Freight Glossary
Clear definitions for the freight terms that shape how networks, pricing, and execution actually work.
All terms
Cross-dockingCross-docking is the transfer of inbound freight through a facility for near-immediate outbound movement instead of storage. Freight arrives on inbound trailers, gets sorted by destination, and moves out on outbound vehicles within hours. Unlike traditional warehousing, cross-docking eliminates storage dwell entirely. The result is fewer touches, lower damage rates, and tighter delivery windows for shippers moving palletized freight through regional distribution networks.Zone skippingZone skipping is a parcel shipping strategy where you bypass traditional sort centers by consolidating parcels onto pallets, trucking them directly to a regional hub near your customers, and injecting them into the local carrier network for final delivery. Instead of handing a parcel to UPS or FedEx at your warehouse and letting it travel through five or six sort centers across the country, you move it on a pallet at freight rates to a hub one or two zones from the delivery address. The parcel enters the carrier network close to the customer and ships as a short-zone delivery. This typically reduces parcel shipping costs by 10 to 20 percent and compresses transit from five days to one or two days without paying for air.Pool distributionPool distribution is the movement of inbound freight into a market level sort point and then into multiple downstream deliveries. A shipper consolidates orders for an entire metro onto one inbound trailer, sends it to a cross-dock, and breaks it into individual store or customer deliveries from there. This replaces multiple direct shipments with a single linehaul leg plus local routes. The approach works best for palletized retail freight going to clusters of stores, DCs, or jobsites within the same region.Store replenishmentStore replenishment is the recurring movement of inventory into retail locations to preserve shelf availability and store readiness. It covers everything from weekly pallet drops at big box stores to daily restocks at convenience or specialty retail. Unlike one time project freight, replenishment is a continuous program with fixed cadences, appointment windows, and receiving requirements. The freight itself is usually palletized, often temperature sensitive, and always time bound to store operating hours.Inbound vendor consolidationInbound vendor consolidation is the coordination of multiple supplier shipments into cleaner, more coherent inbound delivery at the destination node. Instead of each vendor shipping independently on different carriers and schedules, their freight is routed through a consolidation point where it gets combined into fewer, fuller loads. The consolidated shipments then deliver to the DC or facility on a predictable cadence. This turns a chaotic stream of random inbound arrivals into a controlled, plannable receiving operation.Same-day LTLSame day LTL refers to palletized freight that needs faster than normal delivery while still preserving pallet economics where possible. It sits between standard LTL, which moves on carrier schedules over 2 to 5 days, and dedicated hotshot trucks, which are fast but expensive. Same day LTL uses right sized vehicles like cargo vans and box trucks to move palletized freight directly to the destination within hours. The goal is speed without the full cost of chartering a 53 foot trailer for a small shipment.Per-pallet pricingPer-pallet pricing is a freight pricing structure that ties transport cost to pallet count rather than trailer purchase alone. Each pallet gets a flat rate that covers pickup, linehaul, cross-docking, and delivery in a single number. There are no freight class lookups, no density based reclassifications, and no accessorial surcharges stacked on top. This model works because pallets are a physical, countable unit that both shippers and carriers can agree on without ambiguity.Middle mileMiddle mile is the movement of freight between upstream inventory points and downstream delivery networks, including transfers into regional nodes, stores, or parcel injection points. It covers the leg between a fulfillment center or DC and the local delivery infrastructure that reaches the end customer or store shelf. Middle mile freight is almost always palletized, moves on LTL or truckload assets, and flows through cross-docks or transfer points. It is the connective tissue between where inventory lives and where it needs to be consumed.Final mileFinal mile is the last delivery leg into the customer, store, or destination receiving point. It covers the move from a local cross-dock, hub, or sortation center to the actual door where freight is received. For palletized freight, this usually means a cargo van or box truck delivering pallets to a retail store, jobsite, or commercial address. Final mile is the most visible part of the supply chain to the end recipient, which means service failures here damage brand reputation and customer relationships directly.Emergency capacityEmergency capacity is rapid response freight coverage used to recover from service failure, urgent inventory need, or an unexpected network gap. It covers scenarios like a carrier no show on a critical load, a production line running out of parts, or a retail chain needing emergency replenishment after a weather event clears shelves. The freight is almost always time sensitive, often palletized, and requires a vehicle that can be dispatched within hours rather than days. Emergency capacity sits at the top of the cost curve, so the goal is to resolve the immediate need while keeping spend controlled.DrayageDrayage is the short-distance trucking of freight, typically containers, between ports, rail yards, and nearby warehouses or distribution centers. It bridges ocean or intermodal shipments to their next inland leg. For example, a 40 foot container arriving at the Port of Los Angeles might dray 15 miles to a cross-dock in Compton before pallets are sorted for regional delivery.Detention (Freight)Detention is a fee carriers charge when their truck and driver are held at a shipper or receiver location beyond the agreed-upon free time, typically two hours, waiting to load or unload. It compensates the carrier for lost productivity. For instance, a driver waiting three hours at a grocery DC for an unload appointment would trigger one hour of billable detention.DemurrageDemurrage is the charge assessed when a shipper holds a shipping container or railcar beyond the allotted free time at a port, terminal, or rail facility. Unlike detention, demurrage applies to the equipment itself rather than the driver's time. A common example is an importer who clears customs on day four but has only three free days, triggering daily demurrage fees from the shipping line.Fuel SurchargeA fuel surcharge (FSC) is a variable fee added to freight invoices