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Industry Terms

The purpose of this area of our Web Site is to provide an understanding of some of the terms and jargon used in the courier industry.

All of our terms appear in alphabetical order, so if there’s a specific word you are looking for, you can easily scroll down to it. You may also find it helpful to simply review the entire list.

To further improve the usefulness of this area, if there is a term you cannot find, please Contact Us to let us know about it so we can add it to our list for the benefit of future visitors.

Accessorial Charge: A charge that is assessed for either additional services or to cover added expense incurred by a courier based on a shipper error. Generally includes anything in addition to the stated charges for the transportation of shipments from an origin point to delivery destination (e.g. address correction, missing account number, oversized package, etc.).

Account Executive: Term most frequently used within the courier industry to describe a Sales Representative.

Account Number: Unique number that is assigned to a courier user to facilitate the billing process and otherwise keep track of relevant company information. Account numbers are usually between 6 and 10 digits.

Additional Package Handling Fee: Additional fee assigned to packages that are not fully encased.

Address Correction Charge: Applied when a shipper does not write the correct delivery address on the shipping document, and is assigned to cover the additional time/expense associated with attempting to obtain the correct address and effect final delivery.

Address Label: Sticker that is given to shippers to write the destination their shipment is going to. Used mainly in cases where a manifest recording system is being used (as waybills contain consignee/consignor address information on them).

Advance Purchase: Program offered by some couriers that allow shippers to pre-purchase a quantity of letters or packs at discounted or reduced price. Also referred to as Pre-Solds.

Agent: A designated person or company that acts and operates on behalf of a courier in a geographic area they do not serve directly with their own facilities and equipment. Also referred to as Service Partner.

Airport Code: A three-letter code that is permanently assigned to an airport and recognized worldwide (i.e.”YYZ” is Pearson International Airport, Toronto).

Authorization: Approval required in many companies for transportation of restricted items through an operational system (in addition to standard hazardous materials labelling). Person with such authority is usually Operations Manager.

Authorized Sales Outlet: Term used to describe a location (usually retail) where customers can drop off shipments and still receive delivery by their chosen courier. Common example is Mail Boxes Etc., which receives packages for several couriers including Canpar, UPS, Canada Post, etc.

Automated Shipping System: Term used to describe equipment that automates the processing of courier shipments. Most systems include a CPU, monitor, two printers and a weigh scale and perform a variety of tasks from shipment processing to management reporting.

Bar Code: Digital information capture system that is used for both routing and to capture information on a shipment.

Bill Of Lading: Document that governs the carriage of goods by one party on behalf of another and is generally required for delivery service to be provided. Includes several key pieces of information such as the account number, name and address of the consignor, the address of the consignee and various other value added services that are desired. Also referred to as Waybill.

Billing Adjustment: Process whereby an invoice is adjusted (usually reduced) from its original amount.

Billing Option: Term used to describe a method of billing where payment of charges is assigned to a party other than the consignor (shipper). Typically includes Collect and Third Party.

C&F Billing Option: Stands for Cost & Freight. A term of sale included on a Commercial Invoice that indicates the seller has agreed to pay for transportation fees from the point of pickup to the port of import (or destination country). The buyer must then pay for the transportation costs from the port of import to the final delivery destination.

C.O.D. Service: Collect on delivery. When payment for the cost of the goods shipped (not the cost of the shipping charges) is made by the consignee to the delivery person at the time of delivery. Payment by cheque is the most common (and accepted) method. Not to be confused with collect billing.

Call In Cut-off Time: The latest time that a shipper can call a courier company and still receive a pickup that same day.

Cabotage: Legislative regulation that specifies the degree to which aircraft (or trucks) domiciled in one country can obtain freight from and travel within another country. For example, this regulation restricts U.S. courier company planes from travelling north into Canada, picking up freight and traveling across the country and then going back down into the U.S. Same applies to U.S.-based trucks.

Centre: Term used to describe a facility or plant in which drivers and vehicles that pickup and deliver shipments are located. Most also serve as small distribution centres where shipments coming into their territory from other cities are received and processed for local delivery, and shipments going from their territory to other cities are consolidated and sent out via either air or truck transport.

