Here is a list of commonly used terms in the EDI and Commport environment. While it primarily covers EDI terminology, you’ll also find some GDSN and Commport products and services included throughout.
ACH (Automated Clearing House) is an electronic funds transfer (EFT) system that facilitates direct payments and deposits between bank accounts in the U.S. It is managed by Nacha (National Automated Clearing House Association) and is widely used for transactions like payroll deposits, bill payments, tax refunds, and business-to-business payments.
A widely used EDI standard developed by the American National Standards Institute for business transactions in North America.
API (Application Programming Interface) is a set of rules and protocols that allow different software applications to communicate and interact with each other. It defines how requests and responses should be structured, enabling seamless data exchange between systems.
An Advanced Ship Notice (ASN) is an electronic notification sent by a supplier to a buyer or retailer, providing detailed information about a shipment before it arrives. It is commonly used in Electronic Data Interchange (EDI) transactions to improve supply chain efficiency.
Business to Business denotes trade conducted over the internet between businesses.
B2C (Business-to-Consumer) refers to a business model where companies sell products or services directly to individual consumers, rather than other businesses. It is commonly associated with retail, e-commerce, and service industries where the end-users are everyday customers.
B2G (Business-to-Government) refers to a business model where companies provide products, services, or solutions to government agencies, public sector organizations, or regulatory bodies. It involves contracts, tenders, and long-term agreements between businesses and government entities.
A backorder occurs when a product is out of stock but is still available for purchase, with the expectation that it will be restocked and shipped at a later date. Businesses use back orders to continue accepting orders even when inventory is temporarily unavailable.
A barcode is a machine-readable representation of data that encodes information about a product, item, or asset. It is typically displayed as a series of parallel lines (1D barcode) or patterns (2D barcode) that can be scanned and decoded using barcode scanners or mobile devices
A Bill of Lading (BOL) is a legally binding document issued by a carrier (shipper) to a sender (consignor) that outlines the details of a shipment. It serves as a receipt, contract, and document of title for the transported goods
A carrier is a company or individual responsible for transporting goods, people, or information from one location to another. Carriers play a crucial role in supply chain management, e-commerce, and freight transportation by ensuring the timely and secure delivery of shipments.
Penalties or cost offsets that are assessed by a retailer to a supplier for not following vendor procedures, the compliance manual or vendor agreements established in the contract with the retailer. Chargebacks can be associated with incorrect discounts, order fill rates, missing data, data quality, labeling, packing and carton-marking requirements.
Commport Monitoring Centre is a visibility tool used both internally on the CCI processing environment as well as externally by our customers.
Commport Datapool is a certified data pool. It is both a source (supply side) and a recipient (demand side) data pool that offers customized tools to enable each partner to manage their data synchronization initiative. We help our customers implement GDSN standards as part of an organizational initiative or a retailer mandate. Loading your item data or migrating to our GDSN Datapool solution is simple and secure.
The Commport VAN has established interconnects with all of other major VAN service providers to ensure your documents are forwarded without delay or additional costs. We also operate as an EDIINT gateway, connecting directly with trading partners and customers using AS2, FTP and SFTP whenever that is required.
In order to conduct Electronic Data Interchange (EDI) transactions with a trading partner, businesses need a way of transmitting their EDI messages. Generally speaking, when conducting EDI transactions with a trading partner, there are only two sets of options for transmitting EDI messages. The first option involves a third party service known as a VAN or Value Added Network, while the second option does not. In the second option, known as the Direct or Point-to-Point method, two trading partners connect directly with one another through an agreed communication protocol such as FTP, FTPS, SFTP, AS2, or OFTP. You will still need to select an EDI communication protocol if you transact through a VAN. The main difference with connecting directly is that, when you use a VAN, you will generally only need one protocol – the protocol for communicating with the VAN.
The smallest unit of information in an EDI message, representing a single value, like a price or quantity.
A database is an organized collection of data, generally stored and accessed electronically from a computer system. Where databases are more complex they are often developed using formal design and modeling techniques.
A debit memo (or debit memorandum) is a document issued by a buyer or a bank to notify the seller or supplier about a reduction in the amount owed for a particular transaction. It is essentially a formal request for an adjustment to the original invoice, typically due to errors, discrepancies, or returned goods. Debit memos are often used to correct billing mistakes, account for returns, or reflect price adjustments in business transactions.
Direct Store Delivery (DSD) is a supply chain and distribution strategy where manufacturers or suppliers deliver products directly to retail stores, bypassing centralized distribution centers. This model is commonly used in industries where speed, freshness, and product visibility at the store level are critical, such as in beverages, snacks, and perishable goods.
