Supply Chain and Logistics Cheat Sheet 2026
The 30 highest-yield Supply Chain and Logistics facts, distilled from real exam questions. Print it, save it as a PDF, or study it here — free, no sign-up.
- What is shrink wrap used for in warehouse operations? → Securing and stabilizing pallet loads for safe storage and transport
- What is cycle counting? → Counting a rotating subset of inventory items on a regular schedule
- Which inventory strategy reduces risk by stocking products closest to confirmed demand? → Pull strategy
- In a two-bin inventory system, what triggers a new order? → When the second bin starts being used
- What is the three-way match process in accounts payable? → Matching a purchase order, receiving report, and supplier invoice before payment
- What does 'supply chain agility' mean? → The ability to rapidly respond to changes in demand, supply, or market conditions
- When a company transfers supply chain risk to an insurer by purchasing cargo or business interruption insurance, this is an example of: → Risk transfer
- What is nearshoring in sourcing strategy? → Relocating production or sourcing to nearby countries rather than distant ones
- What does RFID technology enable in warehouse management? → Real-time tracking of items without line-of-sight scanning
- What is the primary advantage of air freight over ocean freight? → Fastest transit time for international shipments
- What is a 3PL in logistics? → Third-Party Logistics provider
- What is a forklift operator certification requirement in the US? → OSHA-required training covering safety, operation, and workplace-specific hazards
- What is safety stock used for in inventory management? → Buffer against demand variability and supply delays
- Which supply chain risk management document details the step-by-step actions teams must take when a specific risk event (e.g., port closure) occurs? → Risk response playbook (contingency plan)
- A Business Continuity Plan (BCP) in supply chain management is primarily designed to: → Ensure critical supply chain functions continue during and after a major disruption
- What does the term 'shrinkage' refer to in retail inventory? → Inventory loss due to theft, damage, or administrative error
- What is a purchase order (PO)? → A legally binding document sent to a supplier authorizing a purchase
- Which metric measures how many times inventory is sold and replaced over a period? → Inventory turnover
- Which inventory valuation method results in the lowest net income during rising prices? → LIFO
- What is the bullwhip effect in supply chains? → Increasing demand variability amplification moving upstream through a supply chain
- What is value-added services (VAS) in warehousing? → Services like labeling, kitting, or repackaging performed on goods while in the warehouse
- What is the purpose of a Request for Quotation (RFQ)? → Request pricing from suppliers for a defined quantity of specified goods or services
- What is the purpose of a Request for Proposal (RFP)? → Solicit detailed proposals from vendors for a product or service
- What is a reorder point (ROP)? → The inventory level at which a new order should be placed
- What is a reverse auction in procurement? → Suppliers compete by submitting progressively lower bids for a buyer's contract
- What is a TMS in logistics operations? → Transportation Management System
- What is cross-docking? → Transferring inbound shipments directly to outbound transport with minimal storage
- Which shipping term means the seller bears all costs and risks until goods are delivered to the buyer's named place? → DDP
- A supply chain resilience strategy that uses multiple geographically dispersed suppliers for the same component is known as: → Dual/multi-sourcing
- What is the formula for Days Inventory Outstanding (DIO)? → (Average Inventory / COGS) × 365
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