right PRODUCT

right QUANTITIES

right PLACES

right TIME

Fourth Party Logistics

Companies which provide overall managementof logistics networks and LSPs on behalf of manufacturers or retailers (e.g. haulage, warehousing, co-ordination and information services).

Automatic Storage & Retrieval Systems

A Warehousing term

Business to Business

A term used particularly in relation to e-commerce.

When a business sells to other businesses, for example, a logistics supplier (LSP) selling to a processor or supermarket. 

Business to Consumer

A term used particularly in relation to e-commerce.

Business to Government

A term used particularly in relation to e-commerce.

Business Process Re-engineering

The idea that organisations need to identify their key processes and redesign them to be as lean and efficient as possible, to improve quality, service and speed, while reducing cost. A management fad of the early 90s,  developed and popularised by James Champy and Michael Hammer.   Management consultants often introduced radical redesigns, which eliminated processes and led to down-sizing, thus discrediting this approach.

Continuous Improvement

A set of management practices/techniques for finding and eliminating waste and making general improvements in business processes, quality or costs.

Category Management

A retailer/supplier process of managing categories as strategic business units, producing enhanced business results by focusing on delivering consumer value (ECR, 2009).

Collaborative Planning

see CPFR

Certificate of Professional Competence

A UK qualification which covers all aspects of road transport. It is a necessary qualification for traffic managers (where a company has an O licence). A CPC qualification can be for either road haulage or road passenger transport, and there are national and international modules.

Collaborative Planning, Forecasting and Replenishment

A manufacturer/distributor/retailer initiative designed to improve the partnership between them through joint planning and shared information.

Customer Relationship Management

Deliberate management of all the contacts and interactions with customers and other markets/stakeholders.

Corporate Social Responsibility

A range of ethical issues that companies incorporate into their policies, including: employee welfare; human rights, the environment/sustainability; Faitrade

Distribution Centre

see RDC and NDC

Demand Chain Management

A concept which aims to integrate demand processes which create value at the customer/market interface and supply processes necessary for fulfilling demand (Jüttner et al., 2007).

Decision Making Unit

 The group of people who make purchasing decisions. Also called a buying centre.

Direct Store Delivery

"Manufacturers or distributors deliver store merchandise direct to retail outlets without going via a centralised distribution warehouse. This type of delivery is common practice across many retail markets and is widespread for bread, milk, news & magazines, home entertainment and clothing ranges" (IGD, 2010).

Direct-to-store

See Direct Store Delivery (DSD)

Efficient Consumer Response

A joint initiative by members of the supply chain to work to improve and optimise aspects of the supply chain & demand management to create benefits for the consumer e.g. lower prices, more choice variety, better product availability. The mission of ECR Europe is To serve the consumer better, faster and at lower costs.

Efficient Foodservice Response

ECR/Category Management adapted for Foodservice

Ethical Trading Initiative

An alliance of companies, trade unions and voluntary organisations who work in partnership to improve the working lives of people across the globe who make or grow consumer goods (ETI).

Factory Gate Pricing

A "supply chain initiative which aims to remove unnecessary transportation costs and improve the efficiency of the supply chain. It involves retailers asking their suppliers to release product costs at the Factory Gate; that is product costs excluding the cost of delivery to the retailer, i.e. splitting out the product price and the transport price" (IGD, 2004).

First-in, First-out

A common method used for stock rotation, where the oldest stock is used or sold before newer stock.

Fast Moving Consumer Good

A frequently purchased, high volume product, which is 'consumed' on use (as oposed to a durable good which is not used up on consumption). FMCGs include food, personal and domestic products, such as eggs, baked beans, toothpaste, bleach.

Global Positioning Satellite

GPS tracking systems can be used to keeping track of vehicles and containers.

GPS Navigation helps truck drivers avoid getting lost.

Hazard Analysis & Critical Control Point

"System applied to monitor and control microbiological, physical and chemical factors affecting food safety and acceptability" (IGD, 2005).

Key Account Management

A term used in business-to-business marketing for developing and maintaining relationships with customers who are considered to be of strategic importance (Millman, 1995), such as major supermarkets.

Key Performance Indicator

A financial and non-financial measure/indicator of success. For example, a KPI for delivery could be cases ordered vs. cases delivered. A set of KPIs may be used to monitor the performance of a company or division, or to evaluate suppliers. 

Known Value Item

A high profile or well known product, for which shoppers tend to know the price and use it for comparisons, for example, a basic item like a pint of semi-skimmed milk.

