Food Distributors Industry Terminology
ABC Analysis
A method of categorizing SKUs by relative importance (often by sales volume, margin, or velocity) to focus resources on “A” items, manage “B” items efficiently, and control “C” items cost-effectively.
- “Let’s re-slot our ‘A’ movers near the dock based on the latest ABC analysis.” - “Cycle count frequency is weekly for A items, monthly for B, and quarterly for C.” - “Our buyer used ABC results to negotiate better terms on top-margin A SKUs.”
ASN (Advanced Shipping Notice)
An electronic pre-alert (often EDI 856) sent before shipment arrival detailing contents, lots, dates, and pallet IDs to speed receiving and improve accuracy.
- “Receiving will be faster if the supplier sends an ASN with SSCC pallet labels.” - “The ASN didn’t match the PO quantities, so we flagged it as an exception.” - “Our WMS can auto-create receipts from ASNs to reduce dock-to-stock time.”
B2B eCommerce
Digital ordering platforms and portals through which restaurants, retailers, and institutions place wholesale orders, view pricing, and track deliveries.
- “Shifting to B2B eCommerce raised order accuracy and reduced call center costs.” - “Customers want real-time inventory and substitutions in the eCommerce cart.” - “We integrated promotions and contract pricing into the B2B portal.”
Backhaul
Using a vehicle’s return trip to carry revenue loads back toward the DC, minimizing empty miles and improving asset utilization.
- “We secured a dairy backhaul after the store delivery to cut empty miles.” - “TMS suggested backhaul matches for Tuesday routes.” - “Backhauls must comply with our sanitary trailer standards before loading.”
Case Pick
Order fulfillment method where workers pick full cases rather than individual units; common for grocery and foodservice distribution.
- “Case-pick lanes are designed for our top 500 movers.” - “We use voice picking for case pick to improve accuracy.” - “Case pick productivity is 185 cases per labor hour this shift.”
Catch Weight
Variable-weight products (e.g., meat, cheese) sold by weight but handled/logged by case, requiring actual weight capture for pricing and inventory.
- “Ensure catch weights are scanned during receiving for accurate invoicing.” - “The WMS records catch weight against each lot tag.” - “Pricing is by lb, but we allocate picking in cases for catch-weight items.”
Cold Chain
The temperature-controlled supply chain from supplier to customer that preserves food quality and safety across chilled and frozen zones.
- “Data loggers prove our cold chain stayed within 2–4°C.” - “Multi-temp trailers protect the cold chain for mixed orders.” - “FSMA audits require documented cold chain controls.”
Cross-Docking
Moving product from inbound to outbound with minimal storage, reducing handling time and dwell while increasing freshness.
- “We cross-dock produce arriving overnight to morning store routes.” - “ASN accuracy is critical for same-day cross-docking.” - “Cross-dock lanes are assigned by route departure time.”
DC (Distribution Center)
A facility that receives, stores, and ships products to customers or stores; often segmented into ambient, chilled, and frozen zones.
- “Our new DC added 20,000 pallet positions.” - “The DC is moving to voice-directed picking.” - “We’ll split inventory across two DCs to cut lead times.”
Demand Forecasting
Predicting future demand at SKU/location level using history, seasonality, and causal factors to drive purchasing and replenishment.
- “We adjusted forecasts for the holiday spike in ham.” - “Weather signals improved ice cream forecasting.” - “Forecast error dropped after adding promo lift factors.”
DRP (Distribution Requirements Planning)
A time-phased plan that translates demand into replenishment orders by DC, accounting for lead times, lot sizes, and service targets.
- “DRP recommends a 3-truck inbound for next week.” - “We raised safety stock in DRP for A items during the event.” - “DRP signals when to transfer inventory between DCs.”
DSD (Direct Store Delivery)
A fulfillment model where suppliers or distributors deliver directly to stores/restaurants, bypassing the retailer’s DC.
- “Bread and beverages often run on DSD to ensure freshness.” - “DSD vendors stock and rotate product on store shelves.” - “Our DSD routes target early-morning delivery windows.”
EDI (Electronic Data Interchange)
Standardized electronic messaging (e.g., 850 PO, 855 PO Ack, 856 ASN, 810 Invoice) that automates ordering, receiving, and billing.
- “We require EDI 856 ASNs for faster receiving.” - “EDI reduced invoice errors and short-paid claims.” - “The retailer rejected the load due to an EDI mismatch.”
ERP (Enterprise Resource Planning)
Integrated system for purchasing, inventory, finance, and order management, often linked to WMS/TMS.
- “The ERP holds the item master and pricing; WMS handles execution.” - “We’re upgrading ERP to support catch-weight.” - “ERP and TMS integration improved OTIF performance.”
Expiration Date Management (Date Coding)
Processes to capture, track, and control code dates to meet FEFO, customer MSL requirements, and recall readiness.
- “The PO specifies a minimum remaining shelf life of 80%.” - “Short-dated lots are flagged for markdown and priority picking.” - “Receivers reject pallets with illegible date codes.”
FEFO (First Expire, First Out)
Inventory rotation policy prioritizing earliest-expiring lots to minimize spoilage and ensure freshness.
