CEC Supply Chain & Fulfillment 2 — Questions and Answers
Question 1: What is 'dropshipping' in the context of ecommerce fulfillment?
- Shipping damaged goods back to suppliers
- Selling products without holding inventory, where the supplier ships directly to the customer (Correct answer)
- Reducing shipping costs by consolidating orders
- Dropping off parcels at third-party pickup points
Correct answer: Selling products without holding inventory, where the supplier ships directly to the customer
Dropshipping allows retailers to sell products without holding stock, as the supplier fulfills orders directly to the end customer.
Question 2: Which metric measures the percentage of orders shipped complete and on time without damage or errors?
- Order Fill Rate
- Perfect Order Rate (Correct answer)
- On-Time Delivery Rate
- Inventory Turnover
Correct answer: Perfect Order Rate
The Perfect Order Rate measures the percentage of orders delivered complete, on time, undamaged, and with accurate documentation.
Question 3: A 3PL (Third-Party Logistics) provider typically offers which combination of services?
- Manufacturing, design, and marketing
- Warehousing, transportation, and fulfillment (Correct answer)
- Payment processing, customer service, and returns
- Sourcing, procurement, and supplier vetting
Correct answer: Warehousing, transportation, and fulfillment
3PLs specialize in outsourced logistics services including warehousing, pick-and-pack, and transportation management.
Question 4: What is 'safety stock' in inventory management?
- Stock held in a fireproof warehouse
- Extra inventory kept to prevent stockouts due to demand variability or supply delays (Correct answer)
- Recalled or defective products awaiting disposal
- Products reserved for loyal customers only
Correct answer: Extra inventory kept to prevent stockouts due to demand variability or supply delays
Safety stock is buffer inventory maintained to protect against unexpected demand spikes or supplier lead time variability.
Question 5: Which fulfillment strategy involves stocking inventory in multiple warehouses closer to end customers?
- Centralized fulfillment
- Cross-docking
- Distributed fulfillment (Correct answer)
- Just-in-time fulfillment
Correct answer: Distributed fulfillment
Distributed fulfillment places inventory in regional warehouses to reduce shipping distances and delivery times.
Question 6: What does 'backorder' mean in an ecommerce fulfillment context?
- An order placed by a returning customer
- An order for an out-of-stock item that will ship when inventory is replenished (Correct answer)
- A duplicate order flagged for cancellation
- An order shipped to a wrong address that must be redirected
Correct answer: An order for an out-of-stock item that will ship when inventory is replenished
A backorder allows customers to purchase currently unavailable items, with fulfillment promised once stock is restored.
Question 7: Which shipping incoterm means the seller is responsible for all costs and risks until the goods are delivered to the buyer's named destination?
- EXW (Ex Works)
- FOB (Free on Board)
- DDP (Delivered Duty Paid) (Correct answer)
- CIF (Cost, Insurance, Freight)
Correct answer: DDP (Delivered Duty Paid)
DDP places maximum obligation on the seller, who covers all costs including duties and taxes until delivery at the buyer's location.
CEC Supply Chain & Fulfillment 2
What is 'dropshipping' in the context of ecommerce fulfillment?