A.
Address validation
An automated check that assesses whether a delivery address is complete and correctly formatted. It helps identify potential errors before dispatch, reducing the risk of delivery delays.
Average order value (AOV)
The average amount customers spend per order. It is calculated by dividing total order revenue by the number of orders placed during the same period.
B.
B2B fulfilment
Business-to-business fulfilment involves preparing and shipping orders to other companies, such as retailers, wholesalers or distributors. Orders may require bulk quantities, pallet deliveries or specific labelling and booking arrangements.
Backorder
An order accepted for a product that is temporarily out of stock. It remains outstanding until replacement stock arrives and the order can be fulfilled.
Batch picking
A picking method where products for several orders are collected during one trip through the warehouse. The items are then separated into individual orders for packing.
Bill of lading (BOL)
A transport document commonly used in sea freight that records goods accepted for carriage and the shipment’s terms. Depending on its type, it can also act as a document of title.
Bulk shipping
Transporting large quantities of goods together. In freight terminology, bulk cargo often means unpackaged commodities, while ecommerce businesses may use the term for large consolidated shipments.
Bundle fulfilment
The process of preparing and dispatching products sold together as a bundle. Items may be assembled into sets in advance or picked together when an order is received.
Bundling
Combining two or more products into a single offer. Examples include gift sets, starter kits and multipacks, which may have their own price and SKU.
Business-to-consumer (B2C)
Sales made by a business to individual customers. This includes purchases from retailers and brands through websites, marketplaces or physical shops.
C.
Carrier
The company responsible for transporting goods. For ecommerce orders, this is usually the courier or postal operator delivering parcels to customers.
Cart abandonment rate
The percentage of shopping baskets that do not result in a completed purchase. It helps businesses understand where potential customers leave before placing an order.
Checkout process
The steps a customer follows to complete an online purchase. These usually include entering delivery details, selecting a shipping option and making payment.
Churn
The loss of customers over a given period. For subscription businesses, churn commonly refers to customers cancelling or choosing not to renew their subscriptions.
Cluster picking
A picking method where one operative collects products for several orders while keeping each order in a separate tote or compartment. Orders are sorted as they are picked.
Compound annual growth rate (CAGR)
The steady annual growth rate that would take a starting value to its ending value over a specified period. It smooths out year-to-year changes rather than showing actual growth in each year.
Consignment stock
Goods held by another business while ownership remains with the supplier until an agreed event, usually a sale or use. Payment and stock responsibilities depend on the consignment agreement.
Courier service
A service that collects and delivers parcels or documents. Options can include standard, next-day, same-day and international delivery, depending on the provider.
Cross-docking
Moving incoming goods into outbound shipments with little or no storage between arrival and departure. Products may still need checking, sorting or consolidation before onward transport.
Customer acquisition cost (CAC)
The average cost of gaining a new customer. It is commonly calculated by dividing relevant sales and marketing expenditure by the number of new customers acquired during the same period.
Customer relationship management (CRM)
The processes and software used to manage relationships with customers and prospects. A CRM system can record contact details, enquiries, sales activity and previous communications.
Cut-off time
The deadline for an order to qualify for a particular dispatch window. Eligibility depends on the agreed service, stock availability and whether the order is ready to process.
D.
DAP shipping — Delivered at Place
A shipping arrangement where the seller delivers goods to an agreed destination, ready for unloading. The buyer handles import clearance, applicable import duties and taxes, and unloading.
DDP shipping — Delivered Duty Paid
A shipping arrangement where the seller delivers goods to an agreed destination and handles export and import clearance, including applicable duties and taxes. The goods are delivered ready for the buyer to unload.
Demand forecasting
Estimating future customer demand using sales history, seasonal patterns, promotions and other relevant information. It helps businesses plan purchasing, stock levels and fulfilment capacity.
Digital supply chain
A supply chain supported by connected software, data and digital tools. These systems help businesses share information and coordinate purchasing, stock, transport and delivery.
Direct-to-consumer (D2C / DTC)
A sales model where a brand sells directly to its end customers rather than through a separate retailer or wholesaler. Orders are commonly placed through the brand’s own website.
Direct-to-retail
A sales or distribution model where a manufacturer or brand supplies retail businesses directly. Those retailers then sell the products to consumers.
Discrete picking
A picking method where an operative collects all the items for one order before starting another. Packing may be completed by the same person or handled at a separate workstation.
Dispatch
The stage when an order leaves the warehouse and is handed to the carrier. Dispatch is different from delivery, which happens when the shipment reaches its destination.
Distribution centre
A facility used to receive, organise and send goods to other locations. It may supply retail stores, businesses, other warehouses or individual customers.
Dropshipping
A sales model where a retailer accepts customer orders without holding the products itself. A supplier or other partner ships the goods directly to the customer on the retailer’s behalf.
E.
Ecommerce
The buying and selling of products or services online. Transactions may take place through websites, apps or online marketplaces.
Ecommerce analysis
Reviewing online trading data to understand business performance. This can include sales, conversion rates, customer behaviour, returns and product profitability.
Ecommerce fulfilment
The process of storing products and preparing online orders for delivery. It includes picking, packing, dispatch and, where required, returns processing.
Ecommerce fulfilment services
Services that manage some or all of an online business’s fulfilment operations. These can include warehousing, stock control, order preparation, shipping and returns.
Ecommerce platform
Software that allows a business to operate an online shop. It typically supports product listings, checkout, payments and order management.
F.
FEFO — First Expired, First Out
A stock rotation method that prioritises products with the earliest expiry dates. It helps businesses manage goods with a limited shelf life and reduce waste.
FIFO — First In, First Out
A stock rotation method where goods received first are picked or used before newer arrivals. It helps prevent older inventory from being left in storage.
First-mile delivery
The initial transport stage in a shipment’s journey. This may involve collecting goods from a seller or warehouse and moving them into a carrier’s network.
Flat-rate shipping
A fixed shipping charge within a defined service or set of conditions. Weight, dimensions, destinations and other limits may still apply.
Fourth-party logistics (4PL)
A service where a provider coordinates a business’s logistics activities across multiple partners. This can include managing warehouses, carriers, technology and overall supply chain performance.
Free Carrier (FCA)
An Incoterms rule where the seller delivers goods to the buyer’s nominated carrier or other nominated party at an agreed place. The seller handles export clearance, with loading responsibilities depending on the delivery location.
Freight forwarding
Arranging the movement of goods through one or more transport providers. A freight forwarder may coordinate road, sea or air transport alongside shipment documentation and related services.
Fulfilment by Amazon (FBA)
A service where sellers send stock to Amazon fulfilment centres for storage and order fulfilment. Amazon picks, packs and dispatches eligible orders on the seller’s behalf.
Fulfilment centre
A warehouse that stores products and prepares customer orders. Its activities typically include receiving stock, inventory management, picking, packing and dispatch.
Fulfilment cost
The costs involved in storing products and fulfilling orders. Depending on the operation, these may include receiving, storage, picking, packing, packaging, shipping and additional handling.
Fulfilment industries
The product sectors served by fulfilment providers, such as beauty, electronics, pet supplies and stationery. Different sectors may need specific storage conditions, packing methods or handling procedures.
Fulfilment network
A group of facilities and delivery connections used to store and distribute products. A coordinated network can support orders across multiple locations or markets.
Fulfilment Network Stock Keeping Unit (FNSKU)
An Amazon identifier used to associate inventory with a particular seller and product within its fulfilment network. It differs from a business’s internal SKU.
Fulfilment partner
An external company that manages fulfilment activities on behalf of a business. Its responsibilities can include storing stock, preparing orders, arranging dispatch and processing returns.
G.
Global shipping
Sending goods to destinations in other countries. International shipments may require customs information, import clearance and payment of applicable duties or taxes.
Goods-in
The process of receiving products into a warehouse. It usually includes checking deliveries, recording discrepancies and booking stock into the warehouse system.
Gross margin
Gross profit expressed as a percentage of revenue. It is calculated by dividing gross profit by revenue and multiplying by 100.
Gross profit
Revenue remaining after subtracting the cost of goods sold. It shows the amount available to cover other business expenses before arriving at net profit.
I.
Import One-Stop Shop (IOSS)
An EU VAT scheme that simplifies how eligible imported consumer sales are reported and paid. It allows participating sellers or marketplaces to collect VAT at checkout and report it through a single system.
In-stock rate
A measure of product availability. It can show the proportion of products available at a given time or how often products remain available over a period, so the calculation should be defined consistently.
Incoterms
Standard trade rules published by the International Chamber of Commerce. They define how buyers and sellers divide delivery responsibilities, costs and risks in a goods transaction.
Indemnity insurance
Insurance that covers specified losses or liabilities under the terms of a policy. Professional indemnity insurance specifically concerns claims arising from professional advice or services, such as alleged errors or negligence.
Internet of Things (IoT)
Physical devices connected to systems that collect and share data. In logistics, examples include sensors that monitor temperature, equipment condition or goods in transit.
Inventory carrying cost
The total cost of holding stock over time. This can include storage, insurance, capital tied up in products, damage, shrinkage and obsolescence.
Inventory management
Monitoring and controlling stock quantities, locations and availability. It supports purchasing decisions, order fulfilment and the balance between having enough stock and holding too much.
K.
Kitting
Assembling separate products or components into a defined set. A completed kit may be stored and sold as a single unit or prepared for a specific order.
L.
Last-mile delivery
The final transport stage before a shipment reaches its recipient. For parcels, this usually means the journey from a local delivery depot to the customer’s address.
Lead time
The time between starting a process and completing it. In stock purchasing, this commonly means the period between placing a supplier order and receiving the goods.
M.
Marketplace fulfilment
Preparing and shipping orders placed through online marketplaces. Fulfilment may be handled by the seller, a logistics partner or the marketplace’s own service.
Minimum order volume (MOV)
The minimum number of orders a fulfilment provider requires over an agreed period. This differs from a minimum order quantity, which usually refers to the number of units purchased.
O.
Omnichannel fulfilment
A coordinated approach to fulfilling orders across websites, marketplaces, shops and other sales channels. Connected stock and order information helps support consistent availability and service.
Order management system (OMS)
Software that manages orders from receipt through to completion. It can bring together sales channels, allocate inventory and monitor fulfilment, delivery and returns.
Order tracking
Information showing an order’s progress through processing and delivery. Updates may include warehouse statuses, dispatch confirmation and carrier scans.
P.
Pick accuracy
The percentage of picking activity completed without product or quantity errors. It may be measured by item, order line or complete order, depending on the reporting method.
Pick and pack
Collecting the required products from their warehouse locations and packaging them for dispatch. The process may also include adding inserts, applying labels and following agreed packing instructions.
Platform integrations
Connections between sales platforms and other business systems. They allow information such as orders, stock quantities and tracking details to transfer with less manual data entry.
R.
Replenishment
Replacing stock to maintain availability. This can mean ordering more products from a supplier or moving goods from bulk storage into warehouse picking locations.
Returns processing
Receiving and assessing products sent back by customers. The process can include recording the return, checking condition and following instructions for restocking, repair, recycling or disposal.
Reverse logistics
The movement of goods back through the supply chain. It includes returns and related activities such as repairs, refurbishment, recovery and recycling.
S.
Safety stock
Extra inventory held to help cover unexpected demand or supply delays. The appropriate level depends on sales patterns, supplier reliability and replenishment lead times.
Same-day dispatch
When an eligible order is prepared and handed to the carrier on the same working day. It depends on the agreed cut-off time and service conditions and does not mean same-day delivery.
SKU — Stock Keeping Unit
An internal identifier used to track a particular product or variant. Different sizes, colours and pack quantities will usually have separate SKUs.
Small business fulfilment
Fulfilment services suited to smaller or growing businesses. They allow a brand to outsource storage, packing and dispatch as its operational needs develop.
Stock rotation
Selecting and moving stock in a planned order. Methods such as FIFO and FEFO help businesses manage ageing products and goods with expiry dates.
Subscription box fulfilment
Preparing and dispatching recurring subscription orders. It may involve assembling sets, changing the contents between cycles and coordinating scheduled dispatch dates.
T.
Tracking number
A reference assigned by a carrier to identify a parcel or shipment. It allows businesses and customers to check delivery progress through the carrier’s tracking system.
V.
Value-added services (VAS)
Additional warehouse services beyond standard storage, picking and packing. Examples include relabelling, assembly, gift wrapping, kitting and adding promotional materials.
