Glossary of International Shipping Terms

If you work in the shipping industry, then you know that there is a lot of jargon to keep track of. From acronyms to technical terms, it can be difficult to keep everything straight.That's why we've put together a shipping terms glossary to help you make sense of it all.In this glossary, you'll find definitions for common shipping terms, as well as some lesser-known ones.

Whether you're new to the shipping industry or a seasoned pro, we hope you find this glossary to be a helpful resource.

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ACS or ACE

Advanced Cargo Information System or Automated Customs Environment, two systems used by the U.S. Customs and Border Protection to track inbound shipments of cargo and conveyances entering the United States.

Advance Payment

Advance payment is a type of down payment or prepayment a good or service is realized. Advance payments are sometimes required to clear the trade and sometimes to cover the seller's costs to supply the product or service.

Advance payment may cover the total amount or part-paying a supplier before the goods are delivered. The general practice in cross-border trade is that the payment is made after the freight service is received. However, making payment at the reservation stage is a common method in practice.

Advanced Charges

Advanced Charges, i.e., Freight Forwarding charges, are the fees charged on transportation for a shipment advanced or assigned between the carriers or the shipping companies. Advanced Charges are collected from the consignee or whoever organized the shipment.

Freight charges advanced between the carriers could be collected by any of these carriers from the consignor.

Advance Fee

Shipping agents pay in advance on behalf of their customers for any costs incurred during the shipping process. Many freight forwarder companies add a certain percentage of depreciation or profits to these costs and pass them on to their customers. Sometimes advance fees are called credit limitations.

Advice of Shipment

The advice of shipment is a caution sent to buyer companies "consignee" advising that the shipment has taken place. The advice of shipment includes the content of the loaded goods, the number of packages or parcels, the type of products, and their prices. A copy of the invoice and bill of lading can be attached with the advice of shipment. Because one of the purposes of sending advice on the shipment is to enable the importer company to make shipping insurance with the information, it will obtain.

Air Freight

Air Freight covers the transporting cargo by aircraft. Both cargo aircraft and commercial passenger aircraft are used to transport cargo. Air freight also indicates the cost of transporting freight transported by air. So, air freight also means the cost of air transportation. Air freight is the fastest and the safest shipping type.

Air Cargo

Air cargo means the goods that are moved by airways. Since the definition of air freight also means the cost of transportation by air, the cargoes to be transported by air are defined as air cargo by the sector employees. Air cargo covers all products transported by air transport. Both export shipments and courier service shipments. Transport of express shipments worldwide is within the scope of "air mail, air freight, and air express" air cargo.

Air Waybill

Air Waybill is a legally enforceable freight document issued by the Carrier or agent (on behalf of the Carrier), containing information about the items being shipped. It has basic information about the goods, sender and receiver, incoterms, and delivery conditions. Air waybill is a standard document prepared for air shipments and circulated by the IATA (International Air Transport Association).

Air Carrier

Companies that offer passenger and freight transport services by air are called air carriers. In order for a company to provide air cargo service, it must be authorized by IATA (International Air Transport Association). The Warsaw Convention determines the authorities and responsibilities of the air carriers involved in international transportation.

All Risks (AR)

All risks It is a type of marine insurance. It is the widest standard type of collateral at the shipping stage for overseas trade. All risks do not cover damages caused by wars, strikes, and riots.

All risk provides protection against all risks of physical loss or damage, with the exception of the conditions as mentioned above. However, the delays experienced during the shipping or at the ports are not covered.

Arbitrage

The fact that the freight transportation originating from an international trade does not occur on a previously agreed term by the parties may cause conflict. The dispute in the overseas trade process can be determined by arbitration, according to which law it will be resolved. Transportation and shipping arbitration handles a variety of complex, cross-border transportation disputes in jurisdictions around the world.

Arrival Notice (AN)

It is the notice sent by the Carrier to the company in the "notify" part of the bill of lading before the cargo reaches the destination port.

Arrival notice contains information such as product, quantity, weight, and volume in the transport vehicle. The importer company checks the information in the arrival notice and starts customs procedures through the customs broker.

Arrival notice also includes information such as BL number and container number. Although as a standard procedure, shipping companies send Arrival notices and tracking transit and accept on-time delivery. It is the buyer's responsibility to track the load and start the transactions on time.

Assignment

The cargo could be transferred to another consignee or shipping company by assignment in overseas shipments. Mostly it's seen at ocean freight. Assignment (shipping assignment) enables the transfer of a shipment's rights and ownership of the goods to any other consignee. The assignment term is used in connection with a B/L. The assignment involves the transfer of rights, title, and interest in order to assign goods by endorsing the bill of lading.

