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Logistic Glossary – Letter CC & FSee Cost and FreightCab ExtendersAlso called gap seals, which help to close the gap between the tractor and the trailerCabotageA federal law that requires coastal and inter-coastal traffic to be carried in U.S.-built and registered ships.Calendar DaysThe conversion of working days to calendar days is based on the number of regularly scheduled workdays per week in your manufacturing calendar. Calculation To convert from working days to calendar days if work week = 4 days, multiply by 1.75; = 5 days, multiply by 1.4; = 6 days, multiply by 1.17Call CenterA facility housing personnel who respond to customer phone queries. These personnel may provide customer service or technical support. Call center services may be in house or outsourced. Synonym Customer Interaction Center.Can-Order PointAn ordering system used when multiple items are ordered from one vendor. The can-order point is a point higher than the original order point. When any one of the items triggers an order by reaching the must-order point, all items below their can-order point are also ordered. The can-order point is set by considering is set by considering the additional holding cost that would be incurred if the item were ordered early.Capacity ManagementThe concept that capacity should be understood, defined, and measured for each level in the organization to include market segments, products, processes, activities, and resources. In each of these applications, capacity is defined in a hierarchy of idle, non-productive, and productive views.Capacity PlanningAssuring that needed resources (e.g., manufacturing capacity, distribution center capacity, transportation vehicles, etc.) will be available at the right time and place to meet logistics and supply chain needs.CapacityThe physical facilities, personnel, and processes available to meet the product or service needs of customers. Capacity generally refers to the maximum output or producing ability of a machine, a person, a process, a factory, a product, or a service. Also see Capacity ManagementCAPEXA term used to describe the monetary requirements (CAPital EXpenditure) of an initial investment in new machines or equipment.CapitalThe resources, or money, available for investing in assets that produce output.CAPSTANComputer-Aided Planned Stowage and Networking system.CARATCargo Agents Reservation Air Waybill Issuance and Tracking.CargoMerchandise carried by a means of transportation.Carmack AmendmentAn Interstate Commerce Act amendment that delineates the liability of common carriers and the bill of lading provisions.CarnetA Customs document permitting the holder to carry or send special categories of goods temporarily into certain foreign countries without paying duties or posting bonds.CarouselA rotating system of layers of bins and/or drawers that can store many small items using relatively little floor space.CarriageSee Transportation.Carrier AssetsItems that a carrier owns (technically or outright) to facilitate the services they provide.Carrier Certificate and Release OrderUsed to advise customs of the shipment's details. By means of this document, the carrier certifies that the firm or individual named in the certificate is the owner or consignee of the cargo.Carrier LiabilityA common carrier is liable for all shipment loss, damage, and delay with the exception of that caused by act of God, act of a public enemy, act of a public authority, act of the shipper, and the goods' inherent nature.CarrierA firm that transports goods or people via land, sea, or air.CartageThere are two definitions for this term 1) charge for pick-up and delivery of goods 2) movement of goods locally (short distances).CartelA group of companies that agree to cooperate rather than compete, in producing a product or service. Thus limiting or regulating competition.Carton Flow RackA storage rack consisting of multiple lines of gravity flow conveyors.Cash Against Documents (CAD)A method of payment for goods in which documents transferring title are given to the buyer upon payment of cash to an intermediary acting for the seller.Cash Conversion Cycle1) In retailing, the length of time between the sale of products and the cash payments for a company's resources. 2) In manufacturing, the length of time from the purchase of raw materials to the collection of accounts receivable from customers for the sale of products or services. Also see Cash-to-Cash Cycle Time.Cash In Advance (CIA)A method of payment for goods whereby the buyer pays the seller in advance of shipment of goods.Cash with Order (CWO)A method of payment for goods where cash is paid at the time of order, and the transaction becomes binding on both buyer and seller.Cash-to-Cash Cycle TimeThe time it takes for cash to flow back into a company after it has been spent for raw materials. Synonym Cash Conversion Cycle. Calculation Total Inventory Days of Supply + Days of Sales Outstanding - Average Payment Period for Material in Days.Catalog ChannelA call center or order processing facility that receives orders directly from the customer based on defined catalog offerings, and ships directly to the customer.Cause-and-Effect