Chargeable Weight: Term used to describe a situation where the billed amount for a shipment will be based on a weight that is different than the actual weight of the shipment. Reason for variance is usually due to cubing, or the application of dimensional weighting, but can also include oversize charges as well.

Claim: A process which allows a customer to attempt to regain the cost of a lost or damaged shipment.

Collect Billing Service: Where the cost of delivering a shipment is billed to the consignee, or person receiving the goods.

Commercial Value: The value that is used to assess duty. It is the actual value of the shipment in dollars, which may or may not be equal to the declared value (which is the amount declared for insurance purposes).

Commodity: Word used to describe a specific product/goods being shipped (e.g. metal ¾” bolts are a commodity that a metal shop might send).

Consignee: Party receiving the shipment.

Consignor: Party sending the shipment.

Consignment: One or more letters, envelopes, packs, packages or boxes that are picked up at same time and going to the same destination. Also referred to as a shipment.

Consignee Routing: Process whereby the party receiving a shipment specifies the courier that will be used to effect delivery.

Consolidation: Process of combining two or more shipments for the purposes of either transporting goods and/or clearing at customs.

Consumer Commodity: With respect to transportation, means dangerous goods that are packaged and distributed in a quantity and concentration intended or suitable for sale through retail sales agencies for consumption by individuals for the purpose of personal care or household use. Includes items such as pesticides, prescription drugs, etc.

Containerization: Placing all packages going to the same destination area in a large bin, or container. Most frequently used to describe how goods are shipped via air (e.g. one container, or “can” as they’re often referred to might be 6 feet high by 6 feet wide). Functional purpose is to ensure all packages stay secure while in transit, plus to maximize available space on the plane.

Controlled Drugs: Any drug that is only available by a doctor’s prescription. These must usually be shipped through a couriers Chain of Signature, or high value item system.

Courier: Individuals who pick-up and deliver customers' packages. Also referred to as drivers in many companies.

Credit Card Payment: Process of paying for the transportation of goods via a credit card.

Credit Terms: Number of days in which an invoice for the delivery of goods must be paid within; includes discounts that may be available through early payment.

Cubing Rule: Also referred to as Dimensional Weighting. Mathematical equation used to assign a price to large, bulky, lightweight packages that take up a lot of space. Most couriers have one formula for air shipments (15 lbs./cubic foot) and one for ground (10 lbs/cubic foot).

Customer Service Representative (C.S.R): An employee who assists customers, usually by telephone and is available to answer questions, arrange for pickup of shipments that need to be sent or investigate tracking/tracing inquiries.

Customs Broker: Individual or firm that has the authority to transact business with customs on behalf of an importer or exporter.

Customs Documentation: The documents that the government states are necessary for goods to be imported and /or exported (e.g.B-13).

Customs Official: The customs representative who examines goods entering the country. They are responsible for checking that the customs documentation is in order, proper duty is charged, etc. They can decide whether goods can cross the border and be accepted into their country.

Customs Clearance Service: Procedure of declaring merchandise at the customs office. The shipment is not allowed to enter the country until customs has “cleared” it, or formally granted it admission. This involves ensuring the item can legally be transported between the two countries, and assessing any applicable duty or taxes.

Daily Pickup Service: Service offering where a courier will make an automatic stop (no phone call required) each day at a company location to pickup shipments. Usually only offered to medium/large size shippers.

Dangerous Goods: Items that have been designated by the International Air Transport Association (IATA), the International Civil Aviation Organization (ICAO) or the Canada Transportation of Dangerous Goods Act as being potentially harmful in the event of an accident.

Declared Value: The amount that the shipper would like to insure a shipment for during transportation. This amount must be written in the appropriate place on the shipping document unless a special agreement has been made. Most courier companies provide $100.00 of free coverage.

Dedicated Service: A service whereby the customer “rents” a courier and any other related equipment, such as a delivery vehicle. Offered very rarely, but when used, pricing is generally based on an hourly rate.

Delivery: When the courier leaves the shipment with the consignee, (usually) obtaining the receiver’s signature as proof of delivery.

