Freight Glossary and Definitions

A

3PL (Third-Party Logistics) – A company that provides outsourced logistics services including transportation, warehousing, distribution, and fulfillment services.

4PL (Fourth-Party Logistics) – A logistics provider that manages and coordinates the activities of multiple 3PLs and other service providers on behalf of a client.

Accessorial Charges – Additional fees charged by carriers for services beyond standard pickup and delivery, such as detention, fuel surcharges, or special handling.

Air Waybill (AWB) – A document that accompanies goods shipped by air, serving as a receipt and contract of carriage.

All-Risk Coverage – Insurance coverage that protects against all risks of physical loss or damage except those specifically excluded.

Arrival Notice – Notification sent by a carrier to the consignee advising of the arrival of a shipment.

B

Backhaul – The return trip of a transportation vehicle after delivering a load, ideally with cargo to maximize efficiency.

Bill of Lading (BOL) – A legal document between a shipper and carrier that details the type, quantity, and destination of goods being carried.

Bonded Warehouse – A secured warehouse where imported goods can be stored without paying customs duties until they are withdrawn for use or export.

Broker – An intermediary who arranges transportation services between shippers and carriers without taking possession of the goods.

Bulk Cargo – Cargo that is shipped unpackaged in large quantities, typically liquids, gases, or granular materials.

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C

Carrier – A company that transports goods or people from one location to another via truck, rail, air, or sea.

CBM (Cubic Meter) – A unit of measurement for volume used in international shipping, equivalent to 35.31 cubic feet.

CFS (Container Freight Station) – A facility where LCL (Less than Container Load) cargo is consolidated into containers or deconsolidated from containers.

Chargeable Weight – The weight used to calculate shipping charges, which may be either actual weight or dimensional weight, whichever is greater.

Chassis – A wheeled frame used to transport containers over the road, typically pulled by a truck tractor.

COD (Cash on Delivery) – A service where the carrier collects payment from the consignee upon delivery of goods.

Consolidation – The practice of combining multiple smaller shipments into one larger shipment to reduce costs.

Consignee – The person or company to whom goods are shipped and delivered.

Consignor – The person or company who ships goods; also known as the shipper.

Container – A large standardized shipping box designed for efficient handling, storage, and transportation of goods.

Cross-Docking – A logistics practice where products are directly transferred from inbound to outbound transportation with minimal or no storage time.

CWT (Hundredweight) – A unit of weight measurement equal to 100 pounds, commonly used in freight pricing.

D

Deadhead – Operating a vehicle without cargo, typically returning empty after delivery.

Demurrage – Charges applied when containers or rail cars are held beyond the allowed free time at terminals or facilities.

Detention – Charges applied when a carrier’s equipment (truck, trailer, container) is held by the shipper or consignee beyond agreed free time.

Dimensional Weight – A pricing technique used by carriers that considers the size of a package in addition to its actual weight.

Dock Receipt – A document acknowledging receipt of cargo at a dock or warehouse.

Drayage – Short-distance transportation of goods, typically between ports, rail terminals, and warehouses.

Dry Van – An enclosed trailer without temperature control, used for general freight transportation.

E

EDI (Electronic Data Interchange) – The electronic exchange of business documents between companies in a standardized format.

ETA (Estimated Time of Arrival) – The expected time when a shipment or vehicle will arrive at its destination.

ETD (Estimated Time of Departure) – The expected time when a shipment or vehicle will depart from its origin.

Export – Goods or services sold and shipped to another country.

EXW (Ex Works) – An Incoterm where the seller makes goods available at their premises, and the buyer is responsible for all transportation costs and risks.

F

FCL (Full Container Load) – A shipping term used when a single shipper’s cargo occupies an entire container.

FEU (Forty-foot Equivalent Unit) – A unit of measurement based on a 40-foot container, used to describe container ship capacity.

FOB (Free on Board) – An Incoterm indicating the point at which ownership and liability for goods transfer from seller to buyer.

Force Majeure – Unforeseeable circumstances that prevent a party from fulfilling a contract, such as natural disasters or wars.

