Walmart China Key Terms

3PL (Third Party Logistics)

(1) A logistics model where the manufacturer outsources a package of transportion and logistics activities. (2) A firm to which logistics services are outsourced.

Aggregation

The practice of pooling variables, resulting in lower total variance for the combined variable. This practice is used for demand management, inventory management, and shipping, among other things.

ASN (Advance Ship Notice)

An EDI notification that a supplier will send to its customers when product is on the way.

Break Bulk

Dividing truckloads, railcars, of containers of homogeneous items into smaller, more appropriate quantities for use.

Cross Dock Warehouse

Product is received in one door and taken directly to outbound doors without re-packing or value-added services. This approach generally requires an advanced shipping notice and a pre-allocation of the incoming goods to specific customers or retail stores.

Cube Out

The situation when a piece of equipment has reached its volumetric capacity before reaching the permitted weight limit.

Cube Utilization

In warehousing, a measurement of how much storage capacity is being used.

Cubic Space

In warehousing, a measurement of total capacity.

Customer Service Ratio

A measure of delivery performance of finished goods shipments, usually expressed as a percentage.

Cycle Stock

The most active of the two components of item inventory. It depletes gradually as customer orders are received and is replenished cyclically when supplier orders are received.

DSD (Direct Store Delivery)

A shipment that bypasses the customer's warehouse and goes directly from the manufacturer to the retail location.

FCL (Full-Container Load)

An agreement to ship an entire container. The vast majority of intermodal and ocean freight is contracted in this manner.

Flow Through Warehouse

Product is received in one door and may be held for a few days (less than a week), repackaged or go through other value-added processes before being taken to outbound doors. However, the product is never put away as in a traditional warehouse.

FTL (FL or Full Truckload)

An agreement to ship a minimum of an entire truckload or container load to a single customer. The cargo is typically homogeneous and stays on the same vehicle from the origin to the destination.

Hub and Spoke

A transportation system design in which large terminals are used for freight consolidation. In most systems, all outbound and inbound freight use the same terminal and thus larger shipment sizes are realized. Many transportation systems use this approach (airlines, FedEx, LTL carriers, etc.).

KPI (Key Performance Indicator)

A measure that is used to assess progress toward specific organizational goals.

Line Fill Rate

A distribution performance measurement derived by dividing the total units shipped by the total units ordered. For example, shipping 950 units against orders of 1,000 units would result in a 95% level of performance for this measure.

Order Fill Rate

A distribution performance measure derived by dividing the number of complete orders shipped by the total number of orders.

Reverse Logistics

A specialized segment of logistics that focuses on the return of products for repair, replacement or credit.

SKU (Stock Keeping Unit)

A product or service identification code that can be used to keep track of physical inventory or service offerings.