With so many various phrases and abbreviations, the world of freight forwarding can become complicated! Below we have consolidated some of the most frequently used phrases.

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A-Z of Common Freight Forwarding Terms

3PL (Third-Party Logistics Provider)

A provider of outsourced logistics services, predominantly referenced to transport and warehouse providers who supply and/or manage logistics resources on behalf of their clients.

4PL (Fourth Party Logistics Provider)

A 4PL is usually a non-asset based ‘organiser’. A 4PL orchestrates the alignment of resources and technology of 3PLs in order to provide a logistics service to an end client.

AES (Automated Export System)

The system U.S. exporters use to electronically declare their international exports, known as Electronic Export Information (EEI), to the Census Bureau to help compile U.S. export and trade statistics. It is also used by other government agencies for trade enforcement purposes.

A-Z / Cradle to Grave

The action of an operator/coordinator looking after the full operations process rather than select parts of it (sometimes known as assembly line)

Air Freight

Goods transported by aircraft. Usually, the quickest but most costly method of shipping internationally.

Airway Bill (AWB)

The AWB is a document that controls the routing of an exporter’s cargo while it is in the hands of the air carrier or a consolidator. It is a contract for carriage; however, it cannot be negotiated.

AOG (Aircraft on Ground)

This is an urgent shipment due to the costs incurred when a plane is on the ground longer than it should be i.e. a passenger plane cannot take off due to an issue with a part. They must replace this part before flying. This part will usually have to be transported by air as soon as possible. This shipment would be ‘expedited’.

Breakbulk

Disassembling of consolidated shipments for delivery or reconsignment of a shipment. Typically refers to large goods that are broken down for easier transportation and is commonly used in the Oil & Gas, Construction, Energy, and Mining industries, amongst others.

Bill of Lading (B/L or BoL)

Official shipping document containing details about the shipment. The release of this document to the intended recipient of goods is representative of transfer of ownership, so it is often held until final payment is complete. If there were no issues with the cargo stated on the BOL, it is said to be a clean bill of lading.

Bulk Cargo

Not in packages or containers, shipped loose in the hold of the ship. Grain, coal and sulphur are usually bulk freight.

Cargo

Any goods being transported, regardless of the mode of transport.

Carrier

The company that physically moves the cargo with their own ships (Maersk, MSC, CMA CGM, COSCO), planes, trucks or trains.

Certificate of Origin (COO or C/O)

A document certifying where goods were originally made.

CL

Abbreviation for carload or containerload.

Commercial Invoice

A fundamental document for an international transaction with details including what goods are being shipped, who is the shipper and who is the ultimate consignee. Serves as the basis for all other documents related to the shipment.

Commodity

Any commercial good that is shipped. Sometimes referred to as vertical or ‘industry vertical’

Compliance

In the context of international shipping, being compliant or maintaining compliance means that the company in question is following all applicable laws and rules which govern their shipments.

Contract Logistics

Contract logistics refers to the long-term assumption of complex logistical service packages by logistics service providers, as opposed to spot rate, one off shipments.

Customs house

A government office where duties are paid and import and export paperwork is filed.

Customs

A customs authority, or customs for short, refers to the agency within a government that is responsible for collecting duties and enforcing import and export regulations.

Customs Broker

An individual or organization who helps a shipper navigate customs requirements.

Customs Entry

A statement of the kinds, qualities, and values of goods imported together with duties due, if any, and declared before a customs officer or other designated officer.

Customs Clearance

The process in which a customs authority assesses a shipment being imported in their country to ensure compliance with their country’s import regulations. A shipment that has been approved by the customs authority and allowed to enter the commerce of their country is said to have cleared customs.

Customs Entry

Also called Entry Summary or Form 7501, is a document that provides U.S. Customs and Border Protection with details about a shipment being imported into the United States, such as value, classification and origin.

Dangerous Goods

A product may be considered a dangerous good if it is corrosive, flammable, poisonous, toxic, explosive, etc. Shipping dangerous goods may require special documentation or packaging to ensure safety.

Drayage

The transport of freight from an ocean port to a destination, most often a warehouse.

Expedite

The process of making something happen quicker. In logistics, you’d be expediting something if it was urgently required by the customer. This is what happens with AOG type moves, as well as important car parts, machine parts or similar.

Export

Shipment of goods out of the country your client is based. Opposite of import.

FAK

Abbreviation for “freight all kinds.” Typically refers to a full container loaded with mixed cargo.

FCL (Full Container Load Shipment)

FCL refers to one 20ft or 40ft container filled with cargo.

FEU (Forty-Foot Equivalent Unit)

Refers to the size of a standard 40ft container unit.

FMC (Federal Maritime Commission)

The independent federal agency responsible for regulating the U.S. international ocean transportation system for the benefit of U.S. exporters, importers, and the U.S. consumer.

FMCG

Fast-moving consumer goods are products that sell quickly at relatively low cost.

