We know that it can be tricky to keep track of all the logistics acronyms and terms, as well as the currently trending concepts—even when you have been in the transportation industry for a long time. That is why we have created a helpful glossary with the essential freight forwarding terminology to ensure you are able to communicate effectively with all your stakeholders and business partners.
For an easier navigation, we have divided the glossary into 3 sections:
Common logistics terminology: find all the common acronyms and terms related to shipping that you are likely to come across on a regular, if not daily, basis.
Incoterms: understand the internationally recognized International Commerce Terms as defined by the ICC.
Customs glossary: learn the fundamental terminology about customs procedures.
Common logistics terminology
Bill of Lading (BOL):
A Bill of Lading is a legal document between the carrier (transportation company) and the shipper (supplier of goods), stating what goods are being shipped, where it is coming from, and where they will go.
CBM, Cubic Meter, is the unit of measurement is used to measure shipment volume.
Certificate of Origin:
A legal trade document that details the shipment's origin and other relevant information pertaining to the cargo’s origin. The document is almost always required when shipping cargo across international borders.
CFS: Container Freight Station.
A warehouse at which shipments are consolidated or deconsolidated. An LCL shipment will be taken to a CFS for consolidation.
Combined Transport (CT):
Combined transport is the mode of freight transport that combines different types of transport in the same shipment. In Europe, the majority of the journey is by rail or inland waterways, and any initial and/or final legs carried out by road are as short as possible.
The receiver of the shipment listed on the Bill of Lading. It is generally the buyer of the shipment.
CMR: Convention on the Contract for the International Carriage of Goods by Road.
A document used for regulating road freight transport, and serves as an international agreement used in most European countries.
DDC: Destination Delivery Charge.
A charge based on container size. It covers crane lifts off the vessel, drayage within the terminal, and gate fees at the terminal operation.
Door to Door (D2D):
A shipping arrangement that covers all transportation, handling, and storage from pickup at the shipper location to arrival at the receiver location.
FCL: Full Container Load.
A shipment that occupies the entire container space, without having to share it with other shippers. In FCL cargo, all the goods in the container are owned by one shipper.
FEU: Forty Foot Equivalent Unit.
A standard 40′ shipping container equals a FEU. The term is used as a unit of measurement.
Used in combined transport. It is the first leg of the journey from the shipper's location to the departure train terminal. This leg is conducted by trucks.
FTL: Full Truck Load.
A shipment in which a truck carries a single load and is therefore fully utilized. A FTL shipment is collected from a single sender and transported directly to a recipient without goods handling or storage.
FMS: Freight Management System.
A specialized platform or software that centralizes external freight management, like rouvia.
In intermodal transport, the transportation of cargo is done by two different modes of transport, with every part of the shipment is done by a different provider. Each company has its own bill of lading and is responsible for only its part of the delivery process.
Used in combined transport. It is the last leg of the journey from the destination train terminal to the receiver’s designated location. This leg is conducted by trucks.
LCL: Less than Container Load.
A shipment that does not require the full container capacity. Individual loads from different shippers are shipped in a consolidated container.
LTL: Less than Truck Load.
A shipment that does not require the full capacity of one truck. An individual LTL shipment is collected from a sender and transported to a warehouse for consolidating with other individual LTL shipments.
The manifest document details the information about the cargo carried together with the information about the means of transport, such as its identification, characteristics, and route.
In multimodal transport, the movement of cargo is done through any combination of two different modes, but what makes it special is – it’s done under a single bill of lading, or similar contract. Continue to explore the difference between intermodal vs multimodal transport.
TEU: Twenty-foot Equivalent Unit.
A standard 20′ shipping container is a TEU. The term is used as a unit of measurement.
THC: Terminal Handling Charge.
Fees collected by shipping terminals for the services they provide. These services may include equipment handling, container positioning, maintenance, storage and the discharging of equipment
TMS: Transport Management System.
Software for the organization of transportation of both incoming and outgoing goods.
The International Commercial Terms are a set of globally recognized rules which define the responsibilities of sellers and buyers. They were created by the ICC, International Chamber of Commerce, to facilitate international trade.
EXW: Ex Works.
This term means that the seller is responsible for packing a shipment and making it available for transportation at their premises. It is then the responsibility of the buyer to arrange the transportation, including loading the cargo, and bear the costs and risks for the shipment.
FAS: Free Alongside Ship
This is only applicable to sea and inland waterways transport. The seller is responsible for delivering the cargo alongside the ship in the port. After delivery alongside the vessel, the cost and risk transfer to the buyer.
FCA: Free Carrier.
This term means that the seller delivers the shipment to an agreed destination. The unloading, or onwards transportation from that named place is then the buyer’s responsibility, both in terms of cost and risk.
FOB: Free on Board.
This is only applicable to sea and inland waterways transport. The seller delivers the goods to a named port, and is responsible for loading them onto the shipping vessel. The buyer is responsible for all costs and risks from that point onward.
CFR: Cost and Freight.
This is only applicable to sea and inland waterways transport. The seller is responsible for paying the costs associated with getting the shipment to the port of shipment and loading them onto the vessel. The buyer is responsible for all other costs and risks once the goods are in transit.
CIF: Cost, Insurance and Freight.
This is only applicable to sea and inland waterways transport. The seller is responsible for paying the costs associated with getting the goods to the port of shipment and loading them onto the vessel. The seller is also responsible for insurance costs and risks once the shipment is in transit.
CIP: Carriage and Insurance Paid to.
The seller pays for the transportation and insurance of the goods to the named destination, but the buyer is responsible for all other costs and risks once the shipment is in transit.
CPT: Carriage Paid to.
The seller pays for the transportation of the goods to the named destination, but the buyer is responsible for all other costs and risks once the shipment is in transit.
DAP: Delivered at Place.
The seller delivers the goods to an agreed place, and is responsible for all costs and risks until the goods are unloaded at that destination. The unloading of the cargo and customs is handled by the buyer.
DDP: Delivered Duty Paid.
This term refers to when the seller takes care of the transportation and assumes all costs, including customs duties, as well as the risk until shipment has arrived at the agreed destination.
DPU: Delivered at Place Unloaded.
In this case, the seller assumes all the costs and risks until the shipment is unloaded. The buyer is responsible for the import and customs costs and administration.
Customs is a big part of freight forwarding, so you will want to make sure you understand the language.
Bonded cargo is imported shipments for which the customs charges, such as duties, taxes, and any penalties, have not yet been paid.
This is the location where the bonded cargo is kept by customs authorities until all the duties are paid.
Customs clearance is a necessary process to obtain the official permission to import or export goods.
An individual or company that helps importers and exporters comply with customs regulations.
Customs duty refers to the tax imposed on goods when they are transported across international borders for import or export.
Harmonized Commodity Description and Coding System (HS):
An international product classification developed by the World Customs Organization (WCO).