ANCHOR STORE

A major retail store in a shopping centre; used to drive business to smaller retailers. These larger
department stores or grocery stores are generally part of a retail chain and are the prominent
business in a shopping mall.
Asset Turnover
A performance measure based on a retailer net sales and total assets. It is equal to net sales
divided by total assets.
Big Box Stores
Large stand-alone store with varying maret niches.
Brand
A brand is a name! symbol or other identifying mar for a seller"s goods or services. It is distinct
from other sellers.
Brand Awareness
A gauge of mareting effectiveness measured by the ability of a customer to recogni#e and$or
recall a name! image or other mar associated with a particular brand.
Break Even Point
The point in business where the sales equal the e%penses. There is no profit and no loss.
Brick & Mortar
&ric and mortar store refers to retail shops that are located in a building as opposed to an online
shopping destination! door-to-door sales! ios or other similar site not housed within a structure.
Balanced Tenanc
'ccurs when stores in a planned shopping center complement each other in the quality and
variety of their product offerings. The ind and number of stores are lined to the overall needs
of the surrounding population.
Basic Stock !ist
(pecifies the inventory level! color! brand! style category! si#e! pacage! and so on for every
staple item carried by the retailer.
Battle o" t#e Brands
)hen retailers and manufacturers compete for shelf space allocated to various brands and for
control over display locations.
Bundled Pricing
Involves a retailer providing a number of services for one basic price; most often seen in
mobility service pacages for e%ample.
Black $rida
In retail! &lac *riday is best nown as the shopping day after Thansgiving in the +nited (ates
when retail stores generate their highest sales. &lac refers to the accounting term as a business
moves from loses in red in to gains in blac in.
C#ain Store
'ne of a number of retail stores under the same ownership and dealing in the same merchandise.
Convenience %roducts
,erchandise that is purchased frequently! without advance planning! including staples! impulse
items! and emergency items.
Co&o%erative
A group in which several retailers pool their resources to buy products at a discount from
manufacturers; also called group buying.
Catc#'ent Area
The area from where the majority of shops customer are located.
Categor (iller Store
An especially large specialty store featuring an enormous selection in its product category and
relatively low prices. It draws consumers from wide geographic areas.
C#ain
,ultiple retail units under common ownership that engage in some level of centrali#ed -or
coordinated. purchasing and decision maing.
Cas# $low
/elates to the amount and timing of revenues received to the amount and timing of e%penditures
made during a specific time period. In other words! the movement of money in and out of a
business and the resulting availability of cash.
Ca%ital Ex%enditures
/etail e%penditures that are long-term investments in fi%ed assets.
Cross Merc#andising
A mareting practice based on lateral mareting principle! which includes displaying products
from complementary categories! in order to generate incremental sales. The practice has assumed
wider meanings to include cross-promotions and display of non-complementary merchandise
too.
Categor s%ecialist
A retail store that offers merchandise in a narrow category but a large assortment of merchandise
within that category! usually at competitive prices and dominates a retail category. It can also be
termed as 01ategory 2iller0.
Canni)alis'
The impact that a new location will have on an e%isting store"s sales in a chain corporation.
C)er Monda
1yber ,onday! the ,onday following Thansgiving in the +.(.! is one of the busiest shopping
days of the year for online retailers. The term was coined by (hop.org! a division of 3ational
/etail *ederation. /etailers notice a spie in sales on this day as many consumers chose not to
shop during &lac *riday or did not find what they were looing for! headed to the web on
,onday from wor or home to find bargains. ,any retailers use 1yber ,onday to ic off the
holiday shopping season by offering special promotions.

*e%art'ent Store
A large retail unit with an e%tensive assortment -width and depth. of goods and services that is
organi#ed into separate departments for purposes of buying! promotion! customer service! and
control.
*e%t# o" Assort'ent
/efers to the variety in any one goods$service category with which a retailer is involved.
*iscount Store
A self-service retail store with low marups. 4%ample5 )al-,art! 2mart.
*estination Retailer
A retailer to whom consumers will mae a special shopping trip. The destination may be a store!
a catalog! or a )eb site.
*estination Store
A retail outlet with a trading area much larger than that of a competitor with a less unique appeal
to customers. It offers a better merchandise assortment in its product category -ies.! promotes
more e%tensively! and creates a stronger image.
*ura)le +oods,*ura)les
6roducts that can be used frequently and have a long life e%pectancy! such as furniture! jewelry!
and major appliances.
*r +rocer
7enerally food that is not fresh! e.g. ,asalas$condiments.
*ead Areas
Awward spaces where normal displays cannot be set up.
*ownsi-ing
4%ists when unprofitable stores are closed or divisions are sold off by retailers dissatisfied with
their performance.
Electronic Article Surveillance
Involves attaching specially designed tags or labels to products to curb shoplifting.
Ense')le *is%la
An interior display whereby coordinated merchandise is grouped and displayed together.
Etailing
Internet retailing as it is usually referred to. 1overs retailing using a variety of different
technologies or media! mostly the internet. 6roducts are chosen via a published catalog and
payments made through credit cards and secure payment gateways.
Ease o" Entr
'ccurs for retailers due to low capital requirements and no! or relatively simple! licensing
provisions.
Everda !ow Pricing .E*!P/
A version of customary pricing! whereby a retailer strives to sell its goods and services at
consistently low prices throughout the selling season.
End 01ser The person who uses a product that has been manufactured and mareted. &ased on
the idea that the 8end goal9 of a manufactured product is for it to be useful to the consumer.
$irst&in2 "irst out
A method of stoc rotation in which goods that are received first are sold first. 3ewly received
product is stoced behind the older merchandise.
$ad
A fashion that gains and loses popularity very quicly.
