Manufacturing Glossary

A manufacturing process that builds parts layer by layer from digital files, using materials like plastic, resin, metal, or nylon. Ideal for prototyping and very low-volume production with no tooling required.

A statistical sampling system that defines the maximum acceptable defect rate in a production batch. AQL tables specify how many units to inspect and how many defects are allowed based on batch size.

A legal document issued by the carrier (shipping line) that serves as a receipt for goods, a contract of carriage, and a document of title. It is one of the most important documents in international shipping.

A comprehensive list of all raw materials, components, sub-assemblies, and quantities needed to manufacture a finished product. The BOM is the foundation of cost estimation and production planning.

A manufacturing process for creating hollow plastic parts by inflating a heated plastic tube (parison) inside a mold cavity using air pressure. Used for bottles, containers, and hollow shapes.

A customs-approved storage facility where imported goods can be stored without paying duties or taxes until they are withdrawn for domestic consumption, re-exported, or destroyed.

A mandatory conformity marking for products sold in the European Economic Area (EEA), indicating compliance with EU health, safety, and environmental protection legislation. Required for electronics, toys, machinery, medical devices, and many other product categories.

A subtractive manufacturing process where computer-controlled cutting tools remove material from a solid block (billet) to create a finished part. CNC offers exceptional precision and works with metals, plastics, and wood.

US federal law establishing safety standards for consumer products, with especially strict requirements for children's products including lead limits, phthalate restrictions, and mandatory third-party testing.

An Incoterm where the seller pays for the cost of goods and freight to the named destination port. Unlike CIF, insurance is not included and must be arranged by the buyer.

An informal abbreviation for Cost and Freight (CFR). Often used colloquially by suppliers and on trading platforms, but the official ICC Incoterm code is CFR.

An Incoterm where the seller pays for cost of goods, insurance, and freight to the named destination port. Risk transfers to the buyer once goods are loaded on the vessel at origin.

A licensed professional authorized to clear goods through customs on behalf of importers. In the US, customs brokers must hold a federal license and are responsible for correctly classifying goods, calculating duties, and ensuring regulatory compliance.

An Incoterm where the seller delivers goods to a named destination, ready for unloading. The buyer is responsible for import clearance, duties, and unloading.

An Incoterm where the seller bears all costs and risks of delivering goods to the buyer's named destination, including import duties and taxes.

Charges imposed by the shipping line when a container stays at the port terminal beyond the allotted free days after vessel discharge. Demurrage fees escalate rapidly and can cost hundreds of dollars per day.

A patent that protects the ornamental appearance (shape, configuration, surface decoration) of a functional item. Lasts 15 years in the US and is faster and cheaper to obtain than a utility patent.

Charges imposed by the shipping line when an empty container is not returned to the designated depot within the allotted free days after being picked up from the port. Distinct from demurrage, which is charged at the port terminal.

A manufacturing process where molten metal is forced under high pressure into a reusable steel mold (die) to produce complex-shaped metal parts with high dimensional accuracy and smooth surface finish.

A refund of customs duties paid on imported goods that are subsequently exported, either in their original form or as part of a manufactured product. A powerful cost recovery tool for brands that sell internationally.

A financial arrangement where a trusted third party holds payment funds until both buyer and seller have fulfilled their contractual obligations. Common in high-value transactions where mutual trust is limited.

An Incoterm where the seller makes goods available at their premises. The buyer bears all costs and risks from the factory door onward, including export clearance.

A manufacturing process where material is pushed through a shaped opening (die) to create objects with a continuous cross-sectional profile, like pipes, tubes, channels, and weather stripping.

Meeting the requirements of the US Food and Drug Administration for products under its jurisdiction, including food-contact materials, cosmetics, dietary supplements, medical devices, and pharmaceutical products.

A thorough inspection of the very first production units off the line before mass production begins. FAI verifies that the factory can produce your product correctly and catches problems before they multiply across thousands of units.

An Incoterm where the seller delivers goods, cleared for export, to a carrier nominated by the buyer at a named place. Risk transfers at the point of handoff to the carrier.

An Incoterm where the seller delivers goods on board the vessel at the named port of shipment. Risk transfers from seller to buyer once goods pass the ship's rail.

A logistics company that arranges international shipping on your behalf, handling booking cargo space, documentation, customs brokerage, and coordinating the door-to-door movement of your goods.

A shipping method where you rent an entire container (20-foot or 40-foot) exclusively for your goods. More cost-effective than LCL for larger shipments and offers faster transit times with lower damage risk.

An international product classification system using 6-digit codes standardized by the World Customs Organization. The first 6 digits are universal; countries add additional digits for national tariff and statistical purposes.

