Other Food Distributors Industry Terminology

ABC Analysis

A method of classifying SKUs by value and importance (typically A: top movers/high value, B: mid-tier, C: long tail) to prioritize inventory control, service levels, and cycle counting.

Shift A-items to weekly cycle counts and C-items to quarterly; Assign A-items to golden-zone pick locations; Set higher safety stock targets for A-class chilled SKUs.

Accessorial Charges

Additional transportation fees beyond base linehaul, such as liftgate, inside delivery, residential delivery, appointment fees, detention, and lumper charges.

Add a liftgate accessorial for small cafes without docks; Dispute detention charges with carrier when docks were closed; Build accessorials into landed cost calculations.

Allergen Control Program

A documented system to prevent allergen cross-contact and ensure correct labeling (e.g., milk, eggs, fish, shellfish, tree nuts, peanuts, wheat, soy). Includes segregation, validated sanitation, label verification, and training.

Color-code allergen zones for peanut-containing items; Verify label changes during receiving to avoid undeclared allergen errors; Conduct ATP/allergen swabs after sanitation before restarting lines.

ASN (Advance Ship Notice)

An electronic notification (commonly EDI 856) sent before or at shipment that details contents, quantities, lot codes, SSCCs, and expected arrival time. Used to speed receiving and enable scan-based processes.

Transmit ASN with SSCC to retailer DC to avoid chargebacks; Use ASN data to plan labor for inbound pallets; Match ASN to BOL to reconcile shortages quickly.

Backhaul

Using the return leg of delivery routes to collect vendor freight, recyclables, or reverse logistics to improve truck utilization and reduce empty miles.

Backhaul frozen seafood from supplier after city deliveries; Add a recycling backhaul of shrink wrap to the DC; Evaluate backhaul margin vs. added dwell time.

Billback (Promotional Allowance)

A post-event reimbursement from manufacturers to distributors for discounts given to customers (e.g., temporary price reductions, OIs). Tracked via claims and reconciled against accruals.

Submit a billback claim for the May burger promo; Reconcile billbacks monthly to avoid write-offs; Distinguish billbacks from off-invoice discounts in your ERP.

BRCGS (Global Standard for Food Safety)

A GFSI-benchmarked certification standard covering food safety and quality for storage and distribution sites (among others).

Maintain BRCGS certification for the frozen DC; Close nonconformities raised during the BRCGS audit; Use BRCGS clauses to structure your internal audits.

Broker (Food Broker)

An independent sales agent representing food manufacturers to distributors and operators, typically paid on commission.

Engage a broker network to grow street business; Provide brokers with velocity reports by territory; Align broker incentives with distributor KPIs.

Certificate of Analysis (COA)

A supplier-issued document that certifies a lot meets specified parameters (e.g., microbiological counts, allergens, moisture, organoleptics).

Require COAs for imported spices before releasing to pick; Match COA lot numbers in WMS to ensure traceability; Place product on quality hold when COA values are out of spec.

Cold Chain

An end-to-end temperature-controlled supply chain for refrigerated and frozen products, including storage, transport, monitoring, and handling practices to prevent temperature abuse.

Validate that chilled routes maintain 0–4°C throughout; Use data loggers to verify frozen lanes stay at −18°C; Train drivers on door-opening discipline to protect the cold chain.

CPFR (Collaborative Planning, Forecasting & Replenishment)

A cross-company process where trading partners share forecasts, plans, and performance to improve service and reduce inventory.

Run a CPFR cycle with a national chain on seasonal items; Align promotional calendars to reduce stockouts; Review CPFR forecast bias monthly with suppliers.

Cross-Docking

Moving goods directly from inbound to outbound with minimal storage to reduce dwell time, handling, and inventory.

Cross-dock DSD beverages to meet same-day windows; Use dynamic slotting for cross-dock pallets; Set ASN compliance as a prerequisite for cross-docking.

Cycle Counting

A method of continuously counting subsets of inventory during operations, often prioritized by ABC class, to maintain high inventory accuracy.

Schedule daily cycle counts for A items; Investigate root causes for repeated variances; Tie picker incentives to cycle count accuracy.

Days Inventory Outstanding (DIO)

A working-capital metric showing average days of inventory on hand. DIO = (Average Inventory/COGS) × 365.

Lower DIO for perishable dairy via FEFO; Benchmark DIO by category (frozen vs ambient); Use DIO improvements to free cash for growth.

Deviated Pricing / SPA (Special Pricing Agreement)

Manufacturer-funded discount to a specific end-customer below standard distributor price, managed via off-invoice or post-event billbacks.

Set up SPA pricing for a hospital group; Track SPA accruals by customer and SKU; Audit SPA claims to prevent leakage.

DIFOT (Delivery In Full, On Time)

A service metric that measures whether orders arrive complete and by the promised time window; often used interchangeably with OTIF.