Aggregate Shipment

Aggregate shipment is the transportation of the cargo to be sent to a single buyer from different vendors as a single cargo by being brought together and consolidated. Consolidation avoids multiple customs clearances. This both reduces costs and speeds up transactions. Aggregation is a cost-effective model for collecting multiple orders and shipping goods across the world.

Accessorial Charges (assessorials)

Additional services except the regular shipping operation suppose additional costs from the Carrier called accessorials charges. Costs of additional services and privileges provided during the transportation process are not included in the freight rate and are usually listed as additional costs (assessorials). For example, Collection/delivery, Inside pick up, Collect on delivery, transit privileges, Fuel surcharge, Arrival notification, and transfer.

Back Haul

In the shipping industry, one-way shipping is costly, so when transporting vehicles from one port to another, planning is also done for the return load. The way of transportation between two ports is called Backhaul. A carrier is looking for another load if any container is unloaded to the destination port. Briefly, it is the return movement of a container or truck from its starting destination

Bill of Lading (BL)

A Bill of lading is a transport bill used for shipments made by ship (Sea waybill), train (Rail waybill), or airplane (Air waybill) and determining the conditions under which the loading will take place between the Carrier and the customer (exporter or importer). A Bill of lading is a valuable document representing the loaded goods' belonging.

The BL indicates that the goods have been received for carriage and to whom it will be delivered at the destination. The content of the BL includes information such as the sender and receiver company information, the type of cargo, its quantity, the number of packages or parcels, its weight, loading date, and estimated delivery date.

Blank Endorsement

A blank endorsement on the B/L specifies that it did not specify a buyer for the goods on the bill of lading. The bill of lading also represents the ownership of the goods, and the goods change hands with the endorsement of the document. Bill of ladings can be blank endorsed by putting a shipper stamp on the reverse side of it. However, Non-negotiable Bills are the exception. Endorsement allows a bill of lading to be transferred to someone else. Bills of lading can be transferred to another company in three ways "To the name of," "To the order of," and To order."

Blind Shipping

Shipments made without specifying the recipient or sender on the bill of lading are called Blind Shipping. The main purpose of companies that prefer blind shipments is to ensure that their customers do not know the exporter, that is, the supplier company. In this way, the suppliers ship directly to the final buyers, but the buyers are the interlocutors or distributors. Blind shipping is especially preferred by companies that do drop shipping.

Two different Bills of Lading are created for a blind shipment. The first is between the exporting company and the importing company. The second bill of lading includes the importer and his customer at the destination.

Bonded Warehouse

Bonded warehouses are the areas where the goods are kept until the customs authorities complete the customs clearance. A bonded warehouse controlled by customs. These warehouses are duty-free areas until the importation process. In these warehouses, the goods can be kept until the customs duty is paid and the import procedures are completed, or they are sent to another country (for example, by re-export or transit trade).

Bonded Goods

Products that are hosted in the bonded warehouse, whose import operations are still in progress, or which are planned to be kept for a certain period are called bonded goods. Bonded goods, duties, VAT, and other expense items are unpaid goods. All necessary taxes and charges must be paid to complete the import. Bonded goods are kept in warehouses under customs clearance is completed.

Booking

Booking is arrangements between Carrier and shipper for freight confirmation, mostly for sea shipments. Importer or exporter companies require a full container or less container space from carriers on any specific date for cargo. Booking includes the agreement related to shipment conditions such as freight, delivery time, and loading date. Booking carries an option date, and the deal will automatically expire if the shipper does not make the necessary preparations.

Bulk Cargo

Bulk cargo is a shipment type that is shipped without any package, pallet, or box. The term bulk means that dry cargoes such as mines, grain, coal, etc., are transported unpackaged, unloaded in containers, and loaded directly into the ship's holds. Bulk carriers transport bulk cargo.

The loads transported by bulk carriers but transported in pieces with equipment such as pallets, sacks, and barrels are called break bulk cargoes.

Cargo Insurance

Cargo insurance compensates exporter and importer companies against physical loss or damage of goods during transportation and covers goods in temporary storage during transportation. Shipping cargo insurance policies are issued by insurance companies based on the clauses prepared by the International Underwriting Association of London.

Carriage & Insurance Paid To Incoterm (CIP)

In the form of CIP incoterms, the seller, i.e.," the exporter" company, organizes the processes of loading the container or vehicle, organizing the inland transportation, finalizing the port process and customs clearance, and shipping the cargo according to the final destination. CIP is a form of delivery that can be used for any mode of transport, including multimodal, regardless of which mode of transport is chosen.

