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Any physical piece of cargo in relation to transport consisting of the contents and its packing for the purpose of ease of handling by manual or mechanical means. The final product of the packing operation consisting of the packing and its contents to facilitate manual or mechanical handling. Synonym: Parcel.


Materials used for the containment, protection, handling, delivery and presentation of goods and the activities of placing and securing goods in those materials. Any container or other covering in which goods are packed.

Packing department

The area that prepares picked material for shipment by performing the consolidation, packing, marking and documentation tasks required. The packing department may also be responsible for locating and picking materials for outgoing shipments. 

Packing List

Document specifying the contents of each individual package.

Packing slip

The paperwork that accompanies a shipment, pallet or smaller unit and describes its contents and quantities, and normally references the order number or numbers involved. 

Packing Unit

A type of package where a standard quantity of products of a specific product type can be packed and that requires no additional packaging for storage and shipment.


A platform on which goods can be stacked in order to facilitate the movement by a fork lift or sling.

Pallet Convertor

Superstructure which can be applied to a pallet to convert it into either a box or post pallet.

Pallet Rack

A skeleton framework, of fixed or adjustable design, to support a number of individual pallet loads.

Pallet Truck

Pedestrian- or rider-controlled non-stacking lift truck fitted with forks.

Pallet Wrapping Machine

A machine that wraps a pallet’s contents in stretch-wrap to ensure safe shipment.

Panamax Size

The maximum measurements and dimensions of a vessel capable to pass the Panama Canal.


The simultaneous performance of related activities or tasks, normally using different resources, that enables completing those activities faster than if they were done in a serial manner. 

Parcel Shipment

Parcels include small packages like those typically handled by providers such as UPS and FedEx.


An upper level item that uses a component or material (child).  


A means of sorting data.  For example, the number of quality faults by frequency of occurrence.  An analysis that compares cumulative percentages of the rank ordering of costs, cost drivers, profits, or other attributes to determine whether a minority of elements have a disproportionate impact.  Another example:  identifying that 20% of a set of independent variables is responsible for 80% of the effect.  Also see:  80/20 Rule.

Part number

The set of characters, normally alphanumeric, that identifies a specific manufactured or purchased item and is used in all database, order, inventory and other functions. 

Part period balancing (PPB)

A lot size technique that uses look ahead and look back functions to consider additional periods in modifying an initial calculation based on least total cost. 

Part Standardization

A program for planned elimination of superficial, accidental, and deliberate differences between similar parts in the interest of reducing part and supplier proliferation.  A typical goal of part standardization is to reduce costs by reducing the number of parts that the company needs to manage.

Particular Average

A fortuitous partial loss to the subject matter insured, proximately caused by an insured peril but which is not a general average loss. Particular average only relates to damage and/or expenses which are exclusively borne by the owners of a vessel which has sustained damage as a result of e.g. heavy weather or by the owners of the cargo, which has been damaged in transit.

Parts list

A listing of all components used in the production of a parent item that does not reflect its structure or intermediate levels, and is not useful in time- phasing requirements based on lead time offsets. 

Parts per million (PPM)

A quality measure of the number of defective items observed or projected out of a population of one million. 


A measure of output for passenger transportation that reflects the number of passengers transported and the distance traveled; a multiplication of passengers hauled and distance traveled.


A private code required to gain access to a computer, an application program, or service.

Past due

Line items and orders expected or promised for dates prior to the current date. Past due orders are an integral part of evaluating delivery performance and normally are prioritized when reviewing exception messages. 


A series of connected events, nodes or resources that indicates the links, direction of data flow, timing dependencies and positions of those items. 

Pattern detection

Elements in measurement and decision support systems that identify recurring relationships and distributions of data in a given set.  

Pay on Use

Pay on use is a process where payment is initiated by product consumption, i.e., consignment stock based on withdrawal of product from inventory,  This process is popular with many European companies.


A party to whom a payment is made or owed.