DiagramIn quality management, a structured process used to organize ideas into logical groupings. Used in brainstorming and problem-solving exercises. Also known as Ishikawa or fish bone diagram.CELLA manufacturing or service unit consisting of a number of workstations, and the materials transport mechanisms and storage buffers that interconnect them.Center-of-Gravity ApproachA supply chain planning methodology for locating distribution centers at approximately the location representing the minimum transportation costs between the plants, the distribution centers, and the markets.Central DispatchingThe organization of the dispatching function into one central location. This structure often involves the use of data collection devices for communication between the centralized dispatching function which usually reports to the production control department and the shop manufacturing departments.Centralized AuthorityThe restriction of authority to make decisions to few managers.Centralized Inventory ControlInventory decision-making (for all SKUs) exercised from one office or department for an entire company.Certificate of ComplianceA supplier's certification that the supplies or services in question meet specified requirements.Certificate of InsuranceA negotiable document indicating that insurance has been secured under an open policy to cover loss or damage to a shipment while in transit.Certificate of OriginA document containing an affidavit to prove the origin of imported goods. Used for customs and foreign exchange purposes.Certificate of Public Convenience and NecessityThe grant of operating authority that common carriers receive. A carrier must prove that a public need exists and that the carrier is fit, willing, and able to provide the needed service. The certificate may specify the commodities the carrier may haul, and the routes it may use.Certificated CarrierA for-hire air carrier that is subject to economic regulation and requires an operating certification to provide service.Certified SupplierA status awarded to a supplier who consistently meets predetermined quality, cost, delivery, financial, and count objectives. Incoming inspection may not be required.Channel ConflictThis occurs when various sales channels within a company's supply chain compete with each other for the same business. An example is where a retail channel is in competition with a web-based channel set up by the company.Channel PartnersMembers of a supply chain (i.e., suppliers, manufacturers, distributors, retailers, etc.) who work in conjunction with one another to manufacture, distribute, and sell a specific product.Channels of DistributionAny series of firms or individuals that participates in the flow of goods and services from the raw material supplier and producer to the final user or consumer. Also see Distribution Channel.Chargeable WeightThe shipment weight used in determining freight charges. The chargeable weight may be the dimensional weight or, for container shipments, the gross weight of the shipment less the tare weight of the container.Charging AreaA warehouse area where a company maintains battery chargers and extra batteries to support a fleet of electrically powered materials handling equipment. The company must maintain this area in accordance with government safety regulations.CIF*See Cost, Insurance, Freight (CIF)City DriverA motor carrier driver who drives a local route as opposed to a long-distance, intercity route.Civil Aeronautics BoardA federal regulatory agency that implemented economic regulatory controls over air carriers.CLCarload rail service requiring shipper to meet minimum weight.ClaimA charge made against a carrier for loss, damage, delay, or overcharge.Classification yardA railroad terminal area where railcars are grouped together to form train units.ClassificationAn alphabetical listing of commodities, the class or rating into which the commodity is placed, and the minimum weight necessary for the rate discount; used in the class rate structure.ClearanceA document stating that a shipment is free to be imported into the country after all legal requirements have been met.ClearinghouseA conventional or limited-purpose entity generally restricted to providing specialized services, such as clearing funds or settling accounts.CLMCouncil of Logistics Management, now known as The Council of Supply Chain Management Professionals.CMISee Co-Managed InventoryCOCarbon monoxideCO2Carbon dioxideCoastal CarriersWater carriers that provide service along coasts serving ports on the Atlantic or Pacific Oceans or on the Gulf of Mexico.CodeA numeric, or alphanumeric representation of text for exchanging commonly-used information. For example commodity codes, carrier codes.Co-DestinyThe evolution of a supply chain from intra-organizational management to inter-organizational management.CodifyingThe process of detailing a new standard.COFCSee Container on Flat CarCOGSSee Cost-of-Goods Sold (COGS).Collect FreightFreight payable to the carrier at the port of discharge or ultimate destination. The consignee does not pay the freight charge if the cargo does not arrive at the destination.Collective PaperAll documents (commercial invoices, bills