Direct to Consumer (DTC) refers to a business model where a company sells its products directly to end customers, bypassing traditional intermediaries such as retailers, wholesalers, or distributors. This approach allows brands to have greater control over their marketing, sales, customer experience, and product pricing. DTC is becoming increasingly popular with the rise of e-commerce and online platforms, enabling companies to connect directly with their consumers.
A Distribution Center (DC) is a centralized facility used by businesses to store products, manage inventory, and coordinate the distribution of goods to various destinations, including retail stores, wholesalers, or directly to consumers. Unlike traditional warehouses, distribution centers are designed for the efficient flow of goods, often serving as a hub in the supply chain to streamline inventory management and fulfill orders quickly.
An EDI document is comprised of data elements, segments and envelopes that are formatted according to the rules of a particular EDI standard. When you create an EDI document, such as a purchase order, you must adhere to the strict formatting rules of the standard you are using.
Dropshipping is a business model in which a retailer does not keep goods in stock. Instead, when a customer makes a purchase, the retailer transfers the order details directly to a supplier or manufacturer, who then ships the products directly to the customer. The retailer never handles the product themselves, which allows them to focus on marketing, sales, and customer service.
Ecommerce, short for electronic commerce, refers to the buying and selling of goods and services over the internet. It involves any transaction that occurs online, ranging from purchasing physical products to downloading digital goods and services. Ecommerce has grown exponentially over the years, driven by technological advancements, the rise of online payment systems, and a shift in consumer behavior toward online shopping.
Electronic data interchange (EDI) is the concept of businesses electronically communicating information that was traditionally communicated on paper, such as purchase orders, advance ship notices, and invoices. Technical standards for EDI exist to facilitate parties transacting such documents. EDI implies a sequence of messages between two parties, either of whom may serve as originator or recipient. The formatted data representing the documents may be transmitted from originator to recipient via telecommunications. In EDI, the usual processing of received messages is by computer only. Human intervention in the processing of a received message is typically intended only for error conditions, for quality review, and for special situations.
Refers to map document that identifies the specific segments that an individual organization requires as part of its implementation of the EDI specification.
EDI mapping is a process through which EDI data is translated to a format that is more easily used in new business systems. Through EDI Mapping you can, for example, translate EDI documents from a text, XML formats and other forms.
An EDI provider is a company that offers services and software to facilitate Electronic Data Interchange (EDI) between businesses. EDI is the digital exchange of business documents (such as invoices, purchase orders, shipping notices, etc.) in a standardized electronic format between organizations, eliminating the need for paper-based processes.
EDI providers help businesses set up and maintain the infrastructure required for these electronic transactions, ensuring smooth communication and data transfer between various trading partners, such as suppliers, distributors, and retailers.
Every company whom uses EDI to send and receive their business documents has an EDI Profile. It is kind of like a street address used to locate someone’s home. Usually included in the EDI Profile is the ISA ID, Qualifier, GS ID and VAN.
Organizations that send or receive EDI documents between each other are referred to as “trading partners” in EDI terminology. The trading partners agree on the specific information to be transmitted and how it should be used. This is done in human-readable specifications. While the standards are analogous to building codes, the specifications are analogous to blueprints (specifications may also be called “mapping,” but the term mapping is typically reserved for specific machine-readable instructions given to the translation software.) Larger trading “hubs” have existing Message Implementation Guidelines which mirror their business processes for processing EDI and they are usually unwilling to modify their EDI business practices to meet the needs of their trading partners. Often in a large company, these EDI guidelines will be written to be generic enough to be used by different branches or divisions and therefore will contain information not needed for a particular business document exchange. For other large companies, they may create separate EDI guidelines for each branch/division.
The standards prescribe the formats, character sets, and data elements used in the exchange of business documents and forms. The complete X12 Document List all major business documents, including purchase orders and invoices.
The EDI standard prescribes mandatory and optional information for a particular document and gives the rules for the structure of the document. The standards are like building codes. Just as two kitchens can be built “to code” but look completely different, two EDI documents can follow the same standard and contain different sets of information.
EDI translator is a software application that transforms data from one format to another (Ex from CSV to ANSI X12). It uses maps built from mapping Documentation as instructions. Maps are built using EDI Standards, Company Specifications and Business Rules
EDIFACT is an acronymn for Electronic Data Interchange For Administration, Commerce and Transport. It is a form of text or ‘flat’ file. EDIFACT is accepted as the international EDI standard that has been adopted by organizations wishing to trade in a global context. A standard set of syntax rules have been ratified by the United Nations.
