Fulfillment & Operations

Stock Keeping Unit - a unique alphanumeric code identifying and tracking individual products.

Extra inventory kept as a buffer against unexpected demand spikes or supply disruptions.

Inventory that hasn't sold and is unlikely to sell, tying up capital.

A ratio measuring how many times inventory is sold and replaced over a given period.

The inventory level that triggers a new purchase order from suppliers.

The average number of days inventory sits in stock before selling.

When inventory reaches zero and products become unavailable for purchase.

Accepting orders for out-of-stock items with extended fulfillment timelines.

Third-Party Logistics - outsourcing warehousing, picking, packing, and shipping to external providers.

A fulfillment model where products ship directly from manufacturer to customer.

Fulfillment by Amazon - sellers ship inventory to Amazon warehouses for storage and fulfillment.

Fulfillment by Merchant - sellers handle their own fulfillment for marketplace orders.

A pricing method where carriers charge based on package volume rather than actual weight.

Total time between placing a purchase order and receiving goods in inventory.

Total cost to bring a product to your warehouse, including product cost, shipping, and duties.

Return Merchandise Authorization - a numbered authorization initiating the return process.

Percentage of orders resulting in returns. Industry averages range from 15-30% for ecommerce.

The warehouse process of selecting ordered items and packaging them for shipment.

Combining multiple individual SKUs into a single package or bundle before shipping.