FMCG Export & Trade Glossary
Plain-English definitions of the terms that appear on a quotation, a pro-forma and a shipping file — written for buyers who have to act on them.
Trade vocabulary is usually learned expensively, one misunderstanding at a time: a buyer asks for a EUR.1 into a market with no EU agreement, reads DAP as duty paid, or finds out what detention costs a fortnight after the vessel berthed. Each entry gives the definition and why it matters commercially. Terms run A–Z, each with its own anchor.
Where a rule genuinely varies between carriers, destinations or agreements, it says so. Longer treatments live in the document-by-document export reference, the guide to choosing a delivery term and the pallet and container loading reference.
A
Ambient — Stable at ordinary warehouse and container temperatures, needing no refrigeration. Most of a wholesale FMCG range is ambient, which is why mixed loads consolidate cheaply — but ambient is not the same as indifferent to heat, as chocolate lines prove on an equatorial routing.
B
Batch code / lot code — The manufacturer's production identifier on the pack, tying a unit back to a production run. It is what makes a recall answerable in days rather than never, so ask that coding stays legible on the outer carton.
Best-before date (BBD) — The minimum-durability date. Under EU food information rules (Regulation (EU) No 1169/2011) it differs from a use by date, which is a safety instruction on highly perishable food. A BBD speaks to quality, not safety — a distinction worth holding on ambient grocery lines.
Bill of lading (B/L) — The ocean carrier's receipt and contract of carriage. In negotiable form it is a document of title: cargo is released against surrender of an original, so originals must physically reach whoever collects.
Bonded warehouse — Shorthand for a customs storage procedure. Duty and import VAT are suspended, not cancelled: the debt crystallises on release and never arises if goods are re-exported. What bond does and does not fix is worth reading first.
C
Certificate of Origin — A non-preferential proof stating where goods were produced, issued in the EU by chambers of commerce. It evidences origin only — not authenticity, and not entitlement to a reduced duty rate.
CIF — Cost, Insurance and Freight. The seller pays ocean freight and places a marine policy to a named discharge port, but risk still passes when the goods are on board at loading. Worth a second look on high-value cargo such as dermo-cosmetic skincare, since the default cover is narrow.
Commercial invoice — The seller's definitive invoice for the goods shipped, and what customs values the consignment from. Its description must agree with the HS code and the packing list; disagreement between the three routinely stops cargo.
Consolidation — Building one shipment from several lines, brands or categories so a single freight cost, document set and customs entry cover all of them. How loads are assembled and routed covers the mechanics.
Cube-out — What a load does when it fills the container's internal volume with payload still unused. Most FMCG cubes out, because much of the category is air in a carton — stacked crisp canisters reach the roof long before the weight limit.
Customs value — The value duty and import taxes are assessed on at destination, built from the invoice plus, depending on the term and local rules, freight and insurance. Identical goods quoted FOB and DAP need not attract identical duty.
D
DAP — Delivered At Place. The seller carries the goods to a named address ready for unloading; import clearance, duty and taxes remain the buyer's. DAP is not duty paid, and assuming otherwise is the commonest misreading of a delivered quotation.
DDP — Delivered Duty Paid: the only Incoterms rule under which the seller clears the goods for import and bears duty and destination taxes. It requires the seller to act inside the destination's tax system, so it is quoted less often than buyers expect.
Demurrage — The charge that starts once a container has stayed inside the terminal beyond its free time. It is levied by the carrier or terminal, and accrues against the consignee whatever the reason for the delay.
Detention — The charge for keeping the carrier's equipment outside the terminal beyond free time, typically while a box is unpacked at your premises. Carriers and regions use the two words inconsistently — read your own booking tariff.
E
EORI — The number identifying every party to an EU customs operation, issued by the customs authority where the business is established. Without one, no export, import or transit declaration can be made in the Union.
EUR.1 movement certificate — A preferential proof of origin issued by the customs authorities of the exporting country where an EU trade agreement gives the destination a reduced rate. It certifies EU preferential origin, which follows where the goods were manufactured — not the nationality of the brand on the pack. A famous European brand made outside the EU does not acquire EU origin from its logo.
Exhaustion of rights — Once genuine goods are put on the EEA market by or with the trade mark owner's consent, the owner cannot use the mark to stop their onward sale within that area. It is the basis of lawful parallel trade — see genuine, grey and counterfeit compared.
EXW — Ex Works. Goods are made available at the seller's premises; loading, export declaration, haulage, terminal charges, sea leg and clearance all belong to the buyer. Lowest headline figure, longest to-do list.