Carriage Paid To Incoterm (CPT)

CPT incoterm is especially used in multi-vehicle transportation types. The seller, i.e., the exporter, is responsible for inland transportation, export customs clearance, and organizing the overseas shipment without insurance. Basically, the exporter company is responsible for managing the shipment. After the shipment, all costs excluding freight belong to the importer for CPT shipments.

Certificate of Origin (CoO)

A certificate of origin is a document showing in which country a product was manufactured. The local chamber of commerce or chamber of industry usually approves the certificate of origin. Some countries require that the certificate of origin of the imported goods be presented at the local consulates in the country of origin.

Consignee & Consignor

The transport documents are based on the contract of carriage between the shipper and the carrier, and the buyer, the importer, is defined as the consignee. The consignor is the other party in the contract of carriage, the exporter, who sends the consignment to be delivered by land, sea, or air.

Consolidation

Consolidation provides scale savings in shipment by creating large loading lots from small quantities of cargo. The main reason for consolidation is to reduce transportation costs and speed up the paperwork and customs processes. Consolidated transportation is in case of shipment of the products to the same customer and the same region, transporting them in one piece by combining them and waiting for a while.

Container

Containers are transportation equipment with specific dimensions and standards used in international freight transportation. A large part of maritime transport worldwide is provided by container ships. Container transportation is compatible with multimodal and intermodal transportation. It can be transported by container ships and trucks.

Carrier

The basic elements of the international logistics sector are transport companies, that is, carrier companies. Sea, land, air, and rail transport are the fields in which carrier companies operate. Carriers are companies that provide the shipment of goods from one place to another via a domestic or international logistics network and establish the commercial bridge between buyers and sellers.

Cost Freight Incoterm (CFR)

In CFR incoterms, the seller, i.e., the exporter company, organizes the processes of loading the container, inland transportation, handling the port charges and customs process in their coşuntuya, and delivering the cargo to the buyer at a port located in the country of the buyer, i.e., the importer. CFR is one of the 11 loading variants that make up incoterms.

Cost Insurance Freight Incoterm (CIF)

The CIF delivery terms is similar to the CFR, except for the marine insurance requirement. In short, in the seller's country, inland transportation, customs and port costs, and international transportation organization, including insurance, are the responsibility of the exporter company. Although the transportation cost belongs to the exporter, the risks belong to the importer.

Custom Bond

Customs bonds or bonds allow importers to process imports at US customs. Customs bonds are temporary documents issued on the Importer's behalf, on the shipping company's application, and through the customs broker. Customs bonds are issued annually and must be renewed at the end of every 12 months. Without the bond, the import loads of the shipments can't be cleared by US Customs.

Customs Broker

Customs brokers are the officials responsible for preparing and checking customs documents and issuing export or import declarations. Customs legislation constantly changes depending on trade relations between countries, sectoral and local developments. Customs brokers are responsible for following the changing legislation and checking that foreign trade transactions are in compliance with all applicable laws.

Customs Clearance

Customs clearance covers the customs procedures regarding the export and import stage. The customs procedures carried out at the stage of exporting the products from the seller's country are called Export Customs Clearance. The customs procedures that will be subject to the buyer's country at the stage of entry of the products are defined as Import Customs Clearance.

Custom and Border protection (CBP)

U.S. Customs and Border Protection (CBP), a division of the Department of Homeland Security, is responsible for enforcing U.S. customs laws at ports of entry to prevent the importation of prohibited goods into the United States. CBP also conducts inspections of cargo containers entering or leaving the country. The agency’s mission includes protecting the borders of the United States from illegal immigration, drug smuggling, and terrorist activity; facilitating legitimate trade and travel; and promoting economic growth and job creation.

Delivered At Place (DAP)

DAP, in incoterms, is the most responsible form of delivery after DDP. The seller is responsible for all processes except for paying the customs duties and customs clearance that must be handled in the buyer's country. It is a form of delivery added to Incoterms 2010 to replace the DAS, DEU, and DDU used in Incoterms 2000.

Delivered At Terminal Incoterm (DAT)

Delivered at the terminal, DAT Delivery is one of the 11 different forms of delivery included in incoterms 2010. As of 2020, Incoterms has left new incoterms named DPU (Delivered at Place Unloaded) instead of DAT. In the form of DAT delivery, the seller, the exporting company, is responsible for delivering the cargo at a specific location in the buyer's country and for all stages, except for customs clearance in the buyer's country until this stage.

