Glossary of manufacturing and import terms

What AQL means in inspection, why a lot that passes can hold more defects than its AQL, how a sampling plan is chosen, and how to set AQLs in an order.

A bill of lading is the carrier's receipt for your cargo and evidence of the shipping contract. Negotiable vs straight bills, house vs master, what to check.

What cGMP means: the FDA rules for food, supplement and drug plants, what the C for current adds, and what to ask about a factory that says it follows cGMP.

CIF (cost, insurance and freight) means the seller pays freight and minimum insurance to your port, while the risk passes to you once goods are on board.

What a co-packer is, what FDA rules require of the plant, whose name goes on the label, and what a co-packing quote covers for a food or beverage brand.

What a contract manufacturer does, how it differs from private label, what FDA and EU rules expect of brands that outsource production, and how to find one.

DDP vs DAP under Incoterms 2020: both deliver to your door at the seller's risk, but only DDP has the seller clear US customs and pay duty. When each fits.

An EXW (Ex Works) price is the seller's price for goods ready to collect, before loading, export clearance, freight and duty. With a landed cost example.

EXW vs FOB for importers: where the seller delivers, who clears export, who bears the risk at the port, and how US customs values each price, with an example.

What a factory audit is, how second-party and third-party audits differ, what quality and social audits check, and why a certificate is not an audit.

What FOB (Free on Board) means on a factory quote: where the seller delivers, when risk and freight become yours, what US customs values, and FOB vs FCA.

A freight forwarder books and coordinates the transport of your goods. What forwarders and NVOCCs do, how they are licensed, and forwarder vs customs broker.

Import duty is the tax charged on goods entering a country. How US duty rates work, why the product and origin change them, who owes it and when it is paid.

Incoterms 2020 in one chart: all eleven rules and where risk passes to you, plus who pays what in landed cost examples for FOB, FCA, CIP, DAP and DDP.

Landed cost is the full cost of getting imported goods to your warehouse: what it includes, the formula, splitting shared costs across SKUs, and an example.

What lead time means in manufacturing, the stages inside it, why a factory's quoted lead time is shorter than yours, and how to plan an overseas order by it.

What MOQ means, why minimums differ by factory, how a small first order changes your landed cost per unit, and how to ask a supplier for a lower MOQ.

OEM vs ODM explained for brands: who supplies the design, how CMT, OEM, ODM and full-package production differ, and what each model changes on your quote.

What a pre-production sample is, how it differs from a prototype and other samples, what to check before you approve it, and why it must match your order.

What private label means under US law, what the brand on the label must do for certificates, tracking marks and food labels, and what to agree up front.

Private label vs white label for a new brand: what you own, what can change, what each costs to launch, and whose name US labeling rules put on the pack.

What quality inspection is, how AQL sampling decides if a lot passes, when to inspect an overseas order, and why inspection does not replace lab tests.

What a trading company is, how it differs from a manufacturer, how US customs treats the middleman in your order, and how to tell which one you buy from.

What a manufacturer is: the industry definition, why US safety law counts importers as manufacturers, and how a factory differs from a trader or a brand.

A white label product is a finished item a manufacturer sells unbranded to several companies, each adding its own brand and taking on the duties it brings.