Supply Chain Mode d'Emploi

So that all Supply Chain terms no longer hold any secrets for you.


ABC / Pareto: Method of classifying references into three categories (A, B, C) according to their volume, where class A represents the references with the greatest volume (generally 80% of total volume), followed by classes B and C.

Allotment : Allotment refers to a procurement method in which a supplier delivers to a single point, such as a warehouse, products grouped into distinct lots destined for various end locations, usually stores. This method can be based on a single order, known as an "allotment order", or on several separate orders delivered simultaneously to the same location.

Upstream Supply Chain: This part of the supply chain encompasses procurement and warehousing activities, including raw materials, components, semi-finished and finished goods, as well as order picking and other logistics services, right through to delivery to the carrier.

Predictive analysis: Predictive analysis involves the use of various statistical, data modeling and game theory techniques to study historical and current data, with the aim of predicting future events.

AOM: Advanced Order Management software used in supply chain management systems, designed to manage and process orders and promotions.

Procurement : Procurement is the process of supplying goods or services, encompassing both physical aspects (transportation by various means) and administrative aspects (data management, orders, invoicing).

APS - Advanced Planning System: Advanced Planning Systems (APS) are software packages that support the configuration of logistics networks, the planning and management of logistics operations, with a particular focus on the management of critical resources.

Landing: In the context of seasonal products, landing refers to the efficient management of stocks at the end of the season, ensuring good availability during periods of high demand and adequate adjustment of supply levels.

the "Downstream" Supply Chain: Downstream logistics focus on the distribution of finished products to customers or end consumers, ensuring that the desired delivery times and cost conditions are met.

Gross requirements: This term refers to the quantification of the components needed for production in a manufacturing unit, calculated by multiplying the utilization coefficient of each component by the quantities indicated in the production program, taking into account lead times.

Net requirements: These represent the quantities of an item required, deducted from the gross requirement after subtracting available stock and planned deliveries, taking into account the desired safety stock levels.

WCR: Working Capital Requirement measures the financial resources that a company needs to mobilize to cover the financial requirements arising from the time lag between expenditure and income in its business.

Blockchain: Technology for storing and transmitting data in the form of secure, linked blocks. Used in many sectors, blockchain is particularly promising for the supply chain.

Bullwhip Effect: Phenomenon of information distortion in a logistics chain, causing a chain reaction and the build-up of large upstream stocks.

CBN : Calcul de Besoin Net (MRP = Manufacturing Resource Planning) A method of planning component requirements based on product nomenclature, adapted to companies with products made up of numerous components.

Cloud Computing: Cloud Computing refers to the use of the memory and computing power of remote computers, connected via a network, often the Internet. It enables companies to access online services without managing the underlying infrastructure.

Clustering: A data analysis method that consists of dividing homogeneous data sets into "clusters" according to criteria of trend, seasonality, etc.

Stock coverage: Indicator measuring the number of days that current stock can cover daily consumption. Low stock coverage indicates rapid turnover and limited costs, while high coverage can mean capital tied up unnecessarily.

Cross-dock: logistics process in which goods pass directly from the receiving docks to the shipping docks, without intermediate storage, often used to supply supermarkets.

Product life cycle: The product life cycle describes the different market stages a consumer good goes through: development, introduction, growth, maturity and decline. This notion is crucial in inventory management to maintain adequate service rates.

Datamining: Datamining is the in-depth analysis of information collected on the users of an online store, with the main aim of identifying user behavior to improve the efficiency of visits to the e-shop.

Lead time: This is the time elapsed between placing an order with a supplier and receiving the materials or products ordered. This includes both delivery time (time for the supplier to deliver after the order has been placed) and order lead time (time before a new order can be placed).

Delivery time: Delivery time is the time between the customer's receipt of the order and its actual delivery, and is a criterion of service quality.

Clearance: this characterizes the part of the stock whose shelf life has been exceeded.

Devaluation: This is the reduction in the economic value of inventories due to losses or obsolescence.

Actual demand: Represents actual customer orders that consume forecasts according to defined rules.

Last Mile: Term describing the final stage in the delivery chain to the end customer, often the most complex and costly in logistical terms.

BBD: Use-by date beyond which consumption of a product could present a health risk.

