Important and Commonly Used Logistics terms you should know.

Knowing key logistics terms is extremely important when you start shipping activities for your ecommerce business.

Supply Chain or Logistics is a system where manufactured products are dispatched and delivered to the consumers, the last person in the supply chain, with various modes of transportation. This involves multiple activities from order procuring, processing, storage and fulfillment. To build an efficient business, its eminent that you familiarize yourself with the following terms :

AWB - Air way Bill

 

Document used for the proper identity of the goods or parcel which is exported or transported through airway mode.  It consist of a 11 digit code which helps the consignor and  the consignee or the agent can easily track out and check the status of the goods parceled.

 

MAWB

 

MAWB is Master airway bill issued by main carrier of goods on receipt of goods from a freight forwarder to deliver at destination as per agreed terms.

 

HAWB 

 

HAWB means House airway bill issued by a Shipping Carrier or forwarder on receipt of goods from shipper agreeing to deliver goods at destination.

 

COD 

 

Cash on Delivery is a method of payment which is commonly used in eCommerce industry that helps the customer to make the payment at the time of receiving the goods/ product.

 

PREPAID

2 Scenarios -

Freight charges with regards to a consignment is paid in advance.

or

Product value amount is paid in advance to the seller.

 

PICKUP Manifest

A printed Document that contains all the details of your shipment along with the tracking number to be used to take acknowledgment from the courier person that the pick up is completed for so and so orders. Courier person has to sign the copy adding the date of the pick up on the document. Manifest should be with the shipper and used for future reference.

ETA – Estimated Time of Arrival

The approximate time a truck, train or a shipment is expected to arrive at a location.

Chargeable Weight

The shipment weight used in determining freight charges. The chargeable weight may be the dimensional weight or the gross weight of the shipment, whichever is higher amongst these will be billed and is known as chargeable weight.

POD - Proof Of Delivery

Document to confirm the fact that the consignee has received the shipment sent by the shipper. This document contains delivery date, signature or seal and consignee name and other details.

 

RTO (Return To Origin) RTS- Return to shipper

Return to Origin or Return to Shipper: It is also called Reverse Logistics. It is the situation where the package is undelivered due to various reasons like non availability of receiver, rejection of package, default in payment etc. and will be ultimately returned to the origin or shipper.

ODA/ OPA- Out of Delivery Area/ Out of Pickup Area / Remote Area Surcharge (RAS)

 

Area/Pincode which has been marked as serviceable under terms & conditions due to the limited resources available to deliver the parcel at that location. Additional charges will be applicable for arranging delivery / pick up from these locations.

Demurrage

 

The carrier charges and fees applied when rail freight cars and ships are retained beyond a specified loading or unloading time.

Embargo

 

A prohibition upon exports or imports, either with specific products or specific countries.

 

Harmonized Commodity Description & Coding System (Harmonized Code)

An international classification system that assigns identification numbers to specific products. The coding system ensures that all parties in int'l. trade use a consistent classification for the purposes of documentation, statistical control, and duty assessment.

Air Mode & Surface Mode

 

These are the various modes of transportation in terms of shipment of goods.

If the shipment is carried through Air which helps for faster delivery can be called as Air Mode. And if the shipment is transported by means of Road and Rail mode can be treated as Surface Mode.

Exception

The exception of your shipment appears in tracking if your shipment is undelivered to consignee due to various reasons.

Prohibited List of Items

There are various goods or items which are prohibited or restricted for import or export as per the IATA guidelines. It includes drugs, cash, jewelry, explosives, hazardous goods etc.

Dangerous Goods

Articles or substances capable of posing a significant risk to health, safety, or property, and that ordinarily require special attention when transported.

 

Packing List

A packing list is a document that includes details about the contents of a package. The packing list is intended to let transport agencies, government authorities, and customers know the contents of the package. These details help each of these parties handle the package accordingly.

 

Commercial Invoice

The commercial invoice is a legal document between the supplier and the customer that clearly describes the sold goods and the value of the goods. The commercial invoice is one of the main documents used by customs in determining customs duties also.

BANK AD CODE Registration for Commercial Exports

An Authorized Dealer Code (AD Code) is a 14-digit numerical code provided by a bank with which your business has a current account. You will need to register an AD Code at every port from where your goods are cleared by customs. A registered AD Code is essential for customs clearance. If you do not have one, you will not be able to generate your shipping bill number, which is compulsory for customs clearance.

 

IE CODE & IE CERTIFICATE

Import Export (IE) Code is a registration required for importing or exporting goods and services from India. IE Code is issued by the Directorate General of Foreign Trade (DGFT), Ministry of Commerce and Industries, Government of India. Its also known as Import Export Certificate.

3PL – Third Party Logistics

Logistics services which are outsourced to a company or a third party agency who take care of shipping activities of a business.

Customs

The official department that administers, inspects the goods and collects the applicable taxes and duties levied by  government on exported or imported goods.

Customs Duty

 

Customs duty is a tax that people pay for importing and exporting goods.

Import & Exports

Imports in an international trade, are foreign goods and services bought by residents of a country. Residents include citizens, businesses, and the government.

Exports are the goods which are shipped or sold outside the country.

Certificates and Declarations commonly used while shipping

FDA - Food and Drug Administration, is a federal agency of the United States Department of Health and Human Services. The agency is separated into divisions that oversee a majority of the organization's obligations involving food, drugs, cosmetics, animal food, dietary supplements, medical devices, biological goods, and blood products.

FSSAI - Food Safety and Standards Authority of India, established under the Ministry of Health & Family Welfare. FSSAI is also responsible for protecting and promoting public health through the regulation and supervision of food safety.

Lithium Battery Declaration - is a declaration required for shipping Lithium Battery.

Quarantine Certificate - The purpose and scope of setting up of Quarantine Certification is to prevent the ingress of dangerous exotic diseases into the country through imported live plants, livestock and products.

Leather and Wildlife Clearance - is required from concerned authority to ship wild life products in a normal scenario since it is a prohibited goods to export.

Fumigation Certificate - sometimes referred to as a pest-control certificate, is a document that serves as confirmation that any wooden packing materials (ie, pallets) used in a cargo shipment have been fumigated. They contain details such as treatment purpose, fumigants used, and temperature range.

MSDS certificate - Material Safety Data Sheet, is a document that contains information on the potential health effects of exposure to chemicals, or other potentially dangerous substances, and on safe working procedures when handling chemical products.

NON DG Certificate - Non Dangerous Goods Certificate is a declaration from the shipper that the concerned package is not consist of any potentially hazardous or dangerous in nature.

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