CLT flashcards
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32 cards. Read the term and the definition here. The deck at the top of this page is optional.
- Logistics
- The process of planning, implementing, and controlling the efficient flow and storage of goods, services, and related information from origin to consumption to meet customer requirements.
- Seven Rights of Logistics
- A framework requiring the right product, quantity, condition, place, time, customer, and cost; each dimension can be measured as a service or cost failure.
- Total Landed Cost
- The sum of unit price, freight, duties, insurance, handling, inventory carrying cost, and risk cost; used to compare suppliers on a delivered basis rather than price alone.
- Economic Order Quantity
- The order size minimizing the sum of ordering and holding costs, computed as the square root of twice annual demand times order cost divided by annual holding cost per unit.
- Reorder Point
- The inventory position at which a replenishment order is triggered; equals expected demand during lead time plus safety stock.
- Safety Stock
- Buffer inventory held to cover variability in demand and lead time; increases with demand variance, lead-time variance, and target service level.
- Inventory Carrying Cost
- Annual cost of holding inventory, including capital, storage, insurance, taxes, obsolescence, and damage; commonly modeled as a percentage of average inventory value.
- Cash-to-Cash Cycle
- Days inventory outstanding plus days sales outstanding minus days payable outstanding; measures how long cash is tied up in operations.
- Incoterms
- Standardized international commercial terms defining the division of cost, risk, and responsibility between buyer and seller at a named point of transfer.
- EXW
- Ex Works: the seller makes goods available at its premises and bears minimal obligation; the buyer handles loading, export clearance, transport, and import duties.
- DDP
- Delivered Duty Paid: the seller bears maximum obligation, delivering goods cleared for import and paying duties to the named destination.
- Bill of Lading
- A transport document serving as receipt of goods, contract of carriage, and document of title; it is central to ocean freight and letter-of-credit transactions.
- Freight Mode Tradeoff
- Modal choice trades cost per ton-mile against speed and reliability; ocean and rail are cheapest per mile, air fastest, truck the flexible middle option.
- 3PL
- A third-party logistics provider performs outsourced logistics functions such as transportation, warehousing, and fulfillment on behalf of a shipper under contract.
- Reverse Logistics
- The movement of goods from the point of consumption back for returns, repair, refurbishment, recycling, or disposal; includes inspection, disposition, and credit processing.
- ABC Analysis
- Inventory classification by value or velocity into A, B, and C tiers; A items carry the highest share of value and warrant tight control and frequent review.
- Service Level
- The probability that demand is met during a replenishment cycle, or alternatively the fraction of demand filled; used to set safety stock levels.
- Fill Rate
- The proportion of demand satisfied from available stock; computed as one minus expected shortage per cycle divided by order quantity.
- Newsvendor Model
- A single-period inventory model where the optimal order quantity balances underage and overage costs; the critical ratio equals underage cost divided by total underage plus overage cost.
- Continuous Review System
- An inventory policy that monitors position continuously and orders a fixed quantity when the reorder point is reached; safety stock covers lead-time variability only.
- Periodic Review System
- An inventory policy that orders at fixed intervals up to a target level; safety stock must cover variability over both the review period and the lead time.
- Bullwhip Effect
- Amplification of demand variability as orders move upstream; driven by demand signal processing, order batching, price fluctuation, and shortage gaming.
- Cross-Docking
- A flow-through practice where inbound shipments are transferred directly to outbound vehicles with minimal storage, requiring synchronized schedules and accurate advance shipment notices.
- Warehouse Slotting
- Assignment of SKUs to storage locations based on pick velocity and cube; high-throughput items are placed in accessible, ergonomically favorable positions to reduce travel time.
- Cube Utilization
- The ratio of occupied storage volume to available volume; low utilization raises handling cost per unit while excessive utilization can slow picking and receiving.
- Perfect Order Metric
- A multiplicative measure combining on-time, in-full, damage-free delivery and correct documentation; any single failure makes the entire order imperfect.
- Distribution Network Design
- Selection of warehouse count, location, and service areas balancing transportation cost, facility fixed cost, and inventory cost; total cost is typically convex in the number of facilities.
- Postponement
- Delaying final product configuration or location commitment until customer demand is known; reduces forecast error exposure and inventory while requiring flexible operations.
- Lead Time Compression
- Reducing the elapsed time from order to delivery through process redesign, closer supplier links, and faster transport; lowers safety stock and improves responsiveness.
- Transportation Consolidation
- Combining multiple shipments into larger loads to improve vehicle utilization and lower cost per unit, trading off against longer transit and higher inventory.
- Landed Cost Analysis
- Supplier comparison method that adds freight, duties, insurance, handling, and inventory effects to unit price; supports sourcing decisions on a delivered-cost basis.
- Demand Sensing
- Using near-real-time downstream data, such as point-of-sale and shipment signals, to detect demand shifts earlier than periodic forecasting would reveal.