ALL COMMODITIES VOLUME (ACV)
Method of measuring retailer distribution, taking into account the relative importance of an operator. Example: Brand A is distributed in only one store. That store achieves 10 percent of total market sales. ACV distribution of Brand A is therefore 10 percent.

APERTURE
Vertical, horizontal and depth measurements of facings.

ASSET TURNOVER
Net sales divided by the total assets of a retail operation.

ATMOSPHERE
Concept, architecture, design, layout, displays and signs, lighting, colors, music and fragrances aimed at creating pleasant surroundings and imprint an image of the retailer in the customer's mind.

B-TO-B (BUSINESS TO BUSINESS)
Rapidly growing category of businesses selling products, services or data via internet to commercial customers rather than to individual consumers.

B-TO-C
Business to consumer.

B-TO-G
Business to Government.

BACK CARD
Point-of-sale card attached to the back of a dump bin or floostand, presenting an advertising message at eye level.

BAIT & SWITCH
Illegal practice consisting in advertising an attractively priced item, sometimes not even available, to get customers to visit a retail store where they can be talked into purchasing a higher priced item.

BEST FOOD DAY (BFD)
The day on which most of the food shopping is done. Local retailers usually place feature ads in newspapers on that day.

BUYING POWER INDEX (BPI)
Index of percentage of total retail sales occurring in a given geographical area. This index is used to predict demand for new stores and evaluate the performance of existing retail businesses.

CAKE UNIT
Piece of furniture for promotions with a cake shape.

CASE DEAL
Price discount granted by the manufacturer on the basis of volume of cases purchased by the retailer.

CATALOG SHOWROOM
Store showroom adjacent to a warehouse, where a retailer displays merchandise. Typically used by stores specializing in house wares or other hard goods.

CATEGORY KILLER
Discount retailer offering a comprehensive assortment in one category of products and thereby dominating the category in the customers' eyes. Also called category specialist.

CENTRAL BUSINESS DISTRICT (CBD)
Traditional business area in a city or town

CENTRALIZED BUYING
Policy under which all purchase decisions are made at one single location, usually the headquarters.

CHANNEL MARKETING
A system whereby marketing functions of a firm are organized to put specific individuals in charge of selling to specific classes of trade.

CIRCULAR
Advertising piece inserted in a newspaper or mailed directly to customers as a flyer

CLAIM
Process and form used by retailers to obtain refund of advertising expenses. Also called "Proof of Performance"

CLASSIFICATION DOMINANCE
Assortment sufficiently large to enable customers to fill all their needs for a specific category of merchandise by visiting one single retailer (e.g. Toys'R'Us)

CLOSE-OUT STORE
Specialized retailer offering merchandise purchased through business liquidations

CUSTOMER RELATIONSHIP MANAGEMENT (CRM)
Automated management of integrated business processes, i.e. sales (customer contact product configuration), marketing (campaigns, telemarketing) and customer service (call center, field service).

DECALS (FLOOR DECALS)
Adhesive graphic (like a sticker) placed on the floor. Used for promotional, direction guidance or security purpose.

DEMO
Demonstration organized by a manufacturer in a retail store

DEMOGRAPHICS
Statistical analysis of the population by splitting it into groups such as age, sex, education level, etc.

DFI
Discount from invoice.

DIRECT MAIL CATALOG RETAILER
Retailer offering merchandise by means of catalogs mailed directly to individual potential customers

DIRECT MARKETING
A form of retailing not using a store, where customers are offered merchandise through catalogs, mailers or television ads and purchase by telephone or mail.

DIRECT SELLING
A form of retailing not using a store, where merchandise is sold by contacting customers directly or by telephone at home or workplace.

DIRECT STORE DELIVERY (DSD)
Merchandise delivered directly to a retail store rather than via wholesaler or warehouse. Typical DSD items are products like chips, milk, and soft drinks, usually delivered by a rack jobber.

DISCLAIMER
Document limiting a marketer's liability in regard to promotional claims.

DISPLAY
High visibility arrangement of product, signs and/or promotion material designed to attract customer's attention in a store.

DISTRESSED GOODS
Damaged or soiled product items.

E-COMMERCE
Any form of on-line, internet-based sales methods. The term describes both business-to-consumer and business-to-business sales activity.

EFFICIENT CONSUMER RESPONSE (ECR)
Method used by retailers to evaluate the effectiveness of promotion campaigns, product flow and product development, in order to determine the profitability of a brand.

