B
Back
Order: Product ordered but out of stock
and promised to ship when the product becomes available.
Backhaul: The process of a transportation vehicle returning from the
original destination point to the point of origin. The 1980 Motor Carrier Act
deregulated interstate commercial trucking, thereby allowing carriers to
contract for the return trip. The backhaul can be with a full, partial, or
empty load. An empty backhaul is called deadheading. Also see: Deadhead
Backorder: (1) The act of retaining a quantity to ship against an
order when other order lines have already been shipped. Backorders are usually
caused by stock shortages. (2) The quantity remaining to be shipped if an
initial shipment(s) has been processed. Note: In some cases, backorders
are not allowed. This results in a lost sale when sufficient quantities are not
available to completely ship an order or order line.
Balanced
Scorecard: A structured measurement system
based on a mix of financial and non-financial measures of business performance.
A list of financial and operational measurements used to evaluate
organizational or supply chain performance. The dimensions of the balanced
scorecard might include customer perspective, business process perspective,
financial perspective, and innovation and learning perspectives. It formally
connects overall objectives, strategies, and measurements. Each dimension has
goals and measurements. Also see: Scorecard.
Balance
of Trade: The surplus or deficit which
results from comparing a country's exports and imports of merchandise only.
Bar
Code: A symbol consisting of a series of
printed bars representing values. A system of optical character reading,
scanning, tracking of units by reading a series of printed bars for translation
into a numeric or alphanumeric identification code. A popular example is the
UPC code used on retail packaging.
Bar
Coding: A method of encoding data for fast
and accurate readability. Bar codes are a series of alternating bars and spaces
printed or stamped on products, labels, or other media, representing encoded
information which can be read by electronic readers called bar.
Barge: The cargo-carrying vehicle which may or may not have its
own propulsion mechanism for the purpose of transporting goods. Primarily used
by Inland water carriers, basic barges have open tops, but there are covered
barges for both dry and liquid cargoes.
Barrier
to Entry: Factors that prevent companies from
entering into a particular market, such as high initial investment in
equipment.
Barter: The exchange of commodities or services for other
commodities or services rather than the purchase of commodities or services
with money.
Basing-Point Pricing: A
pricing system that includes a transportation cost from a particular city or
town in a zone or region even though the shipment does not originate at the
basing point.
Batch
Picking: A method of picking orders in which
order requirements are aggregated by product across orders to reduce movement
to and from product locations. The aggregated quantities of each product are
then transported to a common area where the individual orders are constructed. See
Zone Picking.
Benchmarking: The process of comparing performance against the practices
of other leading companies for the purpose of improving performance. Companies
also benchmark internally by tracking and comparing current performance with
past performance.
Benefit-Cost
Ratio: An analytical tool used in public
planning; a ratio of total measurable benefits divided by the initial capital
cost. Also see: Cost Benefit Analysis.
Best
in Class: An organization, usually within a
specific industry, recognized for excellence in a specific process area.
Best
Practice: A specific process or group of
processes which have been recognized as the best method for conducting an
action. Best practices may vary by industry or geography depending on the
environment being used. Best-practices methodology may be applied with respect
to resources, activities, cost object, or processes.
Billing: A carrier terminal activity that determines the proper rate
and total charges for a shipment and issues a freight bill.
Bill
of Activities: A listing of activities required by
a product, service, process output, or other cost object. Bill of activity
attributes could include volume and/or cost of each activity in the listing.
Bill of Lading (BOL): A
transportation document that is the contract of carriage containing the terms
and conditions between the shipper and carrier.
Bill of Lading, Through:
A bill of lading to cover goods from point of origin to final destination when
interchange or transfer from one carrier to another is necessary to complete
the journey.
Bill of Material (BOM):
A structured list of all the materials or parts and quantities needed to
produce a particular finished product, assembly, subassembly, or manufactured
part, whether
purchased or not.
Bill of Material Accuracy:
Conformity of a list of specified items to administrative specifications, with
all quantities correct.
Bill
of Resources: A listing of resources required by
an activity. Resource attributes could include cost and volumes.
Binder: A strip of cardboard, thin wood, burlap, or similar
material placed between layers of containers to hold a stack together.
Blanket Purchase Order:
A long-term commitment to a supplier for material against which short-term
releases will be generated to satisfy requirements. Oftentimes, blanket orders
cover only one item with predetermined delivery dates. Synonyms: Blanket
Order, Standing Order.
Blanket
Wrap: A service pioneered by the moving
companies to eliminate packaging material by wrapping product in padded
"blankets" to protect it during transit, usually on "air
ride" vans.
Bleeding
Edge: An unproven process or technology
so far ahead of its time that it may create a competitive disadvantage.
Blow
Through: An MRP process which uses a
"phantom bill of material" and permits MRP logic to drive
requirements straight through the phantom item to its components. The MRP
system usually retains its ability to net against any occasional inventories of
the item.
Bonded
Warehouse: Warehouse approved by the Treasury
Department and under bond/guarantee for observance of revenue laws. Used for
storing goods until duty is paid or goods are released in some other proper
manner.
Booking: The act of requesting space and equipment aboard a
vessel for cargo which is to be transported.
Booking
Number: The number assigned to a certain
space reservation by the carrier or the carrier's agent.
Bottleneck: A constraint, obstacle, or planned control that limits
throughput or the utilization of capacity.
Bracketed
Recall: Recall from customers of suspect
lot numbers, plus a specified number of lots produced before and after the
suspect ones.
Branding: The use of a name, term, symbol, or design, or a
combination of these, to identify a product.
