The Retail Dictionary

Accounting System

A collection of accounting data or statistical reports of the daily financial activity of the store; computer-based technique to track financial activity in retail

Ad Slick

A special type of paper used for print advertisement; a copy of digital-ready print advertisement supplied by retailers for magazine or newspaper exposure

Add-On Sales

A technique in up-selling merchandise by suggesting additional items after a customer selects the main product; also refers to the revenue earned from additional purchases

Affiliate Marketing

A business strategy commonly used by entrepreneurs to earn commission by promoting other company’s products; the process of linking with other online advertisers to generate sales and exchange traffic in ecommerce

All-in-one POS

An integrated terminal or device used for checkout or cashing out products; a computer-like machine where cashiers enter checkout information at the point which a customer pays for goods or services

Anchor Store

A huge retail chain within a mall; also known as key tenant or draw tenant

Atmosphere

Refers to the ambience of a store enhanced by music, colour, lighting, and display; a key factor in branding and marketing which is composed of the overall aura of store that influence audience appeal

Auditory Marketing

A special technique in choosing a product name in a way that it would sound good to shoppers, enticing them to buy just by the name itself; also refers to a strategy in branding which integrates sensorial stimuli to enhance brand appeal

Average Value Transaction (AVT)

The median cost of transaction per month or year; this can be calculated by dividing the total amount of sales by the number of transaction in a given period

Back Office

A specific headquarter in a retail building where administrative and accounting jobs are carried out; it also refers to the persons working for clearance, record maintenance, settlements, and human resource

Barcode Scanner

A handheld electronic device that uses light sensor to decipher item barcodes and enter price information into the computer during checkout; also known as price reader or price scanner

Beginning of the Month Inventory (BOM)

The cost of products a store has at the start of the month, which is calculated by subtracting the end-of-month inventory from the value of inventory of the previous month

Big Box Stores

A retail store consisting at least 50, 000 square feet that offers voluminous stocks and is often branched out in different locations for example Wal-Mart and Best Buy

Big Data

A technology leveraged by retailers to hold an immense volume of both structured and unstructured data, which cannot be processed by traditional software techniques

Bill of Landing

A legal document given by a carrier to a shipper detailing the exact number of goods delivered and its specific destination; it is sometimes used as proof of shipping or receipt

Black Friday

The first Friday after Thanksgiving Day which marks the onset of Christmas shopping and where stores typically mark down prices; it is a busy shopping holiday in the United States with the highest number of potential shoppers

Blue Law

A rule that prohibits work during Sundays in view of certain religious standards

Booking Program

An application or software that helps retailers schedule online orders or allow customers reserve certain goods and service online

Bottom Feeders

Customers who only buy during clearance sale when prices of merchandise are at its lowest

Brand Awareness

Part of a public relations campaign that aims at promoting a brand name; also measures how well a customer recognizes a specific brand

Break-even point

An instance where the profits and losses are the same indicating that the store is gaining profit; it is calculated by subtracting the variable cost from the fixed cost of sales

Brick and Click

A category in retail that combines traditional and electronic commerce or an integration of physical and electronic shopping; it may be temporary such as pop-stores or permanent like showrooms

Brick and Mortar

A local store where retailers interact with shoppers face to face; also refers to a physical retail establishment

Call Tag

A pre-paid shipping label containing the merchant ID and reference number used to track status of shipped goods or claim packages from a specific location; also pertains to a notice issued by a retailer whenever one decides to return or swap items

Charge Back

A money paid back to the customer when goods are damaged upon delivery at the fault of the retailer or whenever there are unreasonable delays in shipment; also refers to the protection given to credit card holders which obliges banks to refund the original value of cash loss due to fraud or other deceits

Consignment Merchandise

Goods that are sold in another store whereby the consignee only receives commission and the consignor receives the true profit

Cash wrap

A specific area in a retail store where cashiers carry out checkout services; also known as checkout counters

Cashbook

A financial record of payments and receipts including bank withdrawals and deposits

Cash Discount

A rebate given by retailers to customers who pay products within the given period or a deduction in the price offered by sellers during season sale; it is calculated by multiplying the current price with the discount rate; also known as purchase discount or early payment discount

Cash Draw

The act of withdrawing from the business account, which reduces both the business funds and equity of retailers in the company

Cash Flow

A record representing the financial activities of the retail establishment; the inward and outward flow of money as part of retail operations

Cash Register

Also called an old school Point of Sale system, is a device that enables the transaction between the retailer and the employee to take place. This involves the transfer of money by way of Credit Card, Cash, Gift or Loyalty Card, Gift Voucher in receipt for the merchandise purchased.