Life Cycle Assessment

(also sometimes called Life Cycle Analysis)

"LCA involves the collection and evaluation of quantitative data on the inputs and outputs of material, energy and waste flows associated with a product over its entire life cycle so that the environmental impacts can be determined" (RSC, 2010).

Logistics Service Provider

A "company that offers a range of transport, warehousing, distribution and related services to other companies in the supply chain. Also called third party distribution companies, 3PL or contract distribution companies" (ECR, 2009).

Materials Requirements Planning

(or Materials Resource Planning) relates to materials flow

National Distribution Centre

'A large single stock holding point serving retailer regional distribution centres and other customers in either domestic or international markets' (ECR, 2002).

Open Book Costing

Where suppliers and retailers share their costs, helping to reduce costs through initiatives such as joint logistical planning or group purchasing.

Overall Equipment Effectiveness

A measure of the overall performance of a process or piece of equipment, which shows how well resources are being used to satisfy customer quality, cost and delivery (QCD) requirements (used in operations management, lean systems, continuous improvement).

On Time In Full

The right quantity and the right quality delivered to the customer on the agreed order delivery date. If there are multiple lines or items on an order, one hit means all ordered item lines are delivered on time in full. If one line item is missed, this is a miss for the whole order (Robinson, 2006).

Out-of-Stock

i.e. non-availability

Primary Consolidation Centre

A warehouse or depot where goods from several suppliers are received and either cross docked or stored, prior to consolidation and distribution as full loads for delivery to retailer RDCs.

Post-harvest Technology

Central to the preservation of quality and the reduction of damage and wastage in the movement of fresh produce from the grower to the consumer and covers all those processes that fresh produce may undergo, either separately or in combination, throughout this journey. PHT includes processes such as: cleaning; grading (for quality and size); trimming/preparation; weighing; packing; cooling; transport.

Quick Response

'A strategy where partners in a supply chain work together to respond more rapidly to consumer demand. This may involve sharing point of sale data, forecast demand levels and making manufacturing as flexible as possible so that production can be agreed to consumer demand' (ECR, 2002).

Roll Cage Equivalents

Used in planning load fill - e.g. when selecting double deckers. In terms of floor area one roll cage is equivalent to 0.49 pallets.

Regional Distribution Centre

Large warehouses that sort and hold stock prior to distribution to retail outlets. Most multiple retailers have their own network of RDCs. Also referred to as a Depot.

Relationship Marketing

An approach that focuses on customer retention and building long term relationships with customers and other relevant markets (e.g. shareholders and suppliers).

Retail Ready Packaging

also called Shelf Ready Packaging (SRP)

Packaging that makes a product ready to be put onto the shelf, to be easily "merchandised" - easy to identify, easy to open, easy to recycle, etc. An example would be an "outer" (carboard box) containing crisps, where the top tears off.

Retail Selling Price

The price at which a retailer sells a product to the consumer.

Supply Chain Management

'Managing your supply chain involves focusing on how materials, information and finance move along the chain, and making these flows as seamless and efficient as possible' (DTI, 2004)

Stock Keeping Unit

Pronounced either as S-K-U's or "Skews"

One unique inventory item of a particular colour, size, flavour or pack size (including 20% extra free) that requires a separate code number to distinguish it from other all other items. For example, one style of shirt, in six colours and five collar sizes, would be 30 different SKUs

Shelf Ready Packaging

also called Retail Ready Packaging (RRP)

Strengths, Weaknesses, Opportunities and Threats

A Strategic and Marketing Planning analysis framework. 

Value Chain Analysis

'A tool for identifying and quantifying cost reduction opportunities within the supply chain' (ECR, 2009).

Vendor Managed Inventory

Where the supplier (Vendor), particularly the Category Manager, is responsible for maintaining retail or RDC stock levels in the most cost effective manner, appropriate to the agreed service standards (IGD, 2011).

Used in the Automotive industry, by Sainsbury's and other retailers.

Warehouse Management System

An "IT system solution used to optimise the management of product flow and storage within a warehouse environment and process the associated transactions, including receiving, putaway, picking and shipping" (IGD, Supply Chain Analysis Glossary, 2010).

Year-on-year

A direct comparison of results with the same time in previous years.

Lift-on-lift-off

Ships which use a crane to load and unload cargo.

roll-on/roll-off

Ships, ferries, barges and rail wagons which carry wheeled vehicles such trucks and cars. Contrast with lo-lo