Glossary of Terms
1. ABC Analysis
A form of Pareto analysis applied to a group of products in order to apply selective inventory management controls. The inventory value for each item is obtained by multiplying the annual demand by unit cost and the entire inventory is then ranked in descending order of cost. However, the classification parameter can be varied; for example, it is possible to use the velocity of turnover rather than annual demand value.
Source: http://www.ciltuk.org.uk/process/glossary.asp?A
2. ABC Classification
The classification of inventory, after ABC analysis, into three basic groups for the purpose of stock control and planning. Although further divisions may be established, the 3 basic categories are designated A, B and C as follows:
- A Items - An item that, according to an ABC classification, belongs to a small group of products that represents around 75-80% of the annual demand, usage or production volume, in monetary terms, but only some 15-20% of the inventory items. For the purpose of stock control and planning, the greatest attention is paid to this category of A-products. A items may also be of strategic importance to the business concerned.
- B Items - An intermediate group, representing around 5-10% of the annual demand, usage or production value but some 20-25% of the total, that is paid less management attention.
- C Items - A product which according to an ABC classification belongs to the 60-65% of inventory that represents only around 10-15% the annual demand, usage or production value. Least attention is paid to this category for the purpose of stock control and planning and procurement decisions for such items may be automated.
Source: http://www.ciltuk.org.uk/process/glossary.asp?A
3. Accounts Payable
Amounts payable from your business to your suppliers. The accounts payable department is responsible for determining what your business owes to other businesses and ensuring that they are paid.
4. Accounts Receivable
Amounts due to your business from your customers. The accounts receivable department is responsible for ensuring that customers pay their invoices.
5. AGV
Automated Guided Vehicle.
(or AGVS - Automated Guided Vehicle System)
Vehicles that can be programmed to automatically drive to designated points and perform preprogrammed functions.
Source: http://accuracybook.com/glossary.htm#A
6. ASRS
Automated Storage and Retrieval Systems. Also AS/RS. A system of rows of racking, each row having a dedicated retrieval unit that moves vertically and horizontally along the rack picking and putting away loads. The retrieval unit is guided by a computer system, telling it where to retrieve stock from and where to put it away. Versions include unit-load ASRS and mini-load ASRS.
7. Backorder
A customer demand for which no stock is available and where the customer is prepared to wait for the item to arrive in stock.
Source: http://www.ciltuk.org.uk/process/glossary.asp?B
8. Bar Code
Also known as Linear Bar Code.
A method of automatic identification using a series of light spaces and dark bars differing densities, in standard formats, to enable a computer to read data and letters accurately without keyboard entry.
Source: http://www.ciltuk.org.uk/process/glossary.asp?L
9. Bar Code Reader
Any device that can convert a bar code image into data. Common bar code readers consist of pistol-type scanners, wand scanners, and fixed position scanners. Source: http://accuracybook.com/glossary.htm#B
10. Brainstorming
Method used to generate ideas on causes and possible solutions to process problems. A brainstorming session usually involves a group of people getting together and listing ideas. Analysis and commentary on ideas is held off until after the brainstorming session has concluded.
Source: http://accuracybook.com/glossary.htm#B
11. COGS
Cost Of Goods Sold.
COGS is an accounting term used to describe the total value (cost) of products sold during a specific time period. Since inventory is an asset, it is not expensed when it is purchased or produced, it goes into an asset account (the inventory account). When product is sold, the value of the product (the cost, not the sell price) is moved from the asset account to an expense account called “cost of goods sold” or COGS. COGS appears on the profit and loss statement and is also used for calculating inventory turns.
Source: http://accuracybook.com/glossary.htm#C
12. Competitive Advantage
Situation that allows an organisation to work in a more efficient or higher-quality method than the organisations it competes with.
Competitive advantage is the unique position an organisation develops in relation to its competitors through its pattern of resource deployment and/or its product - market scope decisions.
It is the reason that a buyer chooses the company over its competitors.
13. Containerisation
The use of standardised containers for the storage and transport of materials within a facility or supply chain. Containers are of a standard size (which varies between sea and air transportation).
The benefits of containerization include reduced product damage, reduced waste (by using reusable containers), less handling, and greater levels of inventory accuracy by simplifying counting process.
14. Cost Effective
Reasonably priced in terms of the goods or services received for the money spent.
15. Database
For logistics purposes, the database is a computer term that describes the structured electronic storage of data.
Source: http://accuracybook.com/glossary.htm#D