of lading, etc.) submitted to a buyer for the purpose of receiving payment for a shipment.Co-Managed Inventory (CMI)A form of continuous replenishment in which the manufacturer is responsible for replenishment of standard merchandise, while the retailer manages the replenishment of promotional merchandise.Commercial InvoiceA document created by the seller. It is an official document which is used to indicate, among other things, the name and address of the buyer and seller, the product(s) being shipped, and their value for customs, insurance, or other purposes.Commercial zoneThe area surrounding a city or town to which rate carriers quote for the city or town also apply; the ICC defines the area.Committed CapabilityThe portion of the production capability that is currently in use, or is scheduled for use.Committee of American Steamship LinesAn industry association representing subsidized U.S. flag steamship firms.Commodities ClauseA clause that prohibits railroads from hauling commodities that they produced, mined, owned, or had an interest in.CommoditiesAny article exchanged in trade, most commonly used to refer to raw materials and agricultural products.Commodity BuyingGrouping like parts or materials under one buyer's control for the procurement of all requirements to support production.Commodity CodeA code describing a commodity or a group of commodities pertaining to goods classification. This code can be carrier tariff or regulating in nature.Commodity Procurement StrategyThe purchasing plan for a family of items. This would include the plan to manage the supplier base and solve problems.Commodity RateA rate for a specific commodity and its origin-destination.Common Carrier DutiesCommon carriers must serve, deliver, charge reasonable rates, and not discriminate.Common CarrierTransportation available to the public that does not provide special treatment to any one party and is regulated as to the rates charged, the liability assumed, and the service provided. A common carrier must obtain a certificate of public convenience and necessity from the Federal Trade Commission for interstate traffic. Antonym Private Carrier.Common CostA cost that a company cannot directly assign to particular segments of the business; a cost that the company incurs for the business as a whole.CommuterAn exempt for-hire air carrier that publishes a time schedule on specific routes; a special type of air taxi.Company CultureA system of values, beliefs, and behaviors inherent in a company. To optimize business performance, top management must define and create the necessary culture.Comparative AdvantageA principle based on the assumption that an area will specialize in producing goods for which it has the greatest advantage or the least comparative disadvantage.Competitive AdvantageValue created by a company for its customers that clearly distinguishes it from the competition, provides its customers a reason to remain loyal.Competitive BenchmarkingBenchmarking a product or service against competitors. Also see Benchmarking.Competitive BidA price/service offering by a supplier that must compete with offerings from other suppliers.Complete and On-Time Delivery (COTD)A measure of customer service. All items on any given order must be delivered on time for the order to be considered as complete and on time.Complete Manufacture to Ship TimeAverage time from when a unit is declared shippable by manufacturing until the unit actually ships to a customer.ComplianceMeaning that products, services, processes, and/or documents comply with requirements.ComponentMaterial that will contribute to a finished product but is not the finished product itself. Examples include tires for an automobile, power supply for a personal computer, or a zipper for a ski parka.Computer-Aided Engineering (CAE)The use of computers to model design options to stimulate their performance.Computer-Based TrainingTraining that is delivered via computer workstation and includes all training and testing materials.Conference CarrierAn ocean carrier who is a member of an association known as a "conference." The purpose of the conference is to standardize shipping practices, eliminate freight rate competition, and provide regularly scheduled service between specific ports.ConferenceA group of vessel operators joined for the purpose of establishing freight rates.ConfigurationThe arrangement of components as specified to produce an assembly.ConfirmationWith regards to EDI, a formal notice (by message or code) from a electronic mailbox system or EDI server indicating that a message sent to a trading partner has reached its intended mailbox or has been retrieved by the addressee.Confirming OrderA purchase order issued to a supplier listing the goods or services and terms of an order placed orally or otherwise before the usual purchase document.ConformanceAn affirmative indication or judgment that a product or service has met the requirements of a relevant specification, contract, or regulation. Synonym Compliance.ConrailThe Consolidated Rail Corporation established by the Regional Reorganization Act of 1973 to operate the bankrupt Penn Central Railroad and other bankrupt railroads in the Northeast; the 4-R Act