Freight – Goods transported by truck, train, ship, or aircraft, or the charges for such transportation.

Freight Forwarder – A company that organizes shipments for individuals or corporations to get goods from the manufacturer to market or final destination.

FTL (Full Truckload) – A shipping method where an entire truck trailer is used for one shipper’s cargo.

Fuel Surcharge – An additional fee added to freight charges to account for fluctuating fuel costs.

G

Gross Weight – The total weight of goods including packaging and container.

GRI (General Rate Increase) – An across-the-board increase in shipping rates announced by carriers.

H

Hazmat – Short for hazardous materials; goods that pose risks to health, safety, property, or the environment during transportation.

HOS (Hours of Service) – Federal regulations that limit the number of hours commercial drivers can operate vehicles.

Hub – A central facility where cargo is sorted and distributed to various destinations.

I

Import – Goods or services brought into a country from abroad for sale.

Incoterms – International Commercial Terms that define the responsibilities of buyers and sellers in international trade transactions.

Inland – Transportation or activities that occur away from ports or coastal areas, typically overland.

Intermodal – Transportation involving multiple modes of transport (truck, rail, ship) with cargo remaining in the same container throughout.

L

LCL (Less than Container Load) – A shipping term for cargo that doesn’t fill an entire container and is consolidated with other shipments.

Liftgate – A hydraulic platform on the back of a truck that raises and lowers to facilitate loading and unloading.

Linehaul – The main transportation portion of a shipment between major terminals or hubs.

LTL (Less than Truckload) – A shipping method for freight that doesn’t require the full space of a truck trailer.

M

Manifest – A document listing all cargo aboard a vessel, aircraft, or vehicle.

Multimodal – Transportation using multiple modes but potentially involving different containers or handling methods.

N

NMFC (National Motor Freight Classification) – A standard system for classifying freight for LTL shipping in the United States.

Non-Vessel Operating Common Carrier (NVOCC) – A company that provides ocean freight services without operating vessels.

O

OTR (Over the Road) – Long-distance trucking operations, typically involving sleeper cabs and extended trips.

Overweight – Cargo that exceeds legal weight limits for transportation.

P

Pallet Jack – A manual or powered tool used to lift and move pallets within warehouses and loading docks.

Per Diem – Daily charges applied for the use of equipment such as containers or trailers beyond free time.

POD (Proof of Delivery) – Documentation confirming that goods were delivered to the intended recipient.

Port of Entry – A designated location where goods can legally enter a country and undergo customs inspection.

R

Reefer – A refrigerated container or trailer used to transport temperature-sensitive cargo.

ROI (Return on Investment) – A measure of the efficiency of an investment, calculated as the ratio of net profit to cost.

S

Shipment – A quantity of goods sent from one place to another.

Shipper – The person or company that sends goods; also known as consignor.

Spotting – Positioning a trailer or container at a specific location for loading or unloading.

Supply Chain – The network of organizations, people, activities, information, and resources involved in moving a product from supplier to customer.

T

Tariff – A published schedule of rates, charges, and rules for transportation services.

TEU (Twenty-foot Equivalent Unit) – A unit of measurement based on a 20-foot container, used to describe container ship and terminal capacity.

Transload – The process of transferring goods from one mode of transportation to another.

TMS (Transportation Management System) – Software designed to plan, execute, and optimize the shipment of goods.

U

Unitization – The consolidation of multiple pieces of cargo into a single unit for easier handling.

V

Vessel – A ship or large boat used for transporting goods or passengers across water.

VMI (Vendor Managed Inventory) – A supply chain arrangement where the supplier manages inventory levels at the customer’s location.

W

Warehouse – A building used for storing goods before they are distributed or sold.

Waybill – A document prepared by a carrier that provides details about a shipment and serves as a receipt.

WMS (Warehouse Management System) – Software designed to control and manage warehouse operations from receiving to shipping.

Y

Yard – A designated area at terminals, warehouses, or distribution centers where vehicles and equipment are parked or stored.

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This glossary covers essential terms used in freight, shipping, and logistics operations.