Depot: Also known as terminal or centre. An operational location serving a specific geographic area where packages are sorted for delivery and/or pickup. Each major courier company generally has at least one of depot in each major city.

Dimensional Weighting: Also referred to as Cubing. Mathematical equation used to assign a price to large, bulky, lightweight packages that take up a lot of space. Most couriers have one formula for air shipments (15 lbs./cubic foot) and one for ground (10 lbs./cubic foot).

Discount: Refers to the amount by which a courier published, or first tariff rates are reduced. These are usually offered based on either volume or revenue levels, and may be in several forms including percentage off, dollar amount off or customized.

Dispatch: Department that relays pick-up information and other instructions to couriers while on the road. Was originally done using two-way radios, but this has largely been replaced with cell phones and/or computerized technology.

Dock: The warehouse area in a depot where shipments are loaded and unloaded into vehicles.

Domestic Shipment: Term used to describe shipments that are both picked up and delivered to a destination in Canada.

Drop Box: Also known as “mailbox” or “letter centre”. A convenient small-package receptacle similar to a mail-box and usually located in a building lobby or other location that receives a high volume of business customer traffic (e.g. major intersections downtown). Customers deposit their shipment into the box, instead of having a courier pick them up. Most often used in situations where a shipment could not be ready to send at the time the courier regularly comes each day.

Drop Off Discount: A reduction in shipping charges that is offered when a shipper deposits their shipment into a courier’s delivery network themselves (versus having it picked up by the courier). Examples would include taking a shipment to a courier company Retail Outlet or placing it into a Drop Box.

Duty: A tax charged by the Government of the country into which the goods are entering. Usually ranges from 1-40% of the value of the item, depending upon the commodity and country of origin.

Duty Paid/VAT Unpaid Billing Option: Situation where the shipper pays transportation charges plus any applicable taxes relating to customs in the destination country, but the receiver pays any applicable Value Added Taxes.

End Of Day: Delivery standard that typically means the end of a normal business day (5:00 pm).

Exception Notification: Process where a shipper is notified of a development that will prevent the on-time delivery of their shipment before its intended delivery date/time. Can be pro-active, where courier calls customer to let them know of a delay or reactive, where customer must call courier.

Export: Refers to goods or services that are sent FROM Canada to another country for final purchase/use.

Extended Area Surcharge: Additional charge for delivery of shipments to very remote locations that are typically not serviced by the courier directly. Usually charged on either a per package or shipment basis.

F.O.B. Billing Option: Stands for Free On Board. A term of sale meaning the seller has included on the Commercial Invoice issued for the buyer, the value of the goods plus the transportation fees from the point of pickup to the port of export.

Facsimile Transfer: The electronic transmission of images on paper from one location to another, using sophisticated electronic equipment.

Fax On Demand: Information service that allows shippers to call a toll free number and order information regarding a courier’s products or services.

Fragile Goods Service: Used for the transportation of goods that are easily breakable or damaged (e.g. glass, giftware, etc.).

Free Domicile Billing Option: Situation in which the shipper pays transportation charges plus any/all applicable taxes relating to customs and Value Added Tax in the destination country.

Freight: Term often used to describe a commodity or goods being shipped.

Freight Collect Refusal Charge: Applied when a consignee refuses to pay for a shipment that is sent Collect. In this situation most it is the policy of most couriers to bill the cost of the shipment to the location the shipment originated from. This charge is in addition to these transportation fees.

Forward Sortation Area: Also referred to as FSA. Refers to the first three digits of a postal code. This geographic-based territory system is often used by couriers for the purposes of determining rates and service points.

Fuel Surcharge: Applied to cover fuel expense associated with the delivery of a shipment. Most typically applied in times when fuel prices are extremely volatile and at very high rates.

High Value Shipment: A shipment that is valued at over $1,600 Cdn or $1,185 U.S.

Hold For Pickup Service: Available upon customer request. The shipment is held at the courier’s destination depot rather than being delivered to a consignee location until the consignee picks it up. Usually requires a special sticker that is attached to the package or packages at the point of pick-up.

Hub: A central location where freight is brought in from each local operations centre is sorted then re-directed to its destination area. (e.g. UPS’ main U.S. air hub is Louisville, Kentucky).

