A - Z of Shipping Terms Air, Sea, Rail and Road Freight | WTA

Are you new lớn the shipping and freight industry? Not sure about the terminology that you hear from those in the sector? We can help.

We have gathered the most popular abbreviations and terms used in freight and logistics all over the world. On this page, each term has been given an explanation so sánh you will be speaking the industry language in no time.

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3rd Party Logistics (3PL)

3PL service is where a business outsources the management of it's transportation and logistics, but still has eyes over its whole supply chain. As part of 3PL, extra services are included where necessary, such as warehousing, terminal operations and customs brokerage.

4th Party Logistics (4PL)

4PL is one step up from 3PL. It includes everything involved in 3PL, but in this example the business is outsourcing the organisation, planning and management of the entire supply chain.

Actual Time of Arrival (ATA)

This is the confirmed arrival date at the destination shipping point. It's essential lớn be aware this usually is referring lớn the Port of Discharge rather than vãn the final delivery point.

Actual Time of Departure (ATD)

The confirmed departure date from the original shipping point. This information becomes available once receiving the Bill of Lading from the carrier.

AEO Accreditation

Organisations accredited by the Authorised Economic Operator scheme have demonstrated that their role in the international supply chain is highly compliant with regulation and secure.

All Risks Insurance

All Risks insurance is the most comprehensive khuông of insurance for the transportation of goods. While it does not cover every type of risk, it does apply lớn damage or loss of goods caused by accident.

ATA Carnet

The ATA Carnet is a document used for the duty and tax-free import of goods that stems from the International Convention. It acts as a passport for your goods, which is valid in countries that have signed the agreement (87 in total, including the US, UK, Trung Quốc and all EU countries).

Bill of Lading (B/L or BOL)

The Bill of Lading is the official shipping document containing details about the shipment. This document shows ownership of the goods. It’s ‘release’ lớn the recipient of the products. It can be held until final payment for the goods has been made. Without an original paper B/L or an electronic release, the goods cannot be delivered.

Bonded Goods (B/G)

Bonded goods are dutiable landed imports stored under the supervision of customs authorities in bonded warehouses. Bonded goods are usually released for re-export or lớn the importer upon assessment and payment of elements such as import duties, taxes, and other charges.

Bonded Warehouses

A bonded warehouse is a secure location, usually a building, where goods with duty lớn be paid may be stored before that payment has been made.

Bunker Adjustment Factor (BAF)

The shipping company calculates this factor, also known as the bunker surcharge, based on fluctuating oil prices so sánh that the possible financial losses in fuel costs can be offset.

Buyers Consolidation (BCN)

Buyers Consolidation is when several suppliers loads are being consolidated for a single customer. This is usually done lớn fill a container when a single supplier doesn't have sufficient stock.

Carrier

A company which transports goods across sea, air or land.

Carrier Owned Container (COC)

This is a term used when a carrier owns their own shipping container compared with a Shipper Owned Container (SOC).

Certificate of Origin 

The Certificate of Origin certifies the country where the goods originated. It’s usually issued by the relevant Government Department, Chamber of Commerce or Embassy of the exporting country. These are not always needed but can be used lớn lower import duties from certain countries.

CFS Charge

CFS Charge is usually incurred at the delivery or receiving point of the ship's cargo at the destination port. The size of the fee is dependant on the size of the container.

Commercial Invoice

The Commercial Invoice contains the buyer and seller’s details in addition lớn the type of goods, quantity, price of each product and terms of sale. The commercial invoice is used lớn declare the goods lớn customs, therefore, dictating the number of duties and taxes lớn be paid.

Consignee

The person or company who is receiving the shipment. To whom it is consigned. If you’re importing goods, it’s you or your company. The shipper sends the goods lớn the consignee.

Consolidator

In logistics, a consolidator is a company which focuses on combining shipping loads which aren't big enough lớn fill a single container. This means that the shippers get reduced costs because they aren't having lớn pay for an entire container by themselves.

Container

A standardised metal box usually 20ft or 40ft in length that can be relatively easily interchanged between trucks, ships and trains. Containers are the most common way your goods will be shipped. 

