Perpetual Inventory
An inventory record keeping system where each transaction in and out is recorded and a new balance is computed.

Package to Order
A production environment in which a good or service can be packaged after receipt of a customer order. The item is common across many different customers; packaging determines the end product.

Packing List
List showing merchandise packed and all particulars. Normally prepared by shipper but not required by carriers. Copy is sent to consignee to help verify shipment received. The physical equivalent of the electronic Advanced Ship Notice (ASN).

Pallet
The platform which cartons are stacked on and then used for shipment or movement as a group. Pallets may be made of
wood or composite materials.

Parcel Shipment
Parcels include small packages like those typically handled by providers such as UPS and FedEx.

Pareto
A means of sorting data for example. For example, number of quality faults by frequency of occurrence. An analysis that compares cumulative percentages of the rank ordering of costs, cost drivers, profits or other attributes to determine whether a
minority of elements have a disproportionate impact.
Another example, identifying that 20 percent of a set of independent variables is responsible for 80 percent of the effect. Also see: 80/20 Rule

Part standardization
A program for planned elimination of superficial, accidental, and deliberate differences between similar parts in the interest of reducing part and supplier proliferation.
A typical goal of part standardization is to reduce costs by reducing the number of parts that the company needs to manage.

Period Order Quantity
A lot-sizing technique under which the lot size is equal to the net requirements for a given number of periods, e.g., weeks into the future.
The number of periods to order is variable, each order size equalizing the holding costs and the ordering costs for the interval. Also see: Discrete Order Quantity, Dynamic Lot Sizing

Periodic Review System
See Fixed Reorder Cycle Inventory Model 

Piggyback
Terminology used to describe a truck trailer being transported on a railroad flatcar.

Planning Horizon
The amount of time a plan extends into the future. For a master schedule, this is normally set to cover a minimum of cumulative lead time plus time for lot sizing low-level components and for capacity changes of primary work centers or of key suppliers.
For longer term plans the planning horizon must be long enough to permit any needed additions to capacity. Also see: Cumulative Lead Time, Planning Time Fence

Postponement
The delay of final activities (i.e., assembly, production, packaging, etc.) until the latest possible time. A strategy used to eliminate excess inventory in the form of finished goods which may be packaged in a variety of configurations.

Procurement
The business functions of procurement planning, purchasing, inventory control, traffic, receiving, incoming inspection, and salvage operations. Synonym: Purchasing.

Public warehouse
A business that provides short or long-term storage to a variety of businesses usually on a month-to-month basis. A public warehouse will generally use their own equipment and staff however agreements may be made where the client either buys or subsidizes equipment.

Public warehouse fees are usually a combination of storage fees (per pallet or actual square footage) and transaction fees (inbound and outbound). Public warehouses are most often used to supplement space requirements of a private warehouse. See also Contract warehouse and 3PL

Pull or Pull-through distribution
Supply-chain action initiated by the customer. Traditionally, the supply chain was pushed; manufacturers produced goods and "pushed" them through the supply chain, and the customer had no control.
In a pull environment, a customer's purchase sends replenishment information back through the supply chain from retailer to distributor to manufacturer, so goods are "pulled" through the supply chain

The Pareto Analysis (aka the 80:20 rule) is a logistical tool often used in inventory control. It runs on the idea that 80% of a factor (eg: problems, stock value) is caused by 20% of a factor. It is a helpful analysis tool for focusing on the important factors at hand.

post tender negotiation

A Post Tender Negotiation (PTN) is highly recommended as part of the tendering process, where contracts are going to be for more than a year.

price and cost

Price and Cost have different meanings, yet are often confused.

Cost is the total of the individual costs that make up an product or service (eg: labor, materials).

Price is what the product/service is sold for in the market.

privity of contract

Privity of Contract refers to the general rule that only parties to a contract can acquire rights and liabilities under that contract.  Therefore a third party would generally not be able to enforce a contract term, or sue for breach of contract, because they are not "privy" to the contract.

pro-forma invoice

A Pro-Forma Invoice is prepared by the supplier, prior to shipment of goods, to inform the buyer of product details, values, and quantities. It is similar, if not exactly what the official invoice will look like, and is mainly for the buyers information to assists in preparation.

Probity

Probity in Procurement is the confirmed integrity, honesty and transparency across all Procurement functions and processes.

Eg: In tendering, Probity includes treating all bidders with fairness, and having an open and transparent process.

procurement definition

Procurement is a strategic process of procuring goods and/or services, to achieve the best 'Cost, Quality, and Time' results for the organization.

The Procurement function involves high levels of negotiation, sourcing, and contract skills.

Purchase Order

A Purchase Order refers to the contractual document that is raised on the supplier (usually by the Purchasing/Procurement Officer). It is sent electronically or faxed, and specifies the

product/services required
freight method
required date,
delivery address, and
terms and conditions of purchase.

It is best practice that a Purchase Order is raised before any service is performed or goods delivered.

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