E-commerce from Scratch Glossary

Every field has its jargon. Here are the terms this course uses, explained the way you’d explain them to a friend — no dictionary voice, no assumed knowledge.

Niche

A specific slice of a market you can serve better than generalists — narrow enough to target precisely, big enough to sustain a business.

Margin

What’s left after all costs: (price − total cost) ÷ price. Healthy e-commerce margins leave room for ads, mistakes, and profit.

SKU

Stock keeping unit — the unique code for each distinct product variant you sell and track.

3PL

Third-party logistics: a warehouse company that stores, packs, and ships your products so you don’t have to.

Dropshipping

Selling products you never stock — the supplier ships directly to your customer. Low startup cost, thin margins, little quality control.

Average order value (AOV)

Revenue divided by number of orders. Raised with bundles, thresholds (“free shipping over $75”), and post-purchase offers.

Conversion rate

The percentage of store visitors who buy. Most stores convert 1–3%; the page, not the traffic, is usually the lever.

Abandoned cart

A checkout started but not finished. Recovered with reminder emails — some of the highest-ROI emails a store sends.

Chargeback

When a customer disputes a charge with their bank and the money is pulled back — plus a fee. Prevented with clear policies and tracking.

Lead time

How long between ordering from your supplier and having sellable stock. Long lead times mean ordering before you feel ready.

MOQ

Minimum order quantity — the smallest batch a supplier will produce or sell. Negotiate it down while you’re small.

Fulfillment

Everything between “buy” and the package arriving: picking, packing, shipping, tracking, and handling what goes wrong.

Payment gateway

The service that processes card payments at checkout (Stripe, PayPal, etc.). Compare fees — 2.9% + 30¢ adds up.

Launch list

The audience you build before opening — emails, followers, interested friends — so day one has buyers, not silence.