Container Freight Station (CFS)

A Container Freight Station is a place for packing and unpacking Less than vãn Container Load (LCL) consignments (normally at or by a port).

Container Yard (CY)

A Container Yard is a collection and distribution point for Full Container Load (FCL) consignments.

Cost & Freight (C&F or CFR) and Cost, Insurance Freight (CIF)

Cost and freight or cost, insurance and freight. This is a term of trading where the buyer of the goods pays an amount that covers the cost of the goods plus the cost of transporting the goods lớn the port of discharge. CIF also includes marine insurance.

Cubic Metre - CBM (M3)

Volume is usually calculated in cubic metres (although cubic feet is sometimes used). 100cm x 100cm x 100cm equals one cubic metre.

Currency Adjustment Factor (CAF)

The Currency Adjustment Factor is a percentage surcharge for liner shipping. This surcharge is designed lớn offset possible financial losses for the carrier due lớn the fluctuating exchange rate between currencies.

Customs Clearance

Customs Clearance refers lớn the process of clearing shipments by the customs authorities. It is usually a service that the freight forwarder or customs agent carries out.

Delivered At Place (DAP)

Delivered Duty Unpaid means the seller is responsible for ensuring the goods arrive at the destination, but the responsibility of paying import duties is with the consignee.

Deferment

Deferment is when a ngân hàng trương mục is held with customs lớn pay duty and VAT. If you don’t have your own Deferment trương mục (often the case), then you can use your import agent/customs broker’s trương mục although they often charge for this.

Delivered Duty Paid (DDP)

Delivered Duty Paid is an agreement which means the seller is not only responsible for getting the goods lớn the agreed delivery point, but also paying all costs, such as duties and taxes.

Delivered Duty Unpaid (DDU)

Delivered Duty Unpaid is the old acronym for Delivered At Place (DAP) and is no longer widely used.

Delivery Authorisation Document (DAD)

The Delivery Authorization Document authorises the delivery of goods lớn be picked up by designated parties. You must present this document before collection.

Delivery Order (D/O)

A delivery order is a document from a consignee or an owner of a freight carrier that orders the release of cargo transportation lớn another các buổi party.

Demurrage

Charges raised by the carrier for detaining a freight vehicle or container beyond the stipulated time. This arises when shipping full containers and they are held too long at the port or at the delivery point when longer than vãn the 3 hours allotted time is taken lớn unload the container.

Drop Shipping

Economic Operator Registration and Identification (EORI)

An EORI number lets customs keep a record of what’s being imported and exported. This is required in order lớn import goods into the UK. Once you have an EORI number, you can use it on your future imports too.

Entry Summary Declaration (ENS)

An Entry Summary Declaration is provided by the shipper or the importer and is used for electronically submitting information related lớn the cargo before arrival lớn the entry customs office, such as statement goods and transport vehicle.

Estimated Time of Arrival (ETA)

Generally used for the date that the ship or plane is due lớn arrive at its destination port.

Estimated Time of Departure (ETD)

Generally used for the date that the ship or plane is due lớn leave its port of origin and begin its journey.

Ex Works (EXW)

A term of sale where the buyer is responsible for collecting the goods at the premises of the seller and accepts all costs and liabilities from that point onwards. 

Freight All Kinds (FAK)

Freight All Kinds typically refers lớn a full container loaded with mixed cargo.

Forwarder's Cargo Receipt (FCR)

An FRC is a document issued by the freight forwarder or their agent lớn the shipper of the cargo. This document is issued when the shipment has been handed over lớn the freight forwarder.

It serves exclusively as confirmation that the cargo has been received and the consignee now takes full responsibility for the shipment.

Free on Board (FOB)

Free on Board is a term of sale where the seller is responsible for all charges and liabilities of transporting the goods all the way up lớn their arrival onboard the ship. It includes all charges at the port of loading.