$actor Outlet
A manufacturer-owned store selling that firms closeouts! discontinued merchandise! irregulars!
canceled orders! and! sometimes! in-season! first-quality.
$lea Market
:as many retail vendors offering a range of products at discount prices in plain surroundings.
,any flea marets are located in nontraditional sites not normally associated with retailing. They
may be indoor or outdoor.
$ood&Based Su%erstore
A retailer that is larger and more diversified than a conventional supermaret but usually smaller
and less diversified than a combination store. It caters to consumer"s complete grocery needs and
offers them the ability to buy fill-in general merchandise.
$orecourt Retail
'ne stop solution to all the demands of customers coming to petrol pumps.
$ood court
an area as in a shopping mall where fast food is sold usually around a common eating area.
$ull&!ine *iscount Store
A type of department store characteri#ed by -;. a broad merchandise assortment; -<. centrali#ed
checout service; -=. merchandise normally sold by self-service with minimal assistance; ->. no
catalog order service; -?. private-brand nondurable goods and well-nown manufacturer-brand
durable goods; -@. hard goods accounting for a much greater percentage of sales than at
traditional department stores; -A. a relatively ine%pensive building! equipment! and fi%tures; and
-B. less emphasis on credit sales than in full-service stores.
$ranc#ise
A trading entity such as a mareting tool or method! a product or group of products or simply a
trade brand.
$ranc#isee
The party that sells goods and services within the framewor of the franchise.
$ranc#isor
The party that established -manages. the franchise.

$oot"all
In the retail parlance! the number of people visting a retail outlet in a period of time is called a
footfall. 4ven though a footfall indicates the number of people who visited a retail outlet! it is
only when footfalls are converted into purchases! that maes for retail success.
$ranc#ise
The right under which a franchisee person or company may maret a product or service! as
granted by the franchisor -the proprietary owner.. A franchise agreement is the contract defining
the terms and conditions between the franchisor and franchisee. *ranchises often give e%clusive
rights for a specified area
+ross Margin
7ross margin is the difference between what an item costs and for what it sells.

+oods
Tangible products for sale that can be held or touched.
+eneral Store
A shop that sells a variety of goods including food.
+eneric Brands
3o-frills goods stoced by some retailers. These items usually receive secondary shelf locations!
have little or no promotion support! are sometimes of less overall quality than other brands! are
stoced in limited assortments! and have plain pacages.
+oods Retailing
*ocuses on the sale of tangible -physical. products.
+oods,Service Categor
A retail firm line of business.
+ra Market +oods
&rand-name products purchased in foreign marets or goods transshipped from other retailers.
They are often sold at low prices by unauthori#ed dealers.
+eneric Brands
3o-frills goods stoced by some retailers. These items usually receive secondary shelf locations!
have little or no promotion support! are sometimes of less overall quality than other brands! are
stoced in limited assortments! and have plain pacages.
Hig# Street
a main street considered as important retail area
Hardlines
A store department or product line primarily consisting of merchandise such as hardware! house
wares! automotive! electronics! sporting goods! health and beauty aids or toys
3'%ulse Purc#ase
6roducts that people purchase without planning for it! such as maga#ines or candy bars
3nde%endent
A retailer that owns only one retail unit
3nitial Marku% .at Retail/
&ased on the original retail value assigned to merchandise less the merchandise costs! e%pressed
as a percentage of the original retail price
3nventor Manage'ent
Involves a retailer seeing to acquire and maintain a proper merchandise assortment while
ordering! shipping! handling! and related costs are ept in chec.
3nventor S#rinkage
Involves employee theft! customer shoplifting! and vendor fraud.
3solated Store
A freestanding retail outlet located on either a highway or a street. There are no adjacent retailers
with which this type of store shares traffic.
3nventor turnover
A ratio measuring the adequacy and efficiency of the inventory balance! calculated by dividing
the cost of goods sold by the amount of the average inventory.
(3OS(
The term ios! as related to retailing! refers to a small stand-alone structure used as a point of
purchase. This can be either a computer or display screen used to disseminate information to
customers or may be a free-standing! full-service retail location. 2ioss are often found in malls
and other high-traffic locations.
(3RANA STORES
Traditional formats of low cost retailing stores in India! mostly as stand alone family run!
neighbourhood shops. ,ajor strength being familiari#ation with immediate and regular
customers! provision of credit facility! home delivery etc.
(estone Pricing
2eystone pricing is a method of maring merchandise for resells to an amount that is double the
wholesale price.
!oss !eader
A selected item that is deliberately sold at less than cost in order to attract customers.
!oss Prevention
Loss prevention is the act of reducing the amount of theft and shrinage within a business.
!aawa
Layaway is the act of taing a deposit to store merchandise for a customer to purchase at a later
date.
!eased de%art'ent
A part of a department store that is actually leased out to another company and operated as an
independent store within the department store; common with cosmetics companies.
!i'ited line
Cescribes a department store that carries a limited amount of merchandise! usually concentrating
on clothing! accessories! and beauty supplies.
!eader Pricing
'ccurs when a retailer advertises and sells selected items in its goods$service assortment at less
than usual profit margins. The goal is to increase customer traffic in the hope of selling regularly
priced goods and services in addition to the specially priced items.
!everaged Buout .!BO/
An ownership change that is mostly financed by loans from bans! investors! and others.
!ia)ilities
Any financial obligations a retailer incurs in operating a business.
!3$O Met#od
-Last in! first out. Assumes new merchandise is sold first! while older stoc remains in inventory.
It matches current sales with the current cost structure.
!i'ited *ecision Making
'ccurs when a consumer uses each of the steps in the purchase process but does not need to spend a
great deal of time on each of them.