A party who pays or is to pay.


The revenue-producing load carried by a means of transport.


That which discharges a debt.

Payment Against Documents

Instructions given by a seller to a bank to the effect that the buyer may collect the documents necessary to obtain delivery of the goods only upon actual payment of the invoice.

Payment Collection

Obtaining money, or other agreed upon medium, for provision of goods or services.


The operations in a routing used to report production and/or labor. Quantities reported at paypoints are back flushed into previous non-paypoint operations, which may be listed on a routing but are not used for reporting due to process limitations or a condensed time frame that does not require a real-time status update of each individual step. 


Total of all fully-burdened labor costs, including wages, fringe, benefits, overtime, bonus, and profit sharing.

Peak Demand

The time period during which customers demand the greatest quantity.

Peer to Peer (P2P)

A computer-networking environment which allows individual computers to share resources and data without passing through an intermediate network server.


A technique in which a DRP system traces demand for a product by date, quantity, and warehouse location.

Per Diem

A payment rate one railroad makes to use another’s cars.

Performance Indicator

A variable indicating the effectiveness and/or efficiency of a process.

Performance Measurement

The comparison of the results of business processes with each other or with standards in order to know the effectiveness of these processes and/or the supportive actions.


A grant of authority to operate as a contract carrier.

Perpetual Inventory

An inventory record keeping system where each transaction in and out is recorded and a new balance is computed.

Perpetual inventory

The book inventory calculated as a result of all issue, receipt and adjustment transactions, as opposed to verification by physical count.  

Personal Discrimination

Charging different rates to shippers with similar transportation characteristics, or, charging similar rates to shippers with differing transportation characteristics.

Physical Distribution

Those activities related to the flow of goods from the end of conversion to the customer.

Physical Distribution

The movement and storage of finished goods from manufacturing plants to warehouses to customers; used synonymously with business logistics. See Distribution.

Physical Distribution Management

The planning execution and control of those activities which are related to the flow of goods from the end of conversion to the customer.

Physical Supply

The movement and storage of raw materials from supply sources to the manufacturing facility.

Pick and Pack

Taking goods out of a stock and packing them according to customer conditions.

Pick List

A list of items to be picked from stock in order to fill an order; the pick list generation and the picking method can be quite sophisticated.

Pick list release

The process of authorizing the pick of material for a given order, generating the paperwork and releasing to the picking department. Many variations exist in which the pick slip may be manually selected for a given order, is automatically generated a set number of days before the requirement, or is held until the calculated available inventory equals the requirement. Order processing systems often have controls that flag or stop changes to orders when the pick slip has already been released. 

Pick Order

An order to pick certain quantities of goods out of a stock.

Pick to clear

A warehouse order picking scheme that selects the item locations with the smallest quantities first. 

Pick to light

A warehouse order picking scheme that uses LED readouts for each inventory location that display the locations and quantities to be picked based on data from the warehouse management or ERP system. 

Pick Up and Delivery

A service concerning the collection of cargo from the premises of the consignor and the delivery to the premises of the consignee.


Taking products or components out of a stock.

Picking List

A list used to collect items from stores needed to fulfill an order.


Petty stealing of goods from a ship’s hold, cargo shed or warehouse.


A line of pipes for conveying liquids and gasses. The physical goods flow from a supplying organization to a receiving organization.

Pipeline Inventory

The amount of goods in a pipeline: the sum of loading stock, goods in transit and receiving stock.

Place of Acceptance

See place of receipt.

Place of Delivery

The location where a consignment (shipment) is delivered to the consignee viz. the place where the carrier’s liability ends for the transport venture.

Place of Receipt

The location where a consignment (shipment) is received by the carrier from the shipper viz. the place where the carrier’s liability for transport venture commences.

Place Utility

A value that logistics creates in a product by changing the product’s location. Transportation creates place utility.


The activity of positioning an object or goods in a chosen location or position.