Delivered Duty Paid Incoterm (DDP)

DDP delivery method is incoterms in which the exporter undertakes all processes and costs, including transportation, customs, and insurance. Among the 11 Incoterms, the mode of transport bears the most responsibility on the exporter. In the form of DDP delivery, the seller, i.e., the exporter company, organizes all delivery stages. Since customs duties payable in the importer's country are also the seller's responsibility, all-expense items must be calculated before starting the trade process.

Demurrage and Detention

In maritime transportation, container filling and unloading processes are limited to certain limits. If the container is not delivered to the port or container warehouse empty within a specified period of time under the name of free time, the demurrage period begins. Depending on the tariff announced by the carrier in advance, a daily demurrage fee that increases in certain periods is applied.

On the other hand, detention cost is the expense incurred if the container taken out of the port does not return to the port within the free period. The difference between demurrage is that it defines the expense incurred outside the port, not in the port.

Export License

An export license is an official document that shows the export license granted to an organization or company for a particular product group. Within the scope of the free market economy, export transactions are not subject to permission. However, depending on the general and technical characteristics of certain products, exporting only to authorized companies is a common practice. For example, exports of some chemical or medical products or weapons.

Ex Works Incoterm (EXW)

The term "Ex Works" means that the seller delivers the goods at the disposal of his own place or another place such as a factory or warehouse. EXW represents the minimum obligation for the seller. Exworks price is the base price of the goods; additional costs such as customs, insurance, and freight are not included in the export price.

Export Declaration

Export Declaration is the declaration given by the exporting company to the customs regarding the products to be exported through the customs broker. Before the Export of the goods, all mandatory fields in the Export Declaration must be filled, and documents such as invoices and packing list must be submitted to the customs authorities. The document used to complete the customs clearance of the goods in all import and export transactions and to ensure their exit from the customs is called the customs declaration.

Free Carrier Incoterm (FCA)

According to FCA delivery terms, the seller, the exporter company, delivers the goods to the first carrier at a point requested by the buyer, that is, the importer. The responsibility of the exporter ends with the fulfillment of the customs procedures. FCA is the least risky mode of transportation after EXW for exporting companies among the 11 different delivery terms included in incoterms 2020.

Free Along Side Incoterm (FAS)

Free Alongside Ship, the exporter, organizes the inland transport and prepares the container at the port next to the ship specified by the buyer. The seller company also completes the customs procedures. After this point, it is up to the importer company to organize the shipment, take out insurance and complete the customs clearance in his own country.

Free on Board Incoterm (FOB)

FOB is a form of delivery that requires the goods to be loaded on the ship's deck to be transported. In short, the exporter is responsible for inland transportation, harbor charges, and customs clearance processes. The seller's liability ends as soon as the products or containers are loaded onto the ship. FOB delivery term is only used for port shipments. It's also the most popular incoterms with EXW and CIF

Freight Forwarder

A freight forwarder is a company that specializes in the transportation of goods from one country to another. The term "freight forwarder" was coined by the International Air Transport Association (IATA) in the 1960s, and has since become a genericized trademark for companies providing such services. Freight forwarders are also known as consolidators or logistics service providers. They provide services such as arranging air cargo shipping, ocean freight forwarding, warehousing, customs brokerage, and trucking.

Full Container Load (FCL)

Full Container Load identifies the container organized by the exporter or importer for use by a single loader. It is preferred by shippers who have enough cargo to fill all standard 20' or 40' containers. In an FCL container, the entire load belongs to a single company. The FCL loading type usually provides the best price for large volume shipments.

What is Free Trade Agreement?

Free trade agreements (FTAs) are bilateral or multilateral treaties that establish rules for the free movement of goods, services, capital and people between two or more countries. FTAs can be classified into three broad categories:

  1. General FTA – These are agreements which do not specify any specific sector to be covered by the agreement. They cover a wide range of sectors including agriculture, industry, commerce, finance, etc.
  2. Sector-specific FTA – These are agreements covering specific sectors like automobiles, steel, textiles, chemicals, pharmaceuticals, etc.
  3. Multilateral FTA – These are agreements concluded under the auspices of international organizations like World Trade Organization (WTO), European Union (EU), North American Free Trade Agreement (NAFTA), Asia Pacific Economic Cooperation (APEC).

The main objective behind entering into these agreements is to reduce tariffs and other barriers to trade. However, they may also include provisions related to intellectual property rights, government procurement, environmental protection, labor standards, competition policy, dispute settlement mechanisms, etc.

Free Trade Area (FTA)

An area where there are no restrictions on imports or exports. This means that you can import anything from anywhere in the world without having to pay duties or taxes.