Mini'u' Advertised Price
A suppliers pricing policy that does not permit its resellers to advertise prices below some
specified amount. It can include the resellers retail price as well. D
Margin
The amount of gross profit made when an item is sold.
Merc#andise Mix
A merchandise mi% is the breadth and depth of the products carried by retailers. Also nown as
product assortment.
Mster S#o%%ing
A quality chec system employed by companies. Cummy customers are sent into stores to chec
upon quality of service! behaviour and nowledge of store employees etc.
Merc#andising %lan
A strategy for actual and projected sales for a specific period of time.
Merger
The combining of two or more retail organi#ations into one company.
Multiline drugstore
A store that sells a variety of health and beauty products! plus some small appliances and
household items! in addition to prescription drugs.
Merc#andising
The way that products are displayed in a shop.
Multi%le .store/
/etail 1hain.
Maintained Marku% .at Retail/
&ased on the actual price
Maintenance&3ncrease&Recou%'ent !ease
:as a provision allowing for rent increases if a property owner ta%es! heating bills! insurance! or
other e%penses rise beyond a certain point.
Manu"acturer .National/ Brands
6roduced and controlled by manufacturers. They are usually well nown! supported by
manufacturer ads! somewhat pre-sold to consumers! require limited retailer investment! and often
represent ma%imum product quality to consumers.
Marketing Researc# in Retailing
4ntails the collection and analysis of information relating to specific issues or problems facing a
retailer.
Marketing Researc# Process
4mbodies a series of activities5 defining the issue or problem to be studied! e%amining secondary
data! generating primary data -if needed.! analy#ing data! maing recommendations! and
implementing findings.
Market Penetration
A pricing strategy in which a retailer sees to achieve large revenues by setting low prices and
selling a high unit volume.
Market&Seg'ent Product +rou%ings
6lace various products appealing to a given target maret together.
Market Ski''ing
A pricing strategy wherein a firm charges premium prices and attracts customers less concerned
with price than service! assortment! and status.
Midnig#t sale
A centre wide! merchants0 association-sponsored! low-end! off-price promotion! generally
continuing until ;; p.m or midnight5 one night only
Markdown
6lanned reduction in the selling price of an item! usually to tae effect either within a certain
number of days after seasonal merchandise is received or at a specific date. Also! A reduction
from selling price to meet the lower price of another retailer! adapt to inventory overstocing!
clear out shopworn merchandise! reduce assortments of odds and ends! and increase customer
traffic.
Markdown Percentage
The total mardown as a percentage of net sales -in dollars..
Marku% Percentage .at Retail/
The difference between retail price and merchandise cost e%pressed as a percentage of retail
price.
Marku% Pricing
A form of cost-oriented pricing in which a retailer sets prices by adding per-unit merchandise
costs! operating e%penses! and desired profit.
Mar4uee
A sign used to display a store name and$or logo.
Massed Pro'otion E""ort
+sed by retailers that promote mostly in one or two seasons.
Mass Marketing
(elling goods and services to a broad spectrum of consumers.
Mass Merc#andising
A positioning approach whereby retailers offer a discount or value-oriented image! a wide and$or
deep merchandise assortment! and large store facilities.
Ma-ur Plan
Civides all retail activities into four functional areas5 merchandising! publicity! store
management! and accounting and control.
Mega'all
An enormous planned shopping center with ;-million-plus square feet of retail space! multiple
anchor stores! up to several hundred specialty stores! food courts! and entertainment facilities.
Me')ers#i% Clu)
Aims at price-conscious consumers! who must be members to shop.
Me'orandu' Purc#ase
'ccurs when items are not paid for by the retailer until they are sold. The retailer can return
unsold merchandise. :owever! it taes title on delivery and is responsible for damages
Merc#andise Availa)le "or Sale
4quals beginning inventory! purchases! and transportation charges.
Merc#andise Buing and Handling Process
1omprised of an integrated and systematic sequence of steps from establishing a buying
organi#ation through regular re-evaluation.
Merc#andise S%ace
The area where nondisplayed items are ept in stoc or inventory.
Merc#andising
1onsists of the activities involved in acquiring particular goods and$or services and maing them
available at the places! times! and prices and in the quantity to enable a retailer to reach its goals.
Mergers
Involve the combination of separately owned retail firms.
Micro&Merc#andising
A strategy whereby a firm adjusts shelf-space allocations to respond to customer and other
differences among local marets.
Mini'u'&Price !aws
A strategy whereby a firm adjusts shelf-space allocations to respond to customer and other
differences among local marets.
Model Stock A%%roac#
A method of determining the amount of floor space to carry and display a proper merchandise
assortment.
Model Stock Plan
The planned composition of fashion goods! which reflects the mi% of merchandise available
based on e%pected sales. The model stoc plan indicates product lines! colors! and si#e
distributions.
Mont#l Sales 3ndex
A measure of sales seasonality that is calculated by dividing each month actual sales by average
monthly sales and then multiplying the results by ;EE.
Mot#er Hen wit# Branc# Store C#ickens Organi-ation
4%ists when headquarters e%ecutives oversee and operate the branches. This wors well if there
are few branches and the buying preferences of branch customers are similar to customers of the
main store.
Motives
The reasons for consumers behavior.
Multidi'ensional Scaling
A statistical technique that allows attitudinal data to be collected for several attributes in a
manner that allows data analysis to produce a single overall rating of a retailer -rather than a
profile of individual characteristics..
Multi%le&1nit Pricing
A policy whereby a retailer offers discounts to customers who buy in quantity.
Mo' & Po% Stores
(mall independently run stores.
M Co''erce
-mobile commerce. is the buying and selling of goods and services through wireless handheld
devices such as cellular telephone and personal digital assistants -6CAs.. 2nown as ne%t-
generation e-commerce! m-commerce enables users to access the Internet without needing to
find a place to plug in.
