Glossary
Plain-language definitions of the terms used in warehousing, stock control, order fulfilment and supply-chain operations. Browse by topic to see how terms relate, look one up from A to Z, or search by any name a term is known under.
Browse by topic
- Inventory and stock controlKnowing what you hold and where: SKUs, lots, stock takes, safety stock.31 terms
- Inbound: receiving and putawayFrom dock to shelf: receiving, putaway, slotting and cross-docking.9 terms
- Outbound: picking, packing and shippingFrom order to carrier: picking methods, packing, cut-off times, despatch.27 terms
- Warehouse automation (MHE)Machines that store, move and sort goods, and the technologies that guide the work.19 terms
- Systems and integrationWMS, OMS, WCS, WES, EDI and how warehouse software connects.10 terms
- Retail and supply-chain standardsGS1 identifiers, barcodes and the messages trading partners exchange.9 terms
- Metrics and KPIsThe numbers that show how stock and warehouse work are performing.25 terms
A to Z
A
ABC analysis
ABC analysis explained simply: ranking products by how much they matter and splitting them into A, B and C groups. How to use it, with an example.
AS/RS — automated storage and retrieval system
AS/RS explained simply: machines that put goods into storage and fetch them again by themselves, with nobody on board. When it pays off.
Automated guided vehicle — AGV
Automated guided vehicle explained simply: a driverless vehicle that carries goods along a set route. When it pays off, with an example.
Autonomous mobile robot — AMR
Autonomous mobile robot explained simply: a wheeled robot that finds its own way around people and obstacles. When it pays off, with an example.
B
Backorder
Backorder explained simply: an order for something out of stock, accepted now and sent when it's back. When it helps, when it hurts, with an example.
Batch number
Batch number explained simply: the code that tells one delivery of a product from another, so a problem touches only the boxes it should.
Batch picking
Batch picking explained simply: one picker collects the items for several orders in a single round, then sorts them. When it saves walking, with an example.
BPaaS — Business Process as a Service
BPaaS (Business Process as a Service) definition: cloud delivery of an entire business process, not just software.
C
Conveyor
Conveyor explained simply: a belt, roller track or chain that carries cartons, bins or pallets by itself. When it pays off, with an example.
Cost per order line
Cost per order line explained simply: what belongs in the sum, how to work it out, and why the figure can fall without anything improving.
Cross-docking
Cross-docking explained simply: goods arrive and leave again straight away, without being shelved. When it works, when it doesn't, with an example.
Cube storage — grid storage
Cube storage explained simply: bins stacked in a grid with robots on top that fetch them for a picker. When it pays off, with an example.
Cut-off time
Cut-off time explained simply: the time of day before which an order ships today. How to work it out from the courier's collection, with an example.
Cycle count — cycle counting
Cycle count explained simply: counting a few locations every day or week instead of everything once a year. A simple plan, with an example.
D
Days of inventory — stock cover
Days of inventory explained simply: how many days your stock would last at today's sales rate. Two versions, and a worked example.
Dead stock
Dead stock explained simply: items that haven't sold for a long time and probably won't. How to spot it and what to do with it, with an example.
DESADV — Despatch Advice
DESADV explained simply: the message a supplier sends ahead of a delivery listing what is on the truck, so the receiver can check goods against it.
Despatch — dispatch
Despatch explained simply: the last step, handing packed parcels to the carrier and recording that they have gone. Where errors creep in, with an example.
Dock-to-stock time
Dock-to-stock time explained simply: where the clock stops, why available matters more than put away, and why the slow tail is where the money is.
E
EDI — Electronic Data Interchange
EDI (Electronic Data Interchange) definition: structured B2B message exchange between trading partners.
EDIFACT — Electronic Data Interchange For Administration, Commerce and Transport
EDIFACT explained simply: the international format for business messages such as orders, despatch advice and invoices that computers exchange directly.
Expiry date
Expiry date explained simply: best before versus use by, what each means in a warehouse, and why the date decides what ships first.
