Supply Chain & Fulfillment Flashcards

What is 'dropshipping' in the context of ecommerce fulfillment?

Answer: Selling products without holding inventory, where the supplier ships directly to the customer

Dropshipping allows retailers to sell products without holding stock, as the supplier fulfills orders directly to the end customer.

Which metric measures the percentage of orders shipped complete and on time without damage or errors?

Answer: Perfect Order Rate

The Perfect Order Rate measures the percentage of orders delivered complete, on time, undamaged, and with accurate documentation.

A 3PL (Third-Party Logistics) provider typically offers which combination of services?

Answer: Warehousing, transportation, and fulfillment

3PLs specialize in outsourced logistics services including warehousing, pick-and-pack, and transportation management.

What is 'safety stock' in inventory management?

Answer: Extra inventory kept to prevent stockouts due to demand variability or supply delays

Safety stock is buffer inventory maintained to protect against unexpected demand spikes or supplier lead time variability.

Which fulfillment strategy involves stocking inventory in multiple warehouses closer to end customers?

Answer: Distributed fulfillment

Distributed fulfillment places inventory in regional warehouses to reduce shipping distances and delivery times.

What does 'backorder' mean in an ecommerce fulfillment context?

Answer: An order for an out-of-stock item that will ship when inventory is replenished

A backorder allows customers to purchase currently unavailable items, with fulfillment promised once stock is restored.

Which shipping incoterm means the seller is responsible for all costs and risks until the goods are delivered to the buyer's named destination?

Answer: DDP (Delivered Duty Paid)

DDP places maximum obligation on the seller, who covers all costs including duties and taxes until delivery at the buyer's location.