Shipping, Fulfillment & Logistics Flashcards

What is dropshipping in ecommerce?

Answer: A fulfillment model where the retailer sells products without holding inventory, shipping directly from the supplier

In dropshipping, the retailer never holds inventory; instead, when an order is placed, the supplier ships the product directly to the customer.

What does 'fulfillment by Amazon' (FBA) mean for third-party sellers?

Answer: Amazon stores, picks, packs, and ships the seller's products from its fulfillment centers

FBA allows third-party sellers to store their products in Amazon's fulfillment centers, where Amazon handles packing, shipping, and customer service for those items.

What is the purpose of a 3PL (third-party logistics) provider in ecommerce?

Answer: To handle warehousing, order fulfillment, and shipping on behalf of ecommerce businesses

A 3PL provider outsources warehousing, picking, packing, and shipping operations for ecommerce businesses, allowing merchants to scale without managing logistics infrastructure.

What is a landed cost in international ecommerce shipping?

Answer: The total cost of a product including purchase price, shipping, customs duties, and taxes

Landed cost encompasses the total cost of getting a product to the buyer, including product price, freight, insurance, customs duties, and import taxes.

What does SKU stand for in ecommerce inventory management?

Answer: Stock Keeping Unit

A SKU (Stock Keeping Unit) is a unique identifier assigned to each distinct product variant to track inventory and streamline order fulfillment.

Which shipping strategy offers customers free shipping by embedding the cost in the product price?

Answer: Price-inclusive free shipping

Price-inclusive free shipping absorbs shipping costs into the product's retail price, so customers see 'free shipping' while the merchant recovers costs through pricing.