of 1976 provided funding.ConsigneeThe party to whom goods are shipped and delivered. The receiver of a freight shipment.Consignment Inventory(1) Goods or products that are paid for when they are sold by the reseller, not at the time they are shipped to the reseller. (2) Goods or products which are owned by the vendor until they are sold to the consumer.ConsignmentA shipment that is handled by a common carrier. (2) The process of a supplier placing goods at a customer location without receiving payment until after the goods are used or sold. Also see Consignment Inventory.ConsignorThe party who originates a shipment of goods (shipper). The sender of a freight shipment, usually the seller.Consolidation PointThe location where consolidation takes place.ConsolidationCombining two or more shipments in order to realize lower transportation rates. Inbound consolidation from vendors is called make-bulk consolidation; outbound consolidation to customers is called break-bulk consolidation.ConsolidatorAn enterprise that provides services to group shipments, orders, and/or goods to facilitate movement.Consolidator's Bill of LadingA bill of lading issued by a consolidator as a receipt for merchandise that will be grouped with cargo obtained from other shippers. See also House Air Waybill.ConsortiumA group of companies that works together to jointly produce a product, service, or project.ConstraintA bottleneck, obstacle, or planned control that limits throughput or the utilization of capacity.Container ChassisA vehicle built for the purpose of transporting a container so that, when a container and chassis are assembled, the produced unit serves as a road trailer.Container DepotThe storage area for empty containers.Container Freight Station (CFS)The location designated by carriers for receipt of cargo to be packed into containers/equipment by the carrier. At destination, CFS is the location designated by the carrier for unpacking of cargo from equipment/containers.Container Freight Station ChargeThe charge assessed for services performed at the loading or discharge location.Container Freight Station to Container Freight Station (CFS/CFS)A type of steamship-line service in which cargo is transported between container freight stations, where containers may be stuffed, stripped, or consolidated. Usually used for less-than-container load shipments.Container I.D.An identifier assigned to a container by a carrier. See also Equipment ID.Container on Flat Car (COFC)A container that is transported on a rail flatcar. It can be shipped via tractor/trailer using a chassis as the wheel section.Container TerminalAn area designated to be used for the stowage of cargo in containers that may be accessed by truck, rail, or ocean transportation.Container VesselA vessel specifically designed for the carriage of containers.Container Yard to Container Yard (CY/CY)A type of steamship-line service in which freight is transported from origin container yard to destination container yard.Container YardThe location designated by the carrier for receiving, assembling, holding, storing, and delivering containers, and where containers may be picked up by shippers or redelivered by consignees.Container(1) A box, typically 10 to 40 feet long, which is primarily used for ocean freight shipments. For travel to and from ports, containers are loaded onto truck chassis or on railroad flatcars. (2) The packaging, such as a carton, case, box, bucket, drum, bin, bottle, bundle, or bag, that an item is packed and shipped in.ContainerizationA shipment method in which commodities are placed in containers, and after initial loading, the commodities, per se, are not rehandled in shipment until they are unloaded at the destination.Contingency PlanningPreparing to deal with calamities (e.g., floods) and noncalamitous situations (e.g., strikes) before they occur.Continuous Flow Distribution (CFD)The streamlined pull of products in response to customer requirements while minimizing the total costs of distribution.Continuous Improvement (CI)A structured, measurement-driven process that continually reviews and improves performance.Continuous Process Improvement (CPI)A never-ending effort to expose and eliminate root causes of problems; small-step improvement as opposed to big-step improvement. Synonym Continuous Improvement. Also see Kaizen.Continuous Replenishment Planning (CRP)A program that triggers the manufacturing and movement of product through the supply chain when the identical product is purchased by an end user.Continuous-Flow, Fixed-Path EquipmentMaterials handling devices that include conveyors and drag lines.Contract AdministrationManaging all aspects of a contract to guarantee that the contractor fulfills his obligations.Contract CarrierA for-hire carrier that does not serve the general public but serves shippers with whom the carrier has a continuing contract. The contract carrier must secure a permit to operate.Contract of AffreightmentA contract between a cargo shipper and carrier for the transport of multiple cargoes over a period of time. Contracts are individually negotiated and usually include cargo description, quantities per shipment and in total, load and discharge ports, freight