The Element in and EDI transaction set are the individual data within the document. Each data element in a transaction set is defined in the EDI Standard by the type of data it represents. For example, it would be important to distinguish numeric data from text data or calendar dates. The data element definition will describe:
A development environment is a collection of procedures and tools for developing, testing and debugging an application or program. The development environment normally has three server tiers, called development, staging and production.
First In, First Out (FIFO) is an inventory management method used to determine the order in which goods are sold or used. It assumes that the first items to be purchased or produced are the first ones to be sold or used in operations. This method is commonly used in various industries, including retail, manufacturing, and logistics, to manage inventory efficiently.
A flat file layout is a definition that represents the data structure of a flat (text) file to be processed. When reading from or writing to a flat file, Commport can use a file layout as a template to identify and correctly process the records and fields of the file. Also known as FF specifications.
A fixed flat file is characterized by the fact that each field has a predetermined number of characters, there is no need to separate the data by a character. This is called a Fixed Length Flat File. A fixed flat file must be accompanied by a complete description containing the position, length, type (digital or alphanumeric), and content of each data field.
A Delimited Flat File is when the data fields are separated (delimited) by a particular character such as a semicolon, vertical line, or tab. CSV(Comma separated variable) format is the best-known example of this. The specification document for a flat, delimited file describes each type of line, the sequence of the data fields, their numerical (or alphanumeric) type, and the file content.
A freight bill is the carrier’s invoice for the shipment of goods. It includes details about the product(s) being transported, such as weight, dimensions, destination, and possibly additional charges like fuel surcharges, taxes, or special handling fees. An example of an EDI format related to freight bills is EDI 210 Motor Carrier Freight Details and Invoice, which enables the electronic transmission of freight charges between trading partners.
Freight carriers are companies that transport freight (goods) from one location to another. These can be “for-hire” carriers, meaning they offer transportation services for a fee. Freight carriers can use various methods of transportation, including:
A freight charge is the rate set by the carrier for moving goods between two points. This charge can include basic transportation costs and additional fees, such as fuel surcharges, tolls, or handling fees.
When freight is collect, the consignee (the recipient of the goods) is responsible for the payment of shipping charges and any ancillary charges. This term is also referred to as “collect upon arrival” and means the buyer or recipient will pay for the freight costs when the goods are delivered or upon receipt.
When freight is prepaid, the shipper (the sender or seller of the goods) is responsible for paying the shipping charges and any ancillary costs. This is also called “prepaid and add“, meaning the freight charges are included in the overall invoice to the buyer, who may be billed for the shipping costs along with the cost of the goods.
Fulfillment refers to the process of completing an order from the point of sale to the delivery of the product to the customer. The fulfillment process typically involves:
An EDI transaction set (e.g., X12 997) used to confirm the receipt and syntactic correctness of an EDI message.
The Global Data Synchronization Network (GDSN) is a network of interconnected data pools (Commport is one certified data pool) that trading partners use to efficiently and securely share product information. It was developed by GS1 (Global Standards), the entity that creates and updates these standards..
Some Companies may ask for a GS ID, as well. Also known as the Group ID, your GS ID is usually the same as your ISA ID.
The Global Trade Item Number (GTIN) is an identifier for trade items, developed by GS1. Such identifiers are used to look up product information in a database (often by entering the number through a barcode scanner pointed at an actual product) which may belong to a retailer, manufacturer, collector, researcher, or other entity. Commport uses GTINs with our Datapool services.
GS128 refers to a specific format within the Global Standards 128 (GS1-128) barcode standard, which is used to encode product and logistics information in a machine-readable format. GS1-128 barcodes are a widely used type of barcode for logistics, supply chain management, and shipping.
Hardlines refer to a category of retail products that are durable, non-consumable, and typically consist of goods made from hard materials such as metal, plastic, or wood. These products are typically sold in the home improvement, hardware, appliance, furniture, and electronics sectors.
EDI term for a company that initiates a B2B program with its business partners, usually a buyer.
A good or service brought into one country from another.
A system used by companies (retailers, distributors, suppliers) to store item details. Commonly referred to as the item master.
An IDOC (Document Intermediate) file is an example of a fixed flat file. It is a form of text file.
A single EDI transmission that may contain multiple transaction sets and functional groups between trading partners.
A unique identifier assigned to an interchange to track and validate its processing
Commport’s Internet EDI offers functionality, automation and control to organizations looking to automate their fulfillment processes and become EDI compliant. Simple order picking, staging and packing is built into the Internet EDI platform, fully automating complex tasks to insure order accuracy. Shipping notices, ASN shipping labels are quickly and easily generated in Internet EDI, eliminating costly shipping errors. Order management, tax compliance, fulfillment automation, ASN label generator and trading partner contract pricing are all features of the Internet EDI platform. No specialized EDI knowledge, training or large IT resources are required due to Internet EDI’s intuitive and familiar interface.
