Fulfillments and Shipments are parts of a Sale Order and a Transfer Order.
It represents the collection of items from an order that is intended to be fulfilled from a particular facility (Standard Location/Warehouse/3PL Location/Dropship Location).
It's the fulfillment that is associated with a facility/location, and not the order (as an order can have multiple fulfillment).
Split fulfillments allows for:
Partial order fulfillments, where the items in the order can be delivered separately from the same facility.
Order fulfillments where the items are sourced from multiple facilities for the same order.
A Shipment represents a packed set of items on which a Shipment Label can be pasted and be picked up by a shipper for delivery.
A fulfillment can have multiple shipments to allow for delivery flexibility, as different parts of the fulfillment can be delivered by different shippers.