to offset the carrier's fluctuating diesel costs. It is typically calculated as a percentage of the base rate and adjusted weekly based on published fuel price indices. For example, a carrier may set its FSC at 28 percent of the line haul rate when diesel averages $4.00 per gallon nationally.Accessorial ChargesAccessorial charges are fees added to a freight invoice for services beyond standard pickup and delivery, such as liftgate use, inside delivery, residential delivery, redelivery, or extended wait time. They are charged separately from the base rate. A common example is a $75 liftgate fee added to a delivery at a location without a loading dock.FOB TermsFOB (Free On Board) terms define the point at which ownership and liability for a shipment transfer from the seller to the buyer, either at the origin (FOB Origin) or at the destination (FOB Destination). They determine who bears the risk and cost of freight. Under FOB Origin, the buyer owns the goods the moment they leave the seller warehouse and is responsible for filing any in transit claims.Blind ShipmentA blind shipment is a freight move where the bill of lading is structured so the receiver does not know the identity of the original shipper, or the shipper does not know the receiver, or both parties are hidden from each other. It is commonly used by distributors and brokers to protect supplier relationships. A double blind shipment hides both origin and destination parties, using the intermediary as the named entity on all documentation.Co-LoadingCo-loading is the practice of combining freight from multiple shippers into a single truck or container to share transportation costs and maximize trailer utilization. It is a core mechanism behind LTL and consolidated freight services. For example, four shippers each sending six pallets to the same metro can co-load onto one 24 pallet truck instead of booking four separate vehicles.Drop TrailerA drop trailer program allows a carrier to leave an unattended trailer at a shipper or receiver facility for loading or unloading at the facility's own pace, rather than requiring a driver to wait during the process. The carrier returns later to pick up the loaded or empty trailer. A retailer might have three drop trailers in the yard at once, each being floor loaded by warehouse staff overnight for next morning pickup.Freight ClassFreight class is a standardized classification system (NMFC) used by LTL carriers to rate shipments based on four characteristics: density, stowability, handling, and liability. Classes range from 50 (dense, easy-to-handle freight) to 500 (low-density or high-risk items). A pallet of canned goods might classify at 55, while a pallet of lightweight plastic bins could land at 150 or higher.Dimensional WeightDimensional weight (DIM weight) is a pricing method that calculates a shipment's billable weight based on its cubic size rather than its actual scale weight, using a standard divisor. Carriers charge whichever is greater, actual weight or DIM weight. A box of pillows weighing 10 pounds but occupying 8 cubic feet might bill at 40 pounds under a standard DIM divisor.Spot RateA spot rate is a one-time, market-priced freight rate negotiated for a single shipment at the current moment, as opposed to a contracted rate agreed upon in advance. Spot rates fluctuate with real-time supply and demand for truck capacity. During a produce season surge, a spot rate on a refrigerated lane might jump 40 percent above the annual contract price in a single week.Contract RateA contract rate is a pre-negotiated freight price between a shipper and carrier (or 3PL) for a defined lane, volume, and time period, typically 12 months. In exchange for volume commitment, shippers receive pricing stability and capacity assurance. A retailer might lock a contract rate of $850 per truckload on a Dallas to Atlanta lane for the full calendar year.Freight BrokerA freight broker is a licensed intermediary that connects shippers with carriers to move freight, earning a margin on the difference between what the shipper pays and what the carrier is paid. Brokers do not own trucks or freight; they arrange transportation. A typical broker margin ranges from 12 to 20 percent of the shipment cost, which the shipper pays indirectly through a higher rate.Carrier InjectionCarrier injection is a parcel shipping strategy where a shipper or 3PL moves consolidated freight via truck (LTL or FTL) deep into a destination region before injecting individual packages into the local carrier network, bypassing the full national parcel network. For example, an ecommerce brand might truck 500 parcels from Ohio to a Dallas sortation center for USPS injection instead of shipping each parcel individually.Floor-Ready MerchandiseFloor-ready merchandise (FRM) is product that arrives at a retail store already prepared for immediate placement on the sales floor, tagged, labeled, packaged, and sorted, without requiring additional processing at the store or DC level. A typical FRM shipment includes pre-hung apparel on store fixtures with UPC labels, shelf-ready packaging, and department sorted pallets.Proof of DeliveryProof of delivery (POD) is a document, physical or digital, that confirms a shipment was delivered to the intended recipient, typically including the recipient's signature, delivery time, and condition of goods at receipt. A digital POD might include a timestamped photo of pallets on the dock, a GPS location pin, and an electronic signature from the receiving clerk.Bill of LadingA bill of lading (BOL) is a legally binding document issued by a carrier to a shipper that serves three functions: a receipt for the freight, a contract of carriage, and a document of title. It travels with the shipment and is required for every freight move. Key fields include shipper and consignee addresses, piece count, weight, commodity description, and any special handling instructions.Freight AuditA freight audit is the process of reviewing carrier invoices against agreed rates, contracts, and shipment records to identify billing errors, unauthorized charges, and discrepancies before payment. It can be done internally or through a third-party audit firm. A typical audit checks every line item on an invoice against the BOL, contract rate, and actual service provided to catch overbilling.Cargo InsuranceCargo insurance is coverage purchased to protect the monetary value of freight against loss or damage during transit, independent of the carrier's standard liability limits. It covers the full commercial value of goods, whereas carrier liability is often capped at cents per pound. For example, a 500 pound pallet of electronics worth $15,000 might only recover $2,500 under standard carrier liability without cargo insurance.LinehaulLinehaul is the long-distance, intercity movement of freight between major origin and destination points, the primary trunk portion of a freight move, excluding