Report weekly DIFOT by route; Investigate chronic late DIFOT on urban routes; Include DIFOT targets in carrier scorecards.

DSD (Direct Store Delivery)

A model where suppliers or specialty distributors deliver directly to stores or restaurants, bypassing central DCs.

Manage DSD bread deliveries to c-store chain; Coordinate DSD windows with store managers; Compare DSD shrink vs. DC-fulfilled items.

DSR (Distributor Sales Representative)

Field salesperson managing a portfolio of operator accounts, responsible for assortment, pricing, promos, and service.

DSRs present new plant-based SKUs to independents; Tie DSR commissions to gross margin growth; Use DSR feedback to drive SKU rationalization.

EDI (Electronic Data Interchange)

Standardized electronic exchange of business documents (e.g., 850 POs, 856 ASNs, 810 invoices) between trading partners.

Mandate EDI 856 ASNs for all inbound vendors; Automate invoice posting via EDI 810; Reduce chargebacks by improving EDI compliance.

ERP (Enterprise Resource Planning)

The core system integrating purchasing, inventory, sales, finance, and pricing for the distributor.

Use ERP to calculate standard and landed costs; Drive pick tickets and replenishment from ERP; Integrate ERP with WMS and TMS for end-to-end visibility.

Expiry / Code Date Management

Processes to monitor, rotate, and disposition products based on expiration or best-by dates, often using FEFO.

Use short-code reports to drive markdowns; Block near-expiry lots from national accounts; Enforce FEFO at pick to cut write-offs.

FEFO (First Expired, First Out)

A rotation and picking policy prioritizing items with the earliest expiration dates, essential for perishables.

Configure WMS to allocate by FEFO; Apply FEFO to chilled proteins; Override FEFO only with QA approval during shortages.

FIFO (First In, First Out)

A stock rotation principle where the oldest received inventory is shipped first, minimizing aging and obsolescence.

Use FIFO for ambient canned goods; Separate mixed dates on racks to protect FIFO; Audit FIFO adherence during internal walkthroughs.

Fill Rate (Order/Line/Case)

Service metrics measuring the percentage of ordered demand fulfilled, calculated at order, line, or case level.

Target 98% case fill on frozen; Diagnose line fill misses due to vendor OTIF; Tie fill rate to buyer scorecards.

FSMA (Food Safety Modernization Act)

U.S. law shifting focus to prevention, including Preventive Controls, FSVP, Sanitary Transportation, and Intentional Adulteration rules.

Train PCQIs to meet FSMA requirements; Validate reefer temp controls for Sanitary Transport; Audit foreign suppliers under FSVP.

FTL (Full Truckload)

A shipment that uses the full capacity of a trailer, usually moving point-to-point with fewer touches, lower damage, and faster transit than LTL.

Convert multiple LTLs to a weekly FTL; Negotiate FTL rates on backhaul lanes; Use FTL for frozen to minimize door openings.

Fuel Surcharge

A variable fee applied to deliveries to offset fuel price fluctuations, typically indexed (e.g., DOE index).

Update fuel surcharge weekly based on DOE; Separate fuel surcharge on invoices for transparency; Adjust route pricing when fuel spikes.

GFSI (Global Food Safety Initiative)

A benchmarking program that recognizes standards like BRCGS, SQF, and IFS, often required by customers for supplier approval.

Choose a GFSI-benchmarked scheme for the DC; Reference GFSI in RFP food safety requirements; Use GFSI audit results in vendor qualification.

GS1-128 (UCC-128) Shipping Label

A standardized label carrying a SSCC barcode and application identifiers used to identify pallets/cartons and link to ASN data.

Reject pallets missing GS1-128 labels; Scan SSCC at receiving to auto-reconcile ASNs; Print GS1-128s for customer-compliant outbound.

GTIN (Global Trade Item Number)

A GS1 identifier for trade items (e.g., GTIN-12 UPC, GTIN-14 case code), enabling universal product identification.

Validate vendor GTINs in item master; Use case GTINs to drive pick face labels; Sync GTIN changes with customers to avoid scan errors.

HACCP (Hazard Analysis and Critical Control Points)

A systematic approach to identifying and controlling food safety hazards with defined CCPs, critical limits, monitoring, and corrective actions.

Monitor cooler CCP temperatures each shift; Document corrective action for out-of-limit readings; Verify HACCP records during internal audits.

HARPC (Hazard Analysis and Risk-Based Preventive Controls)

FSMA-mandated risk-based controls that extend beyond CCPs to include allergens, sanitation, supply chain, and recall planning.

Conduct a HARPC hazard analysis for relabeling; Implement supplier verification for high-risk imports; Maintain a written recall plan per HARPC.

Inventory Turns

The number of times inventory is sold and replaced in a period; higher turns reduce carrying costs but can risk service.