Foreign Trade Zone (FTZ)

Areas where commodities can be manufactured, modified or stored under specific customs regulations and generally not subject to customs duties. May be abbreviated FTZ and sometimes called a free trade zone or free port.

Freight

Goods that are transported, usually in bulk, from one place to another. Freight can be carried by land (road or rail), sea, or air

Freight Forwarder

A company that brokers/arranges the transportation of goods on behalf of a shipper by liaising with carriers. They are the ‘middlemen’.

FTL (Full Truckload) / TL (Truckload)

A full truckload carrier is a carrier that contracts the entirety of a truck’s carrying capacity to a single customer.

HAWB (House Air Waybill)

Issued by a freight forwarder to a shipper after the receipt of a shipment.

HAZMAT (Hazardous Materials)

Substances in quantities or forms that may pose a reasonable risk to health, property, or the environment. HAZMATs include such substances as toxic chemicals, fuels, nuclear waste products, and biological, chemical, and radiological agents.

HBL (House Bill of Lading)

Common type of Bill of Lading issued by the freight or cargo forwarder to each exporter/customer.

IATA (International Air Transport Association)

The trade and service organization representing international airlines and forwarders from more than 100 countries. Sets global standards for airline safely, security, efficiency and sustainability.

IMDG (International Maritime Dangerous Goods code)

The regulations established by the International Maritime Organization (IMO) for the international transport of dangerous goods.

Import

Shipment of goods into the country your client is based. Opposite of export.

Incoterms

Incoterms are an internationally recognised set of instructions that are used in the global transportation of goods. They define the division of responsibility between the Shipper and the Consignee. The terms dictate which party is responsible for the risks, costs and liabilities associated with the shipment at each stage of the shipping process.

Intermodal

The process of moving freight from a point A to a point B using several means of transport

ITAR

The International Traffic in Arms Regulations regulate the export of space or defence related products and are enforced by the U.S. Department of State.

LCL (Less Than Container Load)

Also known as consolidation, this is a shipment of cargo that does not fill a container and is merged with cargo for more than one consignee of from more than one shipper. On arrival at the destination port the goods are deconsolidated (separated) at a CFS. LCL costs more to ship per unit of freight than FCL but may be the cheaper option for small shipments.

Logistics

The management of the flow of products as they are transported from the point of origin to their final destination. A logistics company is a general term for a company that provides logistics services, which may include freight forwarding, customs brokerage and/or consulting services.

LTL (Less-than-Truckload)

A medium shipment, typically between 150 pounds and 20,000 pounds that does not require the space or cost of a full truck trailer. An LTL carrier mixes freight from several customers in a single truckload which reduces the cost to the customer but increases the profit margin for the carrier.

Maritime

Relating to transport by sea.

MBL (Master Bill of Lading)

A bill of lading issued by a carrier to a freight forwarder acknowledging receipt of container for shipment. This is different from a house bill of lading which is issued by a freight forwarder to a shipper, acknowledging receipt of their items for shipment.

NVOCC

A non-vessel operating common carrier behaves like a carrier except it doesn’t provide the actual transportation service itself. Instead, an NVOCC buys large amouts of space from carriers at a reduced rate and sells this space to shippers and forwarders at an increased price. This is beneficial for freight forwarders that are not purchasing much space on a particular lane which would usually mean they don’t receive any discount for ‘bulk buying’.

Reefer Container

Container that’s refrigerated to keep goods at a constant temperature lower than 15 degrees. Typically used to transport food and perishable items.

RORO (Roll-on/Roll-off)

These are vessels designed to carry wheeled cargo, such as cars and trailers. This is in contrast to lift-on/lift off (LoLo) vessels which use a crane to load and unload cargo.

Sea Freight

Goods transported by ship. Usually the most cost effective method of shipping internationally.

Shipper

A shipper is anyone, whether an individual or business, that has goods or products that need to be transported. Examples of shippers include Nike, Samsung, Walmart.

Supply Chain

A system of interconnected organizations and activities involved in the movement of goods from a supplier to a customer.

Tariff

A tariff is a tax imposed by a government on goods and services imported from other countries.

TEU (Twenty-Foot Equivalent Unit)

A standard 20-foot shipping container, measuring approximately 20 feet long, 8 feet wide and 8 feet high. The container can carry approximately 56,000 pounds, depending on the shipping line's limitations. Two TEUs have the capacity of a single FEU.

TSA (Transportation Security Administration)

The US government organization that checks that the activities of companies transporting people or goods are safe, legal, etc.

Vertical / Vertical Market

The industry of which the goods are related too I.e. automotive, pharmaceuticals, electronics etc. Also referred to as commodity

Vessel

A ship or large boat. Used in shipping to transport sea freight.

Warehouse

A place for the storage, consolidation, and distribution of cargo. Warehousing is the storage of cargo.

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