Goods Movement Insurance

Insurance against loss or damage to goods during transit. Goods movement insurance covers losses due to fire, theft, accidents, strikes, riots, war, natural disasters, acts of terrorism, etc.

Goods Receipt

An invoice issued by an exporting agent to the buyer upon completion of export transaction.

Goods Receiving Agent

A person authorized by the seller to receive payment for the sale of goods.

Goods Shipment

The act of transporting goods from one place to another.

Goods Transportation

Transportation of goods from one location to another.

Guarantee Clause

This clause states that if the goods fail to meet the agreed quality or quantity, then the supplier will replace them with new ones at his/her own expense.

Haulage

Haulage is the name given to the business of transporting the goods that need to be transported from one address to another through transport such as ships, trucks, planes, and trains. Haulage is the transportation of goods between the addresses of exporting and importing companies, along with factories, warehouses, and ports.

Hazardous Materials (HM)

Hazardous materials (HM) are defined as any material that is capable of causing serious injury or death if released into the environment. HM can be divided into two categories: 1) those which pose a significant risk to human health and 2) those which pose a threat to the environment. The former category includes chemicals, biological agents, radioactive substances, and other potentially hazardous materials. The latter category consists of toxic wastes, flammables, corrosives, explosives, and other dangerous substances.

Handling Charges

Charges levied by a carrier for handling and storage of goods. Handling charges vary depending on the size and weight of the shipment.

Harbor Service Fee

This fee is charged by the port authority for using its facilities. Harbor service fees are based on the number of days the ship stays in port.

Heavy Lift Cargo

Cargo that requires special equipment to move it. Heavy lift cargo includes cars, trucks, tractors, cranes, forklifts, etc.

Highway Billing

Bill of lading used to track the progress of goods through the transportation system.

Hold Harmless

Agreement whereby the buyer agrees to hold harmless the seller from any claims arising out of the use of the product sold.

Home Port

Port where the shipper has its headquarters. The home port is usually the same as the shipping address.

HTS Codes or HS Code (Harmonized System Code)

The HS code is created for categorizing internationally traded goods and covers the first six digits of the universal part. HTS is a code system that can be up to 12 digits. HS codes are universal, while HTS codes are country-specific. For example, the USA uses a 10-digit HTS code, while EU countries use an 8-digit HTS code. During the export or import phase, the customs procedures of the products are made according to the HS number. In short, there is an HS code for each tradable item.

Inspection Certificate

Certificate issued by the government stating that the goods have been inspected and found to be free from defects.

International Air Waybill

Waybill used when the air waybill is not signed by the consignee. It is used only when the consignment is shipped via air.

Interstate Commerce Act

A federal law passed in 1887 that regulates interstate commerce. This act prohibits carriers from charging unreasonable rates and establishes minimum standards of safety and sanitation.

Insurance Coverage

Coverage provided by the carrier against loss or damage to the goods during transit. Insurance coverage is provided either by the carrier or by the shipper.

Insured Value

Value stated on the bill of lading at time of issue. If the value changes after issuance, the new value will appear on the bill of lader.

Invoice

Document showing the amount due for the purchase of goods. Invoices are sent to the customer before the goods leave the warehouse.

Inbound Freight

Inbound freight defines the transportation and storage processes during the production facilities' raw material purchasing stages. Inbound freight covers shipping and storage charges. Inbound freight receives raw materials and deals with suppliers.

Incoterms

Incoterms are the rules that determine the rights and obligations between the buyer and the seller in the shipping processes that take place during the export and import stages. The latest version of incoterms determined by the ICC and revised periodically is incoterms 2020. Incoterms contain 11 different modes of transport, and they are divided into two main groups "Rules for all modes of transport" and "Rules for sea and inland waterway transport."

Intermodal Shipping

Intermodal Transport is a form of transport using two or more transport vehicles without changing the container. Intermodal transportation is a safe, economical, and environmentally friendly transportation method. The fact that the loads are not exposed to the download-restore processes during vehicle change reduces the risk of damage or loss of the products. The transfer takes place faster and with minimum handling costs. Intermodal transit takes place using ships, trucks, and trains.

Import

Import is the inclusion of the products and services purchased from another country within the country borders of the buyer company by completing the transportation and customs processes. Importing is basically an international purchase. The company that performs this transaction is called the importer.

In Bond

An in bond shipment covers the stage before customs for an imported or exported shipment. Importers may prefer bond shipping for various reasons arising from logistics processes or expectations. In bond, describe that customs have not cleared the goods. So it's not entered the borders of a country yet.

