Glossary

PACKAGING

The process of covering an item in a specified material to protect the item and in some cases make it more appealing to the customer.

PACKING

The process of preparing goods for storage or distribution by protecting the contents from outside elements.

PACKING LIST

An itemized list of a package’s contents which is prepared by the shipper.

PACKING LIST

A document which itemizes in detail the contents of a particular package or shipment.

PALLET

A platform used for storing and moving stock.

PALLETISATION

Performing material handling tasks, such as storing and shipping products, using pallets.

PARTIAL PAYMENT

The payment authorized in a contract upon delivery of one or more units called for under the contract or upon completion of one or more distinct items of service called for thereunder.

PARTICIPATIVE

To be involved and contribute to the task or project.

PARTNERSHIP

A legal form of a business that is owned by two or more individuals.

PATENT

Legally grants the inventor sole rights to make or sell their idea or invention.

PATENTED

The inventor has been legally granted exclusive rights to make or sell their idea or invention.

PAYMENT TERMS

The time in which a buyer has to pay the supplier for goods or services received.

PER DIEM

By the day.

PERFECT COMPETITION

A market structure where many companies are competing, each selling the same product.

PERFORMANCE

A term used in contract law to describe what should be done.

PERFORMANCE BOND

A contract of guarantee executed subsequent to award by a successful vendor to protect the buyer from loss due to the vendor’s inability to complete the contract as agreed.

PERFORMANCE MANAGEMENT

Any activity that is carried out to make sure goals are achieved.

PERFORMANCE MANAGEMENT FRAMEWORK

A series of standards and targets that are to be achieved by the supplier, definitions of how performance against those standards will be measured and actions expected to be taken on the basis of the measurement results.

PERFORMANCE SPECIFICATION

A specification setting forth performance requirements determined necessary for the item involved to perform and last as required.

PERFORMANCE SPECIFICATION

Outlines what the product or service is to do or achieve – this covers its output requirements, tolerances and functions it may have to perform.

PERI-URBAN

An area that surrounds a metropolitan area or city.

PERSONAL IMPROVEMENT PLAN (PIP)

A type of action plan geared towards personal improvement.

PERSONAL PROTECTIVE EQUIPMENT (PPE)

Equipment such as a hard hat, work boots or a high-visibility jacket.

PETTY CASH

Money readily available for use by employees on small items.

PHOTOVOLTAIC

Energy generated using solar cells.

PICKING

The process of selecting items from stock or assembling the items required to fill an order.

PIECE PART PRICE

Price per individual item.

PITCH

A business case delivered to an organization to try to sell a product or service.

PLAGIARISM

Passing off another person’s work as your own.

PLANT-MATTER BASED OR BIO-BASED PRODUCT

A product derived from renewable resources, including fiber crops, such as kenaf; chemical extracts from oilseeds, nuts, fruits and vegetables (such as corn and soybeans); agricultural residues, such as wheat straw and corn stover; and wood wastes generated from processing and manufacturing operations. These products stand in contrast to those made from fossil fuels (such as petroleum) and other less renewable resources (such as virgin timber).

POINT OF ORIGIN

(Shipping point)
The location where a shipment is received by a transportation line from the shipper.

POLITICAL SUBDIVISION

A subdivision of a state which has been delegated certain functions of local government. Can include counties, cities, towns, villages, hamlets, boroughs and parishes.

POSITIVE-SUM GAME

Gains by one person or party do not equal the loss to the other.

POST-CONSUMER MATERIAL

A finished material which would normally be disposed of as a solid waste after its life cycle as a consumer item is completed. Does not include manufacturing or converting wastes. This refers to material collected for recycling from office buildings, homes, retail stores, etc.

POVERTY LINE

The minimum level of income required by a family to cover the basic needs of food, clothing and shelter.

PRE-CONSUMER MATERIAL

Material or by-products generated after the manufacture of a product but before the product reaches the consumer, such as damaged or obsolete products. Pre-consumer material does not include mill and manufacturing trim, scrap, or broken material which is generated at a manufacturing site and commonly reused on-site in the same or another manufacturing process.

PRE-QUALIFICATION OF VENDORS

The screening of potential vendors in which such factors as financial capability, reputation and management are considered when developing a list of qualified vendors. See Vendors List, Qualified Vendor/Responsible Vendor.

PRE-QUALIFICATION QUESTIONNAIRE (PQQ)

A document sent to potential suppliers asking for information necessary to support their qualification as an approved supplier.

PRE-QUALIFY

Match a certain set of criteria to qualify immediately for invitation to tender or request for information (RFQ).

PREFERENCE

An advantage in consideration for award for a contract granted to a vendor by reason of the vendor’s residence, business location, or business classifications (e.g., minority, small business).

PREFERRED SUPPLIER LIST

A pre-approved list of suppliers whose financial stability and technical capability have already been checked.

PREPAID

A term denoting that transportation charges have been or are to be paid at the point of shipment.

PRICE

The amount of money that will purchase a definite weight or other measure of a commodity.

PRICE AGREEMENT

A contractual agreement in which a purchaser contracts with a vendor to provide the purchaser’s requirements at a predetermined price. Usually involves a minimum number of units, orders placed directly with the vendor by the purchase, and limited duration of the contract. See Blanket Order and Requirements Contract.

PRICE ELASTICITY

A measure of the change in demand for a product or service in relation to changes in its price.

PRICE FIXING

Agreement among competing vendors to sell at the same price.

PRICE ON APPLICATION (POA)

Meaning you can find out the price when you contact the organization.

PRICE VOLATILITY

Prices that rise and fall repeatedly and unpredictably over short periods of time.

PRICE-PENETRATION STRATEGY

A pricing strategy that aims to attract customers away from competitors by offering a lower price.

PRICE-SKIMMING STRATEGY

A pricing strategy that markets products in the early stages of their life cycle at a higher price than at a later stage.

PRICING MODEL

How the price for goods or services will be presented in a request for information (RFI).

PRICING SCHEDULE APPENDIX

Additional pages, containing more details about the pricing schedule, at the end of the contract.

PRIMARY PACKAGING

The packaging that is in immediate contact with the product (e.g., small box, bottle, bag, etc.).

PRIMARY SECTOR

The first stage of the production and manufacturing process (e.g., farming and the extraction of raw materials).

PRIVATE LIMITED COMPANY (PLC)

A legal form of company in which ownership is apportioned through the number of shares held. Liability of the holders of these shares is limited to the share value and the shares cannot be traded.

PRIVATE SECTOR

Organizations run with the aim of making a profit.

PROACTIVE

Anticipating needs and acting accordingly.

PROBITY

Honesty or integrity.

PROCESS MAPPING

A way to provide a visual representation of a process.

PROCURE TO PAY (P2P)

The process of requisitioning, purchasing, receiving, paying for, and accounting for goods and services.

PROCUREMENT

The act of obtaining something, whether tangible or intangible, such as a product or service.

PROCUREMENT

The combined functions of purchasing, inventory control, traffic and transportation, receiving, inspection, store keeping, and salvage and disposal operations.

PROCUREMENT PLATFORM

The activities that determine the specification and quantities of a product or service prior to contracting for its supply. It is based on a balance of financial and non-financial requirements.

PROCUREMENT SPECIFICATION

A document that presents prospective suppliers with a clear, accurate and full description of the organization’s needs and enables them to propose a solution to meet those needs.

PRODUCT LABEL

Part of the packaging of a product. The product label is the written information on the outer packaging that gives important information that needs to be communicated to the customer.

PRODUCT LIFE CYCLE

The stages a product goes through, from initial concept through to decline and removal from the market.

PROFIT

The amount by which the revenues of a company exceed its costs.

PROFITABILITY

The ability of the organization to make a profit.

PROFORMA INVOICE

A document which confirms the sale which is sent to the buyer in advance of items being shipped and provides details such as description of items, shipment weight, transport charges, etc.

PROMOTIONAL MIX

The aspects of product, place, price and promotion that are used in the marketing of a product or service.

PROPRIETARY

The only items that can perform a function and satisfy a need. This should not be confused with “single source.” An item can be proprietary and yet available from more than one source. For example, if you need a camera lens for a Nikon camera, the only lens that will fit is a Nikon lens, thus, this lens is “proprietary.” However, the Nikon lens is available from more than one source, thus, it is not a single source.

PROPULSION SYSTEM

A machine that produces thrust to push an object forward.

PROSPECTIVE SUPPLIERS

Suppliers that may wish to work with a buyer or who a buyer may wish to work with.

PROTOTYPE

A sample or model of an idea or concept.

PUBLIC LIMITED COMPANY

A legal form of company in which ownership is apportioned through the number of shares held. Liability of the holders of these shares is limited to the share value and the shares can be traded through an exchange.

PUBLIC PROCUREMENT

Purchasing carried out by government departments, local authorities and some other designated types of organization, particularly those funded or supported through taxation.

PUBLIC PURCHASING

The process of obtaining goods and services for public purpose following procedures implemented to protect public funds from being expended extravagantly or capriciously.

PUBLIC SECTOR ORGANIZATIONS

Service organizations run by the government and usually funded by taxes.

PURCHASE MANUAL

A document that stipulates rules and prescribes procedures for purchasing with suppliers and other departments.

PURCHASE ORDER

The signed written acceptance of the offer from the vendor. A purchase order serves as the legal and binding contract between both parties.

PURCHASE ORDER (PO)

Legally binding documents that set out the details of the transaction that the supplier and buyer have agreed.

PURCHASING

The processes concerned with acquiring goods and services, including payment of invoices – it is part of the wider procurement process.

QUALIFIED BID

A bid where the potential supplier has ‘exempted themselves’ from one or more of the requirements of the tender (i.e., the bid specifically states that it does not comply with one or more aspects of the specification or contract terms).

QUALIFIED PRODUCTS LIST (QPL)

A list of products that, because of the length of time required for test and evaluation, are tested in advance of procurement to determine which suppliers comply with the specification requirements. Also referred to as an “approved brands list.”

QUALIFIED VENDOR/RESPONSIBLE VENDOR

A vendor determined by a buying organization to meet minimum set standards of business competence, reputation, financial ability and product quality for placement on the vendor list.

QUALITATIVE

Measured in terms of quality.

QUALITATIVE RESEARCH

Research designed to gain insights into reasons why something happens.

QUALITY

The composite of material attributes, including performance features and characteristic, of a product or service to satisfy a given need.

QUALITY ASSURANCE

Processes put in place the ensure that quality requirements will be met.

QUALITY CONTROL

Checking a product against a set of criteria to ensure it meets quality standards.

QUALITY MANAGEMENT SYSTEM (QMS)

A formal system that includes documented processes and procedures that outline the responsibilities for achieving quality within an organization.

QUANTITATIVE

Measured in terms of numbers or quantity.

QUANTITATIVE RESEARCH

Research that uses statistics and mathematics as a means of analyzing data.

QUANTITY

Amount or number.

QUANTITY DISCOUNT

A reduction in the unit price offered for large volume contracts.

QUOTA

A limit on the quantity or value of a particular type of import or export.

RADIO FREQUENCY IDENTIFICATION (RFID) TAG

Data chips that are attached to products and contain a signal for tracking and identification.

RATIONALIZATION

The process of reviewing products and consolidating variety to reduce inventory costs.

RE-ENGINEERING

Redesigning existing products and services.

REACTIVE

Responding to needs when they present themselves.

READ RECEIPT

A response from an e-mail recipient that indicates the message was opened.

REBATE

An amount paid back on top of any discounts that have previously been agreed.

RECIPROCAL

Something that is the same on both sides.

RECRUITMENT

The act of finding a person or persons to do a role within an organization.

RECYCLED CONTENT

The portion of a product that is made from materials directed from the waste stream; usually stated as a percentage by weight.

RECYCLED PRODUCT

A product that contains the highest amount of post-consumer material practicable, or when post-consumer material is impracticable for a specific type of product, contains substantial amounts of pre-consumer material.

REDUNDANT STOCK

Excess stock that is not required.

REGRESSION ANALYSIS

Statistical methods used for predicting what will happen in one variable as a result of a change in another – e.g., will quality improve by X amount if the price is increased by Y amount? Quality is not a direct function of price, so it may do so, or it may not. Regression analysis looks at probabilities.

REGULATORY FRAMEWORK

A model that policy makers and others can use to reform and apply regulations in an effective and logical way.

REMANUFACTURED PRODUCT

Any product diverted from the supply of discarded materials by refurbishing and marketing said product without substantial change to its original form.

REMEDIES

Contractual remedies are the provisions in a contract that enable the injured party to take action when the other party does not comply with the contract terms.

REMITTANCE ADVICE

A document confirming that payment has been made.

RENT

A rental contract giving the right to use real estate or property for a specified time in return for rent or other compensation.

REPROCUREMENT

To procure again – put in place a new contract when a previous one expires or is terminated.

REQUEST FOR BID (RFB)

A solicitation in which the terms, conditions, and specifications are described and responses are not subject to negotiation.

REQUEST FOR INFORMATION (RFI)

A document used to gather information about suppliers and their capabilities prior to a formal procurement process.

REQUEST FOR PROPOSAL (RFP)

A solicitation in which it is not advantageous to set forth all the actual, detailed requirements at the time of solicitation and responses are subject to negotiation. Price must be a factor in the award but not the sole factor.

REQUEST FOR QUOTATION (RFQ)

An invitation to suppliers to bid on specific products or services.

REQUEST FOR TENDER (RFT)

Document inviting potential suppliers to quote for business.

REQUIREMENT

Materials, personnel or services needed for a specific period of time.

REQUIREMENTS CONTRACT

A form or contract that is used when the total long-term quantity required cannot be definitely fixed but can be stated as an estimate or within maximum and minimum limits with deliveries on demand.

REQUISITION

An internal document that a functional department (stores, maintenance, production, etc.) sends to the purchasing department containing details of materials to meet its needs, replenish stocks or obtain materials for specific jobs or contracts.

REQUISITION

Paper or electronic document stating a need for procurement to supply a product or service.

RESIDENT VENDOR

A person, firm, or corporation authorized to conduct business in the State of Minnesota on the date a solicitation for a contract is first advertised or announced. It includes a foreign corporation duly authorized to engage in business in Minnesota.

RESIDUAL WASTE

Waste that is not able to be recycled or re-used and which ends up in garbage dumps called landfills.

RESPONDER

One who submits a response to a solicitation document.

RESPONSE

The offer received from a vendor in response to a solicitation. A response includes submissions commonly referred to as “offers,” “bids,” “quotes,” or “proposals.”

RESPONSIBLE BIDDER

A bidder whose reputation, past performance, and business and financial capabilities are such that the bidder would be judged by an appropriate authority as capable of satisfying an organization’s needs for a specific contract.

RESPONSIVE BIDDER

A bidder whose bid does not vary from the specifications and terms set out in the invitation for bids.

RESTRICTIVE SPECIFICATIONS

Specifications that unnecessarily limit competition by eliminating items capable of satisfactorily meeting actual needs. See Performance Specification.

RETURN ON INVESTMENT (ROI)

A measure of profitability that indicates whether a gain or loss has been generated compared with the initial cost.

REUSED PRODUCT

Any product designed to be used many times for the same or other purpose without additional processing other than specific requirements, such as cleaning, painting or minor repairs.

REVENUE

The amount of income that has come into a business.

RFP OR RFB CONFERENCE

A meeting arranged by a procurement office to help potential bidders understand the requirements of an RFB or an RFP.

RISK ASSESSMENT

An assessment that considers the severity of a hazard and its potential outcome in conjunction with other factors including the level of exposure, the number of individuals exposed and the risk of the hazard being realized.

RISK REGISTER

A document that sets out identified risks, the likelihood and impact of them materializing and who is responsible for dealing with them.

ROAD SAFETY IMPACT ASSESSMENT (RSIA)

A formal, independent assessment of the impact of new or altered layouts and entry points on the safety of a road.

ROLL-OVER CONTRACT

Contract that automatically renews on expiry unless notice is given that it is not to do so.

ROLLER-STACKER SHELF MECHANISM

A set of rotating decks or shelves within a secure container that eliminates wasted space between racks and improves security.

SAFETY STOCK

Extra stock that is held in case it is needed in unexpected situations, such as demand rising or suppliers being unable to deliver.

SALES AND OPERATIONS PLANNING (S&OP)

A multi-department planning process based on factors including expected levels of demand and supply.

SALES TAX

A tax collected by the retailer at the final stage of the supply chain.

SAMPLES

Examples of the product that is required.

SCALABILITY

An organization’s ability to increase its production profitability.

SCANNER

A device that optically scans images.

SCHEDULE OF RATES

An itemized list of component parts within a lump-sum contract, or a list of individual products, giving a price for each unit.

SCHEMATIC

A diagram showing the main form and features of something to help people to understand it.

SCORECARDS

Reports used to track the achievement of, or progress towards, targets or goals that can include quantitative and qualitative data.

SEALED

A method determined by the commissioner to prevent the contents being revealed or known before the deadline for submission of responses.

SEARCH ENGINE

A software system or program that is designed to search for information on the Internet.

SECOND SOURCING

A business practice wherein a supplier shares information about his product with his competitors in order to increase the supply of the product in the market.

SECOND-PARTY AUDIT

An inspection of a supplier by an organization/ company contracted by the organization (otherwise known as an external or supplier audit).

SECONDARY SECTOR

The second stage of the production and manufacturing process, e.g., manufacturing industries.

SELF-ASSESSMENT TOOL

An evaluation method that an organization will use to assess performance.

SENSITIVE RECEPTORS

People or living things that are more readily affected by exposure to contaminants or toxic materials, e.g., people in schools, day-care centers, hospitals and nursing homes.

SERVICE CREDITS

A deduction against fees payable as compensation for poor service, usually a pre-determined percentage derived from a contractual performance management framework.

SERVICE LEVEL AGREEMENT (SLA)

An agreement between a supplier and a buyer based on quality, delivery, availability and other measurable criteria.

SERVICE SECTOR

The third of three sectors recognized by economists. The first sector covers farming and raw materials, the second is manufacturing and the third covers the production and delivery of services.

SERVICE-DISABLED VETERAN (SDV)

A Service-Disabled Veteran Business (SDV) must be at least 51% owned, operated and controlled by a veteran with a service-connected disability of at least 10% and must be certified by the U. Department of Veteran Affairs or the Department of Defense.

SERVICE-DISABLED VETERAN-OWNED SMALL BUSINESS

Service-Disabled Veteran-Owned Small Business Means a small business that is at least 51% owned, operated and managed by one or more service-disabled veterans. In the case of any publicly owned business, at least 51% of the stock must be owned by one or more service-disabled veterans and whose management and daily business operations are controlled by one or more service-disabled veterans or in the case of a veteran with permanent and severe disability, the spouse or permanent caregiver of such veteran. A Service-disabled veteran is defined in 38 U.S.C. 101(2) with a disability that is service-connected. (Service-Disabled Veteran-Owned Small Business).

SERVICE-DISABLED VETERAN’S BUSINESS ENTERPRISES (SDVBE)

A business concern that is (a) at least fifty-one percent (51%) owned by one or more service-disabled veterans or, in the case of any publicly owned business, at least fifty-one percent (51%) of the stock of which is owned by one or more service-disabled veterans or, in the case of a veteran with a permanent and severe disability, the spouse or permanent caregiver of such veteran.

SERVICES

Unless otherwise indicated, both professional or technical services and services performed under a service contract.

SHARES

The means by which a business is apportioned among its owners.

SHIFT

A change in either the quantity supplied, or the quantity demanded while the price remains the same.

SHIPPING ADDRESS

The address to which deliveries are to be sent.

SHOP FLOOR

Within manufacturing, the area where the goods are made.

SIGNED OFF

A process of approving a sample so that orders can be placed or produced.

SILO THINKING

When people within a department do not share their knowledge or ideas with others outside the department.

SINGLE ADMINISTRATIVE DOCUMENT (SAD)

A standardized customs form used to control goods being moved in and out of the EU, Switzerland, Norway, Iceland, Turkey, Macedonia and Serbia.

SINGLE SOURCE

An acquisition where, after a search, only one supplier is determined to be reasonably available for the required product, service or construction item.

SLOTTING (OR PROFILING)

The process of identifying the most efficient placement for each item in a warehouse.

SMALL BUSINESS

A designation for certain statutory purposes referring to a firm, corporation or establishment having a small number of employees, low volume of sales, small amount of assets or limited impact on the market.

SMALL BUSINESS ENTERPRISE (SBE)

A business independently owned, operated and in accordance with the definitions and size standards established by the SBA, available at http://www.sba.gov/size. The most common
size standards are listed in the following section.

SMALL DISADVANTAGED BUSINESS CONCERN (SDB)

Small disadvantaged business concern means a small business concern that is at least 51 percent unconditionally owned by one or more individuals who are both socially and economically disadvantaged, or a publicly owned business that has at least 51% of its stock unconditionally owned by one or more socially and economically disadvantaged individuals and that has its management and daily business controlled by one or more such individuals. This term also means a small business concern that is at least 51%unconditionally owned by an economically disadvantaged Indian tribe or Native Hawaiian Organization, or a publicly owned business that has at least 51 percent of its stock unconditionally owned by one of these
entities, that has its management and daily business controlled by members of an economically disadvantaged Indian tribe or Native Hawaiian Organization, and that meets the requirements of 13 CFR 124.

SMALL- AND MEDIUM-SIZED ENTERPRISE (SME)

A small- or medium-sized enterprise that is independent of other companies and is defined in terms of the number of employees it has.

SMART

SMART objectives are: Specific, Measurable, Achievable, Realistic, and Time bound.

SOCIAL SUSTAINABILITY

The impact a business can have on people and communities and actions to make this a positive impact.

SOFT SKILLS

Skills that may be taught but are more likely to develop with time and practice, for example, team working and good communication.

SOFTWARE

Programmed code that makes computers (hardware) operate.

SOLE TRADER

Someone who has exclusive ownership of a business and can keep any surplus profits but is responsible for any losses.

SOLICITATION

The process used to communicate procurement requirements and to request responses from interested vendors. A solicitation may be, but is not limited to a request for bid and request for proposal.

SOURCE REDUCTION PRODUCT

A product that results in a net reduction in the generation of waste, and includes durable, reusable and remanufactured products; products with no packaging or reduced packaging.

SOURCING

Sourcing is the process of vetting, selecting, and managing suppliers who can provide the inputs an organization needs for day-to-day running. Sourcing is tasked with carrying out research, creating and executing strategy, defining quality and quantity metrics, and choosing suppliers that meet these criteria.

SPECIFICATION

A concise statement of a set of requirements to be satisfied by a product, material or process that indicates whenever appropriate the procedures to determine whether the requirements are satisfied. As far as practicable, it is desirable that the requirements are expressed numerically in terms of appropriate units, together with their limits. A specification may be a standard, a part of a standard, or independent of a standard.

SPEND ANALYTICS

Gathering, cleansing, classifying and assessing spend data, with the aim of making efficiencies and reducing costs.

SPOT BUYING

One-off purchases or immediate requirements, common in domestic buying.

STAGED PRICING

Payment split into installments across the period of the contract.

STAGGERED DELIVERY

This is where a full order is broken down into smaller loads and delivered against a schedule, e.g., 40% delivered in Month 1, 60% delivered in Month 2.

STAKEHOLDER

Anyone with an interest, or stake, in the organization or project.

STANDARD

An item’s characteristic or set of characteristics generally accepted by the manufacturers and users of the item as a required characteristic for all such items.

STANDARD DEVIATION

A statistical measure that captures the difference between the average and the outliers in a set of data.

STANDARDIZATION

The process of defining and applying the conditions necessary to ensure that a given range of requirements can normally be met, with a minimum of variety, in a reproducible and economic manner based on the best current techniques.

STANDING ORDERS

Document setting out the internal rules of an organization.

STATUTORY

An action that is required by and controlled by law.

STEWARDSHIP

Care and responsibility for minimizing a product’s environmental impact throughout all stages of the product life cycle, including end of life management.

STOCK

Goods, products or materials held for future use or supply, often called inventory.

STOCK KEEPING UNIT (SKU)

An identification code for an item of inventory, usually displayed as a bar code linked to a database.

STOCKHOLDER

American term for shareholder.

STOCKOUT

When an inventory item is unavailable.

STOCKTAKE

The process of physically counting products in a warehouse to match them to the computerized inventory.

STRATEGIC

High-level planning, usually related to long-term goals.

STRATEGIC BUSINESS DECISIONS

Long-term decisions often made by senior management which affect the future and direction of an organization.

STRATEGIC CORE

A category of a buyer’s portfolio in which items have major consequences for the company if they are not available when needed.

STRATEGIC PLAN

A document that includes details of the organization’s goals and the actions to be taken to achieve them.

STRATEGIC PROCUREMENT

The practice of focusing on building long-term relationships with suppliers that could lead to a source of competitive advantage.

SUBJECTIVE

In the context of data, something is subjective if it is a matter of opinion, which may differ from one person to another.

SUBSTITUTES

Goods which, as a result of changed conditions, may replace each other in the market.

SUBTRACT OR OUTSOURCE

To employ another organization to fulfill a contract or part of a contract.

SUPPLIER DATABASE

All of the Seller’s supplier and vendor lists, records, telephone and fax numbers, email addresses and publications and marketing material relating to the purchase of goods or the provision of services to the Seller in connection with the Business.

SUPPLIER DISCOVERY

The process of an organization of located and sourcing new Tier I and Tier II suppliers.

SUPPLIER DIVERSITY PROGRAM

A supplier diversity program is a proactive business program which encourages the use of minority-owned, women owned, veteran owned, LGBT-owned, service-disabled veteran owned, historically underutilized business, and Small Business Administration (SBA)-defined small business concerns as suppliers.

SUPPLIER INSPECTION

A way of testing a supplier’s product or service to confirm compliance with the standard set by the organization.

SUPPLIER MASTER

A framework that a company uses to manage a comprehensive set of records about a company’s suppliers.

SUPPLIER MASTER DATA

The Supplier Master Data is a paper or digital document containing every information related to a supplier such as: contact person, location related information, range of products, legal form of the company and different collected certificates.

SUPPLIER RANKING

A priority order of suppliers that can be used for sourcing.

SUPPLIER RELATIONSHIP MANAGEMENT (SRM)

Process for identifying all interactions with key suppliers and then managing them in a way that increases the value from the relationship for both parties.

SUPPLIER RELATIONSHIP MANAGER (SRM)

The role responsible for developing and maintaining supplier relationships.

SUPPLY

How much or how many of a product or service an organization has to sell, or the act of physically getting something from the supplier to the buyer.

SUPPLY CHAIN

A network of individuals, organizations, technology, activities and resources working together to make sure goods or services reach the end user.

SUPPLY ORGANIZATION

A supplier.

SURPLUS PROPERTY

Property in excess of the needs of an organization and not required for its foreseeable use. Surplus may be used or new, but it possesses some usefulness for the purpose it was intended or for some other purpose.

SUSTAINABILITY

Supporting future ecological balance by not harming the environment or depleting natural resources.

SUSTAINABILITY DEVELOPMENT GOALS (SDG)

17 goals introduced by the United Nations General Assembly to achieve a better and more sustainable future for all.

SUSTAINABLY

In a way that avoids the destruction of nature and helps to keep a good ecological balance.

SYNCHRONISATION

The process of precisely coordinating or matching two or more activities, devices or processes in time.

SYSTEM-GENERATED REFERENCE NUMBER

A reference number automatically assigned to a record in a computer system.

SYSTEMIC

An attribute that applies to a whole system rather than one particular part of it.

TABULATION OF RESPONSES

The recording of responses for the purposes of comparison, analysis and record keeping.

TAIL SPEND

Tail spend is that spend for any firm, which is not actively managed in all the spend categories and may have an impact on the firm’s financial performance due to its impact on SG&A and COGS. It contains a small portion of the spend (10–20% under each spend category) but a large number of suppliers accounting for it.

TALL STRUCTURE

Also known as a hierarchical structure and based on a pyramid – every staff member has somebody to report to.

TANGIBLE

Something you can physically see or touch.

TARGET AUDIENCE

People or organizations at which products such as a film, advertisement or website is aimed.

TARGETED GROUP BUSINESS (TG)

A certified business designated by the commissioner of Administration that is majority owned and operated by a woman, person with disabilities, or a member of a specific minority group who provides goods, products, or services within purchasing categories designated by the commissioner.

TARIFF

A tax paid on a particular type of import or export.

TECHNICAL (OR CONFORMANCE) SPECIFICATION

The set of standards that a requirement must meet or exceed.

TECHNOLOGY CHASM

The gap between the early adopters and larger market segments such as early majority in a product life cycle.

TELEMATICS

Information technology dealing with the long-distance transmission of computerized information.

TENDER

A request from a buying organization to invite suppliers to formally quote on a large value project.

TERM CONTRACTS

Contracts written to last a period of time and include agreed terms.

TERMS AND CONDITIONS

A phrase generally applied to the rules under which all bids must be submitted, and the stipulations included in most purchase contracts; often published by the purchasing authorities for the information of all potential vendors.

TERTIARY SECTOR

The third stage of the production and manufacturing process, where a service is delivered in industries, e.g., banking, communications and marketing.

TESTIMONIAL

A formal statement from a customer giving feedback about the product, service or company and often used for promotional purposes.

THE CARBON TRUST

An independent, expert partner of leading organizations around the world, helping them contribute to and benefit from a more sustainable future through carbon reduction, resource efficiency strategies and commercializing low carbon technologies.

THE GREENHOUSE GAS PROTOCOL (GHG PROTOCOL) CORPORATE STANDARD

The most widely used international accounting tool for government and business leaders to understand, quantify, and manage greenhouse gas emissions.

THIRD-PARTY AUDIT

An inspection of an organization by an independent company or body.

THIRD-PARTY LOGISTICS (3PL)

The use of third-party businesses to outsource part or all of an organization’s fulfilment, logistics, transport, warehousing or distribution.

THIRD-SECTOR ORGANIZATIONS (TSOS)

Not-for-profit, non-governmental organizations run with the aim of achieving social goals, such as charities or community groups.

THRESHOLD

In the procurement context, an upper limit to the amount a contract may cost without certain legal requirements coming into force.

TIER 1 SUPPLIERS

Tier 1 suppliers are manufacturers that deal directly with OEM companies. These are often major companies in their own right. You may recognize names like Bosch or BASF. Though Bosch is primarily a tier 1 supplier for the automotive industry, they’re also well known for their own power tool product lines.

TIER 2 SUPPLIERS

While tier 1 suppliers are creating parts and equipment, they generally don’t make the pieces that make up those parts. For that, they turn to tier 2 suppliers. Tier 2 suppliers deal directly with the tier 1 suppliers, not the OEMs.

TITLE

The instrument or document whereby ownership of property is established.

TOOLING

Cutting tools, molds, fixtures of accessories needed on a machine to manufacture a product.

TORT

A wrongful act, other than a breach of contract, such that the law permits compensation of damages.

TOTAL COST APPROACH

An approach that considers all the costs associated with procuring an item.

TOTAL COST OF OWNERSHIP (TCO)

A structured approach to calculating the full costs associated with buying and using an asset or acquisition over its entire life cycle.

TOTAL COSTS

The total amount of costs spent, including fixed, variable, direct and indirect costs.

TOTAL QUALITY MANAGEMENT (TQM)

Efforts of all departments within an organization to improve processes, products and services.

TRADE BODY

An organization that represents and works for a particular group of individuals or companies, with a specific industry focus, is usually funded by them.

TRAFFIC

Visits or clicks on a website.

TRANSCENDENTAL

Pre-supposed and beyond practically gained experience.

TRANSFORMATIONAL STEP CHANGE

An organizational change that is significant and carried out over a period of time.

TRANSPARENCY

Operating in such a way that everyone can see the actions performed.

TRUCKLOAD (TL)

1. A quantity of freight to which truckload rates apply or a shipment tendered as a truckload.
2. A highway truck or trailer loaded to its carrying capacity. See Less-Than-Truckload.

TURNOVER

The amount of money taken by a business in a particular period.