Freight Forwarders

Freight Forwarders are companies that take care of the shipping. An important note is that in England, a distinction is made between freight forwarders (carriers), carriers and shippers (transport companies). Shippers include goods; carriers include transport. Freight forwarders conclude contracts with the shippers and ensure that the goods are moved from one place lớn another – from the first step lớn the last.

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Full Container Load (FCL)

If you have enough goods lớn fill either a 20ft, 40ft or 40ftHC container, then your goods would be shipped as a Full Container Load.

Garment on Hanger (GOH)

Gross Weight

Gross Weight is the weight of the delivery, including packaging.

High Cube (HC or HQ)

Any container which exceeds 8ft 6in (102 inches) in height. Usually, these containers are 9ft 6in.

House Airway Bill (HAWB)

The House Airway Bill is similar lớn a Bill of Lading; however, it does not confer title in goods. This means a HAWB does not have the same legal standing as a Bill of Lading.

A freight forwarder or consolidator issues the bill.

House Bill of Lading (HBL)

A freight forwarder or consolidator issues a House Bill of Lading (HBL). A HBL covers a single shipment containing the names, addresses and specific descriptions of the goods shipped.

Import Entry Acceptance Advice (E2 Form)

Import Entry Acceptance Advice khuông shows when an import entry has been successfully committed. The E2 khuông includes critical information such as:
· Customs entry number
· Clearance date and time
· Consignee
· Summary of freight
· Insurance and VAT charges
· Breakdown of each item
· Customs value
· Item price

Incoterms

Incoterms are a standardised mix of rules that define the rights and liabilities of both buyer and seller in an international transaction. Incoterms are prepared by the International Chamber of Commerce and include FOB, EXW, CIF, DDU etc.

International Operating Procedure (IOP)

The International Operating Procedure is a mix of step by step instructions adopted by an organisation lớn assist workers when conducting complex routine operations.

International Standard Organisations (ISO)

The ISO is an international standard-setting toàn thân composed of representatives from various national standards organisations.

Kerbside Delivery

Standard delivery for shipments is kerbside unless otherwise requested. In this case, the driver will park the truck outside your premises; then it is your responsibility lớn unload your goods. If you don’t have a forklift and delivery is kerbside, you may need a few extra hands lớn help you out.

Letter of Credit (L/C)

A letter of credit is a contract in which the terms of documentary credit transactions are established.

Letter of Indemnity (LOI)

A letter of indemnity, or LOI, is a contractual document between two parties. This contract guarantees specific provisions will be met depending on the contract.

Lift On/Lift Off (LO/LO)

Lift On/Lift Off refers lớn a charge for lifting a container on and off a train or other vessel.

Less than vãn Container Load (LCL)

Less than vãn Container Load. If you don’t have enough goods lớn fill a 20ft container, then your goods would be shipped as a part load or LCL. In this instance, your goods will be loaded into a shared container with goods from other companies.

Marine Insurance

Marine Insurance covers for loss or damage of goods whilst they are being transported by carriers by sea or land.

Minimum Order Quantity (MOQ)

Minimum order quantity is the smallest amount of a product that the company will supply. If a buyer cannot meet the MOQ Requirement, their supplier won’t enter production. This is quite commonly used on Alibaba.

Notice of Arrival (NOA)

The carrier or agent sends a notice of arrival lớn inform the consignee of the following:

· Arrival of a shipment
· Number of packages
· Description of goods
· Shipment weight
· Collection charges

A notice of arrival is also sometimes known as an arrival notice.

Notify Party

The person or company that needs lớn be notified about the progress of the shipment. This is stipulated on the Bill of Lading.

Origin Terminal Handling (OTHC)

Origin Terminal Handling are charges made by the terminal operator regarding container movements, for example:

· Before departure
· From the seller's vehicle lớn the stack
· Departing conveyance
· At the destination
· From the arriving conveyance lớn the stack
· To the buyer's vehicle

Overweight Surcharge (OWS)

An Overweight Surcharge is a fee charged by shipping lines when a given container exceeds the designated acceptable weight range for its size.

Packing List

A list provided by the shipper detailing what goods are within the shipment and information on how they are packed. Number of items, weight and dimensions of the shipment are included. 

