Supply Chain Terms and Definitions
Learn supply chain management terms and definitions including inventory and fulfillment as they relate to the grocery industry.
A regional fulfillment center is an industry term for a fulfillment center that typically serves a large geographic region. It supports logistics processes needed to get a product from the seller to the customer.
A self-service supermarket is a single channel. A self-service supermarket that also supports online ordering is omnichannel. You can buy through either the physical store channel or the online channel.
Less than case levels describe shipping products to smaller stores or shipping slower moving items in less than a full case. Most product is shipped to stores in full cases. This is the conventional way to replenish inventory.
Last mile delivery is defined as the very last step of the delivery process when a parcel is moved from a transportation hub or warehouse to its final destination, usually a personal residence or retail store.
A distribution center is a location between manufacturing and retail locations, where products are temporarily stored before delivery to multiple stores. It is typically hundreds of thousands of square feet. It is used to replenish inventory for the stores it serves.
Direct store distribution exists when retailers have at least some goods shipped directly from suppliers to individual stores.
Direct store delivery (DSD) describes a method of delivering product from a supplier/distributor directly to a retail store and, in some cases, including placement on the correct store shelf, thereby bypassing a retailer’s distribution center and eliminating a substantial amount of retailer labor cost.
A customer fulfillment center or CFC is a centrally located warehouse that can replenish inventory for a number of stores and/or also provide direct order fulfillment to customers. Fresh Direct’s New York installation would be an example of the latter. A customer fulfillment center contains the full product assortment necessary to serve customers in the area. Direct store delivery and fresh/prepared foods do not necessarily fit easily into this model.