ELECTRONIC ARTICLE SURVEILLANCE (EAS)
Technique used to protect business assets and merchandise by means of security labels, tags and detection equipment. EAS ensures protection of buildings, access points, exits and enclosed areas, and sets off an alarm whenever items equipped with an active tag go through the electronic detector.

ELECTRONIC DATA INTERCHANGE (EDI)
Exchange of documents, e.g. purchase orders, between retailer's computer and supplier's computer and vice versa.

ENTERPRISE RESOURCE PLANNING (ERP)
Package designed to create one single corporate image from various disparate and decentralized divisions, giving users the opportunity to visualize and reshape basic processes and blend into the corporate business philosophy.

EVERYDAY-LOW-PRICE STRATEGY
Strategy aimed at offering low prices on all products throughout the year rather than engaging in periodic promotional price actions involving a small number of items. Retailers using this strategy usually match their competitors' prices.

FEATURE
Advertisement included in a retailer's circular letter or newspaper

FORWARD BUYING
Buying excess product on special deals to sell of full price at a later date.

FRANCHISING
Contract under the terms of which a franchisor allows a franchisee to operate a retail outlet using the name, format and style created and supported by the franchisor.

FREE STANDING INSERT (FSI)
Coupon carrier, such as found in Sunday edition newspapers, for example.

FREE STANDING UNIT (FSU)
Promotion furniture located in-store to merchandise products in promotion.

FRONT-END
Area at the front of the store, near the cash registers. Prime location for impulse buying and high profit products, as well as for items that require surveillance.

GENERAL MERCHANDISE, APPAREL AND FURNITURE. (GAF)
Acronym used in reference to the retail business in general, excluding automotive and restaurants.

GIFT WITH PURCHASE (GWP)
Promotional technique frequently applied in department stores, e.g. free eyeshadow with a purchase of perfume or cosmetics.

GONDOLA
Long, narrow display case providing access for merchandise from both sides.

GRADUATED PERCENT PARTICIPATION
Participation plan linked to the number ads run by the advertiser. Participation may for example increase from 50% for the first ad to 75% for the second and reach 100% for the third.

GROSS MARGIN
Difference between retail price and cost of the merchandize.

HARD-LINES
Durable products such as furniture, appliances and housewares, excluding clothing items

HIGH PROFILE PROMOTION (HPP)
A larger instore promotion as a beauty stand represented by a beauty advisor giving out free samples. See also: Small profile promotion (SPP)

HORIZONTAL CO-OP
Co-op program combining several dealers' accruals to fund one single schedule.

INDEPENDENT RETAILER
Retailer owning one or two stores only.

INVENTORY MANAGEMENT
Management of the acquisition and maintenance of a suitable assortment of merchandise and management of related costs, i.e. ordering, shipping, handling, etc. Adequate inventory management is a vital aspect of retail merchandising. Dillard's and Wal-Mart are reputed for their advanced techniques in this area.

INVENTORY TURNOVER
Net sales divided by average retail inventory. A measure of the effectiveness with which the money invested in inventory is used.

JUST-IN-TIME-INVENTORY
Computerized method of controlling inventory and timing purchase orders to ensure new stock arrives no earlier than on the day it is required.

KEYSTONE MARKUP
Markup method consisting of doubling the cost of merchandise to determine the retail price.

LAUNCH
Roll out of a new product.

LEASED DEPARTMENT
"Store within a store". Common examples are footwear, cosmetics or jewelry departments within a department store, which pay rent to the main store.

LENGTH OF DEAL
Inclusive dates of validity of a particular deal and related promotion offered by the principal.

LEVERAGED BUYOUT (LBO)
Financial transaction in which the management of a firm or a third party acquires a company either by obtaining a loan from a financial institution or by issuing junk bonds guaranteed by the company's assets.

LICENSED BRANDS
Brands for which the owner of a well-known name (the licensor) grants licensing rights to a retailer or third party (the licensee). The licensee may choose to manufacture the licensed product himself or contract an outside manufacturing source. He then pays a royalty to the licensor. Fashion designers often license their brands.

LIFESTYLE MERCHANDISING
Matching merchandise lines to consumer living patterns.

LINE EXTENSION ALLOWANCE
Variation of an existing product promoted as a new product by the principal.

LOSS LEADER
Merchandise offered at low price, often below cost, with the aim to increase store traffic and generate sales of other, profitable items.

LOW VOLUME PRODUCT (LVP)
Products, also known as convenience items, that are stocked in a retail store solely for customer's convenience, e.g. shoe strings, kite string, etc .