rates and duration of the contract.ContractAn agreement between two or more competent persons or companies to perform or not to perform specific acts or services or to deliver merchandise. A contract may be oral or written. A purchase order, when accepted by a supplier, becomes a contract. Acceptance may be in writing or by performance, unless the purchase order requires acceptance in writing.Contribution MarginAn amount equal to the difference between sales revenue and variable costs.ContributionThe difference between sales price and various costs. Contribution is used to cover fixed costs and profits.Controlled AccessReferring to an area within a warehouse or yard that is fenced and gated. These areas are typically used to store high-value items and may be monitored by security cameras.ConveyanceThe application used to describe the function of a vehicle of transfer.ConveyorA materials handling device that moves freight from one warehouse area to another. Roller conveyors utilize gravity, whereas belt conveyors use motors.Cooperative AssociationsGroups of firms or individuals having common interests; agricultural cooperative associations may haul up to 25 percent of their total interstate non-farm, nonmember goods tonnage in movements incidental and necessary to their primary business.Coordinated TransportationTwo or more carriers of different modes transporting a shipment.Co-PackerA contract co-packer produces goods and/or services for other companies, usually under the other company's label or name. Co-packers are more frequently seen in consumer packaged goods and foods.CORBACommon Object Request Broker Architecture.Cost AccountingThe branch of accounting that is concerned with recording and reporting business operating costs. It includes the reporting of costs by departments, activities, and products.Cost AllocationIn accounting, the assignment of costs that cannot be directly related to production activities via more measurable means, e.g., assigning corporate expenses to different products via direct labor costs or hours.Cost and Freight (C & F)The seller quotes a price that includes the cost of transportation to a specific point. The buyer assumes responsibility for loss and damage and pays for the insurance of the shipment.Cost CenterIn accounting, a sub-unit in an organization that is responsible for costs.Cost Driver AnalysisIn cost accounting, the examination, quantification, and explanation of the effects of cost drivers. The results are often used for continuous improvement programs to reduce throughput times, improve quality, and reduce cost.Cost DriverIn accounting, any situation or event that causes a change in the consumption of a resource, or influences quality or cycle time. An activity may have multiple cost drivers. Cost drivers do not necessarily need to be quantified; however, they strongly influence the selection and magnitude of resource drivers and activity drivers.Cost ElementIn cost accounting, the lowest level component of a resource activity, or cost object.Cost ManagementThe management and control of activities and drivers to calculate accurate product and service costs, improve business processes, eliminate waste, influence cost drivers, and plan operations. The resulting information can be very useful in setting and evaluating an organization's strategies.Cost of CapitalThe cost to borrow or invest capital.Cost of Lost SalesThe forgone profit companies associate with a stockout.Cost Trade-OffThe interrelationship among system variables in which a change in one variable affects other variables' costs. A cost reduction in one variable may increase costs for other variables, and vice versa.Cost VarianceIn cost accounting the difference between what has been budgeted for an activity and what it actually costs.Cost, Insurance, FreightA freight term indicating that the seller is responsible for cost, the marine insurance, and the freight charges on an ocean shipment of goods.Cost-of-Goods Sold (COGS)The amount of direct materials, direct labor, and allocated overhead associated with products sold during a given period of time, determined in accordance with Generally Accepted Accounting Principles (GAAP).COTDSee Complete and On-Time Delivery (COTD).CountertradeA reciprocal trading agreement that includes a variety of transactions involving two or more parties.Countervailing DutiesAn additional import duty imposed to offset Government subsidies in the exporting country, when the subsidized imports cause material injury to domestic industry in the importing country.Country of DestinationThe country that will be the ultimate or final destination for goods.Country of OriginThe country where the goods were manufactured.Courier ServiceA fast, door-to-door service for high-valued goods and documents; firms usually limit service to shipments weighing fifty pounds or less.CPFRSee Collaborative Planning, Forecasting and Replenishment (CPFR).CPISee Continuous Process Improvement (CPI).CraneA materials handling device that lifts heavy items. There are two types bridge and stacker.Credit LevelThe amount of purchasing credit a customer has available. Usually defined by the internal credit department and reduced by any existing