Key Account Executive (KAX)

The KAX is responsible for managing the relationship with the client. He/she is also responsible for maintaining the account. A KAX can be either internal or external. An internal KAX works directly under the sales manager. An external KAX works for the sales department but reports to the marketing department.

LCL (Less Than Container Load)

LCL is the transportation of the products of more than one company with a single container by combining loads of more than one company for loads that will not fill one container. LCL can also be defined as consolidation. LCL enables exporting and importing companies to ship small quantities of cargo at a low cost.

LTL (Less Than Truck Load)

LTL (Less Than Truckload) refers to the small freight or a limited quantity for a truck. In short, if there is not enough load to fill a truck, it is necessary to consolidate the goods of more than one company with LTL. With LTL, exporters and importers can ship at a cost proportional to the truck's load. LTL offers a more profitable transportation model for transporters with partial cargo transportation compared to an alternative and full truck.

Letter of Credit (LOC)

A letter of credit is a payment method that enables exporters and importers to trade with a secure payment method, prepares the export documents in accordance with the L/C conditions of the exporter, and gives the assurance that the issuing bank will make the payment on behalf of the importer after the shipment processes are completed. The parties in the letter of credit; Applicant is Beneficiary, Issuing Bank, and Confirming Bank.

Logistics

Logistics is the process of moving goods from one location to another. Logisticians plan, coordinate, and manage the movement of goods through the supply chain. They work closely with the buyers and sellers to ensure that the right products reach the right customers at the right time.

Market Research

Market research is used to identify potential customers and their needs. Market research is done through surveys, focus groups, interviews, and market analysis. It helps companies understand what consumers want and need.

Merchant Invoice

A merchant invoice is a document that details the terms of sale and payment made between a supplier and a customer. Merchant invoices include information about the product being sold, the price of the product, the quantity of the product, and any discounts offered.

Minimum Order Quantity (MOQ)

The MOQ is the smallest order quantity required to fulfill a contract. For example, if you buy 10 widgets at $10 each, your MOQ would be $100. If you buy 100 widgets at $5 each, your MOQ will be $500.

Modified Value Added Tax (VAT)

Modified VAT is a tax on the value added to a good or service after its manufacture or production. Modified VAT is charged at different rates depending on where the good or service is consumed.

Model Number

The model number is a unique identifier assigned to a specific product. Model numbers are typically found on the back of the box or on the bottom of the packaging.

Multinational Company

A multinational company has operations in multiple countries. Multinational companies often use intermodal transportation because they can save money and time compared to air freight.

Multiple Shipment Discount (MSD)

MSD is a discount applied when more than one shipment is received during a billing period. MSD is calculated based on the total weight of all shipments received.

Multimodal Shipping

International shipments sometimes require the cargo to be transported using more than one transportation vehicle due to geographical conditions, delivery times, or economic conditions. This requires the use of multimodal transport as an integrated system. In multimodal transportation, a single transportation contract is prepared for all transportation vehicles used between loading and destination points.

Notify Party

Notify party defines the party to be notified about the cargo at the destination in the bills of lading. While the buyer of the goods is the consignee, that is, the importer, the notify party is usually a customs broker or shipping agent. If the payment is made by letter of credit, what will be written in the "notify" section is specified in the letter of credit. In sales against documents, the notify part is usually the bank.

National Freight Classification (NFC)

The NFC is a classification system used by the United States Department of Transportation to classify commodities according to their relative importance and risk. The National Freight Classification System was developed in 1973.

Net Weight

Net weight refers to the actual weight of the merchandise minus any applicable charges such as insurance, brokerage fees, etc.

Non-Domestic Importer (NDI)

An NDI is a person who imports goods into the U.S. from another country without having been issued a permit by the U.S. Customs Service. Non-domestic importers must pay duties and taxes on imported products.

Non-Refundable Advance Payment

An advance payment is a deposit paid before the start of a project. It is nonrefundable unless there is a change in the scope of work or the client cancels the agreement.

Non-Returnable Goods

Goods which cannot be returned to the seller. These include items sold under warranty, such as computers and appliances.

Non-Voidable Bill Of Lading

A bill of lading is a document that serves as proof of ownership of the goods being shipped. A voidable bill of lading allows the shipper to return the goods if the carrier fails to deliver them within the agreed upon time frame. However, a non-voidable bill of lading does not allow the shipper to return goods after the agreed upon time frame expires.

Ocean Freight

Ocean freight, i.e., "sea freight," is the international transportation of goods by sea. Sea transport provides the transportation of heavy and dimensional cargoes that cannot be transported by air, with more advantageous freight costs than road transport. Sea transport, which includes transportation types such as container, bulk cargo, tanker, and ro-ro, provides full (FCL) or partial (LCL) transportation options.

