Retail Jargon Glossary
Retailing is full of buzzwords and jargon. We've been wholesale suppliers to shops across the world since 2012, so we've come across plenty of confusing expressions. Here's a list of the ones we're asked about the most. If there are more you think we should know about, please email us on email@example.com.
Paying on account means paying after you have received a product (typically 30 days after receiving delivery). It allows retailers to maintain a healthy cash flow, often selling all or most of the stock before having to pay for it.
Many suppliers will allow you to pay on account after your first order.
Click and collect is a service offered by many large stores and supermarkets which allow customers to order through their website. The idea is that a customer orders and pays online but picks their product up in-store or at a convenient local place (often a local shop or post office).
The advantage for customers is that they do not have to be in the house to receive a delivery. Many retailers find that it increases their conversion rate (the number of visitors to their website who purchase a product).
A CRM (short for Customer Relationship Manager) is a piece of software which makes it easier for companies with lots of clients to keep in touch with them all. It is often used by wholesale businesses to keep track of their customers and things they have previously ordered.
Drop Shipping is selling a product on the internet without ever actually having any stock of the product.
Drop shipping websites charge their customers more than the amount that they can buy it for elsewhere in the internet. When a customer places an order, the drop shipper orders the product from the cheapest supplier and asks for it to be delivered to their customer's address.
E Commerce is the act of selling products over the internet. If you have a website which allows your customers to place orders, that is an e commerce website.
EPoS is short for Electronic Point of Sale. Your EPoS system is the electric till you have in your shop (typically, the EPoS will have two screens, one for the person serving the products and one for the customer being served).
EPoS systems often communicate with your inventory management software to keep stock levels updated and allow you to measure the popularity of the products you sell.
Inventory is the amount of stock that a business has on hand. It is another way of describing all of the products which are stored on your shelves and in your warehouse.
We need to order more Stow Away Travel Kits as our inventory is running low.
Keystone pricing is a common pricing strategy for retailers. It means selling a product for double the amount that you paid for it.
For example, if you order a product for £10 and sell it for £20, that is an example of keystone pricing.
Loss leaders are products which shops sell for less than the amount of money the bought them for. It is a pricing strategy employed to bring customers into the store in the hope that they buy other (more profitable) products while they are there.
The most common example of a loss leader is milk in supermarkets. Supermarkets often sell milk for less than what it costs them, knowing that people who visit to buy milk will often end up buying other things.
M commerce is short for mobile commerce. It's the technical name for having a website which allows people to order from you on their mobile phone.
In the past, it has been expensive and time consuming to create a functioning m commerce website. This has been made easier, quicker and significantly cheaper by services such as Shopify.
Merchandising and visual merchandising (often abbreviated to VM) are the act of laying a shop or shop window out in an appealing way. Large retailers often have VM managers who are responsible for the displays in shop windows and around the store.
Well organised visual merchandising can dramatically increase sales of highlighted products. The practice was popularised in London by Henry Selfridge in the windows of the famous Selfridges department store.
The minimum order quantity is the smallest number units a supplier will allow you to order. Many suppliers will not let you order less than 100 units of a product, to ensure that they make a minimum amount of revenue per order.
At Men's Society and Apothecary Department, we don't have minimum order quantities. You are welcome to order as many or few products as you wish.
Multi channel retail means that customers can buy from you in more than one way. For example, if your customers can buy from your shop, your website and your Instagram page, you have a multi channel retail business.
The advantage of being multi channel is that there are more opportunities to make a sale. The biggest disadvantages are the time involved in updating and maintaining your internet product listings.
A pop up shop is a temporary retail outlet. They are often used for promotional purposes, or by new companies trying to decide if they would like to go into retail full time.
Pop up shops are a great way to increase your exposure in a certain area without having to open a shop there full time. Because of their short time-frame and often high rental costs, pop up shops can struggle to be profitable in the short term.
Pro rata is a term which refers to the way you pay a supplier. Paying pro-rata means that you pay before receiving the products.
Often, suppliers will ask you to pay pro-rata for your first order, but may be happy to negotiate more favourable payment terms for subsequent orders.
Retargeting / remarketing is the technical name for those adverts that you see around the internet after visiting a website. Some companies use it to remain at the front of your mind after you visit them on the internet.
It is a strategy that can help to increase sales if you normally sell online. However, you need to consider whether your customers are likely to be irritated or "freaked out" by the fact that your adverts follow them everywhere you go.
SEO (short for search engine optimisation) is the act of making a website more appealing to search engines - usually Google - in the hope that you will appear higher in the results pages.
As technology improves, SEO is becoming gradually easier. Some people still choose to hire an SEO agency to manage this for them.
You can find advice on a website called MOZ. This is the leading authority in SEO strategies. Clients who order from Men's Society are entitled to free SEO advice and practical help from our in-house SEO expert.
You may also see:
Local SEO. This is SEO on a very small scale. The intention is that when people Google things like "Gift shop in Newquay", your shop appears in the results.
Showrooming is another name for window shopping. It is when customers browse your shop without buying anything and then purchase products for a cheaper price on the internet.
There is frustratingly little that retailers can do to reduce showrooming. Suppliers can often help by refusing to sell their products to internet retailers who intend to sell them at below RRP.
Shrinkage is the amount by which the amount of stock in your possession decreases between you buying it and selling it. Shrinkage can be caused by theft on the shop floor, theft by employees, items lost in transit or items damaged or lost in the warehouse.
If you notice that you have received fewer products in a delivery than you ordered, you should speak to the supplier immediately. They will have a policy of either reimbursing you or replacing the missing stock.
SKU is short for Stock Keeping Unit. It is a unique number that's assigned to each of the individual products that a company sells.
SKU numbers are not ordinated between businesses, meaning they might not be unique. You may have several suppliers who use the SKU code 00-101, for example.
Many retailers assign all of their products to new SKU numbers once they arrive to avoid confusion.
The stock cover is the amount of time you can last without ordering more stock of a particular product. It is an estimate based on current or projected sales figure.
The Beard Grooming Kit is selling well. We only have enough stock cover for another week. We should order more.
The supply chain is the journey that a product takes before it reaches your store. For example, a product's supply chain could be:
Raw ingredients are farmed / harvested > raw ingredients sold to a wholesaler > raw ingredients bought by component manufacturer and taken to their premises where they are processed and manufactured > components sold to product manufacturer where they are assembled into the final product > product is sold to a distributor and stored in their warehouse > product is bought by retailer (you!).
One unit is one item of stock. It is often used as a plural. The word unit is often used instead of the word product to avoid confusion when ordering several different kinds of products in the same transaction.
I would like to order sixty units of your Sneaker Cleaning Kit.
We have six units left in stock.
WSSI is an abbreviation of Weekly Sales and Stock Intake. It's often pronounced Whizzy.
This is usually a spreadsheet where stock managers list the number of units which have been sold alongside a list of units which have been delivered. It is usually completed on a weekly basis but can be monthly.
The purpose of a WSSI is to help the buyer decide when the shop should stock up on some products or order fewer of others.