MANUFACTURER'S ACCRUAL NOTICE
Monthly, quarterly or semi-annual report on amount of accrued earnings, sent by the manufacturer to the retailer

MANUFACTURER'S CLAIM FORM
Specific form provided by a manufacturer for use by retailers when claiming advertising reimbursements.

MARGIN
Gross profit, i.e. the difference between retail price and wholesale price before expenses (excluding costs of goods sold).

MARK DOWN POOL
Budget allowing a manufacturer to cover a percentage of the cost of selling merchandize at a reduced price.

MARKDOWN
Reduction of the original selling price

MARKET DEVELOPMENT FUNDS
Extra funds provided by principals to encourage trade buyers to increase shelf space or stock new products. Such funds have historically been used to provide incentives, i.e. sports tickets, trips, etc.

MARKUP
Difference between the cost and the selling price of a product

NET LEASE
Form of lease stipulating that the retailer is responsible for paying all maintenance expenses of his store, i.e. heating, insurance and inside repairs, etc.

NON-STORE RETAILING
Form of retailing independent from the existence of a store, i.e. conducted through vending machines, direct sales and marketing, party-based sales, direct mail, catalogs, television programming, telemarketing and internet.

ON COUNTER DATE (OCD)
When the products are on the shelves in store.

OPEN-TO-BUY (OTB)
Difference between planned purchases and stock already on order

OPTICAL CHARACTER RECOGNITION (OCR)
Classification system adopted industry-wide for coding data onto merchandize, allowing retailers to record information on each individual SKU at time of sale. The information can then be fed into a computer through cash registers equipped with bar-code scanners, known as point-of-sale systems.

PAD SITE
Location available for a free-standing building in front of a shopping center or mall

PASS-THROUGH CO-OP
Co-op funds available to a retailer even though he purchases from a wholesaler or other indirect source.

PERCENTAGE LEASE
Leasing contract linked to a store's turnover, i.e. where rental rate is determined as a percent of sales

PERFORMANCE DATE
Deadline for an ad to be run in order to qualify for co-op.

PERFORMANCE REQUIREMENTS
Manufacturer rules and regulations with which a retailer must comply to qualify for reimbursement of advertising costs.

PLANOGRAM
Space management tool used to maximize use of available floor and shelf space with regard to inventory, shelf stocking requirements and promotion needs.

POINT OF PURCHASE (POP)
Materials displayed at the point-of-sale to capture customer attention to a product

POINT OF SALE (POS)
Printed or electronic materials displayed in the store to capture customer attention and stimulate purchases. Refer also to "Point of Purchase"

POINT-OF-PURCHASE DISPLAY
In-shop display providing customer information and promoting merchandise.

POINT-OF-SALE TERMINALS
Laser equipped cash register capable of scanning a UPC code and record sales electronically. Also called computerized checkout.

POSITIONING
Strategy involving the design and implementation of a complete merchandizing offer, pricing policy and selling style aimed at creating in the customer's mind an image of the retail store relative to its competition.

PREDATORY PRICING
Pricing strategy designed to eliminate competition from the market place.

PREMIUM
Merchandize offered at reduced price or on a no-charge basis an incentive for customers to make a purchase.

PREPACK
Merchandize shipped in bundles, to be either broken down into single units at the warehouse or sold as such to the customer.

PRICE ELASTICITY OF DEMAND
Effect of price change on consumer demand. Measured by dividing percent change in demand by percent change in price.

PRICE FIXING
Illegal activity in which several firms agree upon a fixed retail price for a product within a given market area.

PRICE POINT
The price paid by the end user.

PRINCIPAL
Term used by trades and brokers to designate the manufacturer or supplier.

PRIOR APPROVAL
Step required in certain promotion plans, consisting in obtaining manufacturer's approval before running advertisements.

PRIVATE-LABEL BRAND
Also known as store brand. Brand of products retailes by a store. May consist of the store's name or any other name it has created, e.g. Kenmore appliances at Sears and Charter Club apparel at May's.

PRIVATE-LABEL STORE CREDIT CARD SYSTEM
Credit card system linked to a store but where the accounts receivables are sold to a financial company

PRODUCT INTRODUCTORY ALLOWANCE
Initial incentive trade allowance offered at the time of new product introduction.

PRODUCT TURN
Sale out of the entire inventory.

PROFIT MARGIN
Net profit after taxes divided by sales.