Both the sender of an EDI transaction and receiver of an EDI transaction must have an ISA ID present in the data in order for the transaction to be sent and received successfully. Additionally, each ISA ID has a Qualifier associated with it. This is essentially a business’s license plate.
Just in Time (JIT) Fulfillment is a supply chain management strategy that aims to improve efficiency by receiving goods only as they are needed in the production process, rather than holding large amounts of inventory. This approach minimizes the need for inventory storage and reduces the risk of overstocking, thereby optimizing costs and improving the flow of goods.
A Kilocharacter is a way to measure the size of a file and is equivalent to 1,024 electronic characters. In practical terms, average purchase orders will equal about two kilocharacters.
Sender, Receiver, Transaction type, File format (.txt, .edi), Identifiers
A block or section of an EDI file is called a Loop. Each loop contains several different Segments, which are comprised of Elements and Sub-Elements. Although Loops are the biggest component in an EDI, they are often the hardest to distinguish.
A Load Tender is a formal request or offer to a carrier to transport a shipment of goods, typically issued by a shipper or logistics provider. It specifies the details of the shipment, such as the type of cargo, pickup and delivery locations, timing, and other conditions related to the transportation of the load. The carrier can then accept or reject the tender based on their availability and ability to meet the terms.
The actual code that supports data transformation from one format to another.
The process of defining how data from a business document (e.g., a purchase order) is translated into an EDI standard format.
Master Data Management (MDM) is a set of processes, technologies, and tools used to ensure that an organization’s critical data is consistent, accurate, and trustworthy across the enterprise. It focuses on managing the “master data”—the key business information about entities such as customers, suppliers, products, and employees—across all systems and departments to create a unified, accurate, and reliable data environment.
A Micro Fulfillment Center (MFC) is a small, localized warehouse or facility that is strategically positioned near urban or high-demand areas to streamline the fulfillment process, typically for e-commerce businesses. These centers are designed to handle a high volume of small, fast-moving goods and focus on speeding up the last-mile delivery process. Micro fulfillment centers are especially beneficial for businesses looking to meet the growing demand for quick and efficient delivery times, often offering same-day or next-day delivery services.
A network path specifies a unique location in a file system. A path points to a file system location by following the directory tree hierarchy expressed in a string of characters in which path components, separated by a delimiting character, represent each directory. The delimiting character is most commonly the SLAsh(“/”), the backslash character (“\”), or colon (“:”), though some operating systems may use a different delimiter. Paths are used extensively in computer science to represent the directory/file relationships common in modern operating systems, and are essential in the construction of Uniform Resource Locators (URLs). Resources can be represented by either absolute or relative paths.
Omnichannel refers to an integrated approach to customer experience and retail strategy that allows businesses to provide a seamless and consistent experience across multiple channels, both online and offline. In an omnichannel environment, customers can interact with a brand through various touchpoints such as physical stores, websites, mobile apps, social media, email, and call centers, among others. The key feature of omnichannel is that all these channels are interconnected, providing a unified experience regardless of the platform or device being used.
Omnichannel Fulfillment refers to the process of delivering products to customers through multiple, integrated fulfillment methods, allowing them to receive their orders via the channel that is most convenient for them. The fulfillment process is designed to provide a seamless experience across various sales and distribution channels, such as online stores, physical stores, mobile apps, and third-party platforms. The goal is to ensure customers can purchase products through their preferred channel and receive them in the most efficient manner, whether it’s through home delivery, in-store pickup, or another option.
Order Management System (OMS) refers to a software solution used by businesses to manage and streamline the entire order process, from order creation and fulfillment to tracking and returns. It helps businesses efficiently handle customer orders, ensuring timely delivery, accurate processing, and effective inventory management. OMS plays a crucial role in supporting the order lifecycle and integrating various channels for both online and offline sales.
Out of Stock (Stockout) refers to a situation where a retailer, supplier, or warehouse runs out of inventory for a particular product, meaning they are unable to fulfill customer orders due to the lack of available stock. This can happen for various reasons, such as unexpected demand, supply chain disruptions, or inventory management errors.
Overstock refers to a situation where a business has more inventory on hand than is required or can be sold within a reasonable time frame. It occurs when a company overestimates demand or fails to properly manage its inventory, leading to an excess of goods that are not moving off the shelves.
A Product or software is a set of instructions or programs instructing a computer to do specific tasks. They are generic terms used to describe computer programs that run on PCs, mobile phones, tablets, or other smart devices. Product/Software is often used to describe all the functional aspects of a computer that do not refer to its physical components (hardware). Everything that “runs” on a computer, from an operating system, to a diagnostic tool, video game, or app can be defined as software.
