure that the team can identify discrepancies before stock take.
Warehouse transfers

Warehouse Transfer

Customers may request certain product moved from our MEL warehouse to our BNE warehouse.

This shortens lead time for their product when ordered by their customer.

PIFOT (Picked In Full On Time)

The measurement of product being picked in full (quantity, product, batch) on time. The KPI is met when complete order is delivered on the requested delivery date.

Pick Faces

Easily accessible locations that are set up in MIMS to stage fast-moving products making it more efficient for picking. Majority of the time, pick faces are set up for level 1 locations so that team members don’t have to bring pallets down from higher locations allowing them to pick orders faster.

Domestic Terminology

Outturn

The process of unloading the freight at the destination depot ready to be allocated to a delivery truck

Endorsement 

Special information that applies to a particular consignment

So now you've got your head around some of the terminology, try it out by talking to our team of freight experts

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