Category Killer

A huge product company that dominates above other business and attains the status of being tough and matchless; a retail establishment that is exceptionally and highly profitable

Chain Store

A retail outlet that is part of a larger business; in order to be considered a chain, the retail establishment must have at least 10 branches spread throughout different locations

Click and Collect

A method in shopping where customers select items online and pick them up in chosen retail chains on preferred day and time

Closed Merchandising

An approach in sales promotion that is also part of self-defeating security policy wherein items are locked behind glass and shoppers need to ask permission before they can get hold of them

Colour Blocking

A trend in fashion where multiple solid colours are combined in one outfit; a stylish mix-and-match of brightly and darkly coloured outfits for mannequin display

Comp Sales

A shortcut for comparable sales; often a test of profitability where retail chains compare current sales from previous sales; a comparison of sales between two retail outlets; also known as same-store sales or comparable store sales

Co-Operative

An organization of retailers aimed at centralizing efforts to obtain discounts from manufacturers and lessen the cost of retail operations

Consumer Goods

The final results of production and manufacturing which are supplied by the retail sector for usage and consumption such as food, water, clothes, vehicles, and many more

Core Range

Products with consistent demand such as staple items, which retailers have to incessantly top off

Cross Merchandising

A profit generation technique wherein products of different categories are arranged together to give customers a variety of options in just one look

Cross Selling

A method in marketing or product promotion wherein retailers suggest complimentary products to customers as they shop in the store

Customer Relationship Management (CRM)

The principles and guidelines of how sellers interact with customers

Dead Stock

Products that need to be removed from sale typically because they have never been sold to customers or have become outdated

Deep and Narrow

A strategy in retail which involves selling lesser items than what is available in stocks

Digital Signage

Any LCD, LED, or projection monitor used to display images, video, or product information

Docket Printer

A small electronic device attached to the computer that prints out receipt during checkout

Dog Stock

An item that seldom sells which often slows down sales input

Drop Shipping

A buy and sell technique wherein the retailer only sells the products but the wholesaler does the shipping

Dual Sighted / Dual Listed

A business structure in which two retail companies of different countries function together as one but retain their individual separate legal identity

Duopoly

A situation in which only two retail companies dominate in a single location

Dynamic Clustering

An assortment planning process to localize retail stores; also refers to a data storage technique that leverages K-nearest neighbour algorithm to trace sales logs and history

eCommerce Software

Software the enables the retailer to sell their products and services via the internet.

EFT

Acronym for electronic fund transfer; the process of transferring money across multiple accounts through computer-based systems

EFTPOS

Acronym for electronic fund transfer at point sale; a method of paying purchased goods using debit or credit cards at the payment counter

EIN

Acronym for Employer Identification Number; a unique nine-digit number issued by the Internal Revenue Service to store owners in the United States for identification purposes; also known as Federal Employer Identification Number (FEIN)

End of Month (EOM)

The term used by retail establishments to describe the last day of the month where they are required to pay their suppliers

Enterprise Resource Planning (ERP) Software

A software containing a set of integrated applications used by retail establishments to manage business operations and process data

E-tailing

Short term for electronic reselling; refers to the buy and sell of goods and services through the Internet

Exchange

Trade of goods and services between buyers and retailers; the act of swapping an item in exchange for another

Facing

A technique in merchandising where all products are placed on the front edge to make the store look perfectly stocked even when it is not; also known as zoning, straightening, conditioning, blocking, or rumbling

Fair Trade

A socialized movement aimed at balancing trade between marginal and giant retailers to achieve a sustainable business environment

Flash Sales

Hugely discounted products that are up for anyone to grab within an hour or day; these are excellent deals that come out very quick and which do not last long

Finger Print Reader

A small electronic device that uses biometric technology to identify individuals by scanning and matching their fingerprints with a previously stored data

First In, First Out (FIFO)

A scheme in organizing data wherein the oldest entry comes first while the recent one is placed at the last; also refers to the method in inventory assessment wherein the oldest things are sold first to avoid being outdated