F
FCL — Full Container Load: a consignment filling a box booked for it alone. Freight is charged for the container rather than its contents, which is why a half-built load costs what a full one costs.
FOB — Free On Board. The seller delivers the container to the vessel and clears it for export; risk passes once on board and the buyer holds the ocean contract. Drafted around sea carriage, so an inland handover stretches the rule.
Form M — The transaction registration a Nigerian importer raises through an authorised dealer bank before goods ship, under the Central Bank of Nigeria's regime. Everything downstream is matched against it, so pro-forma and final invoice must describe the same goods. See how a Nigerian consignment is sequenced, and confirm current procedure with the CBN.
Free time — The period a container may sit at the terminal, or with the consignee, before demurrage or detention begin. Set by carrier and terminal, it varies by port and contract.
G
Grey market — Genuine goods traded outside the channel a brand owner intended for a market. It is neither counterfeiting nor the same thing as lawful parallel trade inside the EEA. The three get conflated constantly, and the differences are legal, not rhetorical.
Groupage — Several shippers' consignments consolidated by a forwarder into one container. A cheaper entry point than a full box, at the cost of a higher unit rate, longer transit and more handling.
H
Halal attestation — Certification by a recognised body, required by several markets on food and ingredient lines. Acceptance usually turns on recognition rather than certification: the destination authority must accept the certifying body. Checked before dispatch on composed sauces and condiments.
HS code — The Harmonized System, the World Customs Organization's international product nomenclature. Its six-digit codes are used by more than two hundred countries as the basis of customs tariffs and trade statistics, with national tariffs extending them — in the EU through the Combined Nomenclature and TARIC. Classification decides duty, restrictions and certificates.
I
Importer of record — The party legally responsible for the import declaration, the duty and destination compliance. Under every Incoterms rule except DDP that party is the buyer, including under DAP.
Incoterms — The International Chamber of Commerce's eleven three-letter rules allocating cost, risk and obligation between seller and buyer. They are not payment terms, do not transfer title, and apart from CIF and CIP oblige nobody to insure. Always written with a named place and an edition, because FOB Belgium is not a contract term.
L
Landed cost — Total cost of getting goods into your warehouse: unit price, freight, insurance, duty and import taxes, brokerage, inland haulage, finance and currency cost. The only figure worth comparing between suppliers.
LCL — Less than Container Load: the part-load ocean booking, sharing a container with other shippers' cargo. Useful for testing a range, expensive as a permanent arrangement.
Letter of credit — A bank's undertaking to pay against documents complying exactly with its terms. The bank examines paper, not goods, so a wrong description or date holds payment even when the shipment is perfect.
M
MOQ — Minimum order quantity: the smallest quantity a supplier will trade a line at. It is line- and market-specific rather than one company figure, so it is confirmed on enquiry alongside availability.
MRN — Movement Reference Number, allocated by customs when a declaration is lodged. It follows the consignment and evidences that the export was properly declared.
N
Non-preferential origin — The country of origin determined where no trade agreement applies. Used for statistics, trade-defence measures and origin marking, it carries no duty benefit. This is what a chamber-issued Certificate of Origin evidences.
Notify party — The party a carrier notifies of arrival, named on the transport document beside the consignee. A licence held in one company's name and a document naming another stops the consignment.
O
Origin declaration — A statement of preferential origin made by the exporter in prescribed wording on the invoice or another commercial document, instead of a stamped certificate. Access2Markets states that for consignments up to €6,000 an exporter may issue an invoice declaration regardless of partner country, and above that only an approved exporter may. The prescribed wording is what makes it valid; a paraphrase is not.
Original manufacturer packaging — Goods in the pack the manufacturer filled and sealed, unopened and unrelabelled. It is what keeps the batch trail intact; repackaging changes both traceability and the trade mark analysis.
P
PAAR — Pre-Arrival Assessment Report, issued by the Nigeria Customs Service against a registered import transaction, carrying the classification and valuation the entry is assessed on. Issuing it before arrival is the point: a tariff-heading argument should happen while the box is at sea.
Packing list — What is in each carton and on each pallet, with quantities, marks, dimensions and weights. It is what an inspector reads at examination, and its weights must agree with the transport document rather than approximately resemble them.
Parallel import — Genuine goods imported through a channel other than the brand owner's appointed one. Inside the EEA this is lawful where rights are exhausted; outside it, the destination's own law governs.
