eCommerce Glossary Terms
Listed below are common terms within the e-commerce and fulfillment industries.
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3PL – Third-Party Logistics
Third-Party Logistics: A service provider that handles warehousing, laborers, shipping, and more on your company’s behalf.
4PL – Fourth-Party Logistics
A single point of contact that manages your supply chain for you.
A
ASN – Advanced Shipping Notification/Advance Ship Notice
A document that notifies a buyer of the pending and/or upcoming shipment. Usually sent electronically, it is a common EDI.
ASIN – Amazon Standard Identification Number
Identifying products using an alphanumeric identifier that is ten characters long, specific to Amazon.
API – Application Programming Interface
In the context of APIs, the word Application refers to any software with a distinct function. Interface can be thought of as a contract of service between two applications. This contract defines how the two communicate with each other using requests and responses.
AWB – Air Waybill
A document providing detailed information (destination, contact information, etc) about internationally shipped goods, issued by an air carrier. This is also referred to as an Airway Consignment Note.
B
B2B – Business to Business
A business model where one business sells its products or services to another business.
B2C – Business to Consumer
A business model where products or services are sold directly to the end consumer.
Barcode
Printed or electronically produced series of black lines and white spaces to represent a number with the ability to be interpreted by various types of scanning machines.
Batch Picking
The process of picking products in a warehouse in large groups.
Bins
Containers in a warehouse storage system, often where large numbers of a single product is stored. Bins may vary in shape and size.
Blind Count(ing)
Counting all items in a specific location without knowing ahead of time what the total quantity should be.
Blind Receiving
The process of getting inventory without any information related to products, quantities, shipper, purchase order (PO), supplier, or other essential information needed to streamline the inbound process.
BOM – Bill of Materials
An extensive list of raw materials used to construct a product. A BOM may contain additional notes and instructions to be used in building the final product, including, necessary quantities, types of measurements, notes to help a user better understand the building process, machinery or equipment/tools needed, or any other necessary information.
Brick and Mortar
A business operating out of a traditional, physical storefront location or office.
BRP – Best Rate Plan / Best Rate Possible
This is a rate shopping feature within Shipedge that allows the warehouse to rate show between preconfigured shipping methods and automatically selects the cheapest one.
Business Items
Nearly any product or service that a business utilizes to generate revenue (excluding real estate). Products created for sale, purchased for resale, services, or digital content are all examples of goods intended for sale to customers of the business.
C
C2C – Consumer to Consumer
A consumer sells a product or service to another consumer. The Facebook Marketplace or eBay are examples of spaces for C2C transactions to occur.
Cartonization
A process or system to determine the most efficient and cost-effective option for packaging based on the shape, weight, and volume of every picked product to be shipped.
Cloud-based
Data that is stored on a network of servers and hosted on the internet rather than on personal computers.
Consignment
The seller of an item will pay the owner the cost of the item after the item sells.
Consumer Goods
Anything intended for end-use by a customer. This does not include raw materials to be used in the production of more goods.
Corporation
A legal business entity that is separate from its owners. Corporations legally possess many rights and responsibilities in the way individuals do. Different states and laws may dictate how they’re treated.
Cross-Docking
The process of unloading products and transferring them directly from inbound to outbound transport.
Cycle Counting
The process of physically counting inventory in select areas or locations of a warehouse.
D
DC – Distribution Center
A location in the fulfillment process that processes products for delivery to other locations or end-users.
Dropshipping
A seller indirectly manages inventory after a buyer makes a purchase, the warehouse (or other location) is notified of the order by the seller and ships the product directly from the warehouse location.
DTC – Direct to Consumer
Selling a product or service to an end consumer, rather than to a business entity.
DSV – Drop Ship Vendor
Order fulfillment locations for products that are sold by certain retailers. A DSV will advertise products for sale on another business’s website, often without indicating their own business name. They stock the item, fulfill the order, and ship the product, but are not the retailer.
E
Each
A unit of measure for a single product; or the smallest unit of measure that an item can be broken down into.
E-commerce
The buying and selling of products/services electronically. These transactions occur via the internet or through an online service.
EDI – Electronic Data Interchange
Allows businesses to communicate information electronically using a standardized methodology; however, standards across different industries vary widely.
ERP – Enterprise Resource Planning System
A type of software utilized by enterprise-level organizations to manage business operations like accounting, customer services (CRM), project management, and more. Examples of ERP software include Netsuite, SAP, or Oracle.
Expiration Date Management
A method of inventory management that is dictated by the expiration date of a product. A WMS will automatically flag items at or near their expiration.
F
FBA – Fulfilled by Amazon
Orders sold by AND fulfilled by Amazon.
FBM – Fulfilled by Merchant
Orders sold by Amazon, but fulfilled by the merchant, a 3PL, or another entity.
FEFO – First Expire First Out
An inventory picking rotation style that dictates inventory that is set to expire before other inventory of the same SKU is prioritized to leave the warehouse before those set to expire at a later date. Often associated with food, drugs, or beauty products.
FIFO – First In First Out
An inventory picking rotation style that dictates inventory first entering the warehouse first is also the last to leave.
FLFO – First Lot Number First Out
An inventory picking rotation style that dictates the lot of entering the warehouse first is also the last to leave.
First-Mile Logistics
The initial stage of the supply chain process, which involves the transportation of goods from the seller to the warehouse or distribution center. Typically includes the processes of picking up goods from the manufacturer, checking them for quality and quantity, and delivering them to the warehouse.
Flow Bin
A category of bins used for the highest velocity products in the warehouse.
FTL – Full Truck Load
A shipping carrier that transports the entire contents of an at-capacity truck load of product. Commonly used for larger shipments that fill an entire truck.
Fulfillment
The processing and shipment of ordered products from the warehouse to the consumer in a timely manner. May be accomplished in a warehouse setting, but not all warehouses are fulfillment centers.
I
Integration
The connection of systems, equipment, and data among various business entities, often for the purpose of increasing efficiency by performing conversions and communication processes automatically. Software integration is commonly achieved through web APIs.
K
Kitting
Taking multiple individual SKUs and packaging them together to create a new SKU.
KPI – Key Performance Indicator
Measurable data items that can be used to determine the effectiveness of a process. KPIs vary from industry to industry and can include conversion rates, monetary growth percentages, or number of website visitors.
L
Laborer(s)
Employees (usually in a warehouse) that typically partake in physical work such as picking, packing, unloading, or racking.
Last In First Out
An inventory picking rotation style that dictates the oldest stocked inventory is the first to leave the warehouse.
LLC – Limited Liability Company
A business structure in the United States that can protect owners of the company from personal responsibilities and liabilities of the company.
LLFO – Last Lot Number First Out
An inventory picking rotation style that dictates the oldest stocked lot is the first to leave the warehouse
Last-Mile Logistics
The final stage of the supply chain process. This involves the transportation of goods from the distribution center to the end customer, including picking, packing, and delivery of goods to the customer’s doorstep.
Location
In warehousing, this can be a physical or virtual space where a product is currently stored in the supply chain.
Logistics
The coordinated movement of products through the supply chain. Involves the identification and planning of various teams’ actions as a product is procured, processed, sold, and shipped to an end-user.
Lot Control
An inventory expiration date management module that works in conjunction with a Warehouse Management System.
Lot Number
A designated number for the production of a particular quantity of material from a manufacturer. This is also referred to as a batch.
LP – Limited Partnership
A business entity formed between two or more business partners. One partner, called the general partner, manages all business operations and is typically unlimited in their liability for debt.
LTL – Less Than Truck Load
A shipping carrier that transports multiple small shipments that take up only part of the truck. Most commonly used for small shipments that cannot take up an entire truck load.
M
Market Demand
A measurement of how much product is required to meet the needs of consumers.
Manifest
A list of shipped items that includes information about the shipper, receiving destination, and method of transportation. Common items listed include shipper name and address, destination address, the number of items, a description of the items; the shipping carrier license number, name, and contact information.
Manufactured Products
Goods that have been processed and/or assembled, often for final consumption by users. Usually produced in mass quantities and processed by tooling, human labor, or machining.
MCF – Multi-Channel Fulfillment
Fulfillment through multiple channels outside of Amazon’s fulfillment services. For example, an Amazon MCF order received through a different sales channel (such as Shopify, WooCommerce, Magento, etc), but is sent to Amazon for fulfillment. These orders are shipped out of an Amazon warehouse despite originating from outside of Amazon.
N
Non-profit organization
A business entity formed for purposes other than to generate profit, such as churches, charities, or hospitals.
O
Omnichannel Order Fulfillment
A logistics strategy that enables companies to manage and deliver goods across multiple sales channels, providing a seamless shopping experience for customers. It involves centralized inventory management that tracks stock levels and order information across all channels – including physical brick-and-mortar locations.
OMS
(Order Management System): A software system (cloud-based or downloadable) used to centralize orders across multiple selling channels and manage those orders from the beginning to end of the customer and logistics lifecycles.
Online Marketplace
A space for multiple sellers to offer items for sale at the same online location. Vendors offer goods and services to consumers, and customers can place orders directly on that website.
Order Fulfillment
The process of sending your customers the orders they purchased online.
P
Packing
After the order has been picked, it is given to laborers to put the order in the proper packaging and label the box.
Packing Slip
An itemized list of products shipped, denoting the quantity of each item, name, description, and other additional information the recipient needs to verify a complete shipment.
Partnership
A business entity in which two or more parties officially agree to share liabilities and profits of a business. Some partnerships agreements may include equal ownership among all parties, others may limit benefits and liabilities with certain members.
Picking
The process of finding the correct product(s) to fulfill a customer’s order in a warehouse.
PO – Purchase Order
Often the first official record in a sales transaction of goods or services, this document may contain details regarding the quantity, anticipated delivery of products, pricing, and a description of what is expected.
POC – Proof of Concept
Evidence that an idea, process, or product can successfully be implemented. Offers valuable insight into feasibility, but may not include details regarding the ultimate goal.
POS/POP – Point of Sale/Purchase
The time/place that a retail transaction occurs.
PPS – Pick Pack and Ship
A term that encompasses the process of finding a product to send to the consumer and choosing the most appropriate packaging.
Purchased Products
Goods that have been bought by customers. In e-commerce, these goods usually remain in the possession of the seller, warehouse operator, or shipper until final delivery to the consumer.
Q
QA – Quality Assurance
Proactive methods and processes designed to prevent mistakes and defects in production and manufacturing by creating and maintaining manufacturing process.
QC – Quality Control
Inspection of the processes and products during a manufacturing procedure to ensure high-quality items are produced.
R
Raw Materials
Typically (but not always) unprocessed components, from which an end product is manufactured.
Replenishment
A receipt of fresh stock or inventory into the warehouse. This may involve the physical stocking of shelves for storage and/or the necessary inventory software updates.
Reverse Logistics
Deciding how to best deal with merchandise that has been returned to the seller or warehouse from the customer.
RMA – Return Merchandise Authorization
The process of returning a product to receive a refund, replacement, or repair during the product’s warranty period, in which both parties may come to an agreement on how to handle it.
ROI – Return on Investment
A metric used to evaluate productivity and/or quality of an investment. This is represented as a percentage of profit/loss by an amount of capital generated after a cost over a set period of time.
S
SaaS – Software as a Service
An approach to distributing software through online means, as opposed to buying and physically installing software to the computer. The software is managed by the host, the user is given access to the software after paying a monthly/quarterly/yearly subscription fee. This is also known as cloud-based software. An example of a SaaS is Shipedge!
Serial Number
A unique number given to an individual item to identify it. Usually used sequentially as a part of a group. For example, the serial numbers printed on money to identify its authenticity.
SFP – Seller Fulfilled Prime
A type of Amazon service similar to FBM where the product is sold on Amazon, but fulfilled by the seller or a 3PL. The seller is required to met Amazon’s metrics for shipping timeframes with Prime orders.
Shipping Label
A label attached to a package for delivery, often printed using shipping software, this contains appropriate information to properly delivery the package, typically including the origination address, the recipient name and address, and other necessary data.
SKU – Stock Keeping Unit
An alphanumeric coding system that retailers use to differentiate individual products or kits. There is no industry standard for the creation of a SKU, they are unique to every business.
Software
A program that runs on a given computer to provide functionality.
Sole Proprietorship
A business owned and operated by a single person. There is no legal distinction between the business owner and the company itself.
SOP – Statement of Process/Standard Operating Procedure
Sequential processes by which something is accomplished.
T
Telecom Inventory (Management)
Keeping track of all assets, both physical and contractual.
U
UOM – Unit of Measure
A standard measurement used to identify stock quantities. An example of this would be a product measured in eaches, boxes, and cases. A case could have 10 boxes, and the box could have 10 eaches. This would make one case equal to 100 eaches.
W
WMS – Warehouse Management System:
A software consisting of processes and policies intended to promote efficiency and productivity at individual sites (warehouses) by keeping track of labor, inventory, shipping, and all aspects of daily operations.
Workflows
Defining the steps in a process from beginning to end.
Y
Yard Management
The organization, movement, tracking, and recording of inbound and outbound shipments of goods and materials in a shipping area, or yard.