Break-Bulk: The separation of a consolidated bulk load into smaller
individual shipments for delivery to the ultimate consignee. The freight may be
moved intact inside the trailer, or it may be interchanged and rehandled to
connecting carriers.
Break
Bulk Cargo: Cargo that is shipped as a unit or
package (for example: palletized cargo, boxed cargo, large machinery, trucks)
but is not containerized.
Break-Even
Point: The level of production or the
volume of sales at which operations are neither profitable nor unprofitable.
The break-even point is the intersection of the total revenue and total cost
curves.
Broker: There are 3 definitions for the term "broker": 1)
an enterprise that owns and leases equipment2) an enterprise that arranges the
buying & selling of transportation of, goods, or services 3) a ship
agent who acts for the ship owner or charterer in arranging charters.
Bucketed
System: An MRP, DRP, or other time-phased
system in which all time-phased data are accumulated into time periods, or
buckets. If the period of accumulation is one week, then the system is said to
have weekly buckets.
Buffer: 1) A quantity of materials awaiting further processing. It
can refer to raw materials, semi-finished stores, or hold points, or a work
backlog that is purposely maintained behind a work center. 2) In the theory of
constraints, buffers can be time or material, and support throughput and/or due
date performance. Buffers can be maintained at the constraint, convergent
points (with a constraint part), divergent points, and shipping points.
Buffer
Management: In the theory of constraints, a
process in which all expediting in a shop is driven by what is scheduled to be
in the buffers (constraint, shipping, and assembly buffers). By expediting this
material into the buffers, the system helps avoid idleness at the constraint
and missed customer due dates. In addition, the causes of items missing from
the buffer are identified, and the frequency of occurrence is used to
prioritize improvement activities.
Buffer
Stock: A quantity of goods or articles
kept in storage to safeguard against unforeseen shortages or demands.
Build
to Inventory: A "push" system of
production and inventory management. Product is manufactured or acquired in
response to sales forecasts.
Build
to Order: A method of reducing inventory by
not manufacturing product until there is an actual order from the customer.
Bulk
Area: A storage area for large items
which at a minimum are most efficiently handled by the palletload.
Bulk
Cargo: Unpacked dry cargo such as grain,
iron ore or coal. Any commodity shipped in this way is said to be in bulk.
Bullwhip
Effect: An extreme change in the supply
position upstream in a supply chain generated by a small change in demand
downstream in the supply chain. Inventory can quickly move from being
backordered to being in excess. This is caused by the serial nature of
communicating orders up the chain with the inherent transportation delays of
moving product down the chain. The bullwhip effect can be eliminated by
synchronizing the supply chain.
Bundling: An occurrence where two or more products are combined into
one transaction for a single price.
Burn
Rate: The rate of consumption of cash in
a business. Used to determine cash requirements on an on-going basis. A burn
rate of $50,000 would mean the company spends $50,000 a month above any
incoming cash flow to sustain its business. Entrepreneurial companies will
calculate their burn rate in order to understand how much time they have before
they need to raise more money, or show a positive cash flow.
Business Application:
Any computer program, set of programs, or package of programs created to solve
a particular business problem or function.
Business Continuity Plan (BCP): A contingency plan for sustained operations during periods
of high risk, such as labor unrest or natural disaster. CSCMP provides
suggestions for helping companies do continuity planning in their Securing
the Supply Chain research. A copy of this research is available on CSCMP's
web site at www.cscmp.org.
Business
Logistics: The process of planning,
implementing, and controlling the efficient, effective flow and storage of
goods, services, and related information from the point of origin to the point
of consumption for the purpose of conforming to customer requirements.
Business
Plan: (1) A statement of long-range
strategy and revenue, cost, and profit objectives usually accompanied by
budgets, a projected balance sheet, and a cash flow (source and application of
funds) statement. A business plan is usually stated in terms of dollars and
grouped by product family. The business plan is then translated into
synchronized tactical functional plans through the production planning process
(or the sales and operations planning process). Although frequently stated in
different terms (dollars versus units), these tactical plans should agree with
each other and with the business plan. (2) A document consisting of the
business details (organization, strategy, and financing tactics) prepared by an
entrepreneur to plan for a new business.
Business Performance Measurement (BPM): A technique that uses a system of goals and metrics to
monitor performance. Analysis of these measurements can help businesses
periodically set business goals, then provide feedback to managers on progress
towards those goals. A specific measure can be compared to itself over time,
compared with a present target, or evaluated along with other measures.
Business Process Outsourcing (BPO): The practice of outsourcing non-core internal functions to
third parties. Functions typically outsourced include logistics, accounts
payable, accounts receivable, payroll, and human resources. Other areas can
include IT development or complete management of the IT functions of the
enterprise.
Business Process Reengineering (BPR): The fundamental rethinking and radical redesign of business
processes to achieve dramatic organizational improvements.
Business-to-Business (B2B): As opposed to business-to-consumer (B2C). Many companies
are now focusing on this strategy, and their web sites are aimed at businesses
(think wholesale) and only other businesses can access or buy products on the
site. Internet analysts predict this will be the biggest sector on the web.
Business-to-Consumer (B2C): The hundreds of e-commerce web sites that sell goods
directly to consumers are considered B2C. This distinction is important when
comparing web sites that are B2B as the entire business model, strategy,
execution, and fulfillment is different.
Business
Unit: A division or segment of an
organization generally treated as a separate profit-and-loss center.
Buyer: An enterprise that arranges for the acquisition of goods or
services and agrees to payment terms for such goods or services.
Buyer
Behavior: The way individuals or
organizations behave in a purchasing situation. The customer-oriented concept
finds out the wants, needs, and desires of customers and adapts resources of
the organization to deliver need-satisfying goods and services.
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