Cargo Shipping Terms: A Complete Guide for Shippers

Cargo Shipping Terms: Introduction

Understanding cargo shipping terms is essential for shippers. These terms help communication in routing shipments. Effective communication leads to smooth processes. Learn these terms to avoid costly mistakes, ensure compliance, and streamline your shipping process.

Accessorial

An accessorial in shipping refers to additional services or fees beyond the line haul, or standard. Carriers charge for extra work done on a shipment. Common accessorial charges include: Lift gate services, inside delivery, limited access locations, truck order not used, residential delivery, and much more. While Fuel Surcharges are commonly separated from line haul charges, this is not commonly known as an accessorial but it’s own category. Learn more about Fuel Surcharges here.

Also referred to as: Special Services

Backhaul

The trip trucks take back to or near their starting point. To avoid running empty on backhauls, carriers will often carry a different shipment towards their starting point.

Billing Adjustment

An adjustment made to cover unpaid freight shipping costs as reported by a motor carrier.

Cargo

The physical commercial or personal goods involved in a shipment. Commonly confused with term freight, cargo refers to the actual goods moving in a shipment, and not the shipment process.

Cargo Carriers

The term refers to all carriers handling cargo, including LTL, full truckload, ocean, rail, air, and other modes of transportation. Cargo Carriers is usually used interchangeably with freight carriers.

Also known as: Cargo Companies, Freight Carriers, Motor Carriers

Carrier Lanes

Specific routes that carriers regularly service between two or more locations. These lanes represent the geographic corridors where carriers have established equipment, location, drivers, and networks to operationally move shipments.

Cartage Services

Short distance transportation of goods, typically within a local area or metropolitan region. These services play a crucial role in the first and last mile of a supply chain. The services bridge the gap between long-haul operations and final delivery points. Typically, these providers have fleets of smaller trucks or vans for urban environment deliveries.

Common Carriers

The proper term for commercial companies moving goods at published freight rates. The term originates from carriers popping up for general freight movements. A shipper may use this term when shipments are being moved outside of their in-house carrier or trucks.

Also referred to as: Interstate Trucking, Freight Carrier, Freight Hauler, Freight Companies, Motor Freight Carriers, Trucking Companies, Shipping Companies, Freight Lines

Consignor / Consignee

The consignor (shipper) sends goods and the consignee (receiver) receives the shipment. Typically, consignor is less commonly used as it’s referred as the shipper. Consignee is the standard word for the party receiving the shipment.

Cost per Mile

A metric used in shipping to either calculate or evaluate freight rates. To find cost per mile, simply divide the total freight cost by the total miles in the shipment. There are specific tools to help ensure mile calculation is accurate due to specific routes needed by specific trucking equipment.

The cost per mile is typically used to help ensure a carrier is operating efficiently. Carriers will run analysis to find the minimum per mile needed to be profitable to determine if a shipment is worth committing to. This metric helps to reasonably compare different lanes to ensure profitability.

Crating Services

The best way to protect a shipment is to crate the shipment. Crating a shipment involves enclosing all exposable sides with specific packaging guidelines, usually with wooden material. These services, done by specialized providers or white-glove carriers, are for shippers without the proper resources or knowledge to crate a shipment.

Density Calculator

In shipping, the density is important for calculating freight class in LTL and computing freight rates. A density calculator helps shippers easily calculate the pound per cubic foot. Transportation Management Systems (TMS) like ViewPoint offers built-in density calculators for ease.

Drayage

A type of mode of transportation where a carrier will pick up a container. Typically, drayage moves come from ports after a shipping container makes landfall. However, drayage can also be describe for the final leg of an intermodal, or rail, shipment. The carrier will have the container loaded on a empty chasis for easily loading and unloading.

Drop Deck

A specialized trailer type with a lower deck to provide more room for over length freight. This trailer is to help transport goods over the height limit and is a specialized type of flatbed. These type of trailers can be found in single and double drop standards.

Drop Shipping

Shipping goods directly from a vendor to the customer. Any time that the company’s location is not a point in the shipment, then the move is considered drop shipping.