local pickup and delivery. In LTL networks, linehaul connects terminal to terminal. A Chicago to Dallas linehaul move, for example, covers the 900 mile trunk segment while separate local carriers handle pickup and delivery at each end.SortationSortation is the process of physically separating, organizing, and routing freight at a facility based on destination, carrier, delivery route, or other criteria. It is a core function of cross-docks, parcel hubs, and distribution centers. At a busy cross-dock, inbound pallets from five different shippers might be sorted into 15 outbound lanes within two hours of arrival.TransloadingTransloading is the process of transferring freight from one mode of transportation to another, for example unloading containers from a railcar or ship and reloading the goods onto trucks for final distribution. It is distinct from cross-docking in that it typically involves a mode change. A common transload scenario is devanning a floor loaded ocean container onto pallets and reloading those pallets onto regional delivery trucks.DevanningDevanning (also called unstuffing or stripping) is the process of unloading cargo from a shipping container, typically removing floor-loaded goods piece by piece from an ocean container and placing them on pallets or a warehouse floor. A 40 foot container packed floor to ceiling can take a team of four workers three to five hours to fully devan and palletize.On-Time Delivery (OTD)On-time delivery (OTD) is a key performance metric measuring the percentage of shipments that arrive at their destination within the committed delivery window. It is one of the most widely used benchmarks for carrier and 3PL performance. Most retail compliance programs require 95 percent or higher OTD, with some major retailers setting the bar at 98 percent.Delivery WindowA delivery window is the scheduled time range within which a freight shipment is expected to arrive at a destination, often specified in hours (e.g., 8 AM to 12 PM) or by a specific appointment time. Windows are set by the receiver and must be met by the carrier. A grocery DC might assign a 6 AM to 8 AM window for perishable deliveries and a broader 10 AM to 2 PM window for dry goods.Lumper ServiceLumper service refers to hired labor, typically at a receiving facility, that unloads freight from a truck on behalf of the driver. Lumpers are commonly used at grocery DCs and retail warehouses where drivers are not permitted to unload. The lumper crew physically moves pallets or cases off the truck and onto the dock, then the driver is released to continue their route.Liftgate ServiceLiftgate service is the use of a hydraulic platform mounted on the rear of a truck to raise or lower freight between the truck bed and ground level, required when a delivery location has no loading dock. It is typically an accessorial charge in traditional LTL. Most standard liftgates handle pallets up to 2,500 pounds, though heavy duty units can support 4,000 pounds or more.Freight ClaimA freight claim is a formal demand filed by a shipper or receiver against a carrier for reimbursement of loss or damage that occurred during transit. Claims must be filed within specific timeframes and supported by documentation including the BOL, delivery receipt, and photos. Common claim types include visible damage noted at delivery, concealed damage discovered after unloading, and shortage where the pallet count does not match the BOL.DC BypassDC bypass is a supply chain strategy where freight moves directly from a manufacturer or supplier to stores or regional delivery points, bypassing the traditional distribution center entirely. It reduces inventory handling steps and can shorten the total supply chain cycle. A beverage brand, for example, might ship pallets from its bottling plant through a cross-dock directly to retail stores without touching the retailer DC.Direct Store Delivery (DSD)Direct store delivery (DSD) is a distribution model where a supplier or manufacturer delivers product directly to individual retail store locations, bypassing the retailer's distribution center. DSD is common in CPG categories like beverages, snacks, and bakery. A snack brand delivering to 40 convenience stores in a metro area each week is a classic DSD operation.Milk RunA milk run is a scheduled, multi-stop freight route where a single truck picks up or delivers freight at multiple locations in sequence, named after old-fashioned dairy routes. It consolidates multiple small pickups or deliveries into a single efficient circuit. A typical milk run might service eight retail stores in a 30 mile radius from a single cross-dock, delivering two to four pallets per stop.Freight ForwardingA freight forwarder is an intermediary that arranges the international shipment of goods on behalf of shippers, handling documentation, customs clearance, carrier coordination, and mode selection across ocean, air, and rail for cross-border freight. A forwarder managing a China to US import would coordinate the ocean booking, customs clearance, and dray from port to the importer warehouse.Appointment DeliveryAppointment delivery is a freight delivery process where the carrier and receiver pre-schedule a specific date and time window for the delivery, as opposed to open-window delivery where the carrier delivers at any available time. It is standard for retail, grocery, and commercial deliveries. A typical appointment might reserve a 30 minute dock slot at a retail DC, with the carrier required to check in within that window.Hub-and-SpokeHub-and-spoke is a freight network model where freight from many origins flows into central hub facilities, is consolidated and sorted, then redistributed outward to destination spokes or delivery points. It is the foundation of most LTL carrier and parcel networks. In a traditional LTL hub-and-spoke setup, a shipment might pass through two to four terminals before reaching the destination city.Point-to-Point FreightPoint-to-point freight is a direct shipping model where a single truck moves freight from one origin to one destination without intermediate stops, transfers, or terminal handling. It is the fundamental structure of full truckload (FTL) shipping. A manufacturer shipping 24 pallets from a plant in Memphis directly to a DC in Atlanta is a classic point to point move.Full Truckload (FTL)Full truckload (FTL) shipping is a freight mode where a shipper purchases the entire capacity of a trailer for a single shipment moving from one origin to one destination. The truck moves direct without stops or freight transfers. A standard dry van FTL can carry up to 26 pallets or 44,000 pounds, whichever limit is reached first.PalletizingPalletizing is the process of stacking and securing product cases or items onto a pallet in a structured pattern to create a stable, shippable unit load. Proper palletizing uses stretch wrap and/or strapping to secure the load for transit. A well