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Defining Terms

Sarah Koehn

Defining Terms

If you are new to the shipping business you may be confused by all the different terms. Some of which seem are used interchangeably. 

Understanding the terms used in e-commerce is essential. A lack of understanding prevents clear communication. 

Here is a list of some of the commonly used terms in the logistics industry. We will update this list as we come across new terms. 

  • 3PL: short for “third-party-logistics.” This refers to a third-party company who provides logistics for e-commerce companies. This may include warehousing, fulfillment, inventory management, FBA prep, and more.
  • Fulfillment Center: a warehouse that provides storage, pick, pack, and shipping services for e-commerce. 
  • Distribution Center: a warehouse that provides shipping services, acting as the middleman between a business and their fulfillment center or other retailers. 
  • Pick: the process of locating items and picking them for orders.
  • Pack: the process of packing picked items into a suitable package.
  • Fulfillment: the process of picking, packing, and shipping e-commerce orders. 
  • B2B: short for “business to business.” B2B shipments refer to shipments from one business to another. The term wholesale may be used interchangeably. These are often wholesale orders by another retailer.
  • DTC or B2C: short for "direct to consumer" or "business to consumer." This refers to orders shipped by a business to a consumer. It eliminates the middleman of another retailer (unlike wholesale). 
  • FBA: acronym for “fulfilled by Amazon” refers to shipments to an Amazon fulfillment center. Amazon acts as your warehouse providing storage and fulfillment services. 
  • FBM: represents "fulfilled by merchant." This refers to orders sold on the Amazon marketplace by fulfilled by the merchant. Unlike FBA orders, FBM orders can be shipped in house or outsourced to a fulfillment center. 
  • LTL: short for “less-than-load” are freight shipments which do not fill an entire truckload. 
  • WMS: represents “warehouse management software” is a software utilized by a warehouse to manage inventory and orders. 
  • DDP: acronym for “delivered duties paid” refers to a shipment that is delivered internationally with duties paid by the shipper.
  • DDU: acronym for “delivered duties unpaid” refers to a shipment that is delivered internationally with duties unpaid, they must be paid by the recipient.
  • Outsourcing: choosing to delegate certain aspects of business to an individual or another business. An online retailer may outsource their fulfillment to a fulfillment center.
  • SKU: short for "stock keeping unit." A SKU is a unique identifier for inventory. 
  • FNSKU: short for "fulfillment network stock keeping unit." Like a SKU, this is a unique identifier for inventory. However, a FNSKU is specific to FBA, the Amazon fulfillment network. It is an Amazon specific product identifier.
  • UPC: short for "universal product code." A UPC is also called a barcode. Like a SKU, it is unique to each product. It is applied to items to enable scanning.

At Viable Shipping, we are known for providing excellent customer service. We love making the process as simple and clear as possible.