Outbound Freight

Outbound freight includes the goods that companies will ship to their customers and the finished products they transfer to the distribution channel. Outbound freight consists of every stage in the distribution processes of final products, including storage and shipping. Outbound logistics aims to control and minimize transportation and storage costs.

Offer To Purchase

An offer to purchase is a promise to buy something at a certain price. An offer to purchase may be accepted by the seller's signature on the offer.

On Board Insurance

Insurance coverage provided by the carrier while the goods are in transit.

Open Account

An open account is a type of business transaction where the customer makes payments directly to the supplier rather than through a third party. Open accounts are often used in small businesses because they can save money on commissions and other costs associated with collecting payments.

Overland Transport

Transportation over land. Overland transport includes railroads, trucks, ships, barges, pipelines, and air freight.

Packing List

In international shipments, a packing list or weight list is a document prepared to specify details such as the definitions of the products loaded on the transport vehicle, parcel, several containers, weight, and volume information. A packing list is a mandatory document in many countries' customs clearance stages.

Parcel Shipment

In the shipping industry, parcel shipment refers to loading the goods of more than one company on the same transport vehicle to be transported to the same destination. Partial transportation brings the transportation cost to an economic level for both transportation companies, exporters, and importers. Partial shipment offers the advantage of fast and economical shipment, especially to small-scale trade companies and sometimes bigger companies that need partial transportation.

Port of Destination

Port of destination (POD) is the port where a ship will be loaded or unloaded. It is also known as the port of call, port of discharge, and port of loading/discharge. The POD can be any port within the country or outside the country.

Port of Shipment

Port of shipment is the port where a ship docks to unload its cargo. It is also known as “the place of discharge” or “place of delivery”. The term “port of shipment” is used when the goods are shipped from one country to another, and it is usually the last point at which the goods leave the country before they reach their ultimate destination.

Payment Terms

Payment terms define when and how much the buyer pays for the goods. There are two types of payment terms: fixed and variable. Fixed payment terms are based on a set amount of time, such as 30 days. Variable payment terms are based on the value of the goods, such as per pound.

Periodic Inspection Report (PIR)

A PIR is an inspection report prepared by the carrier during transportation. This report details the condition of the goods at each stop along the way.

Pickup Location

The location where the carrier picks up the shipment. For example, if you ship your package via UPS Ground service, the pickup location would be the UPS facility. If you ship your package via FedEx Express International, the pickup location would probably be the FedEx office.

Place of Delivery

The location where the consignee receives the shipment. In most cases, this is the address listed on the bill of lading. However, some shippers may use a different address, such as the post office box number.

Prepaid Shipping Label

A prepaid shipping label is a form of preprinted shipping label that has been paid for in advance. Prepaid labels are often used by businesses that want to send large quantities of items. They are available through many online retailers.

Pro Forma Invoice

Pro forma invoice is a statement of account that shows what the seller owes the buyer. Pro forma invoices are created by sellers to show what the buyer owes them. These statements are not legally binding but are useful tools for buyers to compare prices between companies.

Proof of Delivery

Proof of delivery is documentation showing that the carrier delivered the goods to the recipient. This includes copies of the original delivery receipt, tracking information, and any other documents provided by the carrier.

Prompt Payment Discount

If you pay within 10 business days after receiving the merchandise, you can get a prompt payment discount. You will need to provide proof of purchase.

Property Insurance

Property insurance protects against loss or damage to the contents of your shipment. Property insurance covers the cost of replacing lost or damaged goods.

Quarantine

A quarantine is a period during which a vessel is detained because of a disease outbreak or other health concerns. Quarantines may occur due to violations of various laws or issues such as disease outbreak.

Receiver

In international trade, the receiver represents the buyer, i.e., the importer. The exporter is the sender, and the importer is the receiver. Products shipped overseas based on the trade between them are sent to a predetermined delivery point or the address of the importer. The receiver is the party responsible for receiving the goods at the delivery point.

Reefer

Special equipment called Reefer Container or "Refrigerated Container" is used to ship products that need to be transported under particular temperature and humidity conditions. Generally, frozen food, fruit and vegetables, fish and meat products, medicines, and medical products are transported in this way. Reefer container not only has temperature control but also has features such as air circulation and air conditioning.

Sea Waybill “SWB”

Sea Way Bill is a type of digital bill of lading used in maritime transportation. It is arranged if the exporter or importer requests it from the shipping company before shipment. The main purpose of SWB is to prevent delays that may arise from transferring bills of lading by post and express courier, especially for shipments between ports at a close distance. The shipping company sends a digital SWB to its agency at the destination port so that the importer, the receiving company, can start the import process without wasting time.