A packing slip is an itemized list of the products included with a shipment or order. It typically includes details such as the quantity, description, weight, and other relevant information about the contents of the shipment. The shipper prepares this document and includes it with the shipment. In cases of drop-shipping, retailers may brand the packing slip to clearly indicate that the products are coming from them, not the third-party shipper.
A Peer-to-Peer network allows users to connect directly with one another without a middleman. Each participant in a P2P network acts as both a supplier and a consumer of resources. Early examples include music-sharing platforms like Napster. Today, P2P networks are integral to services like Bitcoin and other cryptocurrencies, enabling payments to be made directly between individuals without involving traditional financial institutions.
This refers to the process of picking products from shelves in a fulfillment center or warehouse, packing them, and then shipping them directly to the consumer. This model is especially beneficial for eCommerce retailers who want to outsource the handling of their products, enabling them to sell items without having to manage physical inventory or shipment logistics themselves.
A merchandising plan is a financial document that sets goals at the category level, typically created either seasonally or annually. It helps businesses map out their merchandising strategy, ensuring they are stocked with the right products at the right time and are meeting their sales and financial objectives.
A planogram is a visual representation or diagram that illustrates how products should be placed within a store to maximize visibility and sales productivity. This tool helps retailers design efficient product layouts that encourage customer purchases by considering factors like space, product grouping, and eye-level placement.
The Purchase Order Acknowledgement (EDI 855) is an EDI document used to confirm the receipt of a purchase order (EDI 850). It signals a supplier’s intent to fulfill the order and can provide feedback on any issues such as backorders or discrepancies with the order. It also helps streamline communication between trading partners, reducing the likelihood of errors and ensuring that everyone is aligned on order details.
A POS system combines hardware (such as cash registers) and software to facilitate transactions at retail locations. It processes payments, manages inventory, and can track various operational metrics like sales history, customer data, and inventory levels. Modern POS systems are often integrated with other business systems like marketing tools, ERP, and accounting software for seamless operations.
Procurement is the process of sourcing and acquiring goods and services. It typically includes identifying product requirements, finding suppliers, negotiating contracts, issuing purchase orders, tracking deliveries, and managing supplier relationships. Effective procurement processes are crucial for ensuring that businesses maintain efficient operations and cost management.
PIM is a system used to manage and centralize product data. This master set of product information can be distributed across various platforms, including websites, marketing teams, and ERP systems. By centralizing product data in one location, businesses can ensure consistency and accuracy in their product listings, improve customer experience, and reduce errors across different systems.
Product planning involves the steps taken to bring a product from concept through market analysis, pricing, revenue goals, and eventually to launch and beyond. This includes researching competitors, determining market fit, setting price points, and managing the product throughout its lifecycle, from launch to potential phase-out or discontinuation.
Product turns refer to a metric that measures how frequently a product or category sells during a specific time period. It is calculated by dividing the sales or cost of goods sold over a period by the average inventory level during that period. This metric is crucial for assessing how efficiently inventory is being sold and turned over.
The purchase order change process occurs when a buyer or seller needs to modify an order after it has been placed. If a change is necessary—such as altering the quantity or requesting a backorder—EDI 860 (Purchase Order Change Request) is used to officially update the order. This process ensures that both the buyer and seller agree to the changes before proceeding, which helps avoid billing issues or confusion down the line.
The Qualifier comes before the EDI ID, and is used to identify and describe the content that follows.
Radio Frequency Identification (RFID) is a data collection technology that utilizes electronic tags for storing data. These tags, also called “electronic labels,” “transponders,” or “code plates,” consist of an RFID chip attached to an antenna. Similar to barcodes, RFID tags identify items. However, unlike barcodes, which require line of sight and proximity to be scanned, RFID tags can be read without line of sight, allowing them to be embedded within packages. RFID tags can be read at varying distances, depending on the type and application. Furthermore, RFID-tagged cartons on a conveyor belt can be scanned much faster than barcoded boxes.
A customer that purchases our EDI services through a reseller of Commport’s services.
A reseller is a company that purchases Commport’s services with the intention of selling them to their customers – rather than consuming or using them themselves.
A Regional Distribution Center (RDC) is a warehouse strategically located to support customers such as suppliers, distributors, retail stores, or end consumers. RDCs are typically positioned in key geographical areas to optimize logistics and distribution efficiency, ensuring timely delivery of goods.
Replenishment refers to the process of ordering and moving inventory from upstream or reserve storage locations to downstream or primary storage, picking, and shipment locations. The goal of replenishment is to maintain a steady flow of inventory throughout the supply chain by ensuring efficient order fulfillment and line item fill rates. Proper replenishment helps keep stock levels optimal and prevents stockouts.