Plan-Do-Check-Action (PDCA)

  In quality management, a four-step process for quality improvement.  In the first step (plan), a plan to affect improvement is developed.  In the second step (do), the plan is carried out, preferably on a small scale.  In the third step (check), the effects of the plan are observed.  In the last step (action), the results are studied to determine what was learned and what can be predicted.  The plan-do-check-act cycle is sometimes referred to as the Shewhart cycle (Walter A. Shewhart discussed the concept in his book Statistical Method from the Viewpoint of Quality Control) and as the Deming circle (W. Edwards Deming introduced the concept in Japan; the Japanese subsequently called it the Deming circle). 


The setting of goals over a certain time and the determination of how to achieve these goals and with what resource.

Planning Horizon

The period of time to which a certain particular plan relates.

Plant Finished Goods

Finished goods inventory held at the end manufacturing location.


The bare floor of a container, suitable for the carriage of uncontainerable cargo, as several platforms can be placed together to provide a larger base. Plated for the carriage of heavy goods. 20′ and 40′.

Platform Body

A truck or trailer without ends, sides or top but with only a floor.

Plimsoll Mark

A mark, welded on both sides of the vessel, which gives the limit to which a vessel may be loaded, depending on the specific gravity of the water in which the vessel is situated.

Point Value

The point value can be seen as the relative value of an empty container of a certain size type in a depot location. The system serves to quantify the imbalance costs resulting from a full container move and are the result of empty optimization calculations. Point values are created on forecasted container flows between depot locations. They are calculated taking into account i.e.. the forecasted imbalances plus repositioning, storage and container costs for empty moves and expressed in USD.

Poka Yoke (mistake proof)

The application of simple techniques that prevent process quality failure.  A mechanism that either prevents a mistake from being made or makes the mistake obvious at a glance.


A vessel with flat deck and a shallow draft.


The shared use of e.g. equipment by a number of companies, which make together the investments in the equipment mentioned.


  A shipping term for the practice of combining shipment from multiple shippers into a truckload in order to reduce shipping charges.


Aft part of a vessel where the steering engine is located.


Harbour having facilities for vessels to moor and load or discharge. Left side of a vessel when facing towards the front or forward end

Port of Call

Place where a vessel actually drops anchor or moors during a certain voyage.

Port of Discharge

The port where the cargo is actually discharged (unloaded) from the sea (ocean) going vessel.

Port of Entry

A port at which foreign goods are admitted into the receiving country.

Port of Loading

The port where the cargo is actually loaded on board the sea (ocean) going vessel.


A web site that serves as a starting point to other destinations or activities on the Internet.  Initially thought of as a home base-type of web page, portals attempt to provide all Internet needs in one location. Portals commonly provide services such as e-mail, online chat forums, shopping, searching, content, and news feeds.

Portal Crane

A type of gantry crane with vertical legs of sufficient height and width to permit vehicles or railroad equipment to pass between the legs.


A statement concerning a vessel containing the actual arrival and departure time used tugs, draft, deadweight, quantity of discharged and loaded goods/containers and any other important particulars.


Point of Shipment, or Point of Sale


The transport of empty equipment from a depot to shipper’s premises or from consignee’s premises back to a depot as the empty leg of a carrier haulage transport

Possession Utility

The value created by marketing’s effort to increase the desire to possess a good or benefit from a service.

Postal Code

A national code maintained by the Postal Authorities designed to indicate areas and accumulated addresses to facilitate sorting and the delivery of mail and other goods.


The delay of final activities (i.e., assembly, production, packaging, etc.) until the latest possible time.  A strategy used to eliminate excess inventory in the form of finished goods which may be packaged in a variety of configurations.


That what has become customary as a result of repeated acts.


The carriage of goods (containers) by any mode of transport from the place of receipt to the port (place) of loading into the ocean vessel (main means of transport).


The carrier by which the goods are moved prior to the main transport.


