Mastering Retail Terminology: Understanding the Language of Trade
By Lily Syafiqa · 20th November, 2023
Whether you're starting your journey in retail or aiming to refine your expertise, understanding the language of the trade is crucial. Our insightful glossary covers a wide range of terms that are vital for anyone involved in the retail industry, helping you to communicate effectively and stay informed.
Bundled pricing involves selling goods and services together at a lower price than if they were purchased separately. It's commonly seen in options packages, meal deals at restaurants, and streaming subscription plans. This strategy can increase profit by offering discounts on items that are not selling well individually.
Buy Now, Pay Later (BNPL)
BNPL allows customers to purchase products immediately and pay for them in installments. This is particularly effective for large-ticket items or luxury goods.
Buy Online, Pickup In Store (BOPIS)
A retail strategy allowing customers to purchase items online and then pick them up at a physical store location. This approach combines the convenience of online shopping with the immediacy of in-store pickup, reducing shipping times and costs while providing customers with a flexible shopping experience.
A chargeback is a return of funds to a payment card after a customer disputes a purchase. It can happen with bank accounts or credit cards and is effectively a refund for various reasons like returns, duplicate charges, or technical issues.
A cloud POS is a web-based point-of-sale system that processes payments through the internet, rather than on local computers or servers.
Contactless payments use near field communication (NFC) allowing customers to pay without touching the payment terminal. This includes mobile payments like Apple Pay.
Consumer Packaged Goods (CPG)
CPG are items used daily and have a short shelf life, needing frequent replacement. Examples include food, beverages, tobacco, clothing, and household products.
This metric measures the percentage of store visitors who make a purchase.
Retailers display unrelated products from different categories together, often connected by a common theme, to encourage customers to buy them all.
CRM (Customer Relationship Management)
An online system for managing relationships with current and prospective customers, storing their information online.
Merchandise not owned or paid for by the retailer until it's sold. The retailer pays the seller a percentage of the funds generated upon sale.
Products that have never sold or been in stock for a long time, also known as dead inventory.
A desktop terminal for Point of Sale (POS) is a computerized system used in retail and service settings for handling sales transactions. It includes components like a monitor, keyboard, barcode scanner, and receipt printer, and runs POS software for tasks like scanning items, processing payments, and managing inventory. These terminals streamline checkout, record sales data, and enhance customer service efficiency.
A business model where the company doesn't maintain inventory or own a warehouse but partners with a supplier who ships products directly to customers.
Brief promotions or discounts with limited quantities to encourage impulse buying due to the fear of missing out.
The measurement of the number of people entering a business premises.
An estimate of future demand for goods or services, based on past demand, trends, and seasonal patterns.
A licensing relationship where a franchisor issues a license to a franchisee to operate under the business’ name, often specifying the products and services to be provided.
Fulfillment in business involves processing, packing, and shipping orders to customers. It is a crucial part of the customer service and supply chain process, ensuring that customers receive their products promptly and in good condition.
Total sales revenue minus the cost of goods sold, divided by total sales revenue, expressed as a percentage.
The process of knowing when to restock items, in what quantities, and at what price, often automated with POS technology.
The frequency at which inventory in stock is sold or used during a given period.
Assign customers to tiers with personalized rewards based on their spending levels. Encourage repeat purchases to unlock the next membership tier.
Marketing strategies where retailers present goods and services to potential customers appealingly to encourage sales.
A mobile terminal for Point of Sale (POS) is a portable, handheld device used to manage sales transactions in various settings. Equipped with capabilities such as scanning, payment processing, and receipt printing, these devices often run POS software and can connect wirelessly to larger systems. Mobile POS terminals offer flexibility and mobility, enabling transactions in locations like pop-up stores, bazaars and outdoor settings.
The actual profit after working expenses have been paid.
Net Profit Margin
The percentage of revenue left after expenses have been deducted from sales.
The revenue a retailer makes during a specific time period, after deducting customer returns, markdowns, and employee discounts.
Omnichannel is a strategy that integrates multiple sales and communication channels, such as online stores, social media, mobile apps, and physical stores, to provide a seamless and consistent shopping experience across all platforms.
Online Merge Offline (OMO)
OMO is a retail strategy that blends digital and physical shopping experiences. It extends beyond the integration seen in omnichannel approaches by deeply intertwining online and offline worlds, allowing customers to seamlessly switch between them.
Find out more about how EasyStore can support your OMO strategy here.
Online-to-Offline (O2O) is a business strategy that encourages customers to move from digital transactions or engagements on an online platform to a physical, brick-and-mortar location, or vice versa. This approach aims to create a seamless customer journey, where online marketing, advertising, or browsing leads to offline activities like purchasing in a store, attending an event, or utilizing a service.
Point of Sale (POS) System
A system used by retailers to ring up sales and track transactions, often including modern setups like computers, barcode scanners, and card readers. More about EasyStore's POS solutions here.
A short-term shop set up in various locations for a limited time. Learn more about how BVERA's venture into pop-up shop accelerated their business growth.
Product Life Cycle
The stages a product goes through from conception until it's removed from the market.
A reduced price per unit when purchasing an item in bulk.
Revenue per Square Foot
Revenue per square foot is a metric used by retail businesses to assess the efficiency of their use of space in relation to revenue generated. It's calculated by dividing the total revenue by the total square footage of retail space. This measurement helps retailers understand how effectively their store layout, merchandising, and product assortment contribute to sales. It's particularly useful for comparing the performance of different stores in a chain or assessing the impact of layout changes in a single store.
When customers view a product in-store but purchase it online, often at a lower price.
SKU (Stock-Keeping Unit)
An alphanumeric code assigned to products for internal inventory tracking.
The ability to make purchases within a social media platform, like buying directly through Facebook or Twitter.
When customers consistently choose a specific store for purchases, often encouraged by rewards programs or special discounts.
Supply Chain Management
Activities necessary to plan, control, and deliver a product, from acquiring raw materials to distribution to customers.
A strategy that fully integrates all sales and communication channels into one platform, providing a seamless and cohesive shopping experience across online and offline mediums. It centralizes data, offers consistent inventory visibility, and ensures real-time updates, enhancing customer convenience and streamlining business operations.
Unified Customer Experience (UCX)
A holistic approach in managing interactions with customers across all channels and touchpoints. This concept aims to create a seamless, consistent, and highly personalized experience for customers, regardless of how or where they choose to engage with a brand.
Interested to apply Unified Customer Experience approach to grow your business further? Click for more!
Unified Loyalty Program
Unify online and physical store members with one system. Track and reward customer loyalty with points, gifts, discounts, and vouchers based on membership status.
Creating displays to attract customers and encourage purchases, starting from outside the store.
Warehouse Management System
Software and processes for managing warehouse operations from the time goods enter until they move out.
Dec 2023 - Jan 2024 Product Updates
By Kelie Wong · 1st Feb, 2024
6 Key Factors That Spark Customers' Interest for First Store Visit
By Kelie Wong · 31st Jan, 2024
4 Actionable Strategies For Retailers To Reduce CAC in 2024
By Kelie Wong · 16th Jan, 2024
10-Step Plan To Achieve Retail Victory in 2024
By Kelie Wong · 11th Jan, 2024
5 Key Metrics for Retailers to Evaluate UCX Success
By Nathan Ng, Kelie Wong · 3rd Jan, 2024
10 UCX-Driven Product Updates for Business Growth in 2024
By Kelie Wong · 26th Dec, 2023
Connect with our team
Let's begin your unified commerce journey. Complete the form to chat, book a meeting, or connect with our team.