built pallet has an interlocking case pattern, at least three layers of stretch wrap, and no overhang beyond the pallet edges.Floor-Loaded FreightFloor-loaded freight (also called loose-loaded) is cargo stacked directly on the floor of a truck or container without pallets, maximizing cubic capacity but requiring manual unloading piece by piece at the destination. A floor loaded 40 foot ocean container can hold 20 to 30 percent more product by volume than the same container loaded on pallets.Temperature-Controlled FreightTemperature-controlled freight (also called reefer or cold chain) is cargo that requires transport within a specific temperature range, typically refrigerated (34 to 38 degrees F) or frozen (0 degrees F or below), to maintain product integrity and safety. Pharmaceutical shipments may require even tighter ranges, such as 36 to 46 degrees F, with continuous temperature monitoring throughout transit.Residential DeliveryResidential delivery is the delivery of freight to a home address rather than a commercial facility with a loading dock. It typically requires a liftgate, appointment scheduling, and additional driver time, and most LTL carriers charge a residential surcharge. A furniture company shipping a 300 pound sofa to a customer home is a typical residential delivery scenario requiring liftgate and two person handling.Inside DeliveryInside delivery is a freight service where the driver or delivery team brings freight beyond the threshold of a building, past the loading dock or front door, into the interior of a facility. Standard delivery only requires placement at the entrance or dock. A retail store receiving a pallet of merchandise placed inside the stockroom rather than left at the rear entrance is an example of inside delivery.Freight TenderA freight tender is a formal offer from a shipper to a carrier to move a specific shipment under defined terms, including origin, destination, freight details, and rate. The carrier accepts or declines the tender, and acceptance creates a binding commitment. In most TMS systems, tenders flow through an automated waterfall that offers the load to the primary carrier first, then to backups if rejected.ConsolidationFreight consolidation is the process of combining multiple smaller shipments from one or more shippers into a single larger load to improve trailer utilization and reduce per-unit transportation cost. It is the opposite of splitting freight into smaller moves. A cross-dock that combines six separate four-pallet shipments headed to the same metro onto one 24 pallet truck is performing freight consolidation.Service FailureA service failure is any deviation from the committed service standard on a freight shipment, including late pickup, late delivery, lost freight, damage, or missed appointment windows. It is documented and typically triggers a carrier performance record. Common examples include a driver arriving 45 minutes past the delivery window or a pallet delivered with crushed product due to improper loading.On-Time Pickup (OTP)On-time pickup (OTP) is a performance metric measuring the percentage of shipments where the carrier arrives to pick up freight within the committed pickup window. It is a leading indicator of downstream delivery performance. A carrier with 92 percent OTP and 96 percent OTD is likely running tight on transit to compensate for late pickups, which is unsustainable long term.ELD ComplianceELD compliance refers to adherence to the FMCSA's Electronic Logging Device mandate, which requires commercial truck drivers to use certified electronic logging devices to automatically record hours of service (HOS) data instead of paper logs. Under HOS rules, drivers can operate a maximum of 11 hours driving within a 14 hour on duty window after 10 consecutive hours off duty.Freight DensityFreight density is the weight of a shipment per cubic foot of space it occupies, calculated by dividing total weight by total cubic feet. It is a primary determinant of freight class in LTL pricing and a key factor in trailer utilization economics. A 48x40x48 inch pallet weighing 1,000 pounds has a density of roughly 18.75 pounds per cubic foot, which typically classifies at NMFC class 70.Dock AppointmentA dock appointment is a pre-scheduled time slot reserved for a truck to arrive at a specific dock door to load or unload freight. Most retail DCs, grocery warehouses, and large manufacturing facilities require dock appointments for all inbound and outbound freight. Appointments are typically managed through scheduling software like Opendock or Dock Scheduler that assigns specific time slots and door numbers.Carrier VettingCarrier vetting is the process of evaluating a motor carrier's safety record, insurance coverage, operating authority, and financial stability before using them to move freight. It protects shippers from liability exposure and service risk. A thorough vetting process checks the carrier's FMCSA authority status, insurance certificates, CSA safety scores, and DOT inspection history.Less Than Truckload (LTL)Less than truckload (LTL) is a freight shipping mode for shipments that are too large for parcel but do not fill a full 53-foot trailer. LTL carriers consolidate freight from multiple shippers onto a single trailer, and each shipper pays only for the space their freight occupies. Shipments typically range from one to twelve pallets, or roughly 150 to 15,000 pounds. LTL pricing is based on freight class, weight, distance, and accessorial services.LTL ShippingLTL shipping is the process of moving freight that does not require a full truckload by sharing trailer space with other shippers. The carrier picks up your freight, consolidates it with other shipments at a terminal, and routes it through a hub-and-spoke network to the destination. LTL shipping is priced by freight class, weight, origin-destination pair, and any accessorial services like liftgate, inside delivery, or residential delivery.LTL CarrierAn LTL carrier, or less-than-truckload carrier, is a freight company that moves shipments too large for parcel but too small to fill a 53-foot trailer. The carrier consolidates freight from multiple shippers onto one trailer, so each shipper pays only for the space they use. Most LTL carriers run hub-and-spoke terminal networks: they pick up at origin, sort the freight at one or more terminals, and deliver at destination. Pricing is based on freight class, weight, distance, and accessorial services. Major US LTL carriers include Old Dominion, FedEx Freight, Estes, XPO, Saia, and ABF, alongside network carriers like Warp.Pallet ShippingPallet shipping is the movement of freight that is loaded onto standardized pallets, typically 48 by 40 inches, and transported via LTL, FTL, or dedicated vehicle. Palletized freight is the standard unit of measure in commercial shipping because pallets protect goods during handling, allow forklifts to load and unload