Dry Van

The most common equipment type in transportation, a dry van is an enclosed trailer. The trailer protects cargo from weather and theft, making them the most popular trailer for standard, non-perishable shipments. Most common trailer dimensions are 53 foot long, 102 inches wide, and 110 inches high trailers, but all dry van equipment varies depending on the carrier with the equipment.

Estate Shipping

Refers to the shipping of estate sale items. This process requires extensive packaging and crating of personal effects including artworks, furniture, heirlooms, and collectibles. These type of moves are best done through White Glove Service carriers as most common carriers will not provide packaging or inside pickup services.

Expedited Shipping

The term expedited shipping refers to time-sensitive shipments requiring as fast as possible delivering. While transit restraints can exist, expedite carriers utilize different equipment and services to help get the product there fast. Below are some options for expedite shipping:

Team Drivers

Team truckload drivers to help exceed standard Hours of Service (HOS) regulations. This helps to provide additional hours of driving without sacrificing safety in delivering a shipment.

Sprinter Vans / Cargo Vans

Smaller sprinter vans and cargo vans help provide timely deliveries. These smaller vehicles allow faster transit then larger axle vehicles. These providers are able to dispatch drivers to docks within hours. The equipment is smaller and for smaller shipments to deliver fast.

Air Freight

The last option for expediting a shipment is utilizing air freight options. Next day deliveries are available to any point in the United States if the resources is available. Freight will take flight on commercial or passenger airlines to get to the destination as soon as possible.

Final Mile

Refers to the final leg of a shipment to deliver from a distribution hub or fulfillment center to a business, or in more cases a residence. This service includes inside delivery, unpacking, and (in some cases) assembly and installation. E-commerce and retail businesses are common industries utilizing final mile services.

First Mile

Refers to the first leg of a shipment to pickup from a business or residence. This service typically includes inside pickup and/or packaging services. White Glove carriers are typically the carriers offering these services.

Free on Board

A term for outlining when ownership and responsibility for goods transfer from the seller to the buyer. In international shipping, this term is known as an INCO term. Find more about IncoTerms here.

Freeze Protection

A service from motor carriers designed to protect freight from extremely cold temperatures exposure during transit. This is particular important for products such as chemicals and certain plastics that are water-based.

Less-than-Truckload carriers will store products in terminals versus in trailers to help in this service. Blanket wrapping and utilizing temperature controlled trailers are other techniques to keep freight safe in cold conditions.

Freight

The term freight has many different interpretations. At the base, shipments that require additional handling measures is considered freight shipments. A standard freight shipment exceeds 150 pounds, is palletized or crated, and exceeds 4 feet in length. However, this definition is closely related to that of cargo, since it refers to the physical commercial goods.

The definition of freight also encompasses the entire process of shipping larger items. This includes the payment, cargo, and services associated with commercial goods. In recent years, the term usually replaces the term cargo and generally speaks about the process of shipping commercial goods.

Consolidated Freight

The act of combining multiple shipments into one. Consolidating freight can help shippers to achieve savings with less operational costs for moving shipments at once.

Container Freight

Includes shipping freight through a container. Ocean and Rail shipments use shipping containers as the standard for shipping. The containers act as a removable trailer for easy transportation onto different modes of transportation.

Discount Freight

This term refers to offering shipping services at reduce rates compared to standard pricing. The practice is common in carrier base tariff pricing. Tariffs are published prices for transporting goods. Discounts allow for carriers to attract and retain customers and in some cases to fill capacity and compete in specific markets.

There are numerous factors to discounting the base rate, but common ones are:

Shipping Volume
Lane Details
Freight Class
Relationships

Domestic Freight

Refers to the shipping of commercial goods in a specific country. For TLI, domestic freight refers to shipping within the United States of America.

Ground Freight

Refers to the transportation of parcel goods by truck over the roads.

Interstate Freight

Refers to the transportation of goods from one state to another, regardless of the mode of transportation.

Also known as: Freight Shipping, Freight Load

Freight Bill Audit

The examination of shipping invoices to verify accuracy and compliance to agreed upon rates and terms between shippers and carriers. These audits aim to identify discrepancies, such as incorrect charges or billing errors to reconcile them. Freight audits also dive into deeper issues identifying problematic areas of rating and shipment analysis.