Maintained 'arku%
The difference between the net sales and the gross cost of merchandise sold. it is the margin on
sales before maing adjustments for cash discounts earned and alternation costs.
Non dura)le goods
6roducts that are purchased frequently and used in a short period of time! such as beauty supplies
and cosmetics.
Non'arking
A pricing system in which each individual item does not have a price tag! instead a price is
labeled on a bin or a shelf.
Need&Satis"action A%%roac#
A sales technique based on the principle that each customer has different wants; thus! a sales
presentation should be geared to the demands of the individual.
Negotiated Pricing
'ccurs when a retailer wors out prices with individual customers because a unique or comple%
service is involved and a one-time price must be agreed upon.
Neig#)or#ood Business *istrict .NB*/
An unplanned shopping area that appeals to the convenience-shopping and service needs of a
single residential area. The leading retailer is typically a supermaret! a large drugstore! or a
variety store and it is situated on the major street-s. of its residential area.
Neig#)or#ood S#o%%ing Center
A planned shopping facility with the largest store being a supermaret and$or a drugstore. It
serves =!EEE to ?E!EEE people who are within ;? minutes driving time -usually fewer than ;E
minutes..
Net !ease
1alls for all maintenance costs! such as heating! electricity! insurance! and interior repair! to be
paid by the retailer -- which is responsible for their satisfactory quality.
Net Pro"it
4quals gross profit minus retail operating e%penses.
Net Pro"it Be"ore Taxes
The profit earned after all costs have been deducted.
Net Pro"it Margin
A performance measure based on a retailers net profit and net sales. It is equal to net profit
divided by net sales.
Net Sales
The revenues received by a retailer during a given time period after deducting customer returns!
mardowns! and employee discounts.
Net 5ort#
1omputed as a retailers assets minus its liabilities.
Never&Out !ist
+sed when a retailer plans stoc levels for best-sellers. Items accounting for high sales volume
are stoced in a manner that ensures they are always available.
Nic#e Retailing
4nables retailers to identify customer segments and deploy unique strategies to address the
desires of those segments.
Nondisguised Surve
A technique in which the respondent is told the real purpose of a research study.
Nongoods Services
The area of service retailing in which intangible personal services -rather than goods. are offered
to consumers -- who e%perience services rather than possess them.
Non%ro)a)ilit Sa'%le
An approach in which stores! products! or customers are chosen by the researcher -- based on
judgment or convenience.
Nonstore Retailing
+tili#es strategy mi%es that are not store-based to reach consumers and complete transactions. It
occurs via direct mareting! direct selling! and vending machines.
Odd&Even Pricing
A form of psychological pricing that suggests buyers are more sensitive to certain ending digits.
O%en&to&Bu
,erchandise budgeted for purchase during a certain time period that has not yet been ordered.
O%en )ackground
Cescribes a window display with a completely unobstructed view of the interior of the store.
Overerr
A mistae made when an employee enters an amount into the register that is more than the sale
price.
One&sto%&s#o%
/etail outlet that caters for virtually every need within a product or service group or across all
products and services.
Outlet
(hop.
O)6ective&and&Task Met#od
A promotional budgeting technique by which a retailer clearly defines its promotional goals and
then prepares a budget to satisfy these goals.
O)6ectives
The long-run and short-run performance targets that a retailer hopes to attain. 7oals can involve
sales! profit! satisfaction of publics! and image.
O)servation
A form of research in which present behavior or the results of past behavior are observed and
recorded. It can be human or mechanical.
Odd Pricing
A strategy in which retail prices are set at levels below even-dollar values! such as FE.>G! F>.GB!
and F;GG.
O""&Price C#ain
*eatures brand-name apparel and accessories! footwear! linens! fabrics! cosmetics! and$or
housewares and sells them at everyday low prices in an efficient! limited-service environment.
O""&Retail Markdown Percentage
The mardown for each item or category of items as a percentage of original retail price.
One&Hundred Percent !ocation
The optimum site for a particular store. A location labeled as ;EE percent for one firm may be
less than optimal for another.
One&Price Polic
A strategy wherein a retailer charges the same price to all customers buying an item under
similar conditions.
O%en Credit Account
/equires a consumer to pay his or her bill in full when it is due.
O%en&to&Bu
The difference between planned purchases and the purchase commitments already made by a
buyer for a given time period! often a month. It represents the amount the buyer has left to spend
for that month and is reduced each time a purchase is made.
O%erating Ex%enditures
The short-term selling and administrative costs of running a business.
O%erating Ex%enses
The cost of running a retail business.
O%erations Manage'ent
The efficient and effective implementation of the policies and tass necessary to satisfy a firm
customers! employees! and management -and stocholders! if a publicly owned company..
O%%ortunistic Buing
3egotiating special low prices for merchandise whose sales have not lived up to e%pectations!
end-of-season goods! items consumers have returned to the manufacturer or another retailer! and
closeouts.
O%%ortunities
The maretplace openings that e%ist because other retailers have not yet capitali#ed on them.
O%%ortunit Costs
Involve forgoing possible benefits that may occur if a retailer could mae e%penditures in
another opportunity rather than the one chosen.
O%tion Credit Account
A form of revolving account that allows partial payments. 3o interest is assessed if a person pays
a bill in full when it is due.
Order&+etting Sales%erson
Actively involved with informing and persuading customers! and in closing sales. This is a true
HsalesH employee.
Order !ead Ti'e
The period from the date an order is placed by a retailer to the date merchandise is ready for sale
-received! price-mared! and put on the selling floor..
Order&Taking Sales%erson
Involved in routine clerical and sales functions! such as setting up displays! placing inventory on
the shelves! answering simple questions! filling orders! and ringing up sales.