F
FEFO — First Expired, First Out
FEFO explained simply: ship the stock that expires first, not the stock that arrived first. Less waste and a faster recall, with an example.
FIFO — First In, First Out
FIFO explained simply: your oldest stock goes out first. When the rule works, when it doesn't, and how it differs from FEFO. With an example.
Fill rate
Fill rate explained simply: the four versions that give four different answers, how to work it out, and what to do when two reports disagree.
First time right
First time right explained simply: what counts as rework, how to work the figure out
G
GLN — Global Location Number
GLN explained simply: the 13-digit number that identifies a place or a company, such as a warehouse, store or dock door, in orders and shipping messages.
GMROI
GMROI explained simply: how gross margin return on inventory investment settles the argument between a fat slow margin and a thin fast one.
Golden zone
Golden zone definition: the easy-reach band of a rack, between waist and shoulder height, where the most frequently picked articles are stored.
Goods receipt — goods-in
Goods receipt explained simply: checking a delivery against the order and booking it into stock. What to check, and why to do it the same day.
Goods-to-person — G2P
Goods-to-person explained simply: the stock is brought to the picker at a station instead of the picker walking to it. When it pays off.
GS1-128
GS1-128 explained simply: one barcode on a carton or pallet that carries product number, batch, expiry date and more, so one scan records them all.
GTIN — Global Trade Item Number
GTIN explained simply: the number under a product's barcode that identifies it worldwide, why marketplaces ask for it and how it differs from a SKU.
H
HIBC — Health Industry Bar Code
HIBC explained simply: a barcode format used on medical supplies to carry the maker, product, lot and expiry date. What it is and where you meet it.
Horizontal carousel
Horizontal carousel explained simply: a low oval loop of bins turns until the one you need stops in front of you. When it pays off, with an example.
I
IMS — Inventory Management System
IMS (Inventory Management System) definition: software that tracks stock levels, movements and valuation. A WMS directs the work of moving that stock.
Inventory carrying cost
Inventory carrying cost explained simply: the five things that belong in the sum, how to work it out as a percentage
Inventory turnover
Inventory turnover explained simply: how many times a year you sell through your stock, how to work it out and what a low number tells you.
iPaaS — Integration Platform as a Service
iPaaS explained simply: an online service that connects your business apps so data moves between them by itself. With an example for small companies.
L
Labour productivity
Warehouse labour productivity explained simply: what it counts that picks per hour does not, how to work it out, and what actually moves it.
Lead time
Lead time explained simply: the time from placing a supplier order to having the goods ready to sell. Why to measure the real figure, with an example.
Lot number
Also called a batch number: the code that tells one delivery of a product from another. The short answer; the full explanation is under batch number.
O
OEE
OEE explained simply: the three components that multiply together, where it belongs in a warehouse and where it does not
OMS — Order Management System
OMS full form and meaning: OMS stands for Order Management System, software that decides which stock is promised to which order and from where it ships.
Order cycle time
Order cycle time explained simply: where to start and stop the clock, how to work it out, and why the average hides the orders your customers complain about.
Order Orchestration
Order orchestration definition: the OMS logic that decides how, where, and when each order is fulfilled.
OTIF
OTIF explained simply: what on time in full measures, why the choice of which date you measure against can move it by ten points, and what actually fixes it.
P
Pallet AS/RS — automated pallet storage
Pallet AS/RS explained simply: cranes in narrow aisles store and fetch pallets up to the roof without drivers. When it pays off, with an example.
Perfect order rate
Perfect order rate explained simply: the four things that all have to go right, why multiplying them is brutal, and how to read the figure without despairing.
Pick and pack
Pick and pack explained simply: collecting the items on an order from the shelves, then packing them with the right label. How to keep it accurate.
Pick-to-light
Pick-to-light explained simply: lights at each shelf location show the picker where to pick and how many. Where it pays off, with an example.
Picking accuracy
Picking accuracy explained simply: how to work it out, why the figure depends on where you catch the error, and what actually moves it on the floor.
