One-Stop Shop

What it is:

A one-stop shop is a single location where all of the needed services for a particular activity are provided.

How it works/Example:

One-stop shopping is a popular concept for packaging products and service oriented businesses. In the financial sector, for example, commercial lending and mortgage brokerages offer one-stop shops. The marketing, origination, underwriting, inspection, appraisal, documentation, settlement, escrow management, and servicing are all handled under a single entity for the client.  Real estate companies often set up one-stop shop operations to handle brokerage and property management services, along with all of the lending and service activities needed to service real estate buyers and sellers.

Why it Matters:

One-stop shops are convenient for buyers and sellers.  However, the one-stop shop can sometimes hide the true costs of each service and then limit the competition for the lowest cost provider.  In addition, having all of the function in a single "shop", even when certain services such as inspection and appraisal are required by regulation to be contracted out, may pose a conflict of interest between the clients and the one-stop shop operator.

Best execution refers to the imperative that a broker, market maker, or other agent acting on behalf of an investor is obligated to execute the investor's order in a way that is most advantageous to the investor rather than the agent.