efficiently, and provide a consistent unit for pricing and space allocation on trailers.Last Mile DeliveryLast mile delivery is the final leg of a shipment from a local distribution point to the end customer or retail location. It is typically the most expensive and operationally complex segment of the supply chain because it involves navigating residential areas, appointment windows, and individual delivery requirements. Last mile delivery applies to both parcel and freight shipments, though in the freight context it usually means moving palletized goods from a cross-dock or local warehouse to a store, jobsite, or home.Third-Party Logistics (3PL)Third-party logistics (3PL) is the outsourcing of supply chain operations to an external provider. A 3PL can manage warehousing, transportation, order fulfillment, freight brokerage, or any combination of logistics functions on behalf of a shipper. The 3PL model ranges from basic freight arrangement to fully integrated supply chain management where the provider operates warehouses, manages inventory, and handles returns.Intermodal ShippingIntermodal shipping is the movement of freight in a standardized container or trailer using two or more transportation modes, typically rail and truck, without handling the cargo itself when changing modes. The container is loaded at origin, placed on a rail car for the long-haul leg, and then drayed by truck to the final destination. Intermodal combines the cost efficiency of rail for long distances with the flexibility of trucking for first and last mile.Reverse LogisticsReverse logistics is the movement of goods from the customer or end point back through the supply chain for return, repair, recycling, or disposal. It includes product returns, warranty exchanges, recalled goods, packaging take-back, and end-of-life disposal. Reverse logistics is operationally more complex than forward logistics because return volumes are unpredictable, items arrive in varying condition, and each return may require different handling.White Glove DeliveryWhite glove delivery is a premium freight service that includes inside delivery, unpacking, assembly or installation, and removal of packaging materials. It goes beyond standard dock or curbside delivery by placing the item in the exact location the customer specifies, fully ready for use. White glove delivery is standard for furniture, large appliances, medical equipment, trade show displays, and high-value items that require careful handling.Expedited ShippingExpedited shipping is any freight service that delivers faster than standard transit time by using dedicated vehicles, direct routing, or priority handling. In the freight context, expedited typically means a truck is dispatched exclusively for your shipment and drives directly to the destination without terminal stops or consolidation with other freight. Expedited shipping can be same-day, next-day, or simply faster than the standard LTL transit time for a given lane.Freight FactoringFreight factoring is a financial service where a carrier sells its unpaid freight invoices to a factoring company in exchange for immediate cash, typically at a 1 to 5 percent discount. Instead of waiting 30 to 90 days for the shipper or broker to pay, the carrier receives 90 to 97 percent of the invoice value within 24 hours. The factoring company then collects the full amount from the shipper when the invoice is due.Hotshot TruckingHotshot trucking is the use of medium-duty trucks, typically Class 3 to 5 vehicles with flatbed or gooseneck trailers, to haul time-sensitive or smaller-than-truckload freight. Hotshot loads are usually under 16,000 pounds and often involve expedited delivery. The term originated in the oil and gas industry where operators needed parts and equipment delivered urgently to remote well sites, but it now applies broadly to any freight moved on a non-CDL or light-CDL truck.DeadheadDeadhead is the miles a truck drives empty, without revenue-generating freight on board. It occurs when a driver delivers a load and has to reposition to another location to pick up the next shipment. Deadhead miles are pure cost for the carrier: fuel, driver time, vehicle wear, and insurance are all consumed without producing revenue. The deadhead ratio, expressed as a percentage of total miles, is a key efficiency metric for carriers and fleets.NMFC CodeNMFC (National Motor Freight Classification) codes are a standardized system for categorizing freight commodities used by LTL carriers to determine pricing. Every commodity type has an assigned NMFC code and corresponding freight class (50 through 500) based on four characteristics: density, handling difficulty, stowability, and liability. The NMFC system is maintained by the National Motor Freight Traffic Association (NMFTA) and is the basis for virtually all LTL pricing in the United States.Load BoardA load board is an online marketplace where shippers and freight brokers post available loads and carriers search for freight to haul. Load boards are the spot market of trucking, connecting supply (available trucks) with demand (freight that needs to move) in real time. Major load boards include DAT, Truckstop, and various digital freight matching platforms. Carriers use load boards to fill empty capacity, and brokers use them to find trucks when their contracted capacity is insufficient.Customs BrokerageCustoms brokerage is the service of clearing goods through customs on behalf of importers and exporters. A licensed customs broker prepares and submits the documentation required for goods to enter or leave a country, including customs declarations, tariff classifications, duty calculations, and compliance with trade regulations. In the US, customs brokers must be licensed by US Customs and Border Protection (CBP) to transact customs business.Open Source FreightOpen source freight is a network model where pricing is transparent, infrastructure is shared, and cost savings pass through to shippers instead of becoming intermediary profit. The term borrows from open source software, where code locked behind vendors becomes accessible to everyone, but applies it to freight economics. In an open source freight network, there are no hidden broker margins, no fuel surcharges, and no accessorial add-ons. The rate you see is the rate you pay.Transportation Management System (TMS)A transportation management system is enterprise software that plans, executes, and optimizes the physical movement of freight across carriers, modes, and geographies. A TMS typically handles rate shopping, load tendering, shipment tracking, carrier compliance, and freight payment in a single platform. Most legacy TMS platforms were built for EDI-era workflows, requiring months of integration work, dedicated IT staff, and six-figure annual licensing fees to maintain.BackhaulBackhaul is the return leg of a truck trip after the primary load has been delivered. A driver