The US system for classifying imported goods and determining applicable duty rates. Every imported product is assigned an HTS code that determines how much customs duty you pay.

A set of 11 internationally recognized trade terms published by the International Chamber of Commerce (ICC) that define the responsibilities, costs, and risks between buyers and sellers in international transactions.

A manufacturing process where molten plastic is injected under high pressure into a steel or aluminum mold cavity, then cooled to form a solid part. It is the most common process for producing plastic components at scale.

The legal framework for protecting your creative works, inventions, designs, and brand assets from unauthorized use. For product businesses, IP protection includes patents, trademarks, design rights, and trade secrets.

The international standard for Quality Management Systems specific to medical device manufacturing. Required for factories producing medical devices intended for regulated markets like the US and EU.

The international standard for Quality Management Systems (QMS). An ISO 9001 certified factory has documented processes for consistent quality, but certification alone does not guarantee product quality.

The total cost of a product delivered to your warehouse, including the product price, shipping, insurance, customs duties, customs broker fees, and drayage. The true cost you must use for pricing and margin calculations.

A shipping method where your cargo shares a container with goods from other shippers. Used when your shipment is too small to fill a full container, typically under 15 cubic meters.

A financial instrument issued by a bank guaranteeing the seller will receive payment as long as the terms and conditions specified in the letter of credit are met. Provides security for both buyer and seller in international transactions.

The smallest number of units a manufacturer will produce in a single order. MOQs exist because factories need minimum volumes to justify setup costs, material purchases, and production line time.

Payment terms where the full invoice amount is due 30 days after the goods are shipped or received. A sign of strong buyer-supplier trust and beneficial for the buyer's cash flow.

A legal contract that establishes a confidential relationship between parties, preventing the recipient from sharing proprietary information like product designs, business plans, and trade secrets with third parties.

A manufacturer that designs and produces products which buyers can purchase and rebrand under their own label. The factory owns the base design, though minor customizations are usually available.

A manufacturer that produces goods based on the buyer's specifications and design. The buyer owns the design and IP, while the factory provides manufacturing capability.

The destination port where goods are unloaded from the ocean vessel. Choosing the right POD affects your total logistics cost, customs clearance speed, and last-mile delivery time to your warehouse.

The port where goods are loaded onto the ocean vessel at the origin country. The choice of POL affects freight costs, transit times, and under FOB terms, is where risk typically transfers from seller to buyer.

A quality inspection conducted when production is 80-100% complete, using AQL sampling to determine whether the batch meets quality standards before it ships. The last line of defense before goods leave the factory.

The process of inspecting products during and after manufacturing to ensure they meet specifications. QC includes incoming material inspection, in-process checks, and final random sampling before shipment.

An EU regulation governing the use of chemical substances in products sold in Europe. REACH applies to all physical products (not just electronics) and restricts over 200 Substances of Very High Concern (SVHCs).

A formal document sent to manufacturers requesting pricing, lead times, and terms for producing a specific product. A well-prepared RFQ dramatically improves the quality and speed of supplier responses.

An EU directive restricting the use of specific hazardous materials (lead, mercury, cadmium, etc.) in electrical and electronic equipment. RoHS compliance is required for selling electronics in the EU and is widely adopted globally.

A unique identifier for each distinct product variant in your inventory. Each combination of product, size, color, and material gets its own SKU for tracking and management purposes.

A manufacturing process where a plastic sheet is heated until pliable, then formed over a mold using vacuum, pressure, or both. Used for packaging trays, clamshells, and large thin-walled parts.

The molds, dies, jigs, and fixtures required to manufacture a specific product. Tooling is typically a one-time upfront cost that enables mass production of your custom design.

Alibaba's built-in payment protection program that safeguards buyers when orders placed through the platform are not shipped on time or do not meet quality standards specified in the contract.

Confidential business information that provides a competitive advantage, such as proprietary formulas, manufacturing processes, supplier lists, or customer data. Protected through secrecy rather than registration.

A registered symbol, word, phrase, logo, or combination that identifies and distinguishes your brand's goods from those of others. Trademarks protect brand identity and can last indefinitely with proper maintenance.

Safety certification from Underwriters Laboratories (UL) for products that involve electrical components, fire risk, or safety-critical applications. While not legally required, UL certification is effectively mandatory for retail distribution in the US.

A patent that protects how a product works -- its functional aspects, mechanisms, processes, or composition. Provides the strongest form of patent protection but is more expensive and time-consuming to obtain than a design patent.

An electronic bank-to-bank payment (also called Telegraphic Transfer or T/T) that is the most common payment method for international manufacturing orders. Typically structured as a deposit before production and balance before shipment.