Free on board (FOB)

A term used in cross boarder shipping wherein the buyer shoulders all shipment fee; a condition that makes the seller liable for any damages before goods are delivered to their designated location

Gift Cards

Special type of cards representing a specific amount which shoppers can use to purchase items in stores; they can be purchased online or given by retailers as privilege cards to claim certain items for free

Green Retailing

A retail approach that uses environmental friendly processes to help promote sustainable environment and support environmental laws

Gross Margin Return on Investment

An evaluation ratio used to assess the profitability that is calculated by dividing the gross margin with the average inventory cost; also refers to the measure of a store’s ability to exceed the cost of inventory within a year

Hardlines

A category in retail that focuses on the sale of hard goods such as appliances, electronics, and sporting equipment

Hot Spot

A hub or specific area surrounded by retail establishments; or the access point to certain goods and services such as Wi-Fi or WLAN;

High Speed Retail

A fast performing and highly profitable retail establishment; also refers to a mixture of different product categories and voluminous inventory that generates profit faster than any other company

Integrated Labels

Adhesive blank paper-based forms attached to packages upon shipment or during inventory management, invoicing, and order fulfilment

Integrated EFTPOS

An EMV compliant electronic device or point-of-sale PIN pad linked to a personal computer to process payments via debit and credit cards during checkout

Integrated Supply Chain

An extended network of different retailers that are linked together for a common goal

Inventory

A catalogue containing the list of all merchandise on hand or a comprehensive record of all items for sale

Inventory Turnover

A ratio used to measure how many times an inventory is sold and replaced in a given period by dividing the total sales with average inventory

Journal

A daily record of events in retail; also refers to a monthly or yearly publication tackling different matters in retail

Jobber

A wholesaler; any person who supplies bulk goods to small scale retailers

Keystone Pricing

A pricing method in which the original wholesale price is doubled; the act of selling at a price twice as expensive as the original

Kiosk

A stall or booth selling specific goods and services within a mall

Layaways / Laybuys

A money-saving technique in shopping wherein the buyer divides the payment of an item into different schedules until fully paid; also refers to a payment plan offered by retailers in which shoppers can reserve a merchandise by paying a deposit and get the item only after full payment

Leveraged Buyout

An acquisition of a retail establishment by another company using a money loaned from the bank

Limited Editions

A collection of products that is not going to be displayed for a long time either because it is limited in number or only endorsed for a specific season

Link Sales

To bridge or connect purchase transactions; also pertains to a type of virtual advertising which involves exchange of links to promote a website such as selling link spots

Logical Adjacencies

The process of merchandising items according to their likelihood to be bought by costumers instead of grouping them together according to their similarity

Loss Leader

A system of selling products at a price lower than their original market cost to attract shoppers into stores

Loss Prevention

A program or system adopted by a retail establishment to avert bankruptcy; a set of policies outlining how retailers should carry out daily operations to preserve profit

Magnetic Strip Reader (MSR)

A small electronic machine that decodes the data stored in the magnetic stripe located at the back of debit and credit cards; a tool used during checkout to enter a card information into the computer by swiping them into the device

Mass Customisation

The process of delivering modified goods into the wide market; production of custom-tailored products according to the detailed specifications of shoppers

Mark-up

Raising prices of merchandise to generate profit; also refers to the difference between the current value of goods and its selling price

Mark Down

Reducing the cost of merchandise because of its inability to be sold

Margin

The difference between the original selling price of a product and the cost of production

Membership Cards

Customized cards issued to customers certifying that they are members of a certain retail store, which often carry with them certain privileges such as discount and freebies

Merchandise Mix

An assortment of products; or a combination of different items sold in a store

Minimum Advertised Price

A pricing policy banning retailers to advertise products at prices lesser than they are originally sold

Minimum Order Quantity (MOQ)

The lowest number of products required by customers before a retail store completes checkout

Mind Share

The level of awareness that shoppers have in mind pertaining to a particular product

Mobile Payments

Billing out an item using a mobile application; also known as mobile money or mobile wallet

Monopoly

An economic condition in which only one enterprise dominates the whole market for a specific product

Multi-Buys

A special offer of bundled goods with similar brand or category sold at a cheaper price; it is a money-saving technique in shopping which integrates the principle “cheaper by the dozen”

Mystery Shopper

An external or internal consumer that is hired or tasked with the responsibility to shop ‘undercover’ in a retail store and provide feedback of their experience to the retailer.