who hauls freight from Dallas to Atlanta needs to get back to Dallas, and running that return trip empty means the carrier absorbs fuel, driver time, and equipment cost with zero revenue. Backhaul freight fills that return trip, turning a cost center into a revenue opportunity for the carrier and a discount opportunity for the shipper.Spot MarketThe freight spot market is where shippers and carriers negotiate one-time pricing for immediate or near-term shipments outside of contracted rate agreements. Spot rates fluctuate based on real-time supply and demand: when carrier capacity is tight, spot rates spike above contract levels; when trucks are plentiful, spot rates drop below them. Most spot transactions happen through load boards, brokers, or digital freight platforms.EDI (Electronic Data Interchange)Electronic Data Interchange is a legacy system for exchanging structured business documents between trading partners using standardized X12 transaction sets. In freight, the most common EDI documents include the 204 (load tender), 210 (freight invoice), 214 (shipment status), and 990 (response to load tender). EDI transmissions typically flow through value-added networks (VANs) that act as intermediaries, adding cost and latency to every transaction.Just-in-Time DeliveryJust-in-time delivery is a logistics strategy where goods arrive at the point of use exactly when they are needed, minimizing inventory holding costs and warehouse space requirements. JIT originated in manufacturing, where Toyota pioneered the approach to eliminate waste in production lines, but it now applies broadly to retail replenishment, ecommerce fulfillment, and distribution center operations. The approach requires precise coordination between suppliers, carriers, and receivers.Freight APIA freight API is a programmatic interface that allows software systems to quote, book, track, and manage freight shipments without human intervention. APIs use structured HTTP requests and JSON responses to connect shipper systems, TMS platforms, WMS software, and AI agents directly to carrier networks. A well-designed freight API covers the full shipment lifecycle: rate shopping, booking confirmation, real-time tracking events, proof of delivery, and invoice reconciliation.Supply Chain VisibilitySupply chain visibility is the ability to track and monitor goods, orders, and shipments in real time as they move through every stage of the supply chain, from raw material sourcing through production, warehousing, transportation, and final delivery. True visibility goes beyond basic shipment tracking: it includes predictive ETAs, exception detection, milestone confirmation, and the data infrastructure to connect events across multiple carriers and facilities into a single coherent view.Route OptimizationRoute optimization is the algorithmic process of selecting the most efficient path for freight movement based on variables including distance, transit time, cost, carrier availability, facility capacity, and service requirements. In multi-stop and network freight operations, route optimization extends beyond simple point-to-point routing to include stop sequencing, load consolidation, cross-dock selection, and mode matching across the full shipment lifecycle.Network DensityNetwork density is the concentration of carrier capacity, cross-dock facilities, active shipping routes, and freight volume within a geographic area. A dense freight network has enough carriers, facilities, and shipment volume in each market to fill trucks efficiently, dispatch quickly, and maintain consistent service levels. Density is measured by metrics like carriers per market, loads per lane per week, and facility utilization rates.Carmack AmendmentThe Carmack Amendment is a federal statute within the Interstate Commerce Act that governs carrier liability for loss or damage to goods during interstate shipment. It establishes a uniform national standard: the carrier that accepts freight is presumptively liable for any loss or damage that occurs between pickup and delivery. The shipper does not need to prove negligence. The shipper must prove the goods were in good condition at origin, arrived damaged or short, and state the amount of damages. The burden then shifts to the carrier to prove it falls within one of the limited defenses: act of God, public enemy, act of the shipper, public authority, or inherent vice of the goods.ConsigneeThe consignee is the person or business designated to receive a freight shipment at the delivery location. The consignee is named on the bill of lading as the receiving party and is responsible for accepting the freight, inspecting it for damage at delivery, and signing the proof of delivery. In most domestic freight transactions, the consignee is distinct from the shipper and may also differ from the party paying the freight charges depending on FOB terms.Dry VanA dry van is a fully enclosed, non-temperature-controlled trailer used to transport freight that does not require refrigeration or special handling. Dry vans are the most common trailer type in North American trucking, accounting for the majority of over-the-road freight movements. Standard dry van dimensions are 53 feet long, 8.5 feet wide, and 9 feet tall with approximately 3,000 cubic feet of cargo space and a maximum payload of around 44,000 to 45,000 pounds.FlatbedA flatbed is an open trailer with no walls, roof, or enclosure, used to transport freight that is oversized, oddly shaped, or requires crane or forklift loading from the side or top. Standard flatbed trailers are 48 or 53 feet long with a deck height of approximately 60 inches and a maximum payload of around 48,000 pounds. Flatbed freight must be secured with straps, chains, or tarps and is exposed to weather during transit.Step DeckA step deck (also called a drop deck) is a flatbed trailer with a lower rear deck section, allowing taller freight to be transported without exceeding standard height limits. The front section sits at standard flatbed height (approximately 60 inches) behind the tractor, then drops down to approximately 36 to 42 inches for the rear section. This lower deck provides additional vertical clearance for tall freight while staying under the standard 13.5-foot overall height limit for highway travel.SCAC CodeA SCAC (Standard Carrier Alpha Code) is a unique two-to-four letter code assigned by the National Motor Freight Traffic Association (NMFTA) to identify transportation companies. Every motor carrier, railroad, and freight forwarder operating in the United States is assigned a SCAC code, which is used on bills of lading, EDI transactions, and customs documentation to unambiguously identify the carrier handling a shipment.HundredweightHundredweight (CWT) is a pricing unit in freight shipping equal to 100 pounds, used primarily in LTL and rail pricing to express cost per hundred pounds. A shipment weighing 1,200 pounds would be priced