IATA: Stands for International Air Transport Association. Organization that develops policies regarding the transportation of goods internationally.

ICAO: Stands for International Civil Aviation Organization. Mandate is to promote the general development of civil aviation such as aircraft design and operation, safety procedures, etc.

In City Rate: Special low rate that is applied for shipments within a major city, most often major Census Metropolitan Areas. This geographic area is usually smaller, and less expensive than most company’s lowest normal rating zone (e.g. zone 1).

International Billing Options: Unique set of billing options that are typically associated with International shipping. Includes Bill Duty/Tax And Shipping Charges To Shipper or Deliver Duty Paid, V.A.T. Unpaid.

Liability: Legal responsibility for any loss or damage that occurs in a transaction. Unless a higher amount is declared by the shipper, the maximum legal amount a courier can be made to pay is $2.00/lb.

License: The legal authority granted by a province that outlines the limitation of a courier’s operations (e.g. maximum package weight). The need for licenses was, with a few exceptions, eliminated after the passing of the new Transportation Act in the late 1980’s, which effectively “de-regulated” the industry.

Linehaul: The process of moving packages from one delivery centre to another. Usually done by transport truck for ground based services, and plane for air based services (e.g. Express or Next Day).

Limitation Of Liability: The extent to which a courier is legally responsible for the goods they transport. A courier’s limitation is $2.00 per lb. (or $4.41 per kg) unless a higher declared value is stated on the face or the shipping document (e.g. B/L) or there is a special agreement with the customer.

Lock Box: A locking box that is placed on a customer’s property used for pick-ups and deliveries when it is necessary or more convenient than having a daily pickup. Usage has declined significantly during the 90’s due to the proliferation of drop boxes, customer counters and retail outlets. Also referred to as a vault.

Low Value Shipment: A shipment that is valued at between $20.01 and $1,600 Cdn ($14.82 to $1,185 U.S.).

Manifest: A type of shipping document that allows customers to record multiple shipments on one page.

Military Time: Time in a 24 hour day referred to in four numbers, with the first two numbers as the hour (from 00 to24) and the last two numbers as the minutes (from 00 to 60).

Mis-Direct: When a package arrives at the wrong delivery destination area, it is called misdirect (e.g. package from Toronto for delivery to Montreal arrives at Winnipeg depot).

Missing/Invalid Account Number Charge: Applied when a shipper fails to indicate their account number on a shipping document and/or the account number they indicate is incorrect.

Multi-Piece Pricing: Also referred to as Shipment Pricing. Here the charge for a shipment is assessed based on the total weight of all the packages combined.

Multiple Shipper: A regular shipper who sends numerous shipments each day.

N.S.F. Charge: Applied when a shipper’s cheque is returned due to non sufficient funds. Courier charges are in addition to those that may be applied by a financial institution.

Network: A set transportation system (air or ground) in which a courier moves freight from the point of pick-up to destination.

No Commercial Value: A shipment of goods for which no payment is made to the shipper. In other words, they have no value. Typically applies to free samples.

Non Dutiable Item: A commodity which the government has decided will not be taxed upon import ( e.g. business correspondence in an envelope).

On Board Courier: Also referred to as OBC. Refers to a person that flies shipments that are classified as excess baggage. This operational method is most often used for International deliveries.

On Call Pickup: Service where a customer that is not receiving regular daily pickup service calls a courier company and arranges for their shipment to be picked up the same day.

Operating Days: The number of days in any given calendar year in which a company performs both delivery and pickup services. This analysis is based on regular services only (e.g. excludes specialized offerings like Purolator’s Sameday service that is available 365 days/year).

Operational Agent: Term used to describe a company that either assists in the movement of shipments between major city operations centres and/or effects final delivery of shipments to areas that are not directly served by the originating courier.

Oversize Package Charge: Additional fee usually assigned to packages that exceed a company’s size restrictions.

Package Storage Service: Similar to Hold For Pickup service in that the shipment is held at the courier’s destination depot until it is picked up. Package storage service is used when the consignee cannot pick up the shipment for some time (usually more than one week).

