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Logistics Acronyms: Are You Confused Enough?

Two years ago, I became involved with an overseas logistics operation that became so convoluted and required so many changes of hands that tracking and authorizations became a virtual nightmare. It's a scenario that's being repeated even now across the global supply chain.

All I wanted was to ship 6,000 cartons of a consumer product from China to Jamaica and on to Belize. I counted the number of original documents I had to present to complete the shipment. There were 46 official, mandatory documents for this single shipment. That does not include quote exchanges or the multitude of emails required to coordinate the shipment. Clearly, I was doing something terribly wrong. If this were standard procedure, I couldn't believe that anyone would want to choose logistics as a career.

That doesn't even cover the players or individuals involved. There were more than 20 people employed between the overseas shipper and my contracted freight forwarder. I had to hire and authorize customs intercept agents and truckers to move the freight from the port to warehouse facilities. Believe me when I tell you my freight forwarder gave me a 720-page Dictionary of International Trade , and one section listed 1,050 acronyms and abbreviations used in the logistics business.

Part of the confusion stemmed from the fact that I did not know this discipline very well. These acronyms appeared with the blank cells on the forms I was asked to complete. I felt like I had to learn a new language to navigate this supply chain discipline.

I decided that anything that would eliminate confusion by bypassing redundant steps or requirements for managing paperwork would be a source of real joy. On the subsequent shipment, I tried to identify how much of this work I could offload to the forwarders, and whether advanced systems could streamline the overall effort. As a result, the next shipment was almost transparent to me. I had the cargo forwarders bypass US operations and use their established best-practices and agencies for their industry.

All I had to do was authorize different individuals at the various ports to handle all the paperwork and copy me on any documents. Once the logistics supply chain was established with well understood operational instructions, the overseas shipments became much more manageable. I discovered that, if I could identify and rely on third parties positioned inside the various forwarding companies, I could rest easy and avoid a lot of agony.

Unless your company has a dedicated logistics department, then by all means you will want to qualify your forwarder based on the number and nature of inclusive services it can offer. If you are asking for import and export services, have all your authorization paperwork prepared in advance and ready to go. The US Department of Homeland Security has its fingers in this pie in a big way, so you will want to talk with some very knowledgeable people about the latest government requirements.

Identify harmonized tariff codes for the products you will be shipping or receiving, and make sure you are not receiving goods from or shipping them to a conflict country or one with import or export restrictions. If this is your first time handling logistics, ask the forwarder for some basic training before you employ its services. Ask for a contact person and an email address with an alternate. This will simplify things greatly.

Don't be in a hurry to learn all the details of this discipline. Learn what you need to make the shipment, and then get the training that will make your future decisions much more informed. Keep all the archival documents in quickly retrievable formats, because you will be billed based on what others think they did for you and perhaps not what was actually recorded on your paperwork. This is true for quantities and weight disparities. Good luck.

5 comments on “Logistics Acronyms: Are You Confused Enough?

  1. Barbara Jorgensen
    January 2, 2013

    Logistics aren't always logical as you point out. As efficient as Amazon.com is, I recently received an order of books that was fulfilled from three different warehouses with all the associated redundancies in paperwork and shipping. As much as I hate to admit it, the best answer to that is the Kindle, Nook or iPad. I think there is room for a centralized DIY site where the paperwork can be completed, downloaded and shared. The phyiscal shipment is a little more challenging, though, gotta think about that some more.

  2. FLYINGSCOT
    January 3, 2013

    We tend to rely of expert suppliers cognizant of the particular region we are dealing with.  Once our volumes get large enough we then use consultants to develop our internal skills.  It can be daunting though finding the best solution.

  3. dalexander
    January 3, 2013

    @Barbara, I have had exactly the same experience with Amazon. When you place an order that includes multiple items, then it really is a grab bag as to where each item is coming from. The shipping cost on the order goes up with each new origin so I signed up for Amazon's $79.00/yr no shipping cost program. I send packages to my family and friends and start with the One Click service. So far, I have more than saved my shipping cost by streamlining with the pay once a year policy. If you are a frequent Amazon shopper, it is a good way to go.

  4. dalexander
    January 3, 2013

    @Flyingscot… My disasterous experience was because I had no experience going into this shipping operation and I did not even know what criteria I needed to qualify a freight forwarder. Now, having experienced the pitfalls of ignorance, I am better equip to cover the bases when qualifying a forwarder, but unless I have some minimal skills and knowledge, my company is open to being fleeced on pricing and delays in shipping. I honestly have a very high regard for individuals and companies who manage their shipping issues with the greatest knowledge and alacrity. Even more so nowadays with shipping costs and regulations being a moving target. “Daunting” is the exact word for it.

  5. Barbara Jorgensen
    January 3, 2013

    Hi Douglas–I never used to use Amazon enough to justify such as service, but I do now. That's a pretty good deal.

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