Retail merchandising glossary.
When our merchandising reps are hard at work in retail stores across North America, they come across what seems like hundreds of terms and acronyms. Think you know the ins and outs of retail merchandising? Check out our glossary of commonly used retail lingo below.
1. Action alley: The central aisle around the store where there is generally the most open space. Retailers prompt shoppers to make impulse purchases by positioning displays along this main thoroughfare. Also known as the racetrack.
2. Audit: A way to ensure compliance and performance of a merchandising display. Tasks of completing an audit include ensuring products are in the right place, the display is set to POG and correct labels/signage are used. Premium completes 985K+ audit visits per year.
3. Backstock: Inventory that is kept palletized in boxes in the back room until it is needed to replenish displays on the sales floor.
4. Clip strip: A retail product display, so named because it is a length of either plastic or metal with clips or hooks at regular intervals, upon which merchandise is hung. These can be found in the aisle, on an endcap or at the registers and is often an impulse purchase. It depends on the retailer for the rules.
5. CPG (Consumer-Packaged Goods): Merchandise that customers use and need to replace on a frequent basis. CPG examples include food, beverages, cosmetics and cleaning products.
6. Cut-in: Shifting or removing merchandise to make space on the retail shelf for new or promotional products. Cut-ins typically occur between major merchandising resets to introduce items more quickly. Also known as NPI (New Product Introduction) or EOL (Product End of Life).
7. DC (Distribution Center): Where products are stored prior to arriving at a retail store. The velocity of products moving through a distribution center is based on the sales volume occurring in the retail store. The more products people buy, the faster the store will need to replenish with additional inventory from the DC. Premium’s National Logistics and Distribution Center (NLDC) is 130K+ square feet. Each day, we ship 1,800+ packages to stores such as Best Buy and Walmart.
8. Display: A presentation of a store’s products used to attract and entice customers.
9. Endcap: A display at the end of an aisle. Endcaps provide a competitive advantage for brands to call special attention to new or seasonal products, or to capitalize on impulse purchases from customers who would otherwise walk by. Premium builds endcaps in stores such as Walgreens and Walmart.
10. Facing: A way to describe how many “rows” or items should be front-facing on the shelf. This is the typical language used in a planogram. For example, a product may have 2 facings on the 2nd shelf up from the floor. It’s also the process of pulling products forward to be flush with the front of the shelf. Also known as blocking, zoning, straightening or fronting.
11. Fixture: Any piece of furniture or equipment that is fixed in position and displays or presents products. Fixtures are strategically arranged within the store to streamline the shopping experience and entice customers to buy.
12. Freestanding: A display that stands on its own in an aisle.
13. Gondolas: A freestanding fixture that consists of a flat base and a vertical component featuring notches or peg boards. Stores customize gondolas with shelves, hooks, or other display accessories.
14. Islander: An independent display positioned on the floor in a store’s main aisleway or racetrack. It generally has merchandise on all sides and features a distinct category of products. Premium ensures battery islanders near the registers are merchandised with multiple battery brands. Also known as a quad.
15. MOD (Modular): Different retailers utilize the term MOD in a variety of ways. MOD is yet another word for planogram (POG) and is sometimes used to refer to one 4-foot section of an aisle where a category of goods, like laundry detergent, is on display. For example, the laundry detergent is on MOD 4 in aisle 12.
16. MSRP (Manufacturer’s Suggested Retail Price): The price that the manufacturer of the product believes the item should sell for in stores.
17. Mystery shopping: When a decoy shopper is sent into a retail store to evaluate the product merchandising or the customer experience. The mystery shopper behaves like a regular customer but then provides feedback to the store, the brand or the employee to help improve its performance.
18. OOS (Out of Stock): When a product sells out, it leaves an empty slot on the shelf. Premium’s Shared Services merchandising team ensures our clients’ products are not OOS by visiting more than 8,000 retail locations each week.
19. OSA (On-Shelf Availability): Walmart uses the acronym OSCA, meaning On-Shelf Customer Availability.
20. Pack out: The total number of packages of an item for the shelf to be at capacity or fully stocked. Packing out refers to the process of filling the store shelves with replenishment products from the store’s backroom supply. Premium packs out 1MM+ unique products annually.
21. Pallet: A wooden structure used to support goods while they’re being moved.
22. POG (Planogram): Visual diagrams that show merchandisers exactly where to place specific products on shelves within an aisle in order to maximize sales. Think of planograms as blueprints to follow as you build the assortment (a section of facings for several products). Also known as plan-o-grams or schematics.
23. POP (Point of Purchase): Promotional collateral or signage that is not part of the regular store but is placed next to the product it’s promoting. POP may call customer attention to a discounted price, new packaging, coupons or special offers. Also known as shelf talkers or IRCs (Instant Redeemable Coupons).
24. PSP (Preferred Service Provider): Premium is 1 of only 5 approved PSPs who are allowed to merchandise products in the world’s largest retailer, Walmart. We are also a preferred partner for Walgreens, Target, Best Buy and several others. To join our PSP team, click here or learn more about what our PSP team does here.
25. RSA (Retail Sales Associate) or RSP (Retail Salesperson): An employee who works directly for the brick-and-mortar retailer. At Premium, we work in tandem with store management on behalf of our clients. Last year, Premium trained 475K+ Retail Sales Associates.
26. Sidekick: Refers to a display that requires little to no assembly in store. These displays are generally made from corrugated cardboard and are pre-packed when they arrive in stores. Different from POP, sidekicks contain merchandise within the display whereas POP is simply promotional collateral. Also known as shippers or PDQs (Predetermined Display Quantity).
27. SKU (Stock-Keeping Unit): A unique number (usually eight alphanumeric digits) assigned to an item by a retailer for the purpose of tracking and managing their inventory. The category of snack chips can easily have 40 SKUs, in various combinations of brands, sizes, and flavors. Pronounced ‘skew.’
28. Top stock: Additional inventory that is stored on top of store shelves for quick re-stocking to the products’ home location.
29. Top stock cart: Merchandisers often use utility carts to move products from the backroom and onto the store’s shelves. Also known as rocket cart.
30. UPC (Universal Product Code): SKUs and UPCs are commonly confused. The difference is that SKUs are unique to a single retailer whereas a UPC is placed on the product by the manufacturer and applies to that product no matter what store is selling it. If two stores are selling the same product, that item will have different SKUs, but the same UPC.
31. Quad: A display with four sides of merchandise.
32. Quantity on hand: This describes the physical inventory that a retailer has in possession at the store. Also known as on hand or OH for short.
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