Glossary

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Drop Ship Retail

Economy Term

Drop shipping is a retail business model where the seller does not hold the products in stock. Instead, the seller partners with a supplier, who stocks the products and ships them directly to customers. The seller acts as an intermediary, promoting and marketing the products and receiving a profit margin on the sales.

Drop shipping has become increasingly popular in the industry due to its low barriers to entry and convenience. The business model allows entrepreneurs to start a retail business without the need for significant upfront capital investment, such as buying inventory or warehouse space.

Drop shipping offers several benefits for retailers, including reduced risk and cost, as the products are purchased only after a customer places an order. Additionally, it allows retailers to focus on marketing and customer service, rather than logistics and inventory management.

However, drop shipping also presents challenges, such as the need to rely on suppliers* inventory management and shipping processes. This can result in issues such as stockouts or delayed shipping, which can negatively impact the customer experience.

Despite these challenges, drop shipping is expected to continue to grow in popularity in the industry, as it offers an effective way to start and scale a retail business with minimal upfront investment and maximum flexibility.

More Glossary Terms Beginning with D

Daily Average Revenue Trades DARTs
Total revenue trades in a period divided by the number of trading days during that period.

Financial Term Letter: D
DEA Drug Enforcement Administration
Drug Enforcement Administration, the United States federal government agency responsible for enforcement of drugs regulated by the FDA.

Health Care Term Letter: D
Debt Coverage Ratio
A financial strength ratio that measures a companys ability to repay its debt. Debt Coverage Ratio above 1 indicates the company is able to repay its debt within one year. Debt Coverage Ratio at 0.25 indicates the company is able to repay 25% of its debt within one year. The higher the number, the stronger the financial position of the company. Debt Coverage Ratio Formula = (Ebitda / Debt)

Fundamental Analysis Letter: D
Debt to Equity Ratio
A financial strength ratio that measures proportion of companys Debt to Stockholders Equity. Debt to Equity Ratio displays companys indebtedness and the leverage of Stockholders Equity. The number indicates how much company owes of total Debt for one dollar of stockholders equity. The lower the number, the stronger the balance sheet of the company. Debt to Equity Ratio Formula = (Debt / Stockholde

Fundamental Analysis Letter: D
Deductible
The amount of loss that an insured retains.

Insurance Term Letter: D
Defensive Instruments
include high quality fixed income securities and money market instruments. Investors will use temporary defensive instruments in response to adverse market, economic, political or other conditions. When investors takes a defensive position, it may miss out on investment opportunities that could have resulted from investing in accordance with its principal investment strategy. As a result, investor

Financial Term Letter: D
Deferred Acquisition Costs
Primarily commissions and premium-related taxes that vary with, and are primarily related to, the production of new contracts and are deferred and amortized to achieve a matching of revenues and expenses when reported in financial statements prepared in accordance with U.S. Generally Accepted Accounting Principles (GAAP).

Insurance Term Letter: D
Deficiency
With regard to reserves for a given liability, a deficiency exists when it is estimated or determined that the reserves are insufficient to pay the ultimate settlement value of the related liabilities. Where the deficiency is the result of an estimate, the estimated amount of deficiency (or even the finding of whether or not a deficiency exists) may change as new information becomes available.

Insurance Term Letter: D
Deflation
What is Deflation? Deflation is constant decline in general level of prices, usually attributed to contraction of available money and credit. When the volume of money declines but quantity of products and services remain unchanged or decline on the lower level, results are higher lower prices (Deflation). Deflation is measured with CPI on the retail level and with PPI on the Wholesale level The Co

Economy Term Letter: D
Deposit Margin
Represents net interest income expressed as a percentage of average deposits.

Financial Term Letter: D
Depriciation
A charge against the companys earnings that allocates the cost of property, plant and equipment over the estimated useful lives of the assets. Statement of Income

Financial Term Letter: D
Derivative
A financial instrument or other contract, the price of which is directly dependent upon the value of one or more underlying securities, interest rates or any agreed upon pricing index. Derivatives cover a wide assortment of financial contracts, including forward contracts, options and swaps.

Financial Term Letter: D

More in this Category

Advance monthly sales
The U.S. Census Bureau conducts the Advance Monthly Retail Trade and Food Services Survey (MARTS) to provide an early estimate of monthly sales by kind of business for retail and food service firms located in the United States. Each month, questionnaires are mailed to a probability sample of approximately 5,000 employer firms selected from the larger Monthly Retail Trade Survey (MRTS). Firms respo

Economy Term
Affiliate
means with respect to any entity, an entity that is controlled by a other company although the other company owns less than a majority of the other entity.

Economy Term
Agents and Brokers
Persons or organizations that act as a representative for others in negotiating contracts, purchases, or sales. Agents and brokers typically earn a commission or fee for their services and do not take possession of, or title to, any goods.

Economy Term
ARPU
Average revenue per user

Economy Term
Balance of payments
Record of transactions between U.S. residents and foreign residents during a given time period. Includes transactions in goods, services, income, assets, and liabilities. It is broken down into the current accounts (international), capital accounts (international), and financial accounts (international).

Economy Term
Balance on current account
Current receipts from the rest of the world less current payments to the rest of the world, formerly called "net foreign investment." Current receipts equal exports of goods and services plus income receipts from the rest of the world; current payments are the sum of imports of goods and services, income payments to the rest of the world, and current taxes and transfer payments to the rest of the

Economy Term
Balance on goods and services
Record of the difference between exports of goods and services and imports of goods and services. In the broad sense, this balance is conceptually equal to net exports of goods and services, which is a component of gross domestic product (GDP).

Economy Term
Bonded Warehouses Manufacturing
Warehouses that are authorized by the United States Customs for storage or manufacturing of goods on which payment of duties is deferred until the goods are removed into Customs Territory. These goods are not subject to duties if reshipped to foreign points.

Economy Term
Brokers
Persons or organizations that act as a representative for others in negotiating contracts, purchases, or sales. Agents and brokers typically earn a commission or fee for their services and do not take possession of, or title to, any goods.

Economy Term
Business sector
All corporate and noncorporate private entities organized for profit and certain other entities that are treated as businesses in the national income and product accounts (NIPAs), including mutual financial institutions, private noninsured pension funds, cooperatives, nonprofit organizations that primarily serve businesses, Federal Reserve banks, federally sponsored credit agencies, and government

Economy Term
CE-marked
A compliance symbol indicating that a product meets the requirements of the European Union (EU) directives that apply to that product. CE stands for Conformit?e Europ?enne, which means European Conformity.

Economy Term
CFTC Commodity Futures Trading Commission
Commodity Futures Trading Commission, an independent agency with the mandate to regulate commodity futures and option markets in the United States.

Economy Term