BBD: Best Before Date, after which the optimal quality (taste, flavor, etc.) of a product is no longer guaranteed, even though it is not necessarily harmful to health.

DRP: Distribution Resource Planning is a Supply Chain process for anticipating the supply of goods to distribution sites, prioritizing the distribution of short-term stocks, and providing a precise requirements plan for manufacturing.

Period of cover: Period between two successive deliveries of materials or products intended to supply the company.

Inventory discrepancy: Difference between actual physical stock and stock recorded in the computer system.

Breakdown: Operation of distributing the packages or contents of a pallet received from a supplier onto the pallets destined for the stores.

Skimming: Pricing strategy where a newly launched product is sold at a high price and then gradually reduced to reach different market segments.

Load/capacity balancing: Process of determining the forecast load in relation to planned requirements, and comparing it with capacity to help manage and size resources (human, machines, etc.).

EAN : International standard (European Article Numbering) for identifying commercial products using bar codes, renamed GS1 in 2005.

EDI: Data exchange between information systems in different domains using hardware and software standards, without transmission on a physical medium.

EPM: Enterprise Performance Management (EPM) software for modeling business processes (S&OP, budgeting, etc.). As part of a study comparing APS vs. EPM, CXP has published a quadrant showing the different types of editor.

ETL: ETL (Extract, Transform, Load) software is used to manage data integration between different applications.

Facing: Merchandising term for the number of products displayed facing the consumer on a shelf in a point of sale. Facing influences a product's visibility and sales potential.

Flat file: Text file often used for importing/exporting data between computer systems.

FIFO: First In First Out (FIFO ) method of inventory management, in which the first items to enter the warehouse are also the first to leave, used in particular for perishable products.

Push flow: Management model in which raw materials or parts move along the production line according to a set schedule.

Just-in-time: A production system designed to minimize inventories of raw materials and finished products in order to cut costs and optimize lead times, by routing products regularly throughout the production chain.

Pull flow: A flow management model in which raw materials or parts move down the production line only in response to actual demand.

Franco: Term used for a delivery where the sender pays the shipping costs, offering a delivery free of shipping costs to the buyer.

Stacking: Operation of stacking several containers on top of each other.

GMS: Acronym for "grandes et moyennes surfaces", mainly hypermarkets and supermarkets.

GPA: Procurement method (Gestion Partagée des Approvisionnements) where order proposals are drawn up by suppliers, based on warehouse outputs.

GMA: Collaborative approach (Gestion Mutualisée des Approvisionnements - Mutualized Supply Management) between several suppliers to reduce supply costs and inventories in the retail sector, while ensuring a better level of service for customers.

GMS: Grande et Moyenne Surface or Grand Magasin Spécialisé (depending on the context). GSS: Grande Surface Spécialisée. GSA: Grande Surface Alimentaire (food superstore). GSB: DIY superstore.

GS1: International organization establishing identification and communication standards for trade and industry.

IATA: International Air Transport Association, governing air freight standards and tariffs, and setting air transport rules.

Incoterms: standardized rules (International Commercial TERMS) for interpreting the terms of international sales contracts, defining the obligations of seller and buyer, particularly in terms of delivery, transfer of risk and allocation of costs.

Physical inventory: Visual inspection to determine the exact number of items in stock and their location.

Cyclic stocktaking: Physical stocktaking carried out repeatedly at regular intervals to correct errors in the perpetual inventory.

Continuous inventory: real-time computerized stock management.

Just-in-time: Just-in-time management model (Kanban) developed by Toyota to eliminate waste and synchronize production with demand, reducing intermediate stocks.

Lead time: Time elapsed between the start and end of a process, such as the time it takes to manufacture a product or process an order.

Lean logistics: An approach aimed at eliminating all unnecessary operations from logistics processes, making them more efficient, responsive and less costly.

LIFO - Last In First Out: an accounting method for valuing stock removals based on priority consumption of the most recently stored items.

Reverse logistics: managing flows from consumer to manufacturer

Machine learning: Artificial intelligence technology that enables computers to learn from data without explicit programming.

Merchandising: A set of techniques designed to optimize the display and presentation of products in points of sale to maximize sales or margins.

