Retail key terms

Looking to make your way onto shelves or the D2C space and aren’t sure what some of the words mean? The Target Accelerators team has put together the following list of retail jargon to help you on your way.

A

Accelerator Program: Accelerator programs are programs of limited duration that help cohorts of startups on their entrepreneurial journey. They provide a schedule of workshops, mentorship and connections with investors and business partners. They aim to advance businesses to the next stage. Typically, there is an investment of time for attending sessions, networking and completing pre-work.

Annual Revenue: Your annual revenue is the amount of money your company earns from sales over a year; it does not include costs and expenses. To calculate your annual revenue, multiply the quantity of each product you sold by its sale price, and then add each product’s annual sales to determine your gross annual revenue. Source

B

B Corp: A benefit corporation, sometimes called a B Corp, is a for-profit corporation recognized by a majority of U.S. states. B corps are different from C corps in purpose, accountability, and transparency, but aren’t different in how they’re taxed. B corps are driven by both mission and profit. Shareholders hold the company accountable to produce some sort of public benefit in addition to a financial profit. Some states require B corps to submit annual benefit reports that demonstrate their contribution to the public good.* Source

Boutique: A small shop or small specialty department within a larger store.

Brick & Mortar: The term “brick-and-mortar” refers to a traditional street-side business that offers products and services to its customers face-to-face in an office or store that the business owns or rents. Examples include Target stores, boutique stores, and local grocers. Source

Broker: A sales agency or company that sells a manufacturer’s products and/or acts as an intermediary to wholesale/mass retail customers.

C

C Corp: A C corporation, sometimes called a C Corp, is a legal entity that’s separate from its owners. Corporations can make a profit, be taxed, and can be held legally liable.* Source

Certifications: A business certification is an official document that eligible enterprises can apply for. Types of small business certifications include, but are not limited to: 8(a) Small Business Certifications, HUBZone Business Certification, Women-Owned Businesses Certifications, Minority-Owned Businesses Certification. You can read more about these certifications and how to apply for them here.

Competitors: Your competitor is another company selling similar products with similar goals of achieving revenue, profit, and market share growth. There are different kinds of competitors in your market and it is important to know who they are:

• Direct Competitors are businesses offering similar products and services
• Indirect Competitors are businesses that offer slightly different products and services, but target the same group of customers with the goal of satisfying the same need.

Pro Tip: Even if you think you don’t have direct competition, think about indirect competitors.  Even the biggest brands have competitors.

Co-Ops: A cooperative (co-op) is a business or organization owned by and operated for the benefit of its members. Profits or earnings are distributed among its members. The co-op can be a for-profit business or a non-profit organization. Source

D

Direct to Consumer (D2C/DTC): Direct to consumer (DTC) means that you send products directly to your consumer.

Drop Ship: Drop shipping is a fulfillment method where a store doesn’t keep the products it sells in stock. Instead, the store purchases the