Packaging: Refers to the various containers offered by courier company’s and includes items such as Letters, Packs, Boxes and Tubes. While virtually all companies offer packaging, many do not have an associated fixed price (e.g. $11.45 letter for anywhere in Canada), in which case shipping fees are determined based on actual weight.

Pick-up: Process of picking up one or more shipments from a customer (shipper) location.

Pickup Cut-off Time: The latest time that a courier will make a pickup from a shipper’s location.

Piece: Any single envelope, letter, pack, package or box.

Port Of Entry: The place at which a shipment is officially entering a country.

Post Office Box Service: Service where a shipment is delivered to a post office box instead of a physical delivery location (office or building). Special restrictions typically apply when this service is used and available (e.g. no signature for proof of delivery can be obtained).

Prepaid: Payment method whereby the cost of sending the package is invoiced to the consignor (or sender).

Pre-solds: Pricing/payment method where the customer purchases a large quantity of courier services at a reduced rate, but must pay for all of them at the time of purchase (instead of as they are used). Usually applies to letters. Used extensively up until the mid 80’s, then declined.

Profit Centre: A geographic based area in which pick-ups and deliveries are made, and revenue and costs are assigned. Generally used for performance evaluation (e.g. profitability). Often linked to individual depot service areas.

Prohibited Goods: Those commodities that are not allowed to be transported within a courier’s system, due to either their own regulations or those associated with their operating license.

Proof Of Delivery: Verification that a shipment has been delivered. Can be verbal or written. Usually in the form of receiver’s signature or a copy of the Bill of Lading.

Rebilling Charge: Charge applied when an error on the part of the consignor (shipper) results in a new invoice having to be created.

Redelivery Charge: Applied when additional delivery attempts beyond the number normally offered by a courier are required. Can also be applied when a shipment is deemed as being undeliverable and must be returned to the original consignor (shipper).

Restricted Goods: Commodities that a courier cannot accept in their system. Usually applies to Hazardous Goods.

Retail Outlet: Also know as Walk-in Centre, Customer Service Center, Authorized Sales Agent or Terminal Counter. Any location that is staffed where a customer can walk-in to receive service, (i.e. drop-off and send packages).

Revenue Per Package: Term used to describe the dollar value obtained for an individual “piece”. A piece could be a letter, envelope or box. Usually expressed in “net” terms (after discounts).

Revenue Per Shipment: Term used to describe the dollar value obtained for a shipment of one or more packages. Usually expressed in “net” terms (after discounts).

Reweigh: Process whereby a courier company will randomly assess the weight of a given package for the purposes of comparing it to the weight stated on the Bill Of Lading or shipping document. Where differences exist (e.g. actual weight is higher than stated), the policy of most couriers is to adjust the price charged upward.

Rounding Method: Term used to describe how a courier company assesses a shipment charge when the weight of the shipment is a fraction of a pound above a whole number (e.g. 2.2 lbs.). In virtually all cases, couriers will round up based on any fraction above the a whole number, instead of the more frequent method of rounding anything above .5 up, and below .5 down.

Route: Also known as “run”. A geographic area in which a courier is responsible for pick-ups and/or deliveries.

Scanning Device: Tool used to capture shipment level information that is used for tracking purposes. In most cases, these are “wands” that read bar codes.

Security Service: Designed for shippers of goods such as Government Controlled Drugs and high value merchandise. Generally only available to points served directly by the courier. These shipments are usually transported in a locked and sealed container and everyone who touches them must sign for time they were in their control/possession.

Service Guarantee: Commitment by a company to ensure a shipment will be delivered within a stated delivery schedule standard. Usually based on time of day delivery, but also used for other services such as tracking (e.g. 30 minute response time). In all cases, the guarantee is limited to the amount of transportation charges associated with any given shipment.

Service Partner: A designated person or company that acts and operates on behalf of a courier in a geographic area they do not serve directly with their own facilities and equipment. Also referred to as Agent.

Shipment:One or more letters, envelopes, packs, packages or boxes that are picked up at same time and going to the same destination.

Shipment Pricing: Also referred to as Multi-Piece Pricing. Here the charge for a shipment is assessed based on the total weight of all the packages combined.