- “FEFO picking is mandatory in chilled zones.” - “WMS allocates by FEFO after checking customer MSL rules.” - “Audit confirmed FEFO compliance on all dairy picks.”
FIFO (First In, First Out)
Inventory rotation policy issuing the oldest receipt first; used when dates are equivalent or not provided.
- “Ambient snacks run FIFO; perishables run FEFO.” - “FIFO exceptions are investigated for potential mis-picks.” - “Cycle counts verify FIFO integrity in reserve locations.”
Fill Rate
The percentage of ordered lines, units, or value shipped on the requested order, reflecting service performance.
- “Line fill was 96%, but unit fill dipped due to shortages.” - “We improved fill rate by increasing safety stock on A SKUs.” - “Retailers tie bonuses to weekly fill rate targets.”
FSMA (Food Safety Modernization Act)
U.S. law shifting food safety toward prevention; includes Preventive Controls, FSVP, and Sanitary Transportation requirements.
- “Our FSMA plan documents preventive controls at receiving.” - “Drivers complete FSMA training on sanitary transport.” - “FSMA audits reviewed our temperature monitoring logs.”
GFSI (Global Food Safety Initiative)
A benchmarking program that recognizes schemes like BRCGS, SQF, and FSSC 22000; many customers require a GFSI-certified site.
- “The DC maintains GFSI certification via BRCGS Storage & Distribution.” - “RFPs often mandate a GFSI-recognized program.” - “GFSI audits drive continuous improvement in sanitation.”
GS1-128/SSCC Labels
Standard barcode labels for cases and pallets using GS1-128 symbology and Serial Shipping Container Codes to enable scanning and traceability.
- “Print SSCC pallet labels to match the ASN.” - “GS1-128 case labels carry GTIN, lot, and date codes.” - “Retailer compliance requires SSCC on every pallet.”
HACCP (Hazard Analysis and Critical Control Points)
A preventive food safety system identifying hazards and establishing controls and monitoring at critical points in the process.
- “Our HACCP plan covers CCPs at receiving and cold storage.” - “Corrective actions are documented per HACCP procedures.” - “Auditors reviewed HACCP logs for CCP temperature checks.”
HOS (Hours of Service)
Regulations that limit commercial drivers’ on-duty and driving time to ensure safety and compliance.
- “Route plans respect HOS to avoid violations.” - “ELD data proves HOS compliance on long hauls.” - “We scheduled a relay due to HOS constraints.”
Incoterms
International commercial terms (e.g., FOB, CIF, DDP) that define responsibilities, risk transfer, and costs between buyers and sellers.
- “Under CIF, the seller arranges insurance and freight.” - “We prefer FOB origin for better inbound control.” - “Customs delays aren’t our risk under DDP.”
Inventory Turns
A measure of how often inventory is sold and replaced over a period (COGS ÷ average inventory), indicating capital efficiency and freshness.
- “Frozen turns should be 10+, ambient 6–8.” - “We improved turns by rationalizing slow movers.” - “Higher turns reduce shrink on perishables.”
JIT (Just-In-Time)
Inventory strategy that seeks frequent, smaller deliveries to minimize on-hand stock while maintaining service.
- “We moved to JIT replenishment on dairy with daily inbound.” - “JIT relies on reliable lead times and supplier ASN accuracy.” - “JIT cut holding costs but raised delivery frequency.”
KPI (Key Performance Indicator)
Quantifiable metrics that track performance, such as OTIF, pick accuracy, dock-to-stock time, and cost per case.
- “Our top KPIs include fill rate and OTIF.” - “The DC KPI dashboard updates hourly.” - “We tied bonuses to safety and quality KPIs.”
Lead Time
Elapsed time from placing a PO to receiving product, including production, transit, and internal processing.
- “We extended safety stock for items with volatile lead times.” - “Supplier lead time dropped from 14 to 9 days.” - “Lead-time variability drives most of our stockouts.”
Last-Mile Delivery
The final leg from DC to store/restaurant/customer, where time windows, temperature control, and proof of delivery are critical.
- “We tightened last-mile windows for hospitals.” - “Refrigerated last-mile routes use geo-fencing and temp sensors.” - “Late last-mile arrivals hurt OTIF.”
Lot Traceability
The ability to track product by lot/batch from receipt through storage and shipment to specific customers for recalls and quality control.
- “We can trace lot 123 from supplier to each store within 2 hours.” - “WMS enforces lot capture at picking for traceability.” - “Customer requires lot and date on the invoice.”
LTL (Less-Than-Truckload)
Freight shipments that don’t require a full trailer, consolidated with other freight; priced by class, weight, and distance.
- “We ship small store orders LTL to remote areas.” - “NMFC class affects our LTL rates.” - “Damages are more common on multi-stop LTL moves.”
MABD (Must Arrive By Date)
Retailer-required delivery date (and often time window) used for compliance and chargebacks.
- “Missed MABD can trigger hefty compliance fines.” - “We built slack into routes to hit MABD during storms.” - “Suppliers must confirm MABD on the PO ack.”
MOQ (Minimum Order Quantity)
The smallest order size a supplier will accept; can drive inventory levels and order frequency.
