Glossary of Materials

Glossary of Materials

ABC Inventory Control

An inventory control approach based on the ABC volume or sales revenue classification of products (A items are highest volume or revenue, C—or perhaps D—are lowest-volume SKUs

Absolute Advantage

A competitive strength enjoyed by a party as a result of a natural endowment or other natural gifts that other parties do not have

Acceptance

The intentional indication of an offer to be bound by the terms of an offer

Acceptable Sampling Plan

In quality management, a specific plan that indicates the sampling sizes and the associated acceptance or non-acceptance criteria to be used.

Acceptance Testing

A statistical quality control technique used to evaluate the overall condition of a given lot by inspecting only a sample, drawn randomly from the lot

Accessorial Charges

Costs that carriers usually charge in addition to the transportation cost. They include single shipment, inside delivery, loading, unloading, notification and storage and redelivery charges.

Accessibility

The ability of a carrier to provide service between an origin and a destination.

Administered Price

A price determined by certain policies rather than by the competitive forces of the marketplace. For example, prices of sugarcane etc. in India is determined by the government rather than the market forces of demand and supply

AD Valorem Rate

Customs duty charged in terms of percentage on the value of goods that are dutiable, irrespective of quality, weight, or any other considerations. The ad Valorem rates of duty are ascertained from the invoice

Activity Based Costing

A method for calculating indirect costs, based on the activities that drive cost. This is in contrast to the classical accounting methods which pool and arbitrarily allocate indirect cost