Ecommerce Ecommerce Logistics & Fulfillment 2 — Questions and Answers
Question 1: What is a shipping carrier's 'dimensional weight' (DIM weight) pricing model?
- Charging based on the package's size if its volume exceeds the actual weight, whichever is greater (Correct answer)
- Charging a flat fee based on the package's declared value
- Charging based solely on the distance the package travels
- Offering a discount when multiple packages ship to the same address
Correct answer: Charging based on the package's size if its volume exceeds the actual weight, whichever is greater
DIM weight is calculated from package dimensions and used when it exceeds actual weight, preventing merchants from shipping large lightweight items cheaply.
Question 2: What is a return merchandise authorization (RMA) in ecommerce?
- A pre-approved code the customer receives before sending back an item, allowing the merchant to track and process the return (Correct answer)
- A refund processed directly to the customer's bank account
- A re-stocking fee charged to the customer
- An automated label printed by the warehouse
Correct answer: A pre-approved code the customer receives before sending back an item, allowing the merchant to track and process the return
An RMA system helps merchants manage returns systematically by assigning tracking numbers to returned items before they arrive at the warehouse.
Question 3: What is zone-based shipping pricing?
- Shipping costs increase with the geographic distance (number of carrier zones) between the origin and destination (Correct answer)
- Pricing based on the total weight of all packages shipped in a month
- A flat-rate structure that does not change regardless of distance
- Discounts applied when shipping to multiple addresses in the same zip code
Correct answer: Shipping costs increase with the geographic distance (number of carrier zones) between the origin and destination
US carriers divide the country into shipping zones (1–8 from the origin warehouse), with costs rising as the package crosses more zones.
Question 4: What is inventory turnover ratio and why does a high ratio indicate efficient operations?
- Cost of goods sold ÷ Average inventory — a high ratio means inventory sells quickly with less cash tied up in stock (Correct answer)
- Total orders ÷ Total SKUs — higher means more popular products
- Total refunds ÷ Total orders — lower means fewer returns
- Warehouse space used ÷ Total warehouse capacity
Correct answer: Cost of goods sold ÷ Average inventory — a high ratio means inventory sells quickly with less cash tied up in stock
A high inventory turnover ratio signals that products sell quickly, reducing storage costs and the risk of obsolete stock.
Question 5: What is cross-docking in ecommerce logistics?
- Transferring incoming shipments directly to outbound trucks with minimal or no storage time in the warehouse (Correct answer)
- Moving products between two competing 3PL warehouses
- Combining two separate customer orders into one shipment
- Shipping internationally through a bonded customs warehouse
Correct answer: Transferring incoming shipments directly to outbound trucks with minimal or no storage time in the warehouse
Cross-docking eliminates most warehousing time by unloading supplier shipments and immediately loading them onto delivery vehicles, reducing storage costs.
Question 6: What is the difference between 'in-stock rate' and 'fill rate' in ecommerce fulfillment?
- In-stock rate measures how often products are available; fill rate measures what percentage of order demand was actually shipped (Correct answer)
- They are synonymous metrics used interchangeably
- In-stock rate measures warehouse capacity; fill rate measures carrier on-time delivery
- Fill rate tracks returned items; in-stock rate tracks new arrivals
Correct answer: In-stock rate measures how often products are available; fill rate measures what percentage of order demand was actually shipped
In-stock rate is a snapshot of availability, while fill rate measures operational execution — the proportion of ordered units successfully shipped.
Ecommerce Ecommerce Logistics & Fulfillment 2
What is a shipping carrier's 'dimensional weight' (DIM weight) pricing model?