PROOF OF DELIVERY (POD)
Documented evidence provided by a transport company certifying that shipment was effected at a given place and time, and signed for by the recipient.

PROOF OF PURCHASE (POP)
May consist of a box or wrapping tear-off portion, UPC symbol, cash register receipt or other. Sometimes required from consumers to give them access to a retailer's special offer.

PURCHASE CYCLE
Frequency of purchase of a product or service by a consumer.

PURCHASE WITH PURCHASE (PWP)
Consumers purchasing a product are given the opportunity to buy an additional product at a reduced price.

RACK JOBBER
Wholesaler granted permission by a retailer to place and replenish stock of specific products on display racks.

REDEMPTION PROGRAMS
Incentive offers available against proof of purchase of a specific product. Offers may include free product, services, free admission, etc.

REGISTER TO WIN (RTW)
Customer promotion scheme aimed at increasing store traffic and enhancing sales.

RETURN ON INVESTMENT (ROI)
Ratio measuring the degree of success of a marketing campaign, by comparing incremental sales vs. the sum invested in promotion.

SALES PER SQUARE FOOT OF SELLING SPACE
Net sales divided by the selling space expressed in square feet.

SAME STORE SALES
Sales volume generated by stores possessing sufficient historical data to allow comparison between current year sales and sales during the same time frame the previous year.

SAMPLING
Technique frequently used at retail stores to get products into the hands of consumers through tasting, giveaways or reduced price trial offers.

SCANNER
Computerized cash register recording transactions by reading UPC code. Usage includes tracking end user purchases, controlling inventory and follow end user purchasing patterns and trends.

SCANNER DATA
Data read by scanning equipment and used for analyses, inventory control, etc.

SELL IN
The sale of goods by the manufacturer/supplier to the retailer

SELL THROUGH
The sale of goods by the retailer to the end user.

SELL THROUGH ANALYSIS
Comparison between actual and forecasted sales to identify possible need for early markdowns or for ordering additional merchandize.

SHELF EXTENDER
A point-of-sale item containing above normal shelf stock quantity of product, to enhance product visibility and attract customer attention.

SHELF TALKER
Display placed next to the product to provide information on its features and usage, or to signal specific offers, etc.

SHIPPER
Display stand, generally made out of cardboard, sold to trades as a package complete with the product it advertises.

SHRINK ALLOWANCE
Amount deducted from invoice before shipment to cover potential damage to merchandize during transport.

SHRINKAGE
Difference between accounting retail value of inventory and retail value of physical inventory divided by retail sales during a given period of time. Main causes of shrinkage are theft by employees or customers, damage and/or misplacement of merchandize.

SIGN OVER
The release of co-op funds by a retailer to a supplier for placement in a pool destined to finance group advertising.

SKU
Refer to "Stock Keeping Unit"

SMALL PROFILE PROMOTION (SPP)
A smaller instore promotion as a self service food degustation. See also: High profile promotion (HPP)

SOFT GOODS
Clothing and linen goods.

SPACE MANAGEMENT
Technique aimed at analyzing product movement patterns and designing/allocating shelf space to respond to these patterns. See "Planogram".

SPLIT OUT/FORCE OUT
Methods used by a multi-store retailer to distribute products to different branch stores.

SPREAD
The difference in percent between wholesale and retail prices.

STOCK KEEPING UNIT (SKU)
Identification number assigned by retailers to every single product in inventory. Retailers may choose to use an internal number or tie it to an item's UPC.

STOCK-TO-SALES RATIO
The inventory at the beginning of the month (BOM) divided by sales for the month. This ratio constitutes an integral element of the merchandizing plan. Average ratio is 12 divided by planned stock turnover.

STORE BRAND
Refer to "Private-Label Brand"

STREET MONEY
Discretionary payment made by suppliers to gain retailers' support in enhancing sales of their products.

SUGGESTED RETAIL PRICE (SRP)
The price the supplier suggests to the retailer to sell the product for.

TEMPORARY PRICE REDUCTION (TPR)
Promotional action by manufacturers to reduce prices to increase sales during a limited period of time.

TRADE DOLLAR
Money paid by suppliers to retailers to sponsor special prices, set up displays and initiate other types of customer targeted promotion actions.

UNIVERSAL PRODUCT CODE (UPC)
Code bar found on almost all products sold by the majority of retail stores.

VENDOR
Any manufacturer, supplier or distributor selling merchandise to a retailer.

VERTICAL CO-OP
Co-op program combining a retailer's accruals from several different suppliers to fund a schedule.