Glossary
A defined list of industry terms
Customer Shipment Consolidation
Partial shipments are commonplace in the shipping world. Shipment consolidation allows a consolidator to combine shipments to make shipping more efficient. It benefits businesses by reducing costs, minimizing chances of damages, and decreasing time to market.
Electronic Data Interchange (EDI)
Electronic Data Interchange (EDI) is a standardized business-to-business communications system when working with a logistics partner. It helps to replace email, fax, and postal mail by leveraging technology’s ability for instant communication, transparency, and traceability. The exchanged forms are standardized in multiple different formats to make the EDI possible for different systems to read. An EDI translator or an outsourced EDI company can be used to translate information into a standard format. EDI improves operations by providing a faster, more reliable method of communicating and transferring documents.
*EDI may be required by larger retail customers and distributors, but may not be required for all customers. It is important to evaluate customer and distributor requirements, 3PL system capabilities, EDI and middleware partners, and total volume you anticipate shipping by customer to evaluate the cost/benefit analysis of EDI start-up and integration.
Enterprise Resource Planning
As Investopedia describes it, enterprise resource planning “is a platform companies use to manage and integrate the essential parts of their businesses. Many ERP software applications are critical to companies because they help implement resource planning by integrating all the processes needed to run their companies with a single system.” It is the comprehensive backbone of a company and has many useful capabilities.
Food Process Control
The ability to quantitatively track, control, and maintain standards in the process of food being grown, processed and delivered.
Ingredient Sourcing
Ingredient sourcing is the selection of suppliers for ingredients in an edible product. There are many important considerations, including but not limited to; traceability, quality assurance, regulatory awareness, financial consideration, and availability of specialty ingredients. Some important questions to ask a potential source include: how fresh is the product they are supplying? How close are they to the source? Do they stock all year round? Ingredient sourcing can get complicated quickly without knowing the lay of the land, however with the help of a consultant that process can be simplified or completely outsourced.
Sources: https://www.naturalproductsinsider.com/sourcing/ingredient-sourcing-top-considerations,
https://www.rodeocpg.com/knowledge-share/ingredient-sourcing-101
Multi-Channel Fulfillment
Multi-channel fulfillment (MCF) allows existing e-commerce businesses to expand their reach. MCF gives the business time to focus more time on their product, and less on the logistics. First, visibility is increased by displaying the product on multiple sales channels. This not only enhances brand reach, but also customer experience and provides more chances to increase sales and revenue. Lastly, inventory is placed into an e-commerce fulfillment warehouse; allowing companies to distribute more efficiently with a wider reach.
Examples:
Direct-to-Consumer: (Shopify) when a company ships product directly to home address.
Direct-Store-Delivery: when a company ships direct to retail customer store (company to Kroger Store #1034) OR agent/broker stocks items on shelves on behalf of the company (Salty Snacks, Soda, Milk).
Fulfilled by Amazon (FBA): when a company sends case, layer, or pallet quantities to Amazon warehouse or fulfillment centers for de-bulking and re-distribution to consumers.
Dot.Com Fulfillment: when a company uses a Retailers eCommerce portal to reach consumers, but is responsible for order fulfillment directly from their point of distribution (Target.com, Walmart.com).
Quality Control
The process by which food or edible product is inspected, and records kept, post-production to ensure safety and quality.
Request for Proposal (RFP)
A “Request for Proposal” is a business document that companies or governmental organizations use when looking to complete a new project. It defines the project and solicits bids from qualified companies and contractors. Once received, the company requesting bids evaluates the viability of each potential option. RFPs are an efficient and thorough method of weighing options for new projects. Warehouse, or 3PL, RFP’s often include considerations like quality, cost, volume, outline of contractual terms/agreement, length of agreement, customer shipping profile (key customers and shipping modes).
Sensory Testing
Sensory testing is an essential part of product development. There are five senses; olfactory (smell), gustatory (taste), visual, tactile and auditory. Each of these senses are critical to determine the profile of the product, marketability, “best before date” examination, and development of existing or new products. It is usually undertaken by experienced testers or testing amateurs, with basic requirements that prepare for a successful test.
Source: https://www.tentamus.com/lab-analyses/sensory-testing/#the-5-senses
Trace and Recall Capabilities (Reverse Supply Chain)
The ability to track the movement of regulated packaged goods and products throughout its various stages of production and distribution. It is important to ensure the safety of a product and the ability to recall in case of contamination, food security, obsolescence, or product/packaging integrity issues.
Warehouse Management
Warehouse management is a comprehensive term that could be a simple reference to storage with an in/out pallet fee; or as complex as a full-outsourcing of all transportation, storage, and logistical needs. It is critical for warehouse management to take into account the following: inventory management, trace and recall capabilities, system integration with customers, system and process compatibility with your ERP (enterprise resource planning) system, quality assurance, and monthly reporting capabilities. A real-time view of your businesses’ spend rate, on-hand and allocated inventory positions are crucial for operating an agile business in changing markets.