Freight Broker

An intermediary in the logistics industry, connecting shippers with carriers for the transportation of goods. Acting as a liaison, they negotiate competitive rates, coordinate shipments, and track operations from pickup to delivery. While the level of customer service and services from a freight broker varies, there are full-service freight brokers acting as an extension of your company. TLI prides itself in being a full-service 3PL Freight Broker, offering full freight services to it’s shippers.

A benefit of working with freight brokers is the access to transportation resources, experience and relationships the broker has.

Also known as: Transportation Broker

Freight Center

A location dedicated to logistics activities, such as warehousing, cross-docking, and other logistics processes. The freight center are usually strategically positioned for the freight carrier to easily process and dispatch freight towards their final destination.

Freight Class

A class system to help classify and standardize different types of freight base on their characteristics. Volume, handling, liability, and stow ability are the four factors used in determining the freight class of a shipment.

Freight class is important in less-than-truckload shipping where freight shipments move with other freight. LTL Carriers price shipments base on freight class to accurate price the service of moving freight. The classification is monitored and evaluated by the National Motor Freight Traffic Association (NMFTA) under National Motor Freight Classification (NMFC) codes.

Freight Forwarder

A logistics specialist who arranges and manages the transportation of goods in Full Container Loads (FCL) and Less than Container (LCL) shipments on behalf of shippers. Separate from a freight broker, a freight forwarder is able to handle customs and documentation for international shipments as a registered freight forwarder.

Also known as: Freight Forwarding

Freight Insurance

Additional coverage insurance to cargo liability. Carriers outline cargo liability coverage during contract and tariff negotiations. Cargo liability in less-than-truckload is given at per pound basis up base on freight class and truckload is typically held at $100,000 per instance. The burden of proof also falls on the shipper to prove the carrier is at fault for damage.

Freight insurance helps to bridge the gap in coverage from cargo liability for higher value shipments. It also helps to cover cargo in other instances not covered or in the event burden of proof falls on the shipper.

Also known as: Cargo Insurance

Freight Liability

Refers to the carrier’s responsibility and legal obligation for the goods to transport. The carrier’s liable for any loss, damage, or delay that occurs during transit at the fault of the carrier. This liability is typically govern by terms in the carrier’s bill of lading or transportation contract. Freight liability may be influenced by the type of goods shipping, their value, and the agreed-upon terms between shipper and carrier. Understanding freight liability is important to clearly outline responsible parties in unforeseen incidents in shipments.

Freight Matching

The process of paring shipper’s freight with suitable carriers to optimize transportation programs and for cost-effectiveness. Transportation Management Systems (TMS) help shippers to match shipper’s freight requirements with carrier’s capabilities. Providers like TLI who offer TMS systems can also use data to help optimize future shipments using historical data.

Freight Quote

A quote for transporting a freight shipment. Usually, freight quotes are determine by line haul, fuel surcharges, and accessorial charges. Carriers may update freight quotes at invoicing if freight details were inaccurate or if additional services were required to complete the shipment.

Also known as: Freight Rates, Shipping Rates

Freight Rate Calculator

Transportation Management Systems (TMS) help shippers to calculate their freight rates by using rate tables. These calculates can be as simple as lane to lane cost look ups to density based calculation. At TLI, ViewPoint uses shipment details, a built in density calculator and rate tables to help shippers determine accurate freight quotes.

Also known as: Freight Shipping Calculator

Freight Shipping Services

Services that help to complete the transit of commercial goods. Shipping services encompass during transit accessorial in a shipment to front-end and back-end services, such as freight audit and claim services. The purpose of these services are to help ensure timely and accurate shipping for a shipper.

Freight Terminal

A location in freight shipping where carriers store equipment, perform cross-docking, and prepare shipments for the next step in transportation. Admin functions also run out of freight terminals. Less-than-Truckload terminals are steps in moving freight.

Groupage Shipping

Consolidating goods from various companies into a single shipment. This is a form of consolidation to combine like shipments and bring down cost of transportation for shippers.

Handling Unit

A distinct piece of packaged good, moveable by a forklift, pallet jack, or by hand. Handling units group together number of pieces. For example, 30 boxes move on one handling unit of a pallet.