- “MOQ forces us to take two pallets per flavor.” - “We negotiated lower MOQ for slow movers.” - “DRP batches orders to meet MOQ economically.”
OSD (Over, Short and Damaged)
A receiving and claims category for discrepancies in quantity or condition, used for chargebacks and process improvement.
- “Log the dented cans as OSD with photos.” - “High OSD on LTL lanes triggered packaging changes.” - “Carrier disputes require detailed OSD documentation.”
OTIF (On-Time, In-Full)
A service metric combining schedule adherence and complete order fulfillment, commonly tied to retailer compliance programs.
- “Our OTIF improved after route optimization.” - “Retailer penalties kick in below 95% OTIF.” - “ASN accuracy is foundational to strong OTIF.”
Pallet Configuration (Ti-Hi)
The number of cases per layer (Ti) and layers high (Hi) used to build stable pallets and optimize cube and load planning.
- “Update Ti-Hi after the packaging change.” - “We reconfigured Ti-Hi to maximize trailer cube.” - “Incorrect Ti-Hi caused leaning pallets in chill.”
Perpetual Inventory
Continuous, real-time inventory records updated by each transaction (receipts, moves, picks), validated by cycle counts.
- “Perpetual balances drive WMS allocation.” - “Discrepancies from cycle counts trued up the perpetual.” - “Accurate perpetuals reduce stockouts and shrink.”
Pick-to-Light/Voice Picking
Technologies that guide pickers with illuminated displays or voice prompts to improve speed and accuracy in case/each picking.
- “Voice picking boosted accuracy in freezer aisles.” - “Pick-to-light cut travel in high-velocity lanes.” - “We’re A/B testing voice vs. RF scanning.”
POD (Proof of Delivery)
Documentation (paper or ePOD) confirming delivery time, items, and condition, often including photos, signatures, and temperature logs.
- “Drivers capture ePOD with customer signatures.” - “Damage photos attach to the POD record.” - “Retailers require temp-at-delivery on the POD.”
QA/QC (Quality Assurance/Control)
Programs and checks that ensure product meets specifications and is handled under proper conditions from receipt through delivery.
- “QA inspects inbound produce color and brix.” - “QC recorded a temperature deviation on dock 3.” - “Supplier CAPA closed after QA audit.”
Recall Readiness
Preparedness to rapidly identify, locate, and remove affected lots, including mock recalls, contact trees, and documentation.
- “Mock recall traced 99.8% of lots within 90 minutes.” - “We verified customer contacts for recall alerts.” - “Recall binders include lot mapping and PODs.”
Replenishment
The process of refilling pick faces from reserve or placing POs to suppliers to meet forecasted and actual demand.
- “Night shift handles pick-face replenishment.” - “DRP triggers vendor replenishment orders weekly.” - “Replenishment rules consider cube and case pick velocity.”
Safety Stock
Buffer inventory held to protect service levels against demand and lead-time variability.
- “We raised safety stock on soup ahead of the storm.” - “Safety stock is set by service targets and forecast error.” - “Low safety stock caused backorders on A items.”
Sanitary Transportation Rule (FSMA)
FSMA regulation requiring sanitary practices for shippers, loaders, carriers, and receivers to prevent food adulteration during transport.
- “We verify pre-cool and trailer cleanliness per the rule.” - “Driver training covers FSMA sanitary requirements.” - “We document washout certificates for raw proteins.”
Shelf Life
The length of time a product remains safe and of acceptable quality; key to code-date policies and customer MSLs.
- “Short shelf life requires faster turns.” - “Customer needs 30 days’ remaining shelf life on delivery.” - “We rotate to protect shelf life exposure in warm aisles.”
Slotting
Optimizing SKU storage locations based on velocity, cube, compatibility, and pick method to reduce travel and improve throughput.
- “We re-slotted A items to ground-level case pick.” - “Slotting analysis cut travel by 18%.” - “Heavy items are slotted low for ergonomics.”
Temperature Abuse
Exposure of perishable foods to temperatures outside safe ranges, leading to spoilage and potential safety hazards.
- “Data loggers flagged temperature abuse on lane 5.” - “Pallets sat on the dock too long—risk of abuse.” - “We rejected the load due to temperature abuse.”
TMS (Transportation Management System)
Software that plans, optimizes, tenders, and tracks shipments; manages carrier rates, appointments, and freight audit/payment.
- “TMS cut miles with multi-stop routing.” - “We tendered the load via TMS to our core carrier.” - “Freight audit is automated in the TMS.”
Traceability (End-to-End)
The capability to follow products through the supply chain using identifiers (e.g., GTIN, lot, SSCC) and events (ship, receive, transform).
- “End-to-end traceability supports faster recalls.” - “We capture SSCC and lot at each handoff.” - “Retailers are piloting EPCIS for traceability data.”
WMS (Warehouse Management System)
Execution system that directs receiving, putaway, replenishment, picking, and shipping; enforces lots, dates, and temperature controls.
- “WMS allocates picks by FEFO.” - “We added catch-weight to WMS to improve billing.” - “Dock-to-stock time fell after WMS wave tuning.”
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