The function of following up on open orders before the scheduled delivery date to ensure the timely delivery of materials in the specified quantity.


A freight term which indicates that charges are to be paid by the shipper.  Prepaid shipping charges may be added to the customer invoice, or the cost may be bundled into the pricing for the product.

Prepaid Freight

Freight paid by the shipper to the carrier when merchandise is tendered for shipment that is not refundable if the merchandise does not arrive at the intended destination.

Preshipment Inspection

Abbreviation: PSI The checking of goods before shipment for the purpose of determining the quantity and/or quality of said goods by an independent surveyor (inspection company) for phytosanitary, sanitary and veterinary controls. Presently there is a tendency by developing countries to use the inspection also for the purpose of determining whether the price charged for certain goods is correct.


The act of placing goods in slings which are left in position and used for loading into and discharging from a conventional vessel.

Pre-trip Inspection

Abbreviation: PTI A technical inspection of Reefer containers prior to positioning for stuffing

Price transparency

When both buyer and seller know pricing. Net markets can eliminate arbitrage situations when only a broker knows the price. Net markets can result in sellers making more money and buyers paying a lower price, since broker margins are reduced.

Primary-Business Test

A test the ICC uses to determine if a trucking operation is bona fide private transportation; the private trucking operation must be incidental to and in the furtherance of the firm’s primary business.


Person for whom another acts as agent.

Principal Carrier

See Responsible Carrier.

Principal Corporate Body

The company that owns the various subsidiary companies or branches acting as customers on their own and is registered as the corporate customer for statistical purposes.

Priority Order

An order which is identified as taking precedence over other orders to ensure its completion in the minimum time.

Private Carrier

Business which operates trucks primarily for the purpose of transporting its own products and raw materials. The principle business activity of a private carrier is not transportation.

Private Carrier

A carrier that provides transportation service to the firm that owns or leases the vehicles and does not charge a fee. Private motor carriers may haul at a fee for wholly owned subsidiaries.

Private Warehouse

A warehouse operated by the owner of the goods stored there.

Private Warehousing

The storage of goods in a warehouse owned by the company that has title to the goods.

Pro Forma Invoice

Draft invoice sent to an importer by the exporter prior to order confirmation and shipment to assist in matters relating to obtaining import licenses or foreign exchange allocations, or simply to advise the value of a consignment so that letters of credit can be opened.


The strategy of understanding issues before they become apparent and presenting the solution as a benefit to the customer, etc.


A series of time-based activities linked to complete a specific output.

Process Benchmarking

Benchmarking a process (such as the pick, pack, and ship process) against organizations know to be the best in class in this process.  Process benchmarking is usually conducted on firms outside of the organization’s industry. 

Process Improvement

A design or activity which improves quality or reduces costs, often through the elimination of waste on non-value-added tasks.

Process Manufacturing

Production that adds value by mixing, separating, forming, and/or performing chemical reactions.  It may be done in a batch, continuous, or mixed batch/continuous mode.

Process Yield

  The resulting output from a process.  An example would be a quantity of finished product output from manufacturing processes.


The activities which ensure the availability of the material and or services in the desired quantity, quality, place and time from the supplier.

Procurement hub

An MRO procurement marketplace for routine purchases such as office supplies, travel services, or computers needed to run a business but not central to the business’s output. A type of horizontal or functional market. Examples: Ariba, Commerce One. (Related terms: MRO, horizontal market)

Procurement Logistics

Control of the flow of materials up to the manufacturing process.


A result, end item or output from a certain process.

Product Chain

All phases in the transformation- or production process of one product.

Product Characteristics

All of the elements that define a product’s character, such as size, shape, weight, etc.

Product Description

The user’s description of the product.

Product ID

A method of identifying a product without using a full description. These can be different for each document type and must, therefore, be captured and related to the document in which they were used. They must then be related to each other in context (also known as SKU, Item Code or Number, or other such name).

Product Life Cycle

The period of time between the introduction date and end date of a product in the market.