A response to a load tender is the transaction used to indicate the acceptance of a load tender, signaling that the carrier or party has agreed to transport the specified goods. This response ensures that both parties involved in the shipment (the sender and the carrier) are aligned regarding the transportation of the goods.
A retailer is a business or individual who sells goods directly to consumers, in contrast to wholesalers or suppliers who typically sell goods to other businesses. Retailers operate in various sectors and can sell products through physical stores, online platforms, or a combination of both.
Return Merchandise Authorization (RMA) is an EDI document (EDI 180) used by retailers to notify their suppliers that a return has been authorized. It is an essential part of the return process and helps streamline communication between trading partners. Automating the RMA process offers significant benefits by improving efficiency, reducing errors, and enhancing the overall customer experience.
Software as a service is a method of software deliver and licensing in which software is accessed online via a subscription, rather than bought and installed on individual computers. Commport provides SAAS.
Safety stock refers to an inventory level maintained above the basic level to ensure an item is available when a customer needs it. This buffer stock addresses fluctuations in sales, inconsistent inventory supply, long supply lead times, and concerns related to store stocking. Safety stock acts as a safeguard to prevent stockouts and ensure a smooth flow of inventory.
A sales receipt is a document that records a sale, confirming that the buyer has paid the seller for goods or services, and the transaction is complete. A partial receipt indicates that payment will be made in installments. Unlike an invoice, which is issued when an order is placed and payment is due later, a receipt is a confirmation of completed payment.
The Standard Carrier Alpha Code (SCAC) is a four-letter code used to identify a transportation carrier. This code is primarily used in the United States and is crucial for tracking and managing shipments within the supply chain.
Scan-Based Trading (SBT) is a method of using Point of Sale (POS) data from scanners and retail checkouts to initiate invoicing between a manufacturer and a retailer. Also known as pay-on-use, this system helps automate and streamline the invoicing process, ensuring accuracy and efficiency.
Segment is a structural part of any EDI message and is represented as a group of related data elements. Being an intermediate information unit, EDI segment usually contains one or more data elements. Segment starts with a three-character data identifier and ends with a segment terminator.
A segment terminator is a special character that marks the end of a segment. The segment terminator must be defined in the EDI data format. Select a character that is not likely to be used in any content information. This will help prevent translation errors during processing. The tilde (~) and new line (N/L) characters are common segment terminators for the ANSI X12 standard. The single quote (‘) is a common segment terminator in the UN/EDIFACT and TRADACOMS standards.
The sell-through rate is the percentage of purchased inventory that has been sold. It’s especially useful in seasonal businesses to track product movement. Retailers must monitor this rate to identify opportunities and avoid overstocking slow-moving items. Suppliers can also use sell-through data to adjust inventory levels and optimize their product offerings to buyers.
Shelf life refers to the recommended length of time that a product can be stored before it becomes unfit for use, consumption, or sale. This term is particularly relevant for perishable goods and helps businesses manage inventory effectively, ensuring products are used before they expire.
Shelf-ready packaging (SRP), also called display-ready or floor-ready packaging, refers to the preparation of products for direct placement on retail shelves without needing unpacking or repacking. SRP includes packaging designed to be easy to display, and it supports sales and inventory management by making products ready for sale right upon arrival at the store.
A shipper is the consignor, exporter, or seller identified in shipping documents as the party responsible for initiating a shipment. The shipper may also bear the freight costs and handle the logistics of transporting goods to their destination.
Showrooming refers to a shopping behavior where consumers visit a physical retail store to research and evaluate a product, only to make their actual purchase online or through a mobile device. This trend highlights the importance of retailers adopting both in-store and online strategies to capture and convert consumers.
Small parcel shipping involves products that are shipped individually, typically falling under specific weight and size restrictions. Unlike large freight shipments, small parcels are handled by carriers like UPS, FedEx, DHL, and USPS. These shipments require a different logistics system and are often referred to as less-than-load (LTL) shipments.
A sourcing company is an entity responsible for procuring products or services for another business partner, using predefined criteria such as pricing, supply chain capabilities, and quality standards. These companies play a critical role in facilitating global trade and sourcing goods from suppliers.
The Standard Carrier Alpha Code (SCAC) is a unique two-to-four-letter code used in the United States to identify transportation companies. This code, assigned by the National Motor Freight Traffic Association (NMFTA), helps standardize and streamline the identification of carriers in shipping and logistics processes.