Hazmat

Short for Hazardous, Hazmat refers to goods that present potential risk to health, safety, property, or the environment during transportation. These materials require special handling, packaging, labeling, and documentation to ensure safe transport and compliance with regulatory standards. This includes products such as chemicals, gases, flammable liquids, explosives, radioactive materials, and infectious substances.

Transportation regulations require shippers to properly reference United Nations (UN) numbers to help identify the hazardous material. This helps aid carriers, emergency responders, and regulatory authority in identifying and managing risks associated with the hazardous material.

Also known as: Hazardous Freight

Heavy Freight

Shipments that are outside of the standard weight of a normal shipment. Any single pallet over 2,000 lbs or shipments over 8,000 lbs are considered in LTL trucking to be heavy freight. To properly load shipments, carriers need to keep in mind weight distribution to ensure a trailer will not tip over. Heavy freight may require special carriers and/or permits under state regulations.

Inside Delivery & Pickup

Any pickup or delivery that goes beyond a dock door. If a carrier has to go past the dock or any room inside a residence, then the service is considered an inside pickup or delivery. While some carriers may have varying definition, this is a general rule of thumb.

International Freight

The transportation of goods and cargo between countries or across borders. This type of shipping involes multiple modes of transportation such as truck, rail, ocean, or air. Just like domestic freight with less-than-truckload and full truckload, international freight is define in Full Container Loads or Less-than-Container loads. Here are key concepts for International Freight:

Export

Sending goods produced in one country to another country for sale or distribution. The Exporter is the party sending the goods out of their country. Exporters must comply with regulations, documentation requirements, and customs procedures of both exporting and importing countries.

Import

The process of bringing goods and products into the country from another country. The Importer is the party bringing the goods into their country. Importers must comply with regulations, documentation requirements, and customs procedures of both exporting and importing countries.

IncoTerms

A standardize set of terms used in the sales process to determine where where the risk and responsibility transfer from one party to the other. There are eleven IncoTerms describing the responsibility of a buyer and a seller in the transportation process. This is govern by the International Chamber of Commerce.

Lift Gate

A piece of equipment at the tail end of a trailer for moving freight from ground level to the trailer height or vice-versa. Lift gates are most used at limited access, job sites, non-dock businesses, or residential deliveries. There are weight and dimensions restrictions to safely performing on a lift gate.

Most LTL carriers will have fleets with lift gates to perform deliveries. However, truckload carriers commonly do not have this equipment on full Dry Vans. Straight Trucks, or smaller trucks, more commonly have the equipment attached.

Also known as: Tommy Gate

Limited Access

Any location where an additional step is required to perform a pickup or delivery. This includes job sites, locations with a guard shack check in, military/government buildings requiring identification cards, and much more. While it’s good to flag these locations for truckload carriers, LTL Carriers require you flag these locations as there are additional costs to servicing these locations. Actual definitions of a limited access location varies by carrier.

While residential locations may qualify for this definition, these locations are marked and charged at a different rate. Please see the definition for residential below for further details.

Lean Supply Chain

A supply chain in which waste is minimal in the process while performing at a high efficiency in production and distribution. Lean Manufacturing and Supply Chain is a popular strategy for companies looking to reduce waste, lower costs, and optimize customer experiences.

Less-than-Truckload

A mode of transportation that allows shippers to share space to save on costs. LTL usually transports one to six pallets in a single shipment. The carriers will utilize pick and deliver drivers for first and final miles of the shipment. During transit, the shipment will line haul through various terminals with similar bound shipments until at the local terminal for delivery.

Shippers also find success in LTL for delivering to companies requiring special services such as delivery appointments and lift gate services. LTL carriers invest in equipment to make shipping and delivering of smaller freight shipments easier and less costly. To learn more about less-than-truckload, click here.

Not Otherwise Indicated (NOI)

A term in the freight classification process to help determine freight class for goods not specifically classified by the NMFTA. For example, Plastics Articles (NOI) is a common term used to help classify plastic parts since millions of plastic parts exist.

