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Shipping and Fulfillment Terms
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Dropshipping
A retail fulfillment method where a store doesn't keep the products it sells in stock. Instead, when a store sells a product, it purchases the item from a third party and has it shipped directly to the customer. Dropshipping allows e-commerce businesses to operate without maintaining inventory, owning a warehouse, or physically handling the products.
SKU
Stock Keeping Unit, a unique code consisting of letters and numbers that identifies each product in a store or warehouse. It's used to track inventory levels and sales within an e-commerce business.
Fulfillment Centers
Warehouse facilities where receiving, packing, and shipping of orders for e-commerce retailers is centralized. Fulfillment centers are used by businesses to outsource warehousing and shipping.
3PL
Third-Party Logistics, companies that provide outsourced logistics services to other businesses. These services can include transportation, warehousing, picking and packing, inventory forecasting, order fulfillment, packaging, and freight forwarding.
Last Mile Delivery
The final step of the delivery process where a package is transported from the transportation hub to the final delivery destination, typically a personal residence. This stage is key to customer satisfaction as it affects the speed and quality of delivery.
Cross-Docking
A logistics procedure where products from a supplier or manufacturing plant are distributed directly to a customer or retail chain with minimal handling or storage time, often considered as an efficient way to consolidate shipments and reduce costs.
Freight Forwarding
A service provided by a company that arranges shipments for individuals or corporations to get goods from the manufacturer to a market, customer, or final point of distribution. Freight forwarders act as intermediaries between shippers and various transportation services.
Reverse Logistics
The process of moving goods from their final destination for the purpose of capturing value, or proper disposal. This includes processes related to the return of products, reuse of materials, end-of-life recycling, and warranty recovery.
Deadstock
Products that have never been sold to or used by customers, often because they are outdated, out of season, or no longer in demand. Deadstock can tie up capital and storage space for businesses, prompting better inventory forecasting.
White Label Products
Products that are produced by one company and then labeled with another company's brand. In e-commerce, this allows retailers to sell products without having to invest in developing the product themselves.
FBA
Fulfillment by Amazon, a service provided by Amazon where third-party sellers store their products in Amazon's fulfillment centers. Amazon takes care of storage, packaging, and shipping to customers, as well as customer service and returns handling.
Supply Chain Management
The management of the flow of goods and services, involving the movement and storage of raw materials, of work-in-process inventory, and of finished goods from point of origin to point of consumption. Effective supply chain management is crucial for timely delivery and cost efficiency in e-commerce.
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