Cost Management

The management and control of activities and drivers to calculate accurate product and service costs, improve business processes, eliminate waste, influence cost drivers, and plan operations are essential in logistics. The resulting information will be useful in setting and evaluating an organization's strategies.

Cost of Capital

The cost of borrowing or investing capital.

Cost of Lost Sales

The foregone profit associated with a stock-out.

Costs per Unit Moved

A measure to calculate the cost of moving one unit of product is as follows: Calculation: (Total Costs to Move Units) / (Total Number of Units Moved).

Cost-to-Serve

A chain of activities is required to get a company's products or services into their customers' stores and onto their shelves. This includes order taking, picking and freighting the order, arranging promotions by sales reps, processing credits, and merchandising the product.

Cost Trade-off

The interrelationship among system variables indicates that a change in one variable has a cost impact on other variables. A cost reduction in one variable may be at the expense of increased cost for other variables, and vice versa.

Cost Variance

A term used in cost accounting to describe the difference between actual cost and what was budgeted or expected.

COTD

Complete and On-Time Delivery

COTS

Commercial off-the-shelf

Council of Logistics Management (CLM)

Council of Supply Chain Management Professionals.

Council of Supply Chain Management Professionals (CSCMP)

The CSCMP is a not-for-profit professional business organization consisting of individuals throughout the world who have interests and/or responsibilities in logistics and supply chain management, and the related functions that make up these professions. Its purpose is to enhance the development of the logistics and supply chain management professions by providing these individuals with educational opportunities and relevant information through a variety of programs, services, and activities.

Count Back

A process in which order pickers select full cases from pallet rack locations and perform an immediate cycle count at the completion of the pick for that location, using a Radio Frequency or voice terminal. The use of the count-back program is just one component of being able to prove perfect order picking and the highest degree of inventory accuracy.

Country of Origin(COO)

The country of manufacture, production, or growth is where a product comes from.

Courier Service

A fast, door-to-door service for high-value goods and documents; firms usually limit the service to shipments of 50 pounds or less.

CPAF (Cost Plus Award - Fee)

A type of PBL contract pricing that combines a cost basis with an award fee feature. The incentive feature allows a base fee to be adjusted based on success in meeting target performance goals.

CPAR

Contractor Performance Assessment Report

CPFR

A concept that aims to enhance supply chain integration by supporting and assisting joint practices, CPFR seeks cooperative management of inventory through joint visibility and replenishment of products throughout the supply chain. Information shared between suppliers and retailers aids in planning and satisfying customer demands through a supportive system of shared information. This allows for continuous updating of inventory and upcoming requirements, essentially making the end-to-end supply chain process more efficient. Efficiency is also created through the decrease in expenditures for merchandising, inventory, logistics, and transportation across all trading partners.

CPG

Consumable goods, such as food and beverages, footwear and apparel, tobacco, and cleaning products, are items that generally get used up and need to be replaced frequently. This is in contrast to items that people usually keep for a long time, such as cars and furniture.

CPI

Continuous Process Improvement is a strategic approach for developing a culture of continuous improvement in the areas of reliability, process cycle times, costs (in terms of less total resource consumption), quality, and productivity. Also, see Kaizen.

CPIF (Cost Plus Incentive-Fee)

A type of PBL contract pricing that combines a cost basis with an incentive fee feature. The incentive feature allows a base fee to be adjusted based on the relationship of actual costs to target costs.

Cradle to Grave

Product Lifecycle.

Credit Level

The amount of purchasing credit a customer has available is usually defined by the internal credit department and reduced by any existing unpaid bills or open orders.

Credit Memo (CM)

A document issued to provide authorization for a customer account credit, typically due to product returns, billing errors, or other adjustments.

Critical Differentiators

This is what makes an idea, product, service, or business model unique.

Critical Success Factor (CSF)

Those activities and processes must be completed and controlled to enable a company to reach its goals.

Critical Value Analysis

A modified ABC analysis is conducted, wherein a subjective value of criticalness is assigned to each item in the inventory.

CRM

Customer Relationship Management

Crossdock / Cross Docking (XDK)

A distribution system in which merchandise received at the warehouse or distribution center is not put away, but instead is readied for shipment to retail stores. Cross-docking requires close synchronization of all inbound and outbound shipment movements. By eliminating the put-away, storage, and selection operations, it can significantly reduce distribution costs.

Cross docking

This is the practice of unloading freight from an inbound load and then loading it directly into an outbound shipment with little to no storage in between.

Cross Functional

A term used to describe a process or an activity that crosses the boundary between functions, a cross-functional team consists of individuals from more than one organizational unit or function.

Cross Functional “Process” Metric

A number resulting from an equation shows the output of a process that spans departments. These types of measures are also known as process measures because they span across the breadth of a process, regardless of functional/departmental segregation within the process. An example is the Perfect Order Index.

Cross Sell

The practice of attempting to sell additional products to a customer during a sales call, for example, when the customer service representative (CSR) presents a camera case and accessories to a customer who is ordering a camera.

Cross-Shipment

A term used widely in the electronics industry is when a shipment of a replacement part or device is made in advance of the physical return of the defective part.

Cross-Subsidy

In cost accounting, the inequitable assignment of costs to cost objects leads to overcosting or undercosting them relative to the amount of activities and resources actually consumed. This may result in poor management decisions that are inconsistent with the economic goals of the organization.

CRP

Continuous Replenishment Program

CRR

Cost Recovery Rate

CSCMP

Council of Supply Chain Management Professionals

CSF

Critical Success Factor

CSI

Container Security Initiative

CSR

Customer Service Representative.

CTP

Capacity to Promise

C-TPAT

A joint government-business initiative is being undertaken to build cooperative relationships that strengthen overall supply chain and border security. The voluntary program is designed to share information that will protect against terrorists compromising the supply chain.

Cubage

Cubic volume refers to the amount of space that is being used or available for shipping or storage.

Cube

The volume of the shipment or package is calculated as the product of the length x width x depth.

Cube Utilization

The use of space within a storage area, trailer, or container is known as cube utilization. Cube utilization is generally calculated as a percentage of total space or total 'usable' space. It is important to note that there is a point at which too high a percentage of utilization can create inefficiency.

Cubic Space

The measurement of the total space or volume available or required in transportation and warehousing is determined by multiplying the floor space by the height.

Cumulative Available-to-Promise

A calculation that yields future availability based on planned production or purchases and consumption across multiple future periods. Also, see Available-to-Promise.

Cumulative Lead Time

The total time required to source components, build, and ship a product.