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Supply Chain and Logistics Terms and Glossary
Zone of rate flexibility: Railroads are permitted to raise rates by a percentage increase in the railroad cost index determined by the ICC; rates may be raised by 6% per year through 1984 and 4% thereafter.
Zone of rate freedom: Motor carriers are permitted to raise or lower rates by 10% in one year without ICC interference; if the rate change is within the zone of freedom, the rate is presumed to be reasonable.
Zone of reasonableness: A zone or limit within which air carriers are permitted to change rates without regulatory scrutiny; if the rate change is within the zone, the new rate is presumed to be reasonable.
Zone Picking: A method of subdividing a picking list by areas within a storeroom for more efficient and rapid order picking. A zone-picked order must be grouped to a single location and the separate pieces combined before delivery or must be delivered to different locations, such a work centers. Also see: Batch Picking
Zone price: The constant price of a product at all geographic locations within the zone.
Zone Skipping: For shipments via the US Postal Service, depositing mail at a facility one or more zones closer to the destination. This option would benefit customers operating in close proximity to a zone border or shipping sufficient volumes to offset additional transportation costs.
Download the entire glossary in pdf format (1.2MB).
Definitions compiled by Supply Chain Visions, Bellevue, WA, www.scvisions.com. Updated May 2009.
Please note: The Center for Value Chain Research (CVCR) does not take responsibility for the content of these definitions, nor does the CVCR endorse these as official definitions except as noted.