Oversize Freight

Shipments that exceed the standard dimensions allowed. Truckload carriers routing trailers like flatbed need to be careful with oversize freight. Rules and regulations prohibit any overhang or over height shipments without permits. There are specialize trailers to help with oversize shipments.

While for a truckload shipment, this is the legal dimensions govern by state regulations, less-than-truckload can be a little more complicated. LTL prices base on space and each carrier has their own definition of over length or oversize freight.

Parcel

Any shipment that does not require additional handling requirements. These shipments include letters, boxes, and other smaller articles shipped. Parcel couriers have their own standards to what counts as a parcel versus freight shipment. A standard is shipments under 70 lbs and total dimensions adding up to a total of 65″.

Personal Effects

Describing household goods or personal property. These articles relate to non-commercial goods being moved through commercial carriers.

Pounds per Cubic Foot (PCF)

Measures the density of freight and is crucial for calculating freight class. This measurement helps carriers to properly load and move trailers at optimal capacity. A good example for using PCF is a 1,000 pounds of bricks and feathers will move the same weight, but at different PCF values. A 1,000 pounds of feathers will take up more more space than bricks.

Proof of Delivery (POD)

Confirms the receipt of goods and delivery from the carrier. This document is crucial in proving that a carrier made to their promise to deliver a shipment. During freight claims, a proof of delivery helps determine if a shipment arrived in damaged or good condition. A bill of lading is used as the Proof of Delivery in truckload shipping, but less-than-truckload may separate the documents.

Refrigerated Trailer

An equipment type to help monitor and control the temperature of freight. Most commonly known for keeping goods below hot temperatures, a refrigerated trailer may also be used in cold conditions to keep freight warm. The equipment has a refrigeration unit and is more prone to humidity exposure.

Also known as: Reefer, Temperature Controlled

SCAC Codes

Standard Carrier Alpha Code: A unique two to four letter identifier to help identify transportation companies. Motor carriers and brokers are able to utilize SCAC codes as a form of identification. Codes are monitored and issued by the National Motor Freight Traffic Association (NMFTA).

Sea Cargo Container

Standardized containers for the use of shipping goods in sea transportation. These containers are able to be loaded onto ships, stacked in ports, and transported from a truck using a special chassis.

Shared Truckload

A mode of transportation to utilize truckload carriers’ dedicated options while sharing space with shippers. Unlike LTL, these loads will not go through a terminal network and have minimal handling from the carrier. A carrier will build a load in a given area to move towards the final destination utilizing as much space on their trailer as possible. Shippers gain the benefit of saving costs while moving through a truckload carrier.

Shipper

The shipper is the party where the shipment originates from when speaking about a freight shipment. A more general term is any person who conducts themselves in the process of routing shipments.

Also known as: Consignors

Shipping Labels

Labels used in a shipment to properly identify and notate pieces in a shipment. Shipping labels help when carriers need to find shipments lost in terminals, as it gives easy identification. Usually, these labels will host destination, references numbers, and piece counts.

Small Business Shipping

Any business with a small number of employees and/or less revenue than mid-size to large corporation. Small businesses find value in Third Party Logistics companies as they are able to find more competitive rates through 3PL networks and able to find access to shipping services.

Supply Chain Logistics

Describes the entire process from start to the end-user for a product or service. Transportation of goods is a major key factor in the process of logistics. Companies either can handle their supply chain logistics in house or outsource the function to Third-Party Logistics Providers.

Third-Party Logistics (3PL)

A company offering freight services and freight brokerage for a shipper. A 3PL differs from a freight broker in that they offer more than just freight brokerage. Services such as Transportation Management Systems, Freight Invoice Auditing, Contract Management, Freight Claims, and more are common services provided by 3PLs.

Tradeshow Shipping

Arranging of transportation for Trade Show Material and booths. Due to the nature of Trade Shows, the shipping of these materials require special handling and services. A show or conference will have advanced warehouses and marshal yards to help assist with the shipping process.

White Glove Service

A service specializing in the handling and care for shipments, going beyond standard delivery services. A White Glove Carrier will offer services such as packaging of freight, inside delivery, unpacking/assembly services, and trash/debris removal. The premium service is ideal for delicate or high-value items or shipping to residences who require help in the receiving process.