Picks per hour
Picks per hour explained simply: what it counts, how to work it out, and why a high number on its own does not tell you the shift went well.
Put-to-light
Put-to-light explained simply: a light at each slot shows where an item goes when a batch is sorted into orders. When it pays off, with an example.
Putaway
Putaway explained simply: carrying goods from the dock to a shelf and recording exactly which shelf. Simple rules that work, with an example.
R
Reorder point — reorder level
Reorder point explained simply: the stock level at which you place the next order, so the delivery arrives before the shelf is empty. With a worked example.
Return rate
Return rate explained simply: how to work it out, the three choices that decide what the figure means, and why a falling rate is not automatically good news.
Returns processing
Returns processing explained simply: logging a returned item, checking it and deciding what happens next. Why speed matters, with an example.
RFID — radio-frequency identification
RFID explained simply: a small tag answers a radio signal with its code, so goods can be read without seeing them. When it pays off, with an example.
S
Safety stock
Safety stock explained simply: the cushion of extra stock that covers a busy week or a late delivery. A simple way to size it, with a worked example.
Sell-through rate
Sell-through rate explained simply: how to work it out, why a figure without a date attached is meaningless, and why 100 per cent means you under-bought.
Serial number
Serial number explained simply: the code that belongs to one single item, so you can trace that exact unit for a repair, warranty or recall.
Service level
Service level explained simply: why it is a dial rather than a measurement, how it sets your safety stock
Shrinkage
Shrinkage explained simply: how to work it out, why paperwork rather than theft is usually the biggest cause, and how to find out which it is.
Shuttle system
Shuttle system explained simply: small vehicles run on every level of a rack and bring bins or pallets to a lift. When it pays off, with an example.
SKU — Stock Keeping Unit
SKU explained simply: the code you give each product, size and colour so stock, prices and shelf locations can be tracked. With an example.
Slotting — warehouse slotting
Slotting explained simply: deciding where each product lives in the warehouse so that picking takes the least walking. A simple start, with an example.
Sorter — automated sortation system
Sorter explained simply: a machine that reads each parcel's label and sends it to the right lane by itself. When it pays off, with an example.
Space utilisation
Space utilisation explained simply: positions versus cubic fill, how to work both out, and why a figure near 100 per cent is a warning rather than a win.
SSCC — Serial Shipping Container Code
SSCC explained simply: the unique 18-digit number on a pallet or carton label that lets the receiver scan it and know what is on it.
Stock accuracy — inventory record accuracy
Stock accuracy explained simply: how often the number in your system matches the number on the shelf. How to measure it, with a worked example.
Stock control
Stock control explained simply: knowing what you have, where it is and when to reorder, so you neither run out nor tie up cash. With an example.
Stock take
Stock take explained simply: counting what is physically on your shelves and comparing it with your records, how often to do it, with an example.
Stockout rate
Stockout rate explained simply: why counting empty bins and counting lost demand give wildly different answers, how to work both out, and which one to act on.
V
Vertical carousel
Vertical carousel explained simply: shelves on a loop inside a tall cabinet turn until the one you need reaches you. When it pays off, with an example.
Vertical lift module — VLM
Vertical lift module explained simply: a tall enclosed cabinet that brings the tray you need to an opening. When it pays off, with an example.
Voice picking
Voice picking explained simply: a headset tells the picker where to go and how many to take, hands and eyes stay free. When it pays off.
W
Warehouse execution system — WES
Warehouse execution system explained simply: software that decides minute by minute what each machine and station does next. When it pays off.
Wave picking
Wave picking explained simply: releasing orders to the shop floor in timed groups so each group is ready for the courier's collection. With an example.
WCS — Warehouse Control System
WCS meaning: a warehouse control system is the real-time software that runs conveyors, sorters and other warehouse automation on instructions from the WMS.
WMS — Warehouse Management System
WMS (Warehouse Management System) definition: software that manages inbound, storage, picking, packing, and shipping in a warehouse.
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