at 12 CWT times the applicable rate per hundredweight. CWT pricing is the traditional basis for LTL tariffs and is still used in most carrier rate schedules, freight class tables, and contract pricing agreements.PRO NumberA PRO number (Progressive Rotating Order number) is a unique tracking number assigned by an LTL carrier to a shipment at the time of pickup. It serves as the primary identifier for tracking a shipment through the carrier network, from origin pickup through every terminal transfer to final delivery. PRO numbers are typically 9 to 11 digits and are printed on the bill of lading, freight labels, and all carrier documentation.Released ValueReleased value is a carrier liability limitation where the shipper agrees to a maximum reimbursement amount per pound in the event of loss or damage, typically lower than the actual value of the goods. Under released value, the carrier liability is capped at the declared rate per pound (commonly $0.10 to $2.00 per pound) regardless of the freight actual market value. This is the default liability level for most LTL carriers unless the shipper declares a higher value and pays an additional charge.Declared ValueDeclared value is the monetary worth a shipper assigns to a freight shipment on the bill of lading, which establishes the upper limit of carrier liability for loss or damage during transit. When a shipper declares value above the carrier standard released value, the carrier assumes greater liability in exchange for an additional charge, typically calculated as a percentage of the declared amount or a per-pound rate applied to the higher value.Cubic CapacityCubic capacity is the total interior volume of a truck trailer or container, measured in cubic feet, that determines how much freight can physically fit inside. A standard 53-foot dry van has approximately 3,000 cubic feet of cubic capacity. Cubic capacity becomes the binding constraint when freight is light but bulky, meaning the trailer runs out of space before it reaches its weight limit. This is the opposite of weight-limited loads where the trailer reaches maximum payload before filling the available volume.Shipper of RecordThe shipper of record is the party listed on the bill of lading as the legal sender of the freight, responsible for the accuracy of shipment details and compliance with transportation regulations. The shipper of record bears legal responsibility for correct commodity descriptions, proper classification, accurate weight declarations, and compliance with hazmat regulations if applicable. This party may or may not be the physical origin of the freight, particularly in third-party logistics arrangements.Freight TariffA freight tariff is a published schedule of rates, rules, and service terms that a carrier uses to price shipments. Tariffs historically were filed with federal regulatory agencies and were publicly accessible documents. Today, most carrier tariffs are proprietary rate schedules that define base rates by freight class and weight bracket, applicable surcharges, accessorial fee schedules, rules of service, and discount structures for contract customers.NMFCNMFC stands for National Motor Freight Classification, the standardized commodity coding system maintained by the National Motor Freight Traffic Association that LTL carriers use to assign freight class. Each commodity has a unique six-digit NMFC number that maps to one of 18 freight classes (50 to 500) based on density, stowability, handling, and liability. For example, NMFC 156600 covers most "machinery, not otherwise indexed" at class 85, while NMFC 124110 covers ceiling fans at class 250.Liftgate FeeA liftgate fee is an accessorial charge applied when a freight carrier uses the truck's hydraulic tail platform (the liftgate) to lower freight from trailer height to ground level at pickup or delivery. Liftgates are required when the location has no loading dock or forklift. Traditional LTL carriers charge $75 to $200 per liftgate stop, and some bill pickup and delivery as separate liftgate events on the same shipment.Freight MCPA freight MCP server is a Model Context Protocol implementation that exposes freight network operations as tools an AI agent can call. Quote, book, track, retrieve documents — each as a structured MCP tool with typed inputs and outputs. The agent does not learn the freight API by reading documentation; the MCP server tells the agent what it can do, then handles the API call when the agent invokes a tool. This lets Claude, Cursor, ChatGPT, or any MCP-compatible AI book real freight without a custom integration.Freight agent (AI)A freight agent is an AI agent — Claude, ChatGPT, Cursor, a custom GPT, or any LLM-powered assistant — wired to a freight network through an API, CLI, or MCP server so it can autonomously quote, book, track, and reconcile shipments on a user's behalf. Unlike a human freight agent (broker), an AI freight agent is software, available to every shipper that integrates one, and operates at the speed of API calls rather than phone calls.Programmable freightProgrammable freight is the application of API-first infrastructure design to freight movement. Quoting, booking, tracking, document retrieval, and invoicing are exposed as REST endpoints, MCP tools, and CLI commands instead of phone calls, EDI files, and broker portals. The freight network itself runs the same way it always has — trucks, cross-docks, drivers, fuel — but every operation that previously required a human handoff is now a function call.3PL (third-party logistics provider)A 3PL (third-party logistics provider) is a company that handles some or all of a shipper's logistics operations on contract — warehousing, fulfillment, transportation, returns, freight management, or all of the above. The shipper outsources the operational layer; the 3PL provides the trucks, the warehouse, the labor, and the systems. Common 3PL services include inbound receiving, pick-pack-ship, freight brokerage, last-mile delivery, and reverse logistics.Double-brokeringDouble-brokering is the practice (almost always fraudulent) where a freight broker accepts a shipment from a shipper, then secretly re-brokers the load to another broker who then dispatches an actual carrier — adding an extra layer of margin, extending the timeline, hiding the real party hauling the freight, and breaking the chain of accountability if the load is damaged, lost, or stolen. Most reputable carriers and brokers prohibit it in their contracts, and it is a leading driver of cargo theft.CWT (hundredweight)CWT (hundredweight, written as "100 lbs" or "cwt") is the unit used to price LTL freight under the legacy National Motor Freight Classification (NMFC) system. A shipper's rate is calculated as (chargeable weight in CWT) × (per-CWT rate for the freight class). For a 1,000-lb pallet at a $50 per-CWT rate, that is 10 CWT × $50 = $500 line haul before fuel surcharges and accessorials. CWT pricing