CEC Supply Chain & Fulfillment 5 — Questions and Answers
Question 1: What is 'last-mile delivery' in ecommerce fulfillment?
- The final quality check before a product leaves the warehouse
- The last segment of the delivery journey from a local hub to the customer's door (Correct answer)
- The final mile of a long-haul freight shipment between distribution centers
- A carrier's cutoff time for same-day delivery scheduling
Correct answer: The last segment of the delivery journey from a local hub to the customer's door
Last-mile delivery is the final step in the fulfillment chain, moving goods from a local distribution point to the end customer's address.
Question 2: An ecommerce company's Days Inventory Outstanding (DIO) is 90 days. What does this indicate?
- The company takes 90 days to fulfill customer orders
- On average it takes 90 days to sell through its inventory (Correct answer)
- Products have a 90-day shelf life before expiration
- The company places supplier orders every 90 days
Correct answer: On average it takes 90 days to sell through its inventory
DIO (also called Days in Inventory) measures how many days on average inventory is held before being sold; a high DIO may indicate overstocking.
Question 3: What is a 'Warehouse Management System' (WMS) primarily designed to do?
- Manage vendor contracts and supplier negotiations
- Optimize and control warehouse operations including receiving, putaway, picking, and shipping (Correct answer)
- Process customer payments and manage refunds
- Schedule delivery driver routes for last-mile fulfillment
Correct answer: Optimize and control warehouse operations including receiving, putaway, picking, and shipping
A WMS manages all internal warehouse processes from inbound receiving to outbound shipping, optimizing labor and space utilization.
Question 4: Which method of order picking is most efficient for a high-volume ecommerce warehouse with many small orders?
- Single order picking (one order at a time per picker)
- Batch picking (picking multiple orders simultaneously in one warehouse pass) (Correct answer)
- Manual counting and paper pick lists
- FIFO picking without any system guidance
Correct answer: Batch picking (picking multiple orders simultaneously in one warehouse pass)
Batch picking allows warehouse staff to fulfill multiple orders in a single warehouse traversal, dramatically reducing travel time per order.
Question 5: What is the key advantage of using a Transportation Management System (TMS) for an ecommerce brand?
- It automates product listing across multiple sales channels
- It optimizes carrier selection, route planning, and freight costs across shipments (Correct answer)
- It manages customer loyalty programs and reward points
- It provides real-time inventory visibility across warehouse locations
Correct answer: It optimizes carrier selection, route planning, and freight costs across shipments
A TMS automates carrier rate shopping, load optimization, and shipment tracking, reducing freight costs and improving delivery performance.
Question 6: What does 'landed cost' mean when sourcing products internationally for an ecommerce business?
- The cost of the product once it lands on the top-selling category list
- The total cost of a product including purchase price, shipping, customs duties, and all fees to get it to your warehouse (Correct answer)
- The price a product is listed at after applying import markups
- The cost to land advertising placements on international marketplaces
Correct answer: The total cost of a product including purchase price, shipping, customs duties, and all fees to get it to your warehouse
Landed cost is the complete cost of acquiring a product including supplier price, international freight, import duties, insurance, and any handling fees.
Question 7: Which of the following best describes a 'vendor-managed inventory' (VMI) arrangement?
- The retailer manages the supplier's production schedule remotely
- The supplier monitors and replenishes the retailer's inventory based on agreed stock levels (Correct answer)
- Both parties share a single warehouse and manage it jointly
- The retailer holds the supplier's inventory on consignment with deferred payment
Correct answer: The supplier monitors and replenishes the retailer's inventory based on agreed stock levels
In VMI, the supplier takes responsibility for monitoring inventory levels at the retailer and triggering replenishment when stock falls below agreed thresholds.
CEC Supply Chain & Fulfillment 5
What is 'last-mile delivery' in ecommerce fulfillment?