Commonly used lingo when talking about fulfillment
Have you ever thought about the industry you work in and realized that there are so many abbreviations and industry jargon that it can be overwhelming for someone new to your business? In eCommerce fulfillment we definitely hear and say a lot of words that many people wouldn’t use unless they were specifically speaking to someone like ShipBots. When your business scales and you start looking to outsource your fulfillment, you may hear a lot of terms you don’t understand and that's ok!
Here at ShipBots we use and hear this lingo all the time, and in order to help you on your search for the proper solution we would love to fill you in on some of the most commonly heard terms that may be brought up by the person you are speaking with.
3PL: Simply put this is just an abbreviation for third party logistics. Companies like us at ShipBots are contacted when companies look to outsource things such as picking, packing, warehousing and other logistical aspects.
B2B: An abbreviation for the term “business to business”. You would probably hear this when being asked who your clients are or who you sell to.
B2C: This is the abbreviation for business to consumer. Some companies may do business exclusively with the consumer, with other businesses or even a combination of the two. 3PL providers will ask about this so they know whether or not they can properly serve your needs.
Backorder: This one is pretty well known but since it's commonly used it's good to mention. Basically an item is not in stock but will ship once available, usually you get this notification if they still take payment on the item even if they can’t ship right away.
Barcoding: We all know what a barcode is but we may not think about it when we deal with our own products. Barcoding is essential for a 3PL provider, this way they can accurately locate and track products within the warehouse. Some providers offer a service to do this for you, so don’t be afraid to ask!
Batch Fulfillment: This refers to when a bunch of orders are being fulfilled at the same time. Such as pre-orders shipping on release day or if you owe backers product due to a successful crowdfunding campaign.
Carrier: Any provider of shipping rates such as USPS, FedEx or DHL
Dashboard: Third party logistic providers will usually bring up their dashboard as a selling point. A Dashboard is the integration of the online store with the warehouse inventory. ShipBots likes to make it as simple as possible for integration so that companies have transparency with their inventory
Dimensional Weight: This is the weight of the package taking into account length, width and height. Using the longest side, which helps calculate shipping costs.
Kitting and assembly: This is when you have a bunch of items that are placed under one SKU, like the creation of a gift basic with many products in one. This is often a great way to sell products to clients and 3PL providers need to be able to handle such requests.
SKU: Stock keeping unit. This is a unique code used to differentiate items in a system.
There are plenty of other terms and jargon that we haven’t covered but this is a good starting point for those just entering this world. Never feel intimidated by the use of jargon, always ask your point of contact to clarify what they mean. The worst thing you can do when shopping around for fulfillment options is not understand the terms and services your provider is offering. Some of these terms that are included above will usually be asked in an introductory call with a potential 3PL provider. As your company scales and grows a fulfillment center should be able to do that with you. They should be able to handle most requests, of course every provider will have certain policies or limitations that they just have to deal with. This is in order to ensure your products stay safe and the employees who handle them.
The most important thing about a provider is that you feel confident they will be transparent with you and provide you with clear numbers and goals with regards to things like shrinkage, which is the amount of product that may be lost due to various circumstances. If one provider can’t help you then ask them if they can refer you to someone who may be able to. This can also help you cut down on having to run into another issue with other provider who can’t handle your requests. You don’t need to have every term in your memory but the list above should give you a good start with commonly used terms which I hope make life easier on that search for the right eCommerce fulfillment.