What Is Pick, Pack and Ship?
Also known as: pick pack ship process, order fulfillment process
Definition
Pick, pack and ship is the three-stage order fulfillment sequence: pull items from stock against a sales order, pack them with documents and labels, then hand them to a carrier. Each stage posts a transaction in the ERP.
Pick, Pack and Ship Explained
Picking reserves and moves stock against an order line, typically from a pick list or handheld task. Packing verifies the contents, adds dunnage, weighs the carton and prints the packing list and shipping label. Shipping confirms the handoff, which relieves inventory, records the shipment and usually triggers invoicing.
In ERPs, each stage maps to a transaction. SyteLine uses pick list generation, packing, and shipment confirmation with invoicing following. Infor LN uses outbound order lines, handling units and shipment confirmation. NetSuite splits it into sales order, item fulfillment (picked, packed, shipped statuses) and invoice.
The timing of inventory relief and revenue is a design choice. Relieving at pick is early and can overstate shortages; relieving at ship is common and aligns with the invoice and transfer of risk, subject to the terms of sale.
Quality checks fit naturally in the pack stage: scan verification against the order, serial or lot capture and certificate of conformance inclusion for regulated customers.
Why It Matters
- Fulfillment accuracy drives returns, credit notes and customer trust.
- The ship confirmation is the trigger for invoicing and revenue recognition in most setups.
- Weights and dimensions captured at pack feed correct freight cost and labels.
- A clear status per stage shows where orders are stuck.
In Practice
A 12-line order is picked as 11 lines because one item is short. The packer ships the 11, the ERP creates a backorder for the remaining line, and the invoice covers only shipped quantity. If the packer had forced a full ship confirmation, inventory would go negative and finance would invoice goods that never left.
Frequently Asked Questions
When should inventory be relieved?
Most manufacturers relieve at shipment confirmation. Some relieve at pick for tight control, but then must handle returns to stock and short picks carefully.
What triggers the invoice?
Usually shipment confirmation, though contracts can tie it to delivery or milestones. Your terms of sale decide this.
Where do most fulfillment errors occur?
At pick (wrong bin or item) and pack (missing lines, wrong labels). Scan verification at both steps removes most of them.
Related Terms
Packing List
A packing list, also called a packing slip, is a document that itemizes what is in a shipment: items, quantities, package counts and references. It travels with the goods and lets the receiver check contents without opening an invoice.
Bill of Lading (BOL)
A bill of lading (BOL) is the document a carrier issues to confirm it received goods for shipment. It acts as a receipt, a contract of carriage and, in some forms, a document of title. ERPs print it from the shipping transaction.
Wave Picking
Wave picking is a method where a warehouse releases orders to the floor in timed groups, called waves, chosen by carrier cut-off, priority, zone or order type. It lets planners balance workload across pickers and the dock.
ATP (Available to Promise)
ATP (available to promise) is the portion of inventory and scheduled production not yet committed to existing customer orders, calculated by date so order entry can quote a delivery a customer can rely on.
Perpetual Inventory System
A perpetual inventory system updates on-hand quantity and inventory value in real time with every receipt, issue, transfer and adjustment, so book balances are always current. A periodic system updates only after a physical count.
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