Organi-ational Mission
A retailers commitment to a type of business and to a distinctive role in the maretplace. It is
reflected in the firms attitudes to consumers! employees! suppliers! competitors! government! and
others.
Outside Buing Organi-ation
A company or person e%ternal to the retailer that is .
Outside Buing Organi-ation
A company or person e%ternal to the retailer that is hired to fulfill the buying function! usually on
a fee basis .
Overstored Trading Area
A geographic area with so many stores selling a specific good or service that some retailers will
be unable to earn an adequate profit.
Owned&+oods Services
The area of service retailing in which goods owned by consumers are repaired! improved! or
maintained
Online advertising
is a form of advertising that uses the Internet and )orld )ide )eb in order to deliver mareting
messages and attract customers
Precision Retailing
+sing data in information systems to mae refined merchandising decisions store by store.
Planogra'
Iisual description! diagram or drawing of a stores layout to include placement of particular
products and product categories
Pro"it Margin
A ratio of profitability calculated as earnings divided by revenues. It measures how much out of
every dollar of sales a retail business actually eeps in earnings
Product !i"e Ccle
The stages that a new product is believed to go through from the beginning to the end5
Introduction! 7rowth! ,aturity and Cecline
Private !a)el
6roducts which are generally manufactured or provided by one company under another
companys brand
POS
6oint of (ale -6'(. refers to the area of a store where customers can pay for their purchases. The
term is normally used to describe systems that record financial transactions. This could be an
electric cash register or an integrated computer system which records the data that comprises a
business transaction for the sale of goods or services
Product *e%t#
6roduct depth is the number of each item or particular style of a product on the shelves. 6roduct
depth is also nown as product assortment or merchandise depth
Product Breadt#
The product breadth is the variety of product lines offered by a retailer
Purc#ase Order
A purchase order -6'.is a written sales contract between buyer and seller detailing the e%act
merchandise or services to be rendered from a single vendor
Point&o"&Purc#ase *is%la
6oint-of-purchase displays! or 6'6 displays! are mareting materials or advertising placed ne%t
to the merchandise it is promoting. These items are generally located at the checout area or
other location where the purchase decision is made. *or e%ample! The checout counters of
many convenience stores are cluttered with cigarette and candy 6'6 displays
Partial )ackground
The rear of a window display that is partially covered! but allows customers to see through the
display into the store
Patronage )uing 'otive
A reason customers will shop at one store instead of another! can be rational or emotional
Pin ticket
The sort of price ticet used on towels and washcloths that is attached with a pin
Point&o"&sale ter'inal
An electronic machine at a checout station that feeds information from product tags directly
into a computer.
Pre'arking
A system in which the manufacturer! rather than the retailer! mars merchandise with the retail
price.
Preretailing
A system in which a duplicate purchase order is sent to receiving when merchandise is ordered
so that as soon as the merchandise is received! it can be mared with the correct prices.
Product , Service Mix
The number and ind of products and services a general merchandise retailer will offer.
Product , Service %lanning
The process of deciding what the product$service mi% will be.
Pro"it Center
A section of a store that earns money for the retailer.
Pull %olic
A promotional policy aimed at building strong consumer demand for a product.
Pus# %olic
A promotional policy aimed at marets with the intention of getting retailers to stoc a product in
order to build supply in the maretplace.
Pallet
A large flat board that is used to hold and move products.
Pitc#
A plot of land used by street traders As in sales pitch! the approach! emphasis and nuances used
when articulating the virtues of a service or product.
Polester
(ynthetic polymer often used to coat household goods such as refrigerators.
Pol#ook Bag
A bag that contains a small plastic hangar as an integral part of the top of the bag.
Price 5ar
A colloquial phrase denoting aggressive price reductions on the same -or similar. products by
competing retailers.
Pri'ar Packaging
The immediate pacaging around the finished product.
Procure'ent
'btaining 7oods.
Product O""er
6roducts attributes! including price
Parasite Store
An outlet that does not create its own traffic and that has no real trading area of its own
Partners#i%
An unincorporated retail firm owned by two or more persons! each of whom has a financial
interest.
Perceived Risk
The level of ris a consumer believes e%ists regarding the purchase of a specific good or service
from a specific retailer! whether or not that belief is factually correct.
Percentage !ease
(tipulates that rent is related to the retailers sales or profits.
Percentage&o"&Sales Met#od
A promotional budgeting technique whereby a retailer ties its promotion budget to sales revenue.
Percentage 7ariation Met#od
An inventory-level planning method where beginning-of-month planned inventory level during
any month differs from planned average monthly stoc by only one-half of that month variation
from estimated average monthly sales.
Percentage 7ariation Met#od
An inventory-level planning method where beginning-of-month planned inventory level during
any month differs from planned average monthly stoc by only one-half of that monthJs variation
from estimated average monthly sales.
Per"or'ance Measures
The criteria used to assess retailer effectiveness. They include total sales! average sales per store!
sales by goods$service category! sales per square foot! gross margins! gross margin return on
investment! operating income! inventory turnover! mardown percentages! employee turnover!
financial ratios! and profitability.
Per%etual&3nventor 1nit&Control Sste'
2eeps a running total of the number of units handled by a retailer by ongoing record-eeping
entries that adjust for sales! returns! transfers to other departments or stores! receipt of shipments!
and other transactions. It can be done manually! use tags processed by computers! or rely on
point-of-sale devices.
Personal Selling
Involves oral communication with one or more prospective customers for the purpose of maing
sales.
P#sical 3nventor Sste'
Involves an actual counting of merchandise. A retailer using the cost method of inventory
valuation and relying on a physical inventory system can derive gross profit only as often as it
conducts a full physical inventory.