Shipment Recording Options: Term used to describe the various methods or forms that shippers can fill out to effect transportation of their shipment to its destination. Most couriers have at least four options; waybill, manifest, host manifest (e.g. Pitney Bowes shipping system) or automated (proprietary shipping system).

Shipper Return Service: Allows a shipper to request that a courier go to a consignee location and pickup a shipment that was previously delivered and return it to them.

Signature Release Service: Where the shipper provides the courier company with written permission to deliver a shipment without obtaining the signature of the person who received it. Typically used for deliveries to residential locations and/or that are extremely early in the morning.

Single Piece Pricing: Pricing method where a charge is assessed for each package in a shipment.

Size Restriction: Similar to weight limitations, except refers to physical size, or dimensions of an individual piece. These are all voluntary, and again based on company operational equipment and facility handling capabilities.

Sort: A process in which shipments are identified and grouped according to destination.

Split Shipment: A multiple piece shipment in which one or more of the packages has been separated, often caused by a mis-sort.

Tagline: Brief slogan that a company adopts as part of its Marketing/Advertising strategy.

Tariff: A list or scale of prices for courier service. Often in the form of either “first tariff” or published rates, which are those that are charged to small customers and “customized”, which are specially developed based on company’s shipping volume and patterns.

Telephone Centre: Location staffed by Customer Service Representatives that are available to assist customers. Some couriers have one national centre, while others operate locations in various regions of the country.

Temperature Controlled Service: Refers to a courier’s ability to provide either refrigeration and/or heating for shipments while in transit.

Third Party Billing Service: Allows a shipper to request a pickup from a third party location (one different than their address), but still have the shipping charges billed to their account.

Trace: A customer request to be provided with information regarding the location of a shipment. Similar to tracking.

Tracking: Process of locating a shipment in a courier’s network, or system. Most frequently used to confirm delivery. Difference exists between “Real Time” and other systems. With Real Time tracking, package information is scanned at the time it’s picked up and transmitted directly to the courier’s computer system as soon as the driver returns to their vehicle. With non real time systems, drivers must return to their local depot to “upload” information for shipments they picked up that day.

Tracking Guarantee: Commitment by a company to ensure shipment status information will be available within a set period of time (usually 30 minutes). In all cases, the guarantee is limited to the amount of transportation charges associated with any given shipment.

Transaction Fee: Charge that is accessed to cover a couriers costs associated with billing and invoicing of a shipment.

Transit Time: Measure used to describe the amount of time (usually in days) required for a shipment to be delivered to its final destination.

Undeclared Liability: The maximum legal amount a courier can be made to pay for a lost/damaged shipment if no higher amount is declared by the shipper.

Undeliverable Package Charge: Applied when a shipment is deemed as being undeliverable and must be returned to the original consignee (shipper).

Vault: A locking box that is placed on a customer’s property used for pick-ups and deliveries when it is necessary or more convenient than having a daily pickup. Usage has declined significantly during the 90’s due to the proliferation of drop boxes, customer counters and retail outlets. Also referred to as a Lock Box.

Vehicle: A vehicle is used to describe those trucks (often van) that are used for the pickup or delivery of packages to end users (customers). This excludes larger equipment such as transport trailers.

Warsaw Convention: Refers to a Convention for the unification of rules regarding the International transportation of goods by Air. This document was signed in Warsaw on October 12, 1929 and updated in Montreal in 1975.

Waybill: Also referred to as a Bill Of Lading. Legal and binding contract with the customer that governs the movement of a shipment from pickup to delivery. The courier and the customer sign the waybill, with one copy being left with the customer. Upon delivery, one copy goes to the receiver of the goods, one is kept for the carrier’s operations records, and another goes to their billing department.

Weight Limitation: The maximum amount any individual piece or shipment is allowed to weigh, according to a courier company’s operating license (usually either 70 lbs. or 150 lbs./package). After de-regulation in the late 80’s, formalized weight restrictions were pretty much eliminated. Despite this, many couriers have decided to continue to enforce maximum weights voluntarily, most often because their operational equipment and facilities are not designed to handle large, heavy packages. Package maximum weights are typically 150 lbs., while there are generally no maximum shipment weights.

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