Those with an interest in the field may find some logistics terminology initially confusing, so in this article we present definitions of some frequently used phrases.
ABC analysis: Refers to the process of classification of products as per the level of importance in terms of their relative criteria such as purchase or sales volume. It can be described as a technique that is used in a business sense for denoting a categorization of large volume of data into groups. These groups thereafter can be marked as A, B and C. This means that activities that are considered high on priority are labeled as A, those with a lesser priority are grouped under B and the group of activities that are last on the list of priority are labeled C.
Open Policy: This refers to a cargo insurance policy that has an open contract. It gives protection for all the shipments of an exporter that are afloat or in mode of transit within the specified geographical locations for an unlimited period. This policy comes to an end when the open policy is canceled by the insurance company or the insured.
Military Logistics: Means a system which is initialized for the purpose of creating and sustaining military capabilities. It can be also described as the art and science of planning, controlling and managing the maintenance and movement of the armed forces of military. It deals with the designing, storage, development, maintenance and disposition of available material resources. This logistics terminology also deals with the movement and hospitalization of military personnel, operation and facility disposition, and military logistics is regarded as very ancient in nature, with its roots way back in the times of the Roman and Greek empire.
Consignee: This refers to an individual, company or manufacturer to whom a shipper or seller sends merchandise. Intermediate consignee refers to a party who is responsible for merchandise delivery to the ultimate consignee. Ultimate consignee, on the other hand, refers to a party who is in the actual receipt of the merchandise in an export-related transaction.
Air Way bill: This refers to a bill of lading that is related to air transportation which tends to serve as the shipper’s receipt. It indicates that the carrier company has consented to the listed goods and under an obligation to carry the products that are delivered in the form of a consignment to the destination airport in accordance with the conditions specified to the consignee and consignor. Air way bills are always non-negotiable.
Logistics can be classified as a complete process of providing goods at the right time, at the right place, for a right price and at the right condition. Logistics has evolved to unmatched heights because of advances in the field all over the globe. Many organizations which used to treat the process as a burden are now focusing on the growth and development of logistics by making it an integral part of the organization, so just about anyone involved in business can benefit from an understanding of logistics terminology.