unpaid bills or open orders.Credit TermsThe agreement between two or more enterprises concerning the amount and timing of payment for goods or services.Critical DifferentiatorsThis is what makes an idea, product, service, or business model unique.Critical Success Factor (CSF)Those activities and/or processes that must be completed and/or controlled to enable a company to reach its goals.Critical Value AnalysisA modified ABC analysis in which a company assigns a subjective critical value to each item in an inventory.CRMSee Customer Relationship Management (CRM).Cross DockingA distribution system in which merchandise received at the warehouse or distribution center is not put away, but instead is readied for shipment to retail stores. Cross docking requires close synchronization of all inbound and outbound shipment movements. By eliminating the put-away, storage, and selection operations, it can significantly reduce distribution costs.Cross SellThe practice of attempting to sell additional products to a customer during a sales call. For example, when the CSR presents a camera case and accessories to a customer that is ordering a camera.Cross ShipmentMaterial flow activity where materials are shipped to customers from a secondary shipping point rather than from a preferred shipping point.CrossdockCrossdock operations in a warehouse involve moving goods between different trucks to consolidate loads without intermediate storage.CSGCommunications Support Group.CSRSee Customer Service Representative (CSR).CubageCubic volume of space being used or available for shipping or storage.Cube OutThe situation when a piece of equipment has reached its volumetric capacity before reaching the permitted weight limit.Cube UtilizationIn warehousing, a measurement of the utilization of the total storage capacity of a vehicle or warehouse.Cubic CapacityThe carrying capacity of a piece of equipment according to measurement in cubic feet.Cubic SpaceIn warehousing, a measurement of space available, or required, in transportation and warehousing.Cumulative Lead TimeThe total time required to source components, build, and ship a product.Currency Adjustment Factor (CAF)A surcharge imposed by a carrier on ocean freight charges to offset foreign currency fluctuations.Customer Acquisition or RetentionThe rate at which new customers are acquired, or existing customers are retained. A key selling point to potential marquis partners.Customer DrivenThe end user, or customer, motivates what is produced or how it is delivered.Customer FacingThose personnel whose jobs entail actual contact with the customer.Customer Interaction CenterSee Call CenterCustomer OrderAn order from a customer for a particular product or a number of products. It is often referred to as an actual demand to distinguish it from a forecasted demand.Customer ProfitabilityThe practice of placing a value on the profit generated by business done with a particular customer.Customer Relationship Management (CRM)This refers to information systems that help sales and marketing functions as opposed to the ERP (Enterprise Resource Planning), which is for back-end integration.Customer SegmentationDividing customers into groups based on specific criteria, such as products purchased, customer geographic location, etc.Customer Service Representative (CSR)An individual who provides customer support via telephone in a call-center environment.Customer ServiceThe series of activities involved in providing the full range of services to customers.Customer/Order Fulfillment ProcessA series of customers' interactions with an organization through the order-filling process, including product/service design, production and delivery, and order stats reporting.Customer1) In VMI, the trading partner or reseller, i.e., Wal-Mart, Safeway, or CVS. 2) In direct consumer, the end customer or user.CustomizationCreating a product from existing components into an individual order. Synonym Build to Order.Customs Automated Data Exchange System (CADEX)A Canada Customs system that allows for the electronic transmission of import data for goods that have already been released. Additional information such as accounting data and release notifications are also accessible.Customs BrokerA firm that represents importers/exporters in dealings with customs. Normally responsible for obtaining and submitting all documents for clearing merchandise through customs, arranging inland transport, and paying all charges related to these functions.Customs ClearanceThe act of obtaining permission to import merchandise from another country into the importing nation.Customs House BrokerA business firm that oversees the movement of international shipments through Customs, and ensures that the documentation accompanying a shipment is complete and accurate.Customs InvoiceA document that contains a declaration by the seller, the shipper, or the agent as to the value of the shipment.Customs ValueThe value of the imported goods on which duties will be assessed.CustomsThe authorities designated to collect duties levied by a country on imports and exports.Cycle TimeThe amount of time it takes to complete a business process.
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