Glossary
Food distribution terms, explained.
The words distributors use every day, from catch weight to three-way match, written for the people who use them.
A
ACHThe US Automated Clearing House network for bank-to-bank electronic payments, used for customer and supplier payments.AR agingA report that groups unpaid customer invoices by how long they are past due, so you can see who owes what and for how long.AutopayAutomatic payment of a customer's invoices from a saved card or bank account, on a schedule they authorize.
B
C
Case breakSelling less than a full case, such as a few bags or units, while the rest of the case stays in stock.Cash applicationMatching customer payments to the invoices they pay, so receivables show what is really still owed.Catch weightProducts sold by actual weight rather than a fixed unit, such as meat, seafood and cheese, where each case weighs something different.ConsignmentAn arrangement where a grower or supplier keeps ownership of goods until the distributor sells them.Credit holdA block placed on a customer's new orders because of their balance, past-due invoices or a manual decision, until someone releases it.Credit memoA document that reduces what a customer owes, issued for returns, shortages, damages or price corrections.Critical tracking event (CTE)A point in a food's supply chain, such as receiving or shipping, where the FDA traceability rule requires records to be kept.Cut-off timeThe latest time an order can be placed to make a given delivery day, set by the warehouse's picking and routing schedule.Cycle countCounting a portion of inventory on a rotating schedule instead of shutting down for a full physical count.
D
Delivery windowThe span of time a customer can receive deliveries, such as 6 to 10 a.m., which routes have to respect.Demand forecastingEstimating future sales from past demand and trends, to plan purchasing and inventory.DSO (days sales outstanding)The average number of days it takes to collect payment after a sale, a measure of how quickly customers pay.
F
FEFO (first expired, first out)A stock rotation rule that ships the units with the earliest expiry date first, used for perishable food.FIFO (first in, first out)A stock rotation and costing rule that uses the oldest received units first.FSMA 204 (Food Traceability Rule)The FDA rule requiring extra traceability records for foods on the Food Traceability List; compliance date July 20, 2028.
G
General ledgerThe complete record of a business's financial transactions, organised by account, from which financial statements are built.GRNI (goods received not invoiced)An accrued liability for goods you have received but not yet been billed for.Gross marginSales minus the cost of the goods sold, as an amount or a percentage of sales.GS1 barcodeA standard barcode format that encodes product identity and data such as lot, dates and weight using application identifiers.
L
P
PACAThe Perishable Agricultural Commodities Act, a US law that sets fair trading rules for fresh produce and creates a trust protecting unpaid sellers.Price after saleA produce purchase where the price is set after the distributor sells the goods, based on what they sold for.Price agingLowering a perishable item's price as its lot gets closer to expiry, to sell it before it is written off.Proof of delivery (POD)A record that an order was delivered, usually a signature, the signer's name, photos and the time, captured at the door.Purchase price variance (PPV)The difference between the price you expected to pay for goods and the price on the supplier's invoice.
R
RebateMoney paid back after a purchase period, by a supplier to a distributor or by a distributor to a customer, when volume or growth targets are met.Reorder pointThe stock level at which you should order more, set so new stock arrives before you run out.Ripening roomA controlled room where fruit such as bananas and avocados is ripened with ethylene, temperature and humidity before sale.Route accountingSoftware and processes for managing route-based delivery: orders, loads, deliveries and settlement of what each route delivered.
S
Safety stockExtra inventory held as a buffer against demand spikes and late deliveries.SKU velocityHow quickly an item sells, used to separate fast movers from slow ones and set stocking and pricing decisions.Standing orderA recurring order placed automatically on a set schedule, such as every Tuesday, for a customer who buys the same items regularly.
T
See it with your own data.
A working session with your customers, your items and your route days. Thirty minutes.