Niche Retailing

A type of business that specializes only in one retail category and targets shoppers with specific interest

Odd-Even Pricing

A psychological pricing technique that sets price in a way that it looks cheaper than having it in a whole number for example, instead of pricing an item at $50, the price is set at $49.95 making it look less expensive

Off price

A retailer that sells branded and high quality items for a price lower than their prescribed value

Olfactory Merchandising

Defusing scents into the store to captivate the olfactory senses of customers or defusing a unique smell that would remind shoppers of the product

Omni-Channel Retailing

A seamless approach in marketing that makes products available in different shopping channels including mobile internet devices, radio, direct email, catalogue, and many more

Open Merchandising

A specific retail approach wherein customers are free to pick items but such items come with integrated security that monitors their movements to prevent theft

Open-to-buy

A retail concept that requires retailers to stock items according to how much inventory is needed and how much space is available

Operating Expenses

The money spent in running the store or the reported cost in carrying out daily business operations; also known as operational expenditure

Payroll

A document showing the financial documentation of an employee received during or after pay day or statement of account showing the wage, bonuses, and deductions due to the worker; also known as payslip

Pay-Per-Click Advertising

An internet marketing scheme in which advertisers display ads across multiple websites and give commissions to hosts every time the ad is clicked

Peripherals

Input or output devices connected to a computer to enter or retrieve information

Planogram

A diagram showing how items are arranged in the store shelves to facilitate and improve visual merchandising

Point of Commerce

A gateway to take in-store orders; a terminal where in-store retailers can have a 360 degree view of what shoppers want to purchase by monitoring their shopping behaviour

Point of Sale

Refers to the location where products and services are retailed; a method in capturing payment information of shoppers through different checkout devices such as cash registers and bar code scanners

Pop-Up Store

A small retail store that is only temporary and is aimed at drawing shoppers for an exclusive period; also known as flash retailing

Prestige Pricing

Hiking up prices based on the quality of products to help generate bigger revenues; setting higher prices for high-end items to convey that they must be of high status

Price Blocking

A price discrimination based on quantity variation accomplished by setting different prices for diverse quantities of goods

Product Life Cycle

The different phases that a tangible merchandise has to go through; the sequence of events over which an item is released into the market, displayed, and eventually sold; also known as life span or stage life

Profit Margin

A measure of profitability that determines how much a retail store generates profit for every dollar earned; the total cost after dividing net income with total revenue; also known as net profit or profit ratio

Profit and Loss Statement (P&L)

A pertinent document showing a summary of profits and losses within fiscal quarter or year

Projected Capacitive Touch (PCT)

Touch monitors installed behind or layered in store windows which detects human contact through the hand

Proportional Merchandising

Giving bigger space for products that sells better while giving lesser space for products that do not sell well

Primary Space

An area in the floor store where the highest and most expensive items are displayed or the specific zone in a store where customers would go first; also known as primary zone which is often the most crowded part of a retail chain

Private label

A product sold under the name of the retailer instead of manufacturer’s name

Purchase Order

A commercial document authorizing purchase transaction that is issued by the buyer to the seller; also refers to a buyer-generated document containing proposed purchases which when accepted by the seller becomes a binding agreement between the buyer and the seller

Product Breadth

A measure of how many products are sold based on different categories

Product Depth

A measure of how many products are sold based on only one category or interest

Promotional Lines

An assortment of below-the-line and above-the-line strategies of advertising products to a wider audience

Quantity Discounts

A deduction of price offered by sellers to buyers for purchasing more items; or a percentage off based on the number of items bought at one shopping transaction

Quotes

Number of items required to be sold within a given period to reach the expected sales

Rate Card

A document containing the different prices of various advertising options which is often used a reference to tell which media outlet is cheaper

Recommended Retail Price (RRP)

The genuine price suggested by manufacturers for retailers to sell in order to standardize pricing in different locations

Receipt Rolls

A roll of bond or thermal papers available in different sizes and multiple plies for receipt printing

Reconcile

To update inventory; to verify inventory accuracy by recounting items and matching the result with the book balance

Refund

To give money back to the customer; the amount of money given back to the customer or rebate

Relationship Retailing

Building a long-term bond with customers through creative marketing strategies to develop brand loyalty

Reporting Software

Software that analyzes the data collected and produces a summarized report often in graphical or table form.