Target 12 turns for chilled produce; Improve turns by consolidating MOQs; Use turns in SKU rationalization decisions.

IoT Temperature Monitoring

Use of connected sensors and data loggers to continuously track temperatures in storage and transit with real-time alerts and audit trails.

Install door sensors and temp probes in reefers; Trigger alerts when temps exceed 5°C; Provide digital temp logs during customer audits.

JIT (Just-in-Time) Replenishment

A strategy to reduce inventory by receiving goods close to the time of need, often requiring reliable forecasts and supplier OTIF.

Move to JIT for high-turn bakery items; Adjust safety stocks to buffer JIT variability; Partner with suppliers for shorter lead times.

KPI (Key Performance Indicator)

Quantifiable metrics that track performance against goals (e.g., fill rate, OTIF, pick accuracy, damage rate, inventory turns).

Review KPIs in monthly QBRs; Tie picker bonuses to accuracy KPI; Publish route-level OTIF dashboards.

Landed Cost

Total cost to bring a product to the DC or customer, including product cost, freight, duties, accessorials, and handling.

Use landed cost to price private label; Compare vendor quotes on a landed basis; Update landed cost when fuel surcharges change.

Lead Time

Elapsed time from purchase order to receipt, including vendor production, pick/pack, and transit; key input to safety stock.

Model lead time variability in forecasting; Shorten lead times with regional suppliers; Increase safety stock when lead times extend.

LTL (Less-Than-Truckload)

Freight mode for smaller shipments sharing trailer space; uses NMFC classes, terminal networks, and accessorials; typically higher touch and longer transit than FTL.

Use LTL for mixed ambient replenishments; Audit LTL damage claims; Consolidate LTLs into pool distribution to cut costs.

MAPE (Mean Absolute Percentage Error)

A forecast accuracy metric expressing average absolute error as a percentage of actuals; lower is better.

Track MAPE weekly for top 200 SKUs; Segment MAPE by temperature zone (ambient/chilled/frozen); Use MAPE to tune safety stocks.

Mock Recall

A test of the recall and traceability system to ensure the company can quickly identify, locate, and isolate affected lots within a defined time.

Conduct a mock recall quarterly; Demonstrate one-up/one-down trace in under 2 hours; Involve carriers and 3PLs in the drill.

MOQ (Minimum Order Quantity)

The smallest quantity a supplier will accept per order or per shipment; impacts cash, space, and freshness.

Negotiate lower MOQs for slow-turn specialty items; Pool orders across branches to hit MOQs; Evaluate MOQ cost-to-serve impact.

OTIF (On Time In Full)

A service metric tracking whether shipments arrive by the agreed time window and with all items/quantities; used for both inbound supplier performance and outbound customer deliveries.

Set OTIF target at 95% for suppliers; Penalize chronic OTIF misses per contract; Analyze OTIF misses by root cause (late, short, damages).

Pallet Configuration (Ti-Hi)

The number of cases per layer (Ti) and layers per pallet (Hi); determines cube, stability, and truck/DC capacity planning.

Update Ti-Hi after packaging change; Re-slot pick faces based on new Ti-Hi; Use Ti-Hi to optimize trailer cube on FTL loads.

PCQI (Preventive Controls Qualified Individual)

A trained individual who develops, oversees, and verifies FSMA Preventive Controls programs.

Ensure each site has at least one PCQI; Have the PCQI sign off on annual plan reanalysis; Send new QA leads to PCQI training.

POD (Proof of Delivery)

Evidence that goods were delivered as specified, often a signed BOL or electronic POD with time, GPS, and photos.

Require ePOD with photo for unattended drops; Use POD to resolve delivery disputes; Integrate POD into AR workflows to speed invoicing.

Reefer (Refrigerated Transport)

A temperature-controlled trailer or container used to transport chilled or frozen foods.

Pre-trip reefer and set proper setpoint and differential; Calibrate reefer sensors quarterly; Monitor reefer fuel levels on long routes.

TMS (Transportation Management System)

Software to plan, optimize, tender, track, and settle freight across modes; supports routing, carrier selection, and freight audit.

Use TMS to optimize multi-stop routes; Scorecard carriers inside the TMS; Automate freight audit and pay.

Traceability (One-up/One-down)

The ability to track product lots back to the immediate supplier and forward to the immediate customer, enabling rapid recalls and root-cause analysis.

Capture lot codes at receipt and pick; Produce one-up/one-down reports in minutes; Use GS1 standards to standardize lot tracking.

WMS (Warehouse Management System)

Software that manages inventory locations, receiving, putaway, replenishment, picking, and shipping, often with RF/voice and automation integration.

Enable directed putaway by temperature zone; Track batch/lot in WMS for FEFO picks; Use WMS labor tracking to boost pick rates.