The conversion of materials and or assembly of components to manufacture goods, products or services. The total quantity of goods manufactured or to be manufactured in a particular period of time expressed in quantitative or financial terms. (The term manufacturing is often used specifically for physical operations resulting in a product).

Production Capacity

Measure of how much production volume may be experienced over a set period of time.

Production Line

A series of pieces of equipment dedicated to the manufacture of a specific number of products or families.

Production-Related Material

Production-related material is an item classified as a material purchase and included in cost-of-goods sold as a raw material purchase.


Relative measure of output of labour hour or machine hour.

Profit Centre

A business unit or department which is treated as a distinct entity enabling revenues and expenses to be determined so that profitability can be measured.

Profit Ratio

The percentage of profit to sales–that is, profit divided by sales.

Project Cargo

Quantity of goods connected to the same project and often carried on different moments and from various places.


  The act of selling a product at a reduced price, or a buy one/get one free offer, for the purpose of increasing sales.

Proof of Delivery

The receipt signed by the consignee upon delivery.

Proof of Delivery (POD)

Information supplied by the carrier containing the name of the person who signed for the shipment, the time and date of delivery and other shipment delivery-related information.  POD is also sometimes used to refer to the process of printing materials just prior to shipment (Print on Demand).

Proper Shipping Name

A name to be used to describe particular goods on all shipping documents and notifications and, if appropriate, on the goods.

Propriety Standard

A standard which has been endorsed by industry or government as the accepted international standard, but not officially approved by an accredited standards body such as ISO.

Protection and Indemnity Club

Abbreviation: P & I club. A mutual association of shipowners who provide protection against liabilities by means of contributions.


A statement drawn up to attest certain events.


Communication standards that determine message content and format, enabling uniformity of transmissions.

Public Authorities

The agencies or officials in a state responsible for the application and enforcement of the laws and regulations of that state. Source: IMO.

Public Warehouse

A warehouse which is available to all companies and persons who wish to make use of the services offered.

Pull Distribution System

A system to provide warehouses with new stock on request of the warehouse management.

Pull Ordering System

A system in which each warehouse controls its own shipping requirements by placing individual orders for inventory with the central distribution center. A replenishment system where inventory is “pulled” into the supply chain (or “demand chain” by POS systems, or ECR programs). Associated with “build to order” systems.

Pull Signal

A signal from a using operation that triggers the issue of raw material.

Purchase Order

A definite order for one or more deliveries by the supplier to the customer of a specific quantity of goods, materials, services or products under agreed terms of delivery and prices.

Purchasing hub

Buyer-centric mediators that aggregate demand from small buyers to negotiate better terms with large sellers. Can be horizontal (operating supplies) or vertical manufacturing. Used for spot purchasing (using exchange or auction) or systematic purchasing (catalog mechanism). The horizontal purchasing hubs use horizontal logistics (UPS, for example), while the vertical purchasing hubs generally need vertical logistics (for hazardous chemicals, for example) work with existing distributors.

Pure Raw Material

A raw material that does not lose weight in processing.

Push Distribution

The process of building product and pushing it into the distribution channel without receiving any information regarding requirements. 

Push Distribution System

A system to provide warehouses with new stock upon decision of the supplier of the goods

Push Ordering System

A situation in which a firm makes inventory deployment decisions at the central distribution center and ships to its individual warehouses accordingly.

Push Technology

Web casting (push technology) is the prearranged updating of news, weather, or other selected information on a computer user’s desktop interface through  periodic and generally unobtrusive transmission over the World Wide Web (including the use of the web protocol on intranet).  Web casting uses so-called push technology in which the web server ostensibly pushes information to the user rather than waiting until the user specifically requests it.

Put Away

Removing the material from the dock (or other location of receipt), transporting the material to a storage area, placing that material in a staging area, and then moving it to a specific location and recording the movement and identification of the location where the material has been place.

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