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Key Business Terms

From A to Z

Knowing and understanding industry lingo is important to best managing your communication with your professional network. Keeping up with the language used in the manufacturing, wholesale and retail industries isn’t easy, however, especially when new buzzwords emerge regularly. This resource will help keep you up to date with the terms and concepts that are driving modern commerce.
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A notification that provides detailed information on pending deliveries of goods. For example, order info, physical characteristics, transportation method, carrier details, and more.

An organizational method focused on iteration and efficiency. Popularized in software development, but now applied in all places where moving fast is an advantage.

The process of monitoring inventory levels across a distribution network and strategically distributing inventory according to customer demand, store constraints, availability and more.

Analysis of data. A way of using statistics and math to discover patterns and answer questions using a volume of data.

A software interface designed to allow a computer program to easily communicate with one or more other programs without exposing irrelevant internal details.

Software that aims to mimic human intelligence. In the modern day, it is primarily powered by machine learning.

Unique characteristics that make up a feature or a product. For example: color, size, price, brand value, etc.

An emerging technology that seeks to overlay the virtual world onto the physical, allowing for real-time physical interaction with digital objects placed into the real world.

An metric that represents the predicted amount of inventory available to sell, not including inventory already spoken for.

A private certification that is bestowed on companies with high “social and environmental performance.” A private version of the “Benefit Corporation” designation.

An order of a product that is not currently in stock, to be delivered at a later date. Usually indicates an underestimation of demand or a supply chain challenge.

A technique for tracking proximity of users through mobile technologies, that allow retailers to receive notification of a customer arriving in the store and communicating through targeted messaging, or by modifying content on devices in close proximity to the consumer.

A physically large retail establishment that is often part of a chain of stores that sells a wide variety of products. Typically focuses on sales volume and low margins to make profits.

A field that deals with datasets of enormous volume or complexity, requiring its own techniques and technologies as compared to traditional data analytics. Used to describe analytic capabilities against these large volumes, and often streaming nature of consuming data.

Short-term financing for ordinary retail items that allows customers to take home their purchase, but pay for it over time. Spreads the cost of a purchase over multiple weeks/months.

Similar to BOPIS, but picking up at the curb instead of in-store. Popularized during COVID-19 to comply with social distancing guidelines.

An omnichannel retail technique that allows customers to purchase an item online and pick it up at a brick-and-mortar location instead of having it shipped to them.

An omnichannel retail technique that is enacted when BOPIS orders are out of stock. When the ordered item is not available, the BOSS system recovers it at another site.

A place where customers pay for products. Traditionally consisting of a wrap counter where items we folded, wrapped, and placed in the appropriate bag for delivery. Often consists of a Point of Sale (POS) and displays to encourage impulse buys (e.g. gum, batteries, etc.).

A broader term for techniques like BOPIS/BOPAC. Allows customers to purchase online (“click”), and then pick up (“collect”) in a physical place, such as inside a store or a secured locker.

A sales technique that seeks to create a deeper relationship between a sales associates and their customers, in order to influence purchasing volume and frequency. While thought of as a client book, it involves techniques to support outreach from the store to the consumer through email, text, messaging apps, and more. Most current versions support tools for omnichannel engagement (omni engagement) that leverages online tools such as the e-Commerce, social media, and more.

A way of using cloud technology and large server infrastructure to handle commerce needs such as content management, inventory management, payment processing and data processing.

An integration and optimization of supply chains and distribution channels, such that organizations can collaborate to mutually improve their profitability.

An agreement between a shop and a third party vendor where the third party’s goods are available in the store for sale, and reconciled with the vendor when the item is purchased. Consignment items may represnt all inventory provided by a given vendor, or some portion of the inventory to minimize an upfront investment by the retailer.

A software application specifically designed for use by consumers, rather than enterprise/business customers.

Daily use items like health and beauty, cleaning products, snack foods, small toys and electronics, and other items that must be replaced on a regular basis. Most items carried in a drug store and many in a grocery store are CPG items.

A POS technology that allows customers to pay using their phone or creditcard using RFID or NFC technologies avoiding actual contact with the payment device. May speed up payment, and reduces risk of fraud and increases convenience at the point of sale.

A form of self-regulation that that serves to integrate social, environmental and economic concerns into an organization’s business practices.

A total that describes the costs directly associated with the production of goods, such as materials and labor cost.

A type of data analytics that collects and processes customer data in order to improve retention, optimize pricing, create efficient promotions, etc.

An omnichannel retail technique that is enacted when BOPIS orders are out of stock. When the ordered item is not available, the BOSS system recovers it at another site.

The practices and solutions associated with managing a business’s customer relationships through effective outreach interactions. The aim of CRM systems is to improve customer experience by notifying customers of compelling content and value, and to enhance sales through managing process and engagement. CRM may be used for Business to Business (B2B) interactions or Business to Consumer (B2C) interactions used by retailers.

An employee who is responsible for handling customer complaints, inquiries and requests.

A graphical user interface that is used to display, track, evaluate and manipulate business data. Most often comprised of visual components such as charts (pie charts, bar charts, gauges, KPIs, etc.), tables, metrics, and other visual components. Most often providing drill-down capabilities that enable the user to see the supporting detail of the visual element.

Inventory that is considered unsellable or “dead.” Can be caused by overproduction, over-ordering, changes in demand or other factors.

The process of predicting consumer demand for a product or service, and then adjusting business operations (inventory levels, production, etc.) to match it.

A data management process for collecting and storing digital files in an asset library, such that they can be easily organized, distributed and worked on by employees.

The process of adopting new digital technologies and business models into a company to support business process, and to provide tools to engage more easily online.

A business method wherein brands skip distribution to retailers and sell and ship products directly to consumers themselves.

A facility that serves to receive, store, and distribute goods to sales channels and customers. A DC offers value-added services including product mixing, order fulfillment, cross docking, packaging etc. Often used synonymously with Warehouse.

A retail technique where a seller is not responsible for the shipping, storage, or sourcing of a product. Instead, the seller transfers customer orders to a third party who fulfills the orders and ships them to a customer.

Commerce that takes place online. Includes sales, payment processing, shipping, etc.

Retail business conducted over the internet. Most notably retail eCommerce sites.

An electronic framework designed to replace physical inter-company business communications with a standardized electronic document format and specific transaction codes. Used by many brand manufacturers and retailers to standardize communication through their ERP, merchandising solution, financial systems, and more.

A concept that describes the ability to buy from anywhere (online or physical location), and receive from anywhere (store, warehouse, marketplace, vendor). Acts as a virtual shelf
that allows customers to shop a retailer’s entire catalog of products for purchase. The desired products are drop shipped to the consumer, or delivered to a store for pickup by the customer.

A software system that manages and oversees the essential functions of a business,
as well as providing insights.

The process of using past and current data to predict future scenarios. Forecasting is used by manufacturers to identify likely sales by their retail customers, and by retailers to anticipate sales by channel (online and in-store).

A method of attempting to improve aspects of a business by introducing aspects of games such as point-scoring and extrinsic rewards.

An approach to business that incorporates environmental protection and waste reduction into all aspects of a company.

A process that assists consumers in finding the product that suits their needs through questionnaires and suggestion feedback, typically implemented in software on e-commerce platforms.

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