Planned S#o%%ing Center
1onsists of a group of architecturally unified commercial establishments built on a site that is
centrally owned or managed! designed and operated as a unit! based on balanced tenancy! and
surrounded by paring facilities.
Point&o"&Purc#ase .POP/ *is%la
An interior display that provides consumers with information! adds to store atmosphere! and
serves a substantial promotional role.
Positioning
4nables a retailer to devise its strategy in a way that projects an image relative to its retail
category and its competitors! and elicits consumer responses to that image.
Power Center
A shopping site with -a. up to a half-do#en or so category iller stores and a mi% of smaller
stores or -b. several complementary stores speciali#ing in a product category.
Power Retailer
The status reached by a company that is dominant in some aspect of its strategy. 1onsumers
view the company as distinctive enough to become loyal to it and go out of their way to shop
there.
Power Retailer
The status reached by a company that is dominant in some aspect of its strategy. 1onsumers
view the company as distinctive enough to become loyal to it and go out of their way to shop
there.
Predator Pricing
Involves large retailers that see to destroy competition by selling goods and services at very low
prices! thus causing small retailers to go out of business. The practice is restricted by federal and
state laws.
Prestige Pricing
Assumes consumers will not buy goods and services at prices deemed too low. It is based on the
price-quality association.
Price Elasticit o" *e'and
/elates to the sensitivity of customers to price changes in terms of the quantities they will buy.
Price +uarantees
6rotect retailers against possible price declines. If a retailer cannot sell an item at a given price!
the manufacturer pays it; the difference between planned retail and actual retail selling prices.
Price !ine Classi"ications
4nable retail sales! inventories! and purchases to be analy#ed by retail price category.
Price !ining .8/
A practice whereby retailers sell merchandise at a limited range of price points! with each price
point representing a distinct level of quality.
Price !ining .9/
+sed by service retailers providing a wide selection of services. A range of prices is matched to
service levels.
Price&:ualit Association
A concept stating that many consumers feel high prices connote high quality and low prices
connote low quality.
Pri'ar Custo'er Services
Those considered basic components of the retail strategy mi%; they must be provided.
'ar Trading Area
4ncompasses ?E percent to BE percent of a storeJs customers. It is the geographic area closest to
the store and possesses the highest density of customers to population and the highest per-capita
sales.
Private .*ealer/ Brands
1ontain names designated by wholesalers or retailers! are more profitable to retailers! are better
controlled by retailers! are not sold by competing retailers! are less e%pensive for consumers! and
lead to customer loyalty to retailers.
Productivit
6roductivity The efficiency with which a retail strategy is carried out.
Product !i"e Ccle
(hows the e%pected behavior of a good or service over its life. The traditional cycle has four
stages5 introduction! growth! maturity! and decline
Product,Trade'ark $ranc#ising
An arrangement in which franchised dealers acquire the identities of their suppliers by agreeing
to sell the latterJs products and$or operate under suppliersJ names
Pro"it&and&!oss .3nco'e/ State'ent
/epresents a summary of a retailerJs revenues and e%penses over a particular period of time!
usually on a monthly! quarterly! and$or yearly basis
Protot%e Stores
'ccur with an operations strategy that requires multiple outlets in a chain to conform to
relatively uniform construction! layout! and operations standards.
Psc#ological Pricing
/efers to consumer perceptions of retail prices.
Purc#ase Act
An e%change of money or a promise to pay for ownership or use of a good or service. 6urchase
variables include the place of purchase! terms! and availability of merchandise.
Purc#ase&Motivation Product +rou%ings
Appeal to the consumerJs urge to buy a product and the time he or she is willing to spend in
shopping.
:uantit *iscount
A reduction in price based on the amount purchased. ,ay be offered in addition to any trade
discount.
:uick Res%onse .:R/ 3nventor Planning
4nables a retailer to reduce the amount of inventory it eeps on hand by ordering more
frequently and in lower quantity.
Retailing
The sale of goods or commodities in small quantities directly to consumers.
Reserve stock
,erchandise that is ept somewhere other than the selling floor.
Resident Buing o""ice
An office located in a central merchandising area where buyers can receive information about
products from a variety of manufacturers.
Retailers
&usinesses that buy goods from wholesalers or manufacturers and resell them to customers.
Retailing strateg
A strategic plan to adapt to changing technology and marets! and meet company goals and
objectives through retailing.
Returns %ercentage
The relationship between returns and allowances! and sales! calculated by dividing returns and
allowances by gross sales.
Ringseal ticket
A pricing ticet shaped lie a butterfly bandage! used on jewelry and lampshades.
Retail C#ain
A group of shops operated by the same organi#ation.
Reverse !ogistics
/everse movement of goods through the supply chain.
Rack *is%la
An interior display that hangs or presents products neatly.
Rationali-ed Retailing
A strategy involving a high degree of centrali#ed management control combined with strict
operating procedures for every phase of business.
Reac#
The number of distinct people e%posed to a retailerJs ads in a specified period.
Reco''endations
The stage in the research process during which the alternative approach to best solve a problem
or issue is presented.
Recruit'ent
The activity whereby a retailer generates a list of job applicants.
Re"erence +rou%s
Influence peopleJs thoughts and$or behavior. They may be classified as aspirational! membership!
and dissociative
Regional S#o%%ing Center
A large! planned shopping facility appealing to a geographically dispersed maret. It has at least
one or two full-si#ed department stores and ?E to ;?E or more smaller retailers. The maret for
this center is ;EE!EEE-plus people! who live or wor up to =E minutesJ driving time from the
center.
