In the field of shipping and logistics, the common terms used in freight forwarding, as well as the language that appears regularly can add complexities to the shipping process. When you do not know what some of the terms mean, it can make the shipping experience difficult and overwhelming for you. These terms are found in most shipping documents or in commercial agreements and contracts involving the buyer and seller or shipper and carrier.
Therefore, learning some of the most commonly used terms in freight and forwarding is critical. Furthermore, when you learn what the most frequently used trading terms are, you can use them for later reference if you need to establish who is in charge of arranging and paying for what in the shipping process.
Examples of common terms used in freight forwarding
Here is a list of frequently used and misunderstood terms to help you untangle the freight forwarding jargon:
A carrier is any company or individual service that helps you transport your goods from point A to B or helps you receive your goods from a particular point to your current location. Carriers are also known as freight forwarders, freight companies or trucking carrier. Sidoman is an experienced carrier in the industry that can help you transport your goods and shipments safely. Learn more here.
A lot of people think that freight brokers and freight forwarders are the same, but they are not. A freight broker is an individual that acts as a go-between between the customer and the carrier or shipper. A broker basically arranges transportation by road, rail or ocean on behalf of a shipper, consignee or freight forwarder.
On the other hand, a freight forwarder like Sidoman secures all the company business and also has the ability to store cargo in a warehouse and arrange for the distribution of said cargo or forwarding of the cargo as per the instructions of the customer. In short, freight forwarders are a bigger deal than freight brokers.
A shipper is anyone, whether an individual or business, that has goods or products that need to be transported.
A consignee is any person or destination that the freight is to be delivered to. If you buy goods online, the goods will be delivered to you, the consignee.
Accessorial are all the additional services that are given by a carrier which go beyond moving your goods. They include loading and unloading, lift-gates, etc.
This is any item(s) that is boxed, crated, or palletized for transport. It must weigh more than 68 kilograms for it to be referred to as freight.
The supply chain refers to all the resources that are utilized so that goods can move from a supplier to a customer.
Customs clearance is the process of passing shipments or freight through customs so that they can enter or leave a country.
A customs broker is an individual that is authorized by the government to act on behalf of importers and exporters with respect to the customs laws of the country.
Inbound freight refers to any shipment or goods that come are delivered directly from a vendor or manufacturer to a storage facility such a warehouse as it is in transit.
Outbound freight is the opposite of inbound freight and refers to shipments that are leaving a storage facility so that t can be delivered to the owner.
LTL or Less Than Truckload means just that. It refers to shipments that are larger than a parcel or small package. However, LTL shipments cannot fill an entire truckload hence the name less-than-truckload freight.
BOL/ Bill Of Lading
This is a document that acts as a contract between a shipper and carrier. The BOL contains important details such as the description of what is being shipped as well as details of the consignee and the dispatcher.
The PRO number
The PRO number is basically the standard trucking number. It used to help shippers track the progress of their freight.
This is where cargo is kept until it is ready to be moved.
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