Abbreviations, Terms and their Definitions

**ara-uk** · 01-04-2006, 01:45 PM

Here's all the "everyday" terms you NEED to know.

GENERAL

BCL - Bank Credit Letter. Shows you have available funds in the bank.

B/L/BOL - Bill of Lading, is the freight company's receipt to show goods have arrived at port.
CC - Credit Card
CIF - Cost + Insurance + Frieght.
CIS - Customer Information Sheet
COD - Cash/Cashiers Check On Delivery
COGS - Cost of Goods Sold. The sum of expenditures for materials and labor necessary to produce the products/services sold. Also known as Direct costs, they include the clear-cut cost factors of factory output; as opposed to Indirect Costs or Overhead Costs, which are less clear-cut factors. In accounting, the beginning inventory plus purchases minus ending inventory equals the cost of goods sold.
DDP - Delivered Duty Paid is an Incoterm. It means that the seller pays for all transportation costs and bears all risk until the goods have been delivered and pays the duty.
EX WORKS/EX W - (...NAMED PLACE): "Ex Works" is the minimum/lowest obligation of a seller under Incoterms. The seller agrees to make the goods available to the buyer at the seller's premises (named place). The seller under EXW is not even responsible for bearing the cost of loading the goods onto the vehicle provided by the buyer, unless otherwise agreed in advance. The buyer bears the full cost and risks involved in bringing the goods from the EXW location to the ultimate destination. N.B. "Works" can mean "factory" or "warehouse" or "plant" - virtually anywhere defined by seller since EXW is must always to be followed by a "named place". It is seller's responsibility during initial negotiations to clearly identify the named place/location.
F&B - Fly&Buy - Buyer visits supplier's/inspection warehouse, inspects goods and pays the supplier.
FPA/IFPA - (International) Fee Protection Agreement
FOB - Free on Board. Seller pays for delivery to a certain location at which point the buyer must cover all shipping and insurance expenses.
FTZ - Foreign Trade Zone. A location where imported goods may be kept for a limited period of time, free of duty, until shipped to an American destination.
GATT - General Agreement on Tariffs and Trade. A treaty among most countries of the world that provides a forum for negotiating mutual reductions in trade restrictions.
ICPO - Irrevocable Corporate Purchase Order. Once signed the buyer must complete the transaction.
IL/C - Irrevocable L/C - see below.
JIT - Just In Time. A production and inventory method popularized by the Japanese whereby materials and supplies are delivered to the production site at the precise time they are needed rather than being stockpiled in a warehouse at the production site for a future need.
L/C - Letter of Credit. Works like escrow. It is proof that funds are available to the seller. The funds are only released on buyers sight of stock.
LOI - Letter of Intent. Once signed, the buyer is obligated to complete the transaction.
MOQ - Minimum Order Quantity
NAFTA - North American Free Trade Agreement. An agreement among the countries of North America to promote more free trade among themselves.
NCND(A)/NDNC(A) - Non-Circumvention Non-Disclosure (Agreement) - Once signed, buyers/suppliers cannot do business together without going through the parties who introduced them.
PO/IPO - Purchase Order/International Purchase Order
POS - Proof of Stock
T/T - Telegraphic Transfer. Buyer sends funds direct to the supplier from their bank account.

SHIPPING

Airbill - Air Waybill
A shipping document used by the airlines for air freight. It serves as a contract for carriage and includes carrier conditions of carriage such as limits of liability and claims procedures. The air waybill also contains shipping instructions to the airline, a description of the commodity, and applicable transportation charges. The airline industry has adopted a standard formatted air waybill that accommodates both domestic and international traffic.
FAS - Free Along Side
A basis of pricing meaning the price of goods alongside a transport vessel at a specified location. The buyer is responsible for loading the goods onto the transport vessel and pays all the cost of shipping beyond that location.
P.O.D. - Proof of Delivery
Information provide to payer containing the name of person who signed for the package with the date and time of delivery.
PU&D - Pickup and Delivery
An optional service for the surface transport of shipments from shipper’s dock to origination air terminal and from the air terminal of destination to receiver’s dock. For airfreight, an additional charge is usually assessed. It may be provide by an air freight forwarder, an integrated carrier, or by an independent truck operator either separately or under contract to an airline
SED - Shipper’s Exportation Declaration
A form required for the export of goods from the U.S., when the value of a single shipment of one commodity is more than $1,500, or when an export license is required.

I'll be updating it as I remember more and more

matt_16288 · 01-04-2006, 01:49 PM

LOI - Letter of intent

**ara-uk** · 01-04-2006, 01:51 PM

cheers matt. updated.

**Anthony** · 01-04-2006, 03:24 PM

Awesome thread so far, will sticky this as its very useful indeed..

**ara-uk** · 01-04-2006, 03:35 PM

Quote:

Originally Posted by Anthony

Awesome thread so far, will sticky this as its very useful indeed..

Thanks Anthony

Supremetronics · 01-04-2006, 03:56 PM

cheers... very helpful thread

diablo audio · 01-04-2006, 07:58 PM

Nice thread

.

How about:

FOB - Free on Board: Seller pays for delivery to a certain location at which point the buyer must cover all shipping and insurance expenses.