Supply Chain Terms

The following is a list of supply chain terms that may be used on the web site or in marketing materials:

• Aggregate
  Collecting data from disparate sources and making it accessible at a single location.
• Application Program Interface (API)
  Some software solutions offer an API, which is set of tools and protocols that help integrate that solution with other software programs, or facilitate the customization of a user interface
• Application Service Provider (ASP)
  ASPs offer the ability to rent applications in lieu of purchasing software; usually a cheaper solution to establishing eCommerce and eBusiness.
• Auction
  Matches buyers and sellers in any marketplace (or exchange) to transact in any quantity at any time.
• B2B
  Business-to-business.
• Back-end Integration
  The process of connecting front-end application of an eCommerce system with the back-end systems.
• Content
  Online materials including supplier catalog data.
• Content Management
  Content management is often used to refer to the process of handling information presented in either a buy-or sell-side catalogs, including part numbers, descriptions and unit size.
• CRM
  Customer relationship management. CRM systems generally store customer information that is aggregated from sales calls, purchases and customer-service centers.
• Data Mining
  The analysis of database information; this usually involves identifying specific product information and codes, cleansing data and re-formatting it.
• Digital Certificate
  Used by a company to authenticate its identity online as an attachment to other documents or as a record kept on file. Digital Certificates are also used as a means to provide a public key to a trading partner, which encrypts information that a company sends so that only the supplier can read it.
• Digital Signature
  A series of numbers at the end of an email message or in an attachment that guarantees that the contents of a document or message have not been altered.
• eSourcing
  Web-based execution of the sourcing process for products and services
• EDI
  Electronic Data Interchange (EDI). The transmission of trade documents electronically using standardized formatting.
• End-to-End Solution
  A common eBusiness buzzword, end-to-end refers to a streamlined, seamless and real-time flow of information and linkages across a value chain.
• eProcurement
  The act of purchasing via an electronic format, i.e. the Internet.
• ERP
  Enterprise resource planning (ERP) is a set of applications that automate human resources, finances, supply chain, etc.
• Exchange
  A web site for buying and selling products and services.
• Extranet
  A network that is partially accessible to authorized parties outside an organization.
• Firewall
  A firewall is a software or system that creates a barrier and gateway between the computers that are networked for use internally and the computers that interface with the Internet.
• Fulfillment
  In the world of eBusiness, fulfillment refers to the process of shipping an order to a customer, and the automation of that process.
• Host
  An organization that installs and maintains software on behalf of a separate organization.
• Integration
  The act of taking data from one software application (output) and, without human intervention, using it as input into a separate application.
• Just-in-time Inventory (JIT)
  An inventory system model based on the idea that one can coordinate the demand and supply channels to the point that desired items arrive just in time for use, therefore significantly reducing inventory levels.
• Legacy
  Information stored in an old system and is unreadable by the new system. Legacy systems typically require some program to translate them into the new format.
• Logistics
  The processes involved in transferring products through manufacturing, storage and transportation to consumers.
• Maverick Buying
  Any employee purchase that does not meet a company's purchasing policy.
• MRO
  Maintenance, Repair and Operations. MRO products are those products and services that a company purchases which are not used in production or offered for resale.
• OBI
  Open Buying on the Internet. OBI is a project of the OBI Consortium (OBIC), formed in 1996 at the initiative of a group of Fortune 500 companies to establish interoperable sets of process standards for handling maintenance, repair and operations-related transactions over the Internet.
• OEM
  Original equipment manufacturer.
• Portal
  A portal usually refers to an online search engine or marketplace.
• Private Exchange
  An exchange run by a single entity/company.
• Public Exchange
  An industry consortium or third-party owned exchange that offers a many-to-many model.
• Purchasing Card
  Also known as a P-Card. A program for businesses that combines credit card purchasing with back-end reporting. American Express, MasterCard and Visa are examples of companies that offer P-Cards.
• Reverse Auction
  Also called an online auction, a reverse auction empowers the buyer and allows them to find the lowest bidder from among suppliers/sellers
• Reverse Logistics
  The supply chain that flows opposite to the traditional process of order acceptance and fulfillment. For example, reverse logistics includes the handling of customer returns, the disposal of excess inventory and the return journey of empty trucks and freight cars.
• Reverse Supply Chain Management
  The process of tracking items that are returned from customers and accounting for them in inventory; also includes resolving customer credit lines, automating return policies and curbing unauthorized returns.
• RFI
  Request for Information. When a buyer asks a seller to provide information about its business and capabilities.
• RFP
  Request for Proposal. A request sent by a buyer to one or more suppliers for contract pricing and/or services for a specified period of time.
• RFQ
  Request for Quote. A request sent by a buyer to one or more sellers for the pricing and availability of a defined quantity of specific items.
• SKU
  Stock Keeping Unit. A code by which all products are defined within a company.
• Spot Buys
  A spot buy takes place when a buyer purchases a required item, or items, from a non-contracted, non-strategic supplier. Spot buys usually take place in emergency situations or when a buyer's strategic suppliers are unable to provide the required product at that time.
• SRM
  Supplier relationship management
• Strategic Sourcing
  The process of determining long-term supply requirements, finding sources to fulfill those needs, selecting suppliers to provide the services, negotiating the purchase agreements and managing the suppliers' performance.
• Supply Chain Management (SCM)
  SCM refers to the analysis of and effort to improve a company's processes for product and service design, purchasing, invoicing, inventory management, distribution, customer satisfaction and other elements of the supply chain. SCM usually refers to an effort to redesign supply chain processes in order to achieve streamlining.
• Value-added Services
  Any product offering that extends beyond simple buy-and-sell capabilities. This includes logistics, collaborative design, payment, verification and settlement.
• VAN
  Value-Added Network. A VAN company is an organization that helps companies exchange private documents, usual via EDI systems.
• XML
  eXtensible Markup Language. XML is a computer language that was created to facilitate e-commerce because it allows disparate systems to more easily transmit data and communicate. More specifically, XML creates a universal way for companies to describe products, components and services on the Internet, in order to avoid miscommunication.