CES Shipping, Fulfillment & Logistics 1 — Questions and Answers
Question 1: What is dropshipping in ecommerce?
- A fulfillment model where the retailer sells products without holding inventory, shipping directly from the supplier (Correct answer)
- A method of discounting products that have been dropped from the catalog
- A carrier service for heavy freight shipments
- A returns processing model where customers drop off items at retail locations
Correct 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.
Question 2: What does 'fulfillment by Amazon' (FBA) mean for third-party sellers?
- Amazon stores, picks, packs, and ships the seller's products from its fulfillment centers (Correct answer)
- Amazon handles customer service and returns only
- Amazon provides marketing services for third-party sellers
- Amazon purchases inventory directly from third-party sellers
Correct 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.
Question 3: What is the purpose of a 3PL (third-party logistics) provider in ecommerce?
- To handle warehousing, order fulfillment, and shipping on behalf of ecommerce businesses (Correct answer)
- To provide third-party payment processing for online stores
- To manage customer service and returns only
- To develop ecommerce websites for retailers
Correct 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.
Question 4: What is a landed cost in international ecommerce shipping?
- The total cost of a product including purchase price, shipping, customs duties, and taxes (Correct answer)
- The cost of shipping a product to a domestic warehouse
- The final sale price after all discounts are applied
- The cost of landing page optimization for international markets
Correct 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.
Question 5: What does SKU stand for in ecommerce inventory management?
- Stock Keeping Unit (Correct answer)
- Sales Key Unit
- Standard Kit Upgrade
- Supply Knowledge Update
Correct 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.
Question 6: Which shipping strategy offers customers free shipping by embedding the cost in the product price?
- Price-inclusive free shipping (Correct answer)
- Flat-rate shipping
- Real-time carrier shipping
- Threshold-based free shipping
Correct 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.
CES Shipping, Fulfillment & Logistics 1
What is dropshipping in ecommerce?