Pallet Exchange

When a truck driver picks up a delivery of goods, they will often have lớn bring pallets lớn exchange the goods so sánh that the pallets can be strapped lớn the carrier pallet. If no pallets are brought, there is usually a fee for the pallet exchange.

Peak Season Surcharge (PSS)

Peak Season Surcharge is an additional temporary fee required during a high season. This is due lớn how space on the ship can become scarce during these times. The shipping high season is usually the period between August and October.

Port of Discharge (POD)

The port at which the goods are unloaded from the vessel.

Port of Loading (POL)

The port where the goods are loaded onto the vessel.

Purchase Order (PO)

A purchase order is a commercial document and the first official offer issued lớn a seller. The PO indicates everything, such as types, quantities and agreed prices or services. It is also often used lớn control the purchasing of products and services from external suppliers.

Sea Waybill (SWB)

A Sea Waybill is a transport contract in the same as a Bill of Landing. However, a Sea Waybill is not needed for cargo delivery and is only issued as a cargo receipt. It can be provided in hard copy format or digital format.

Shipper

The shipper is the sender of the goods. If you are importing goods from an overseas supplier, then your supplier is the shipper. The shipper sends the goods lớn the consignee.

Shipper Owned Container (SOC)

This is a term used when a shipper owns their own shipping container compared with a Carrier Owned Container (COC).

Shipping Instructions (SI)

Shipping Instructions confirm that space has been allocated on a vessel for a shipment.

Shipping Line

A shipping line is a company that directly or indirectly transports cargo via ocean freight.

Shipping Marks and Numbers

Shipping marks are placed on packages for identification purposes. They can be the size and weight of the carton, the recipient, the number of the carton (e.g. 1 of 6 etc.) and sometimes shape. These marks are essential lớn differentiate the boxes belonging lớn each mix of goods within a shared container.

Stock Keeping Unit (SKU)

A stock-keeping unit, or SKU, is a common khuông of inventory management. An SKU is a distinct type of item for sale, such as a product or service. Also, it includes all attributes associated with the item type that distinguish it from other item types.

Supply Chain Management (SCM)

Supply Chain Management, involves managing the flows of goods, data, and finances related lớn a product or service. The SCM usually occurs from procuring raw materials lớn delivering the product lớn its final destination.

Tail-lift

If your goods are heavy and you don’t have a forklift, then a tail lift might be needed. 

Tariff Code

Every product has a corresponding code that’s used when goods are cleared through UK customs. This code shows the percentage of duty that’s paid on that product and can be found at www.gov.uk/trade-tariff.

Telex Release

Telex release and Express release are terms that refer lớn the electronic handover of the Bill of Lading. Traditionally the original B/L is posted by the shipper lớn the consignee, and in turn, it must be forwarded on before the goods can be released. Telex release is instant, so sánh it has become the favoured option.

Terminal Handling Charge (THC)

Terminal Handling Charge is the cost for the handling of the goods/container at a port. The THC for FCL shipments is for moving the container itself and for LCL it’s for the packing or unpacking of the goods so sánh is billed in w/m.

Transit Time

Transit time is the amount of time that either the ship or plane is travelling for between the Port of Loading and the Port of Discharge. Not lớn be misconstrued as the total amount of time it takes lớn move the goods from door lớn door.

Twenty-Foot Equivalent Unit (TEU)

Twenty-Foot (20′) Equivalent Unit is commonly used when talking about FCL rate increases or representing the number of containers in a particular situation. A 20ft container is one TEU, and a 40ft container is two TEUs (the equivalent size of 2 x 20ft containers).

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Weight Per Measure (W/M)

Weight per measure means that the cost will depend on whether the volume or the weight of the shipment is greater when calculating which will be the deciding factor 1.0cbm = 1000kg.

Verified Gross Mass (VGM)

Verified Gross Mass, this is required by shippers lớn confirm the weight of containers before they are loaded. This was started by SOLAS lớn avoid damages lớn vessels and health concerns lớn ship crew.