Payload — The maximum mass a particular container may carry. It varies between builds and operators, and the governing figures are on the CSC safety-approval plate of the unit you are allocated — which is why the loading reference publishes no generic table.
Preferential origin — Origin acquired under the rules of a specific trade agreement, giving reduced or zero duty at destination. Which instrument evidences it — EUR.1, EUR-MED, an origin declaration or a REX statement on origin — is decided by the destination's agreement with the EU, not by the seller.
Pro-forma invoice — The seller's formal offer: goods, quantities, price, the delivery term with its named place, payment terms and the document set that will travel. Banks, licences and transaction registrations are raised against it, so anything vague on it stays vague downstream.
R
Reefer — A refrigerated container with its own temperature control and power supply. Very little of an ambient FMCG range needs one; where heat sensitivity is real, routing and season are usually the cheaper variables.
REX — The Registered Exporter system, under which a registered exporter self-certifies preferential origin by adding a statement on origin to a commercial document. Registrations are publicly verifiable, which is what lets a destination authority accept a self-made declaration.
S
Safety data sheet (SDS) — The standard document setting out hazards, handling, storage and transport classification for a chemical mixture, and the companion to the CLP hazard labelling carried on laundry and cleaning lines. Forwarders ask for it before the booking; aerosols and some formulations also attract dangerous-goods rules that change the declaration and sometimes the carrier.
Sea waybill — A non-negotiable ocean transport document consigned to a named party and released on proof of identity. No originals to courier, so it is faster — and it removes the payment leverage an original bill of lading gives a seller.
Shelf-life on arrival — The life a consignment has left when it reaches the buyer, after production, storage and transit have each taken a share. It decides whether a retailer will list the stock — on food especially, less so on long-dated personal care — so it belongs in writing against the quantity offered.
SONCAP — The Standards Organisation of Nigeria's conformity assessment programme, checking goods within scope against Nigerian standards through SON's appointed agent in the country of supply, before shipment. Cargo arriving without it becomes an expensive destination problem; scope is set by SON.
T
TARIC — The European Commission's integrated tariff database, giving the EU-side tariff position and the measures attached to a code. Use the destination's own customs authority for the duty you will actually be charged.
Terminal handling charges (THC) — What a terminal levies for moving a container between quay and yard, at each end of the voyage. Whether they sit inside a quoted rate depends on the delivery term and the carrier's tariff, and they differ between the two gateways we load from.
Transit procedure — A customs procedure moving goods under customs control between two points with duties, taxes and commercial policy measures temporarily suspended, so clearance happens at destination rather than at entry. In the EU, external transit covers non-Union goods and internal transit moves Union goods across a non-EU territory; both run against a guarantee.
V
VGM — Verified gross mass. Under SOLAS regulation VI/2, amended by resolution MSC.380(94) and in force since 1 July 2016, the shipper must verify a packed container's gross mass and declare it to carrier and terminal. It is established either by weighing the packed container, or by weighing the contents — pallets, dunnage and securing material included — and adding the tare, using a certified method. A verified figure is a condition of loading the box onto a ship.
W
Weight-out — What a load does when it reaches permitted payload with floor space and headroom still showing. Water, PET soft drinks and glass do it readily — bottled water by the pallet and the wider beverage range are the classic cases.
Checking a definition against the authority that owns it
A glossary is a starting point, not a ruling. Form M, PAAR, SONCAP and anything touching duty describe frameworks that get revised, and none should be relied on from a third-party page when the consequence lands at your border. For preferential origin, the European Commission's Access2Markets service is the primary source; TARIC gives the EU-side tariff position; your destination's customs authority is the only reliable source for the duty and formalities actually applied to you.
Terminology also drifts. Demurrage and detention are used inconsistently between carriers and regions, free time is contractual rather than standard, and MOQ means whatever a given supplier means by it. Where the difference costs money, the answer sits in your booking documents, not in a definition.
Putting the vocabulary to work on an actual order
Nearly all of it resolves into three questions worth settling before a pro-forma is issued: which delivery term the price is quoted on and to what named place, which proof of origin your market uses, and what the document set must contain for your clearing agent. Answer those at enquiry stage and the rest of this page is background reading. New to the corridor? The destinations already served and the questions buyers ask before a first order cover the ground practically, and how we source and who we supply explains the rest. Buyers trading regularly can open a trading account; anyone with a range in mind can send a line list for pricing.
Speak to an export desk that uses these terms daily
Send your destination, the lines you want and the delivery term you trade on — we will come back with what is available, what documents travel with it and what the shipment looks like end to end.