Regression Model
A computer site-selection model that develops a series of mathematical equations showing the
association between potential store sales and various independent variables at each location
under consideration
Reill;s !aw o" Retail +ravitation
The traditional means of trading area delineation that establishes a point of indifference between
two cities or communities! so the trading area of each can be determined
Relations#i% Retailing
4%ists when retailers see to establish and maintain long-term bonds with customers! rather than
act as if each sales transaction is a completely new encounter with them
Rented&+oods Services
The area of service retailing in which consumers lease and use goods for specified periods of
time
Reorder Point
The stoc level at which new orders must be placed
Resident Buing O""ice
An inside or outside buying organi#ation that is usually situated in important merchandise
centers -sources of supply. and provides valuable data and contacts.
Retail Audit
The systematic e%amination and evaluation of a firmJs total retailing effort or some specific
aspect of it. Its purpose is to study what a retailer is presently doing! appraise how well the firm
is performing! and mae recommendations for future actions
Retail Balance
/efers to the mi% of stores within a district or shopping center
Retail 3n"or'ation Sste'
Anticipates the information needs of retail managers; collects! organi#es! and stores relevant data
on a continuous basis; and directs the flow of information to the proper retail decision maers.
Retailing Conce%t
1omprises these four elements5 customer orientation! coordinated effort! value-driven! and goal
orientation.
Retailing E""ectiveness C#ecklist
Lets a firm systematically assess its preparedness for the future.
Retail 3nstitution
/efers to the basic format or structure of a business. Institutions can be classified by ownership!
store-based retail strategy mi%! service versus goods retail strategy mi%! and nonstore-based retail
strategy mi%.
Retail !i"e Ccle
A theory asserting that institutions -- lie the goods and services they sell -- pass through
identifiable life-cycle stages5 innovation! accelerated development! maturity! and decline.
Retail Met#od o" Accounting
A way by which the closing inventory value is determined by calculating the average
relationship between the cost and retail values of merchandise available for sale during a period .
Retail Organi-ation
:ow a firm structures and assigns tass -functions.! policies! resources! authority!
responsibilities! and rewards so as to efficiently and effectively satisfy the needs of its target
maret! employees! and management.
Retail Per"or'ance 3ndex
4ncompasses five-year trends in revenue growth and profit growth! and a si%-year average return
on assets.
Retail Pro'otion
Any communication by a retailer that informs! persuades! and$or reminds the target maret about
any aspect of that firm.
Retail Reductions
/epresent the difference between beginning inventory plus purchases during the period and sales
plus ending inventory. They should encompass anticipated mardowns! employee and other
discounts! and stoc shortages.
Retail Strateg
The overall plan guiding a retail firm. It has an influence on the firmJs business activities and its
response to maret forces! such as competition and the economy.
Return on Assets .ROA/
A performance ratio based on a retailerJs net sales! net profit! and total assets.
Return on Net 5ort#
A performance measure based on a retailerJs net profit! net sales! total assets! and net worth.
Revolving Credit Account
Allows a customer to charge items and be billed monthly on the basis of the outstanding
cumulative balance.
Ro)inson&Pat'an Act
&ars manufacturers and wholesalers from discrimination in price or sales terms in selling to
individual retailers if these retailers are purchasing products of Hlie qualityH and the effect of
such discrimination would be to injure competition.
Routine *ecision Making
Taes place when a consumer buys out of habit and sips steps in the purchase process.
Retail Tec#nolog
systems which increase retailersJ efficiency and productivity and often create a competitive edge.
Return on 3nvest'ent.RO3/
is the amount of profit or cost saving that will be reali#ed in return for a specific e%penditure of
money. It is usually e%pressed as a percentage of the original monetary outlay. The /'I ratio
compares the net benefits of a project to its total costs
Sale&!ease)ack
The practice of retailers building new stores and then selling them to real-estate investors who
lease the property bac to the retailers on a long-term basis.
Sales $orecasting
Lets a retailer estimate e%pected future sales for a given time period.
Sales O%%ortunit +rid
/ates the promise of new goods! services! procedures! and$or store outlets across a variety of
criteria.
Sales&Productivit Ratio
A method for assigning floor space on the basis of sales or profit per foot.
Saturated Trading Area
A geographic area having proper amount of retail facilities to satisfy the needs of its population
for a specific good or service! as well as to let retailers prosper.
Scenario Analsis
Lets a retailer project the future by e%amining the ey factors that will affect its long-run
performance and then preparing contingency plans based on alternate scenarios .
Scra')led Merc#andising
Lets a retailer project the future by e%amining the ey factors that will affect its long-run
performance and then preparing contingency plans based on alternate scenarios.
Scra')led Merc#andising
'ccurs when a retailer adds goods and services that are unrelated to each other and to the firmJs
original business.
Secondar Business *istrict .SB*/
An unplanned shopping area in a city or town that is usually bounded by the intersection of two
major streets. It has at least a junior department store! a variety store! and$or some larger
specialty stores -- in addition to many smaller stores.
Secondar Trading Area
A geographic area with an added ;? percent to <? percent of a storeJs customers. It is located
outside a primary trading area! and customers are more widely dispersed.
Selective *istri)ution
Taes place when suppliers sell through a moderate number of retailers. This allows suppliers to
have higher sales than in e%clusive distribution and lets retailers carry some competing brands.
Sel"&$ul"ill'ent
A life-style concept whereby people e%press their growing sense of uniqueness through goods
and services purchases.
Selling Against t#e Brand
The practice of retailers carrying manufacturersJ brands and placing high prices on them so rival
brands -such as private-label goods. can be sold more easily.
Selling S%ace
The area set aside for displays of merchandise! interactions between salespeople and customers!
demonstrations! and so on.
Se%arate Store Organi-ation
Treats each branch as a separate store with its own buying responsibilities. 1ustomer needs are
quicly noted! but duplication by managers in the main store and the branches is possible.