Resale Number

An identification number issued to a retailer by which the latter purchases products for resale; also known as reselling permit

RFID

Acronym for Radio Frequency Identification; an electromagnetic chip attached in clothing apparels to identify and track inventory

Run of Paper

A status given to a print advertisement allowing it to be placed in any section of the magazine or newspaper at the editor’s own disposition

Sales Floor

The area in a retail building designated for product display; also known as showroom

Sales Orders

A commercial document containing purchase details which is issued by a seller to a buyer to confirm the sales transaction before delivery takes place

Self-Serve

To complete all the steps in purchasing a product at the own effort of shoppers; to shop online and process sales transaction independently

Secondary Space

An area in a mall or retail establishment which has been previously occupied but has become available again for lease

Sensory Experience

Diffusing distinctive fragrance, visuals, or music in the store to capture and enhance the sense of shoppers who come in

Seasonal Merchandising

Organizing items to enhance visual appeal during peak season; also refers to a temporary concept in displaying goods to meet the higher demands of costumers

Show special

An appealing showcase of different products; an exhibition of newest products and retail innovations

Shoplifting

A punishable act which involves taking products in a store without the intention of paying them; also known as stealing, boosting, or five-finger discount

Shrinkage

The difference between the original inventory and the current inventory due to loss; a reduction in the inventory caused by different factors such as theft, damage, or administrative errors

Sliding

Packing an item without scanning it through the cash register barcode scanner; failing to scan an item during checkout

Smart Card Reader

A small tool that is used in cash registers to scan smart cards and transfer financial data from the smart card microprocessor to the computer

Softlines

A category in retail that focuses on the sale of textile merchandise such as clothes, footwear, accessories, and linens

Staple Goods

Products that are consumed and used daily such as milk, sugar, papers and many more

Stock-Keeping Unit (SKU)

A unique code assigned in inventory management to identify products

Store Layout

A basic retail floor plan detailing where and how items are arranged; the totality of the interior and exterior setup of the store

Social Commerce

A category in electronic commerce which leverages on social media to expand scope of product awareness and achieve wider sales coverage

Substitution

Replacing an item with another product that is of the same category and quality

Sustainability

Refers to how a retail establishment survives throughout the years despite certain economic changes and new retail innovations

Tertiary Space

The outskirt area in a retail establishment

Thin Film Transistor (TFT)

A special kind of electric transistor made of layers of thin films or thin sheets of semiconductor glass used in LCD monitors

Touch Monitor

An electronic visual display that detects signal and executes command by sensing pressure through hand contact or when stroked by a special stylus pen

Trade Discount

A percentage off the total price agreed between wholesalers and retailers in event of high-volume orders

Trade Credit

A privilege granted in a sale on delivery wherein the retailer is given a specific period of time to complete payment; a buy-now-pay-later principle

Tribetailing

Selling products that cater only to a specific group of people, for example a mall that is dedicated only for women

Triple Net Lease (NNN) or Net-Net-Net

A lease agreement that requires a tenant to pay all other expenses normally paid by the owner, in addition to the rent; also known as hell water lease or high water lease

Unified Brand Experience

Bridging the link between online and offline retail to strengthen brand image and enhance shopping experience

Units Per Transaction (U.P.T)

A metric used in retail to count how many items are bought by a customer in one shopping transaction

Upselling

A marketing strategy by which retailers suggest more expensive add-on products that the customer might also like for purpose of increasing sales

Vacuum Florescent Display

A display device that uses electric lights to show letters and numbers, commonly used for store signage

VESA Mount

A platform that is compliant with manufacturing standards and where LCD TVs and PC monitors are usually placed

Virtual Augmentation

Displaying the highest quality images of products on screens in a way that it is hard to distinguish their difference from reality

Visual Pollution

A distortion in the aesthetic quality of an object or something that is not pleasing to the eyes

Webrooming

A time-saving strategy in shopping where customers first search for products in the web before actually going to the store

Wholesale

Distribution of goods from large vendors to retailers; the purchase of goods in larger quantities for various retailers to resell

Word-of-mouth

Message relayed by one person to another through verbal communication

Working capital

Principal assets used for the daily operations of a store; the available cash left after deducting current liabilities from current assets