Browse Definitions :
Definition

fulfillment center

A fulfillment center is a third-party logics (3PL) warehouse where incoming orders are received, processed and filled. To manage inventory with an outsourced fulfillment house, the vendor can either receive and review goods prior to shipping them to the fulfillment center or have them sent to the warehouse directly from the manufacturer.

Outsourcing fulfillment allows the vendor to hand off the responsibilities and costs associated with warehouse management and focus on selling. The fulfillment center becomes responsible for inventory problems such as “mispicks” (in which the wrong product is selected to fill an order) and “misships” (in which the wrong item is sent to the customer). If mistakes are made, the fulfillment center absorbs the costs.

Using a fulfillment center can also make shipping faster and returns easier. Major shipping companies typically negotiate pricing with fulfillment centers with high volumes of business, a savings that allows vendors to offer free shipping to customers. Additionally, returns can be sent to the fulfillment center rather than directly to the vendor. This frees the vendor from having to charge the customer restocking fees.

Amazon has a network of fulfillment centers, which also handle warehousing, order processing, picking, packing and shipping for partners through their Fulfillment by Amazon (FBA) program. Other popular fulfillment centers include  ShipBob, RedStag and FulfillmentCompanies.net.

E-commerce companies interested in using a fulfillment center should ensure that they can integrate with merchants’ e-commerce software to track orders.

----------------------------------

These centers help companies handle one of the biggest challenges in online commerce: fulfillment.

Instead, the vendor sends product to the fulfillment center, and the outsourced provider ships them to customers for the sellers.

This was last updated in August 2017

Continue Reading About fulfillment center

Join the conversation

1 comment

Send me notifications when other members comment.

Please create a username to comment.

How do you think fulfillment centers are reshaping the retail industry?
Cancel

-ADS BY GOOGLE

File Extensions and File Formats

SearchCompliance

  • risk management

    Risk management is the process of identifying, assessing and controlling threats to an organization's capital and earnings.

  • compliance as a service (CaaS)

    Compliance as a Service (CaaS) is a cloud service service level agreement (SLA) that specified how a managed service provider (...

  • data protection impact assessment (DPIA)

    A data protection impact assessment (DPIA) is a process designed to help organizations determine how data processing systems, ...

SearchSecurity

  • spyware

    Spyware is a type of malicious software -- or malware -- that is installed on a computing device without the end user's knowledge.

  • application whitelisting

    Application whitelisting is the practice of specifying an index of approved software applications or executable files that are ...

  • botnet

    A botnet is a collection of internet-connected devices, which may include PCs, servers, mobile devices and internet of things ...

SearchHealthIT

SearchDisasterRecovery

  • business continuity plan (BCP)

    A business continuity plan (BCP) is a document that consists of the critical information an organization needs to continue ...

  • disaster recovery team

    A disaster recovery team is a group of individuals focused on planning, implementing, maintaining, auditing and testing an ...

  • cloud insurance

    Cloud insurance is any type of financial or data protection obtained by a cloud service provider. 

SearchStorage

  • DRAM (dynamic random access memory)

    Dynamic random access memory (DRAM) is a type of semiconductor memory that is typically used for the data or program code needed ...

  • RAID 10 (RAID 1+0)

    RAID 10, also known as RAID 1+0, is a RAID configuration that combines disk mirroring and disk striping to protect data.

  • PCIe SSD (PCIe solid-state drive)

    A PCIe SSD (PCIe solid-state drive) is a high-speed expansion card that attaches a computer to its peripherals.

Close