Service Blue%rint
(ystematically lists all the service functions to be performed and the average time e%pected for
each oneJs completion.
Service Retailing
Involves transactions between companies or individuals and final consumers where the
consumers do not purchase or acquire ownership of tangible products. It encompasses rented
goods! owned goods! and nongoods.
SER7:1A!
Lets retailers assess the quality of their service offerings by asing customers to react to a series
of statements in five areas of performance5 reliability! responsiveness! assurance! empathy! and
tangibles.
Si'ulation
A type of e%periment whereby a computer-based program is used to manipulate the elements of a
retail strategy mi% rather than test them in a real setting.
Situation Analsis
The candid evaluation of the opportunities and potential problems facing a prospective or
e%isting retailer.
Sole Pro%rietors#i%
An unincorporated retail firm owned by one person.
Sorting Process
Involves the retailerJs collecting an assortment of goods and services from various sources!
buying them in large quantity! and offering to sell them to consumers in small quantities.
S%ecialog
4nables a firm to cater to specific needs of customer segments! emphasi#e a limited number of
items! and reduce its catalog production and postage costs.
S%ecialt Store
A general merchandise retailer that concentrates on selling a specific ind of product or service.
Standardi-ation
A strategy of directly applying a tried and tested retail strategy to newer marets to ensure
customers get the same e%perience across all stores of a chain.
Standard Merc#andise Classi"ication
A detailed list of common merchandise-reporting categories devised by the 3ational /etail
*ederation. Its use lets retailers contrast their financial data with industry averages.
Stock&to&Sales Met#od
An inventory-level planning technique wherein a retailer wants to maintain a specified ratio of
goods-on-hand to sales.
Stock Turnover
/epresents the number of times during a specific period! usually one year! in which the average
inventory on hand! is sold. (toc turnover can be computed in units or money -at retail or cost..
Stora)ilit Product +rou%ings
1lassify and display products needing special handling and storage together.
Store"ront
The total physical e%terior of a store. It includes the marquee! entrances! windows! lighting! and
construction materials.
Store !oalt
4%ists when a consumer regularly patroni#es a particular retailer -store or nonstore. that he or
she nows! lies! and trusts.
Store Maintenance
4ncompasses all the activities involved in managing a retailerJs physical facilities.
Straig#t !ease
/equires the retailer to pay a fi%ed amount per month over the life of a lease. It is the simplest!
most direct leasing arrangement.
Sales $loor
The sales floor is the location in a retail store where goods are displayed and sales transactions
tae place. *or e%ample! the receiving of merchandise taes place in the stoc room! but all
direct sales and customer interactions are done on the sales floor
S#o%li"ting
(hoplifting is the taing of merchandise offered for sale without paying
S#rinkage
/etail shrinage is a reduction or loss in inventory due to shoplifting! employee theft! paperwor
errors and supplier fraud
S(1
The (toc 2eeping +nit -(2+. is a number assigned to a product by a retail store to identify the
price! product options and manufacturer
Sliding
A loss prevention term referring to the act of a cashier passing merchandise around the cash
register barcode scanner without actually scanning the item
So"tlines
A store department or product line primarily consisting of merchandise such as clothing!
footwear! jewelery! linen and towels
Sta%le +oods
(taple goods are products purchased regularly and out of necessity. Traditionally! these items
have fewer mardowns and lower profit margins. )hile price shifts may raise or lower demand
for certain inds of products! the demand for staple goods rarely changes when prices change
Scri'
A sheer fabric onto which pictures can be painted to be used as a transparent bacdrop in the
theater and as a visual merchandising prop in stores
Service
A product$service mi% that offers only a service! with no accompanying product needed or
wanted! such as an insurance policy.
Service wit# acco'%aning %roducts
A product$service mi% in which a service is the primary offering! such as interior decorating! and
products! such as curtains and carpet! are offered to accompany and augment the service.
S#o%li"ting detection wa"er
A small device attached to goods! especially clothing! that sets off an alarm if it leaves the store.
S%ecialt %roducts
6roducts that solve a specific want or need for specific customers! often e%pensive products with
special characteristics or brand identity.
S%eci"ication )uing
Cemands made by retailers and wholesalers to manufacturers of the products they sponsor and
sell.
Store O%erations
Includes all functions of operating a store e%cept merchandising! such as customer service!
protection! maintenance! and distribution.
String Ticket
A pricing ticet attached with a piece of string.
Su%%ortive Services
*ree services offered to customers to increase convenience! mae shopping easier! and entice
customers to buy more.
Sales Pro'otion
A time-limited period when a product or group of products are given e%tra publicity and intense
mareting support. 7enerally used to give a boost to sales of a certain product category$brand.
Secondar Packaging
The container in which several finished pacs would be distributed -and sometimes displayed
in..
Sel"&Service
A store where customers can pic the goods directly from the display and tae them to the
checout for payment.
S#adow Box
A cabinet display built into a wall.
Sa'e Store Sales
A statistic used in retail industry analysis. It compares sales of stores that have been open for a
year or more. This statistic allows investors to determine what portion of new sales has come
from sales growth and what portion from the opening of new stores. (ame store sales are usually
released by retail companies on a monthly basis. This is also nown as Hcomps.H
T&Stand
A type of merchandising fi%ture commonly used to display apparel! with either straight or
waterfall arms.
Tri%le Net !ease
A triple net lease is a rental agreement on a commercial property where the tenant agrees to pay
all real estate ta%es! building insurance! and maintenance on the property.
7ertical Retailer /etailers that sell only their own branded merchandise; these goods are not
found anywhere e%cept in their own stores or catelogues -also called lifestyle retailer..