Shipper

A shipper is the consignor company that does the loading. As agreed by the parties, the company that sends by sea, land, air, or train also prepares the export documents and shares the necessary information with the shipping company to schedule the bill of lading. The shipper is the party responsible for the shipment. If the importer organizes the transportation by the incoterms agreed by the parties, the consignee undertakes the freight cost and the risks arising from the transportation. In every case, the shipper is the seller company that does the loading process.

Supply Chain

The supply chain covers the entire process in which the product reaches the manufacturer, wholesaler, distributor, retailer, and consumer. In the scope of international trade, the supply chain refers to the shipment process that takes place between the exporter and the importer. In the global supply chain, steps such as transportation vehicles, warehouses, ports, and customs are followed.

Sales Tax

Sales tax is a tax imposed on sales transactions. Sales taxes vary depending on the state and locality where the transaction occurs.

Shipment

When you place an order, you create a shipment. A shipment consists of one or more items ordered. When you receive your shipment, you have received all the items listed on the invoice. You will pay the total amount due when you receive the shipment.

Storage Fee

This fee is charged when you store the item(s) in warehouse. Storage fees vary according to the storage period and location.

Stowage

Stowage means storing goods in containers.

Tariff

Tariffs are the rates set by the government for the transportation of goods. They are based on the weight and size of the cargo. Tariffs are usually determined by the country's customs office.

Terms & Conditions

Terms & Conditions (also known as Terms and Conditions) are written agreements between two parties. These include contracts, terms and conditions, and other legal documents. Terms & Conditions are often found in online shopping websites, mobile apps, and social media platforms.

Transportation

Transportation includes any mode of transport: road, rail, ship, air, or pipeline. Transportation costs depend on the mode of transportation chosen. For example, ocean freight charges are higher than those for ground transportation.

Tracking Number

A tracking number is a unique identifier assigned to each shipment. This number allows you to track the status of your shipment. Tracking numbers are available through the website of the shipping company or via email.

Transhipment

Transshipment refers to transferring cargo from one ship to another during an overseas shipment. The transfer process is usually done by loading the goods onto another vessel after they are unloaded at a port. The number of direct shipping services are less than the indirect services around the world in maritime shipment. However, sometimes buyer companies prefer letters of credit or sales contracts that contain a transshipment not allowed clause in order to reduce the risk of delays, damage, and loss of products on the way.

Transportation

Transportation means the delivery of a product from one point to another. International transportation includes export and import shipments between two countries by seaway, truck shipment, airway, and railroad. Transportation covers all supply chain steps within the international trade, including inland shipments, transshipments, and overseas shipments. Its also known as carriage or shipping.

Terminal Charge “Terminal Handling Charges”

Terminal Charges or terminal Handling Charges refer to the expenses incurred due to the operations carried out at the port terminals during the containers' arrival, transfer, or export stages. During the transfer of containers or partial parcels, all transactions that must be carried out within the port and customs area are priced under the name of handling charges. For example, unloading, transporting and stacking. Sometimes a container or parcel needs to be moved inside the port or warehouse. THC covers these processes.

Unit Load Device (ULD)

An ULD is a device that holds up to 50 kilograms of cargo. An ULD is used to load and unload heavy loads.

VAT

Value Added Tax (VAT) is a value added tax applied at different levels of production. It is levied on products sold in Europe. VAT is not included in the price of most products. However, it can be included in the price if the buyer requests it.

Warehouse

Warehouses are stocking areas where production equipment such as raw materials, semi-finished products, spare parts, or finished products are stored. Shipment processes over warehouses are planned according to the supply chain flow. Warehouses can have different structures according to the product group and sector. Some warehouses consist of sensitive closed areas such as air circulation and temperature control. Within the scope of international trade, warehouses are bonded areas where cargoes are kept while export or import operations are in progress.

Waybill (WB)

The waybill is a document that includes the details about the goods, freight routes, freight charges, and contact details of the seller and buyer company. Basically, it's prepared by the carrier and confirmed by the shipper, i.e., the exporter company. Air waybills and Sea Waybills are the common types of the waybill. A waybill is a shipping contract between a freight company and a shipper.

Yardage

Yardage is the distance covered by a vehicle or ship. Yardage is calculated by multiplying the speed with the time taken to cover a certain distance.

Zone

A zone is a specific geographical location. In logistics, zones are defined based on the type of business activity. Zones include: