GlossaryEN1 min readUpdated: Jun 22, 2026

drop shipment

A retailer sells goods to an end customer and instructs the supplier to ship directly to that customer—without ever stocking or handling the merchandise itself.

Quick Answer

Last updated: 22 June 2026Published: 19 June 2025

Source: https://de.wikipedia.org/wiki/Streckengesch%C3%A4ft

Category

Logistics Concept

Reading time

1 min

Words

114

Mentioned in

–

Definition & Explanation

A retailer sells goods to an end customer and instructs the supplier to ship directly to that customer—without ever stocking or handling the merchandise itself. In drop shipment, the retailer owns the customer relationship and issues the invoice, while the supplier manages physical fulfilment entirely. The model is common in e-commerce and for bulky or specialised goods where holding inventory would tie up capital unnecessarily. Customs compliance requires careful handling: the buyer, the importer of record, and the consignee may all be different parties, creating layered declaration and rules-of-origin obligations. Drop shipment should not be confused with consignment sales, where an intermediary acts in their own name but on account of a third party.

Next steps

Matching tools and partners

Calculate customs valueWork out import duties and customs valueOpen Calculate transit timeEstimate duration per transport modeOpen Find HS codeDetermine the tariff number for customsOpen Find a matching partnerFreight forwarders and logistics partners worldwideOpen

Related Terms

You might also be interested in these terms

Drop shipment processing

Drop shipment processing is a fulfillment model in which a manufacturer or supplier ships goods directly to the end customer while…

Learn more

Drop Shipment Processing Guideline

A drop-shipment processing guideline is an internal policy document that defines procedures, roles, and control mechanisms for dro…

Learn more

Drop shipment process control

Freight forwarders and merchants monitor drop-shipment processes through systematic checks of order data, delivery documentation, …

Learn more

drop shipment processing process

A drop-shipment processing process is a logistics model in which a retailer arranges for goods to be shipped directly from a suppl…

Learn more

Incoterms Drop Shipment

Drop shipment allows the seller to ship goods directly from manufacturer or warehouse to the buyer's end customer—the buyer never …

Learn more

Incoterms drop shipment risk

In drop shipment scenarios, risk transfer becomes critical when goods move directly from a supplier to the end customer, with the …

Learn more

Logistics knowledge straight to your inbox

Free · No password · Never a paywall. Weekly top news and facts from logistics.

drop shipment

Next steps

Related Terms

Drop shipment processing

Drop Shipment Processing Guideline

Drop shipment process control

drop shipment processing process

Incoterms Drop Shipment

Incoterms drop shipment risk

Logistics knowledge straight to your inbox

Community Questions & Answers