In any industry, it’s a pretty good idea to practice effective communication. Understanding some some of the most common freight shipping acronyms related to the business of logistics and transportation will let you tackle quotes and shipping contracts with confidence.
Whether you’re looking to brush up on your freight shipping and logistics vocabulary, or just looking for information as you get your feet wet, this guide is for you. Here’s a few of the most common freight shipping acronyms, what they stand for, and the situations where you might find them.
Acronyms Used in Shipping Options
Before you send an RFQ (Request for Quote), you should first understand what type of carrier you’ll need. Here are some of the more common freight carrier options:
- TL – full truckload
Often the most cost-effective method of shipping your products – provided you have enough to fill the entire truck. When you ship TL your freight goes straight to its destination via long haul. Unlike LTL shipments, TL shipments do not transfer to other trucks or stop at any terminals mid-haul.
- PTL – partial truckload
If you do not have enough product to ship TL, PTL is the next step down. Similar to TL shipping, your products will typically stay on one truck from its pick up point to final destination – but is not accessible during the trip.
- LTL – less than truckload (or less than load)
For many businesses small and large LTL transportation allows you to ship minimal quantities. But for this method to be effective for all parties, the load must consist of a minimum of 1-6 pallets or weigh under 4,000 pounds. When shipping LTL, your items are combined with shipments from other shippers, plus they may be transferred one or more times before they reach their final destination.
- STL – shared truckload
The STL method of shipping is a hybrid whereby multiple shipments can be combined onto one truck moving in the same direction. This intent is to bypass the hub and spoke system thereby reducing the number of stops. This helps avoid damage caused through the extra handling of a shipper’s freight.
Typical Freight Acronyms
Once you have a freight quote form in front of you, you may find a number of unfamiliar associated acronyms. In order to communicate clearly and efficiently with your logistics partner, you’ll need to be familiar with these common terms plus a few more:
- FAK – Freight of all Kinds
The term FAK is used to refer to a pooling of different products into one load for the purpose simplification of rating and pricing.
- BOL – Bill of Lading
As one of the most important documents associated with moving your goods, a BOL is a detailed, legally binding contract between a shipper and a freight carrier. Every BOL includes details that define the names and addresses of the shipper and carrier, shipment description, packaging details, expected pickup date, freight class, and hazardous material designations.
- NMFC – National Motor Freight Classification
NMFC is a series of classification codes assigned to commodities by the National Motor Freight Traffic Association (NMFTA). NMFTA created the National Motor Freight Classification tariff to help classify all commodities into 18 different freight classes determined by four factors; shipment density, stow-ability, handling, and liability.
- EDI – Electronic Data Interchange
At the basic level, EDI is the business-to-business interconnection of computers for the rapid exchange of documents. In the freight shipping industry, this would be items like bills of lading, invoices and tracking information.
- FOB – Free on Board
FOB is a term used to indicate when ownership and liability of goods is transferred from seller to buyer. When used with a physical location such as a shipping port, FOB specifies which party assumes responsibility for the payment of freight charges, and at what exact point title for the shipment passes from seller to the buyer.
- GVW – Gross Vehicle Weight
Because weight is such an important factor in freight transportation, GVW is the term used to quantify the total weight of the transport vehicle and its cargo. Likewise, GVWR, or Gross Vehicle Weight Rating is often used to express the maximum operating weight of a vehicle as specified by the manufacturer.
- LG – Lift Gate
A lift gate is a powered tailgate used to lift pallets from ground level to the same level of a truck trailer deck. Many LTL truck fleets have lift gates as do smaller shipper locations with no loading docks.
- DV – Declared Value
Declared value refers to the monetary value of a shipment as reported by you, the shipper. Being an extremely important declaration, it serves as a disclosure used to determine shipping charges and as a tool to control carrier liability for damage and loss.
Other Terms Used in Freight Management
As the saying goes, “But wait, there’s more!”. The acronyms don’t stop there. Because documentation and performance are an important part of the evolving transportation and logistics industry, you could benefit from a little familiarity with them. Here are a few important terms worth knowing:
- POD – Proof of Delivery / Port of Discharge / Port of Destination
Having a number of different meanings within the transportation industry, how this term is used depends on its context.
The port of discharge or destination implies where the container is correspondingly loaded or unloaded from a vessel and picked up by the consignee.
Proof of Delivery is the paperwork authorized by the consignee indicating the receipt of a load. In this context, a BOL can often double as a POD upon delivery and must be signed for the carrier to get paid.
- CNOR / CNEE – Consignor / Consignee
More like contractions rather than acronyms, these are fairly straight forward: a CNOR or consigner is the entity sending a shipment, whereas a CNEE or consignee is the entity receiving a shipment.
- OS&D Report – Overage, Shortage, and Damage
Mistakes and problems do happen therefor they must be accounted for. For instance, a CNEE can file an OS&D report if there are issues with a shipment they received. As implied, an overage occurs when the recipient gets more product than ordered, while a shortage is the opposite. Shipment items that are delivered unusable or unsellable are considered damaged.
- TONU – Truck Ordered but Not Used
A common result of miscommunication (hence the need for this article) or happenstance, a truck arrives to pick up a shipment, but the load isn’t ready – that’s TONU. If it’s due to your error, you may find yourself having to pay a fine and compensate the carrier for misuse of their time and resources.
As you can see, it’s extremely important to be familiar with these terms and how they apply to your business. It would be wise to take a few minutes and learn them so you get accustomed to seeing and hearing them in context throughout your shipping processes.