is the dominant LTL rate model and the source of most rate-vs-invoice surprises when class, weight, or dimensions get reclassified.DOT Number (USDOT)A USDOT Number is a unique 7-8 digit identifier assigned by the Federal Motor Carrier Safety Administration (FMCSA) to commercial motor vehicles operating in interstate commerce. The number identifies the carrier in federal compliance records, displays on the side of the truck, and is searchable in the public SAFER (Safety and Fitness Electronic Records) database. Carriers must register a DOT number before hauling regulated freight across state lines.MC Number (Motor Carrier authority)An MC Number (Motor Carrier Number) is the operating authority identifier issued by the Federal Motor Carrier Safety Administration (FMCSA) to interstate motor carriers and freight brokers. While a DOT Number identifies the company in safety records, the MC Number certifies that the entity is authorized to carry freight or arrange transportation in interstate commerce. The MC Number is the proof of operating authority — without it, a carrier cannot legally haul interstate loads, and a broker cannot legally arrange them.Transit timeTransit time is the elapsed time from when a freight carrier picks up a shipment to when they deliver it to the consignee. For LTL, transit is typically measured in business days (1-7 day windows are common). For FTL, transit is hours-to-days based on distance, driver hours-of-service (HOS) limits, and whether the lane runs solo or team. Transit time excludes scheduling time before pickup but includes all in-network handling, cross-dock transfers, and final-mile time.Dwell timeDwell time is the duration freight sits idle in a facility — at a cross-dock, terminal, warehouse, or pickup/delivery location — without moving. Pickup dwell is the time from the carrier's arrival to when the freight is loaded. Drop dwell is the time from arrival at the destination to when the freight is unloaded. Cross-dock dwell is the time freight waits at a transfer facility between inbound and outbound trailers. Excessive dwell drives detention charges, missed appointments, and lost network capacity.Cross-dockA cross-dock is a freight transfer facility where inbound trailers are unloaded, freight is sorted by destination, and outbound trailers are loaded for direct delivery — all within hours, no storage. Cross-dock refers to both the operation (cross-docking) and the physical facility. The defining feature is throughput, not storage: freight enters and exits the same building, typically within 4-12 hours.DIM weightDIM weight (dimensional weight, also "dim weight") is a billing weight calculated from a shipment's volume rather than its actual weight. For low-density freight (light but bulky), carriers charge based on the larger of (a) actual weight or (b) cubic dimensions converted to a "billable weight" via a dim divisor. For LTL, this often triggers a freight class reclassification at the carrier's terminal — adding cost.AccessorialAccessorial (also "accessorial charge") is any extra service fee added to a freight shipment beyond the base line haul rate. Common accessorials: liftgate, residential delivery, inside delivery, limited-access location, appointment scheduling, sort-and-segregate, hazmat handling, detention. Each accessorial has its own fee — and most carriers bill them retroactively, after the truck arrives and discovers the need.Contracted pricingContracted pricing is a rate agreement between a shipper and a carrier (or broker) that sets pre-negotiated per-shipment, per-CWT, or per-pallet rates for a defined period (typically 6-12 months). Unlike spot rates (which fluctuate with market conditions), contracted rates lock in a number that both sides commit to honor regardless of capacity tightness or fuel volatility. Contracted pricing is the standard for shippers moving consistent recurring freight volume.All-inclusive rateAn all-inclusive rate is a freight rate that bundles every charge the shipper will pay — base line haul, fuel surcharge, accessorials, terminal handling, residential delivery, liftgate — into one number at booking time. The shipper pays exactly what was quoted; there are no add-on charges discovered at the terminal or invoiced after delivery. All-inclusive is the inverse of the legacy LTL model where a quoted rate is the starting number, not the final number.FTL shippingFTL shipping (full truckload) is the freight mode where one shipper's load occupies the entire trailer for the duration of the trip — typically a 53-foot dry van or refrigerated reefer. Unlike LTL (less-than-truckload) where multiple shippers share a trailer through cross-dock consolidation, FTL is dedicated capacity from pickup to delivery. The shipper pays for the truck, the driver, the fuel, and the time — not per pallet or per CWT.Density-rated freightDensity-rated freight is freight whose LTL class assignment is based on its density (pounds per cubic foot) rather than the standard NMFC commodity class. The carrier measures the shipment at intake (often via a scanner-and-scale system), computes density, and assigns a class on a sliding scale: higher density → lower class → lower rate. Density-rated tariffs were introduced to remove the subjectivity from class assignment, but in practice they create another reclassification opportunity at the terminal.Load tenderA load tender is the formal offer to a carrier (or broker) to haul a specific shipment at a specific rate. In modern freight, tenders are EDI 204 (or REST API equivalent) messages sent from a TMS (transportation management system) to a carrier's dispatch system. The carrier responds with EDI 990 (accept or reject). The full cycle — tender, accept, dispatch, BOL — is what moves freight from "we need this shipped" to "the truck is on the way."Dedicated laneA dedicated lane is a freight route where a shipper commits volume to a specific carrier (or network) on agreed-upon rates and capacity for a defined period — typically a year. The carrier reserves trucks and driver hours for that lane; the shipper guarantees a minimum number of loads per week. The model trades flexibility (spot rates) for reliability (guaranteed capacity at a known price) and is the standard for high-volume recurring lanes where stockouts or late deliveries are existential.Asset-light carrierAn asset-light carrier is a freight company that dispatches loads on third-party trucks and drivers rather than owning a fleet of its own. The carrier vets carriers, manages relationships, handles billing and customer service, but the physical trucks belong to small fleets, owner-operators, or partner carriers. Contrast with asset-based carriers (ODFL, FedEx Freight, XPO, Saia) that own their trucks, terminals, and employ their drivers.
Ship smarter with Warp
Now that you know the terms, see the network in action. All inclusive per-pallet pricing, no fuel surcharges, no hidden fees.