By T.J. Reid, Editor of Fashion Advantage
Last week during a consultation with a retailer, whose business was just about a year old, I realized she did not understand some of the terminology I was using in my suggestions. I stopped and reversed the conversation so that I was asking her the questions, and I quickly found she really did not know half of the things I was talking about. She then admitted to me that “Retailese” was like a whole different foreign language to her, yet she had been too embarrassed to admit to reps, vendors and even other retailers, that she sometimes had no idea what they were referring to.
Here are some terms every retailer should know. Hopefully, it is just a refresher course for some things you may have just forgotten.:
A.R. just means as ready
A.R.O. is after receipt of order. (I.E. as payment due at A.R.O.)
ADVERTISING ALLOWANCE is a discount given by manufacturers to offset the expense of advertising their product line or item. Amount varies from 2% to 8% on the invoice. Always ask – many larger companies are happy to help promote their product. They help with cards, ad and even billboards if their name is featured.
A.O is At Once (as in ship at once)
B.O. is Beginning of the Month
B/C or Best Way means Best Cheapest way to ship
BOGO is Buy One Get One – a popular sales slogan and gimmick used to promote items in the store, such as buy one pair shoes, get another half-price. Or buy one, get one free, etc. Usually always an effective promotion to encourage multiple purchases.
C.I.A. is Cash or Check on Advance
C.O.D. is Cash on Delivery
CHARGE BACK is an amount of merchandise returned to vendor from store, usually for credit or replacement.
CLOSE-OUT is a group of goods offered by a resource to retailers at the end of the season at a discounted cost.
DESIGNER is the visionary, talented person in charge designing and developing the product. They usually draw the sketches, design the details, and select the fabrics – then create the perfect style. (Such as John Bourgeois is the designer of Multiples.)
E.O M. is End of the Month
F.O. B. Free On Board is from where merchandise is shipped.
H.O.C. means hold confirmation. Asking a rep or vendor to hold an order awaiting your guarantee of order. (This is better than canceling because you were unsure.)
JOBBER is a middleman who purchases from manufacturers and sells to vendors thorough their firms. This merchandise is usually for at-once delivery and at special pricing.
KEYSTONE means doubling the wholesale cost in order to determine retail price. (This is very old school retail theory, and no-no in today’s world. You can not make a profit using this method today.)
MARGIN MARKUP is how much you determine to charge for an item.( As example, keystone is 50% margin. You need to figure about a 2.2 markup at the minimal in today’s retail world.)
MARKDOWN is the reducing of merchandise to move slow moving goods, and end out-of-season remerchandising. ( t is best to markdown and move out to make space for new trendy, and sellable goods. That is money clipped on those hangers, get it and turn it into cash.)
O.H. means On Hand
O.O. means On Order
O-T-B is a purchase plan you should always have before placing any orders. (Also the name of an OTB inexpensive software on the market from Mort Has.)
P.O. is Purchase Order
PRIVATE LABEL is developing merchandise to specifications or altering standards of national brands to create and sell merchandise that is unique to the store with your name featured on the label. (This allows you a better markup, as it is an exclusive for your name. Not only is it special to you, it is also impossible to price check, and if good enough can help establish an image for your business. An example – Kim Rogers is the Belk private label brand.)
SALES REP is the company representative who previews the line and product to you and is generally the person you deal with on a regional basis. (You will probably also have a national customer service person for re-orders and problems.)
SHRINKAGE is the loss of merchandise by shoplifting, eternal theft and sometimes bookkeeping errors.(Don’t bury your head in sand – it happens every day!)
O O is. Stock on Order
O H is Stock on Hand
VENDOR is the manufacturer who creates the goods you are buying. He is your supplier and goods are general shipped from him to your door step.
Now you know how to speak the language!
T.J. Reid is Editor of FASHION ADVANTAGE magazine, celebrating its 25th year in distribution. She is also a regular guest speaker at AmericasMart. To reach her, call 800-221-8615 or visit www.tjreid.com.