A Statement of Work (SOW) is a project management document that defines specific activities, deliverables, and timelines for a vendor providing services to a client. It ensures clarity and sets expectations for both parties involved in the project.
A Stock Keeping Unit (SKU) is a unique alphanumeric code used to identify and track inventory. The SKU represents various product characteristics such as manufacturer, brand, style, color, and size. Retailers assign SKUs to products to manage stock levels and streamline inventory tracking.
Amazon has introduced “delivery lockers” in several markets, where large metal cabinets, known as Amazon Lockers, are placed in grocery, convenience, and drugstores. These lockers serve as secure collection points for customers to pick up their packages, providing a convenient and flexible delivery option.
Store clusters refer to groups of stores that share similar selling patterns or consumer demographics. By organizing stores into clusters, businesses can optimize their marketing strategies and better serve regional consumer needs.
The storefront is the entrance to a retail store, often regarded as prime real estate. It is the first point of contact for customers and typically includes elements like customer returns, check lanes, and information boards. A well-designed storefront can significantly impact foot traffic and sales.
Store location rationalization is the process of reorganizing a company’s store network to increase operational efficiency. This may involve expanding, reducing, or altering the strategy for particular locations, helping businesses optimize their store presence based on performance and market demand.
Suppliers are companies or entities whose primary business is to provide a particular product or service to another business. They are often referred to as vendors and play an integral role in the supply chain by providing the necessary materials or goods for production.
A supply chain is a network of organizations and processes that work together to bring a product from raw materials to the final customer. It involves various stages, including manufacturing, storage, distribution, and retailing. The goal of the supply chain is to ensure that products are delivered efficiently and cost-effectively to consumers.
A business entity involved in exchanging EDI documents with another business, such as a supplier, retailer, or distributor.
Tare weight refers to the weight of an empty container used for shipping products, such as casepacks or masterpacks. The tare weight, combined with the net weight (the weight of the goods), gives the gross weight of the entire shipment. The gross weight is subject to various regulations, especially in industries like trucking, where weight limits must be adhered to during transport.
Taxonomy is a system used for naming and organizing things into categories based on their characteristics and relationships. In the context of logistics and supply chain management, taxonomy helps to classify products, services, and other items in an organized way, enabling easier management and retrieval of data.
Tendering a shipment refers to the process of offering a shipment to a motor carrier. This includes providing details such as the shipment’s schedule, equipment requirements, commodity descriptions, and other relevant shipping instructions necessary to transport the products.
A terminal is a facility where freight is temporarily stored and handled as it is transferred between trucks. Also known as a hub, terminals play a critical role in logistics by ensuring efficient movement and re-routing of shipments to their final destinations.
Payment terms are the conditions under which a seller agrees to make a sale. These terms typically outline the period allowed for the buyer to pay the amount due, including options such as cash in advance, cash on delivery, or deferred payment periods of 30 days or more.
Any document sent via Electronic Data Interchange. An EDI Transaction set is a document defined by the ANSI X12 EDI standard that prescribes the exchange of information between two businesses using electronic means. A type of EDI transaction set is the EDI 810 for instance which covers how invoices are to be exchanged between trading partners.
EDI can be transmitted using any methodology agreed to by the sender and recipient, but as more trading partners began using the Internet for transmission, standardized protocols have emerged. This includes various technologies such as:
Total cost of ownership (TCO) goes beyond the purchase price of an item and includes all associated costs over time, such as maintenance, repair, training, insurance, depreciation, and disposal. TCO is an important consideration for businesses, as it can influence decisions about whether to buy, lease, or outsource certain assets or services.
Truck-Load (TL) refers to a shipment that fills an entire truck by itself. Unlike Less-than-Load (LTL) shipments, TL shipments do not get transferred during transit and remain on the same truck for the entire journey. This method of transportation is typically faster, as there is no need to deconsolidate the freight or transfer it through terminals.
A tracking number is a unique identifier assigned to a shipment that allows it to be traced as it moves through the supply chain. Customers and businesses can use the tracking number to monitor the shipment’s progress and receive updates on its status until it reaches its destination.
A trading partner is any entity involved in an ongoing business relationship, typically between a supplier and a retailer, or two companies that regularly exchange goods or services. The terms of these relationships often help shape how business operations are conducted and managed.
A trading partner agreement is a formal contract between two business entities (such as a retailer and supplier) that outlines how they will conduct business together. It defines the roles, expectations, and responsibilities of each party and is essential for smooth and clear transactions.
Transfer refers to the movement or change in ownership of an asset, or the relocation of assets from one place to another. In supply chain management, the term is often used to describe the movement of inventory between storage facilities or inventory hubs, ensuring products are available where needed.
A Transportation Management System (TMS) is a software application used by shippers, 3PLs (third-party logistics providers), or 4PLs (fourth-party logistics providers) to manage and optimize the transportation of goods. It helps companies control transportation costs, manage carrier rates, and streamline the logistics of getting products to their destinations.
In logistics and transportation, a “trip” refers to the continuous movement of one or more loads or trailers handled by a single carrier. The trip usually involves transporting goods from one location to another and may involve several consecutive loads handled in the same journey.
Uniform Resource Locators are addresses used by site owners on the Internet to designate their specific internet location. They follow the same naming convention as a Network Path. Essentially URLs are network paths used on the Internet.
United Nations rules for EDI for Administration, Commerce, and Transport, an international EDI standard primarily used outside North America.
An EDI standard designed for and used by trading partners within the grocery industry. A subset of the X12 national standard.
A type of code printed on retail product packaging to identify a particular item. It consists of two parts: the machine-readable barcode, which is a series of unique black bars, and the unique 12-digit number below it.
A private network provider that acts as an intermediary for EDI transactions, offering secure and managed data transfer.
Validates the format of a data element in an EDI file based on the value of other data elements. This is used in situations where the format of an element changes based on the value of another element in the same segment. Violation of the minimum or maximum length of an element can cause EDI files to be rejected.
Vendor compliance refers to the documented set of rules established by a retailer or buyer that dictates how trading partners should conduct business with each other. These rules are designed to streamline and standardize the supply chain process, ensuring that vendors adjust their operations to meet the retailer’s specific requirements. Adhering to vendor compliance is crucial for smooth and efficient business relationships between suppliers and retailers.
Vendor income is a fee paid by a supplier to a retailer, often for inclusion in valuable retail resources such as weekly circulars, prime shelf space (e.g., endcap space), or marketing programs. This fee may also cover costs associated with clearance or promotional markdowns. Vendor income is a way for suppliers to gain visibility and access to key retail spaces, ultimately driving sales and brand awareness.
Vendor-Managed Inventory (VMI) is a supply chain strategy where the supplier takes full responsibility for managing the inventory levels of their products at a retailer’s locations. The retailer provides the supplier with access to critical data such as EDI 850 purchase orders and EDI 852 product activity documents. Using this data, the supplier monitors, maintains, and suggests optimal inventory levels to ensure a seamless supply chain operation.
A vendor master agreement is a contract that sets the terms for doing business between two parties. It governs all future transactions and agreements between them, allowing for quicker negotiation of future deals. The terms outlined in the master agreement are generally consistent, and only deal-specific terms need to be negotiated for each new transaction. Companies often use amendments to adapt the master agreement for new initiatives or circumstances.
A vendor number is a unique identifier assigned to a supplier within an organization’s accounting system. Large companies or government entities typically assign these numbers to simplify communication and record-keeping when they do business with regular vendors. The vendor number serves as an efficient way to track transactions, orders, and payments related to specific suppliers.
The Voluntary Inter-industry Communication Standard (VICS) is an EDI standard used primarily by trading partners within the retail industry. It is a subset of the broader X12 national EDI standard, specifically designed to meet the needs of retailers and suppliers for electronic communication. VICS helps standardize business transactions, improving efficiency and accuracy in retail supply chains.
A warehouse is a large building where raw materials or manufactured goods are stored before being exported or distributed for sale. It serves as a critical point in the supply chain, enabling businesses to manage inventory and fulfill customer demands efficiently.
Warehouse Information Network Standards (WINS) is an EDI standard designed specifically for the public warehouse industry. It is a subset of the X12 national standard, facilitating electronic data exchange between trading partners within the warehouse and distribution sector. WINS helps streamline communication and improve efficiency in warehouse operations.
A Warehouse Management System (WMS) is a software solution used to manage and optimize warehouse operations. It directs activities such as receiving, put-away, picking, shipping, and inventory cycle counts. Key features of a WMS include:
Additionally, a WMS supports radio-frequency communications, allowing real-time data transfer between the system and warehouse personnel, improving accuracy and speed in warehouse operations.
A wholesaler is a business or individual that buys goods in large quantities directly from manufacturers and sells them in smaller quantities to retailers or other businesses. Wholesalers play a crucial role in the supply chain by acting as intermediaries between manufacturers and retailers, helping to distribute products to various markets efficiently.
X12 is a text based file that is formally known as ASC X12 EDI (Accredited Standards Committee X12, Electronic Data Interchange), and it follows the standard established to govern the use of EDI to electronically exchange information between organizations. X12 EDI includes a set of standards and corresponding messages that define specific business documents widely used across industries today.
XML is a means of formatting EDI data in an Extensible Markup Language (XML) format.