MOQ : Minimum Order Quantity required by a supplier, calculated to minimize the total cost of inventory while ensuring replenishment.

OA: Ordre d'Achat (Purchase Order) - Order placed with a supplier for the delivery of goods under agreed price and delivery terms.

OF: Manufacturing Order - Authorization given to a production shop to manufacture specific parts.

Scheduling: Production control technique designed to ensure that the production program is carried out on time and at minimum cost.

PCB: Packaging of a product (by how many), comprising sub-units (SPCB) or sales units (UV).

Picking: The act of collecting products from a warehouse and grouping them together for shipment.

Route planning: Organization of the transport order of vehicles to minimize costs and travel time.

Volumetric weight: Measure of the density of transported goods, considering the space they occupy in relation to their actual weight.

POS: Point Of Sale where commercial transactions take place.

Distribution networks: All the sales outlets developed by a brand.

RFID: Radio Frequency Identification technology using electronic tags to store and remotely read information attached to objects.

RMR: Retail Management Replenishment, based on sales forecasts to establish replenishment programs.

Stock rotation: Number of times stock has to be renewed over a given period, usually one year, reflecting the efficiency of the supply chain.

Load breakage: A stage in the transport process when goods change vehicles, often costly and to be minimized.

Out-of-stock: Situation where the stock level of an item is at zero.

S&OP: Sales & Operations Planning (S&OP) is a management process that aligns the company's key functions (sales, production, management) to solve and plan complex problems.

Scorecard: Dashboard containing key performance indicators, objectives, strategic initiatives, budget and managers for each key success factor.

SKU : Stock Keeping Unit, designating a specific item in a specific storage location.

SLA: Service Level Agreement, particularly for IT solutions and Cloud architectures.

SaaS: Software as a Service, an application solution hosted in the cloud and operated by a third party, accessible via the Internet.

Sourcing: Process of locating and selecting suppliers of goods or services.

SPCB : sous par combien. Packaging multiple of sales units (SU) and submultiple of packaging by how much (PCB).

Safety stock: Quantity of stock maintained to offset fluctuations in consumption or delays in supply/production.

Supply chain: A supply chain encompassing all the players and processes required to make a product or service available to the customer.

Overstock: Stock in excess of current or forecast demand.

Downtime rate: Cost of keeping a unit in stock for a given period.

Coverage rate: proportion of customer demand met by immediate availability of stock.

Service rate: Probability of not being out of stock during the next replenishment cycle, reflecting the ability to meet customer demand without backorders.

TMA: Tierce Maintenance Applicative de logiciels (Third-Party Software Maintenance) carried out by an external expert in the field of information and communication technologies.

Time to Market: Time taken to bring a product to market, from conception to launch.

TMS: Transport Management System, computer software for optimizing transport planning and organization.

Total Asset Visibility: total visibility of the value of committed resources, offering traceability from supplier to end-user.

Tracking: Logistics service enabling a parcel to be tracked throughout its delivery journey.

PSU: Primary packaging (Packaged Sales Unit) of an article intended for sale. This is the basic unit in which a product is offered to the consumer, such as a can, pack or bottle.

Storage unit: Packaging of items in a warehouse, such as pallets, cartons or UVCs.

VMI: Vendor Managed Inventory, an inventory management method in which the supplier takes charge of managing the customer's stock levels, based on actual consumption, in order to optimize replenishments and stock levels.

WMS: Warehouse Management System, a key component of supply chain management solutions, designed to manage and optimize all warehouse operations.

Workflow: System for organizing and managing work processes in a company, based on a model of functions and procedures, and enabling workflows to be regulated.

Yield Management: Dynamic pricing strategy based on demand and time of booking, used mainly in the hotel and airline industries to optimize sales with fixed costs and capacity.

For further information, here is a list of resources available on the Internet:

  1. Supply Chain Management Review:
  2. Association for Supply Chain Management:
  3. ABC Supply Chain:
  4. Council of Supply Chain Management Professionals:
  5. Supply Chain Digest:
  6. Supply Chain 24/7:
  7. Inbound Logistics:
  8. Logistics Management:
  9. Supply Chain Brain:
  10. The Chartered Institute of Logistics and Transport (CILT):
  11. Gartner Supply Chain:
  12. Institute for Supply Management: