The supply chain and logistics industry has its own language, packed with acronyms, jargon, and terms that aren’t always clearly defined. When it comes to packing, understanding the right terminology can make a big difference in how efficiently and cost-effectively you manage your operation.

This guide covers all of the key packing terms you need to know, including cartonization, a word still missing from the dictionary. Whether you're refining your packing strategy or looking to better understand industry terminology, these definitions will help you grasp all aspects of your operation.

A

Accessorial Charges – Additional fees carriers charge for services beyond standard shipping, such as Additional Handling Charges (AHC) and Large Package Surcharges (LPS).

AGV (Automated Guided Vehicle) – A robot that follows fixed paths or tracks for material transportation around a facility.

AMR (Autonomous Mobile Robot) – A robot that operates autonomously using sensors and machine vision to navigate in an uncontrolled environment without fixed paths or instructions. AMRs help accelerate material movement and improve efficiency in fulfillment operations.

API (Application Programming Interface) – A set of rules that allows different software systems to communicate by sending requests and receiving responses. It enables automation by connecting systems for tasks like shipping, packing, and order fulfillment, reducing the need for manual input.

AS/RS (Automated Storage and Retrieval System) – A computer-controlled system that automatically stores and retrieves items from designated locations. Common in manufacturing, distribution, and retail, AS/RS handles high-volume inventory movement efficiently.

Automated Dimensioning System – A system that quickly measures and records item dimensions and weights to improve packing and slotting efficiency and accuracy.

B

Billable Weight – The weight used by parcel carriers to calculate shipping costs, which may be based on dimensional weight or actual weight, whichever is higher. This may also be referred to as GAD weight.

Bill of Lading (BOL) – A document that serves as a receipt and contract between a shipper and a carrier, detailing shipment contents and terms.

C

Cartonization – The step in the packing process where the best packing configuration for shipping an order is determined. In some cases, it factors in variables like item dimensions, box sizes, and business rules. Cartonization can range from basic rule-based algorithms found in traditional WMS systems to advanced, cost-driven solutions that account for complex variables like carrier rates and packing constraints.

Corrugated Box – The typical box used for most parcel packaging is made from corrugated cardboard, which is a thick, strong material composed of a wavy inner layer sandwiched between two flat outer layers.

Cost-Aware Packing – A packing optimization approach that factors in financial variables like DIM weight, rate card breakpoints, and material costs to minimize shipping expenses. Advanced parcel packing intelligence platforms use patented cartonization algorithms to analyze these factors and recommend the most cost-effective packing strategy.

Cubing – The process of calculating an item’s exact volume to determine the best way to pack or store it.

D

Dimensioning – The process of measuring and recording an item’s dimensions. This is key to improving packing efficiency.

Dimensional Weight (DIM) – A pricing model that calculates shipping costs based on package volume rather than actual weight.

Dunnage – Material used to protect goods during shipping by filling empty spaces, cushioning items, and preventing movement within a box, essentially acting as protective padding that can include things like corrugated cardboard inserts, bubble wrap, packing peanuts, foam inserts, or even wood planks depending on the item being shipped.

E

E-commerce Fulfillment – The process of picking, packing, and shipping online orders.

ERP (Enterprise Resource Planning) – A software system that integrates and streamlines core business processes, such as inventory management, order processing, and accounting, into a unified platform.

F

Fill Material – Material used to fill empty spaces within a package, typically to protect fragile items by preventing movement and absorbing shocks during transit, commonly including items like bubble wrap, packing peanuts, tissue paper, or foam inserts.

Final-Mile Delivery – The final stage of shipping when a package is transported to the customer’s doorstep.

Flat-Rate Shipping – A standardized pricing for shipments determined by the packaging, such as the envelope or box, rather than the weight or dimensions of an item.

Freight Class – A standardized classification system used to determine shipping rates for LTL (less-than-truckload) shipments based on factors like weight, density, handling, and liability.

FTL (Full Truckload) – A shipping method where a full truck is used solely for one shipment or one type of cargo.

G

General Rate Increase (GRI) – Annual adjustments to shipping rates made by carriers to account for changing demand, market conditions, and operating costs.

Goods-to-Person (GTP) Automation – Automation that delivers inventory to workers instead of requiring them to walk through warehouses to retrieve items.

I

Item Master Data – A record of information containing crucial product data such as dimensions and weight.

J

Just-in-Time Fulfillment – A method where orders are packed and shipped only as needed, reducing excess inventory.

L

Liquid Fill – An outdated cartonization method used in ERP, WMS, and OMS systems that calculates the total cubic volume of items in an order and "pours" them into the smallest available box. This method often leads to wasted space and higher shipping costs.

Load Planning – The process of organizing shipments or cargo to maximize space efficiently, ensuring a more efficient delivery.

LTL (Less-than-Truckload) – A shipping method where a single truck carries multiple smaller shipments from different shippers, rather than one full truckload for a single shipment.

M

Master Carton – A large shipping container designed to hold multiple units of product, providing added protection, stability, and efficiency during handling, storage, and transportation.

Multi-Carrier Shipping – The practice of using multiple carriers to optimize costs and delivery times.

N

Nested Packing – Also, known as “Nesting” is a method of packing smaller items inside larger ones to save space.

O

O2C (Order-to-Cash) – The end-to-end business process that begins when a customer places an order and ends when a payment is received.

OMS (Order Management System) – A system that streamlines order processing, inventory tracking, and customer service across multiple sales channels. It manages the entire order lifecycle, from order creation to fulfillment and returns.

On-Demand Packaging System – A system that integrates right-sizing technology, equipment, materials, and services to create custom-sized packaging in real-time.

Omnichannel Fulfillment – A strategy that enables shipping from multiple sources, such as brick-and-mortar stores, and warehouses, to meet customer demand.

Order Consolidation – Combining multiple orders into a single shipment to reduce costs.

P

P2G (Person-to-Goods) Automation – A semi-automated picking method where technology assists workers in locating and retrieving items, but the picker still physically travels to pick the located item.

Packing Rules – Guidelines used to determine how items should be packed together to ensure a safe and secure delivery.

Packing Station – A designated area equipped with the necessary materials, tools, and equipment where orders are packed for shipping.

Packaging Materials – The materials used to protect products during shipping, such as boxes, dunnage, and tape.

Packout – The process of preparing orders to be shipped to a customer, which includes gathering the correct items, placing them in packaging, and creating necessary paperwork, essentially completing the final steps before a product leaves the warehouse or store for delivery to the customer.

Palletization – The process of effectively stacking goods on pallets for transport and handling.

Parcel Packing Intelligence Platform – A software solution designed with advanced algorithms to optimize the way orders are packed for shipping. It considers complex business rules, item and carton limits, and dimensions, and incorporates a patented cost-awareness layer that drives optimal carton choice decisions.

Parcel Shipping – The shipment of individual packages via carriers rather than freight.

R

Rate Shopping – Comparing carrier rates and overall shipping costs across different carriers to get the best price for package delivery.

Reverse Logistics – The process of handling returns and refurbishments, including repackaging and reshipping products.

Right-Sized Packaging – Selecting the ideal box size for an order to improve efficiency and reduce waste. Right-sizing can be achieved by selecting the best box, bag, or mailer, or by using on-demand packaging.

S

SIOC (Ships In Its Own Container) – When a product is packaged in a ready-to-ship container, allowing it to be sent directly to the customer without additional packaging.

SKUs (Stock Keeping Units) – A unique, scannable identifier used in inventory and fulfillment systems to track, manage, and distinguish between products.

Small Parcel Shipping – Small individual packages weighing under 70 pounds that shippers send through regular carriers (e.g. FedEx, UPS, USPS).

T

Transportation Management System (TMS) – Software that helps manage shipping operations, including carrier selection, route optimization, and freight tracking.

V

Void Fill – Packing materials like air pillows or paper used to prevent items from shifting inside a box.

Volume Utilization – The percentage of available space within a box or container that is actually filled with a product.

W

WMS (Warehouse Management System) – Software used to manage warehouse operations such as inventory, picking, packing, and shipping within a warehouse.

Z

Zone-Based Shipping – A carrier pricing model where shipping costs and delivery times are determined based on geographical areas (zones) that carriers use to calculate rates. Zones vary by carrier, region, and country.

Understanding key supply chain and shipping terminology enables you to make smarter, and more cost-effective packing decisions. Every definition in this guide, from cartonization to dimensional weight, plays a role in building a more efficient and sustainable shipping operation.

At Paccurate, we know that better item data leads to better packing. That’s why we’ve partnered with Cubiscan, whose advanced dimensioning technology ensures accurate item data from the start. When combined with Paccurate’s parcel packing intelligence platform, this data drives smarter box selection and packing, lowering transportation costs, and reducing waste.

Whether you’re optimizing an existing fulfillment strategy or just starting to modernize your packing processes, having the right tools and knowledge makes all the difference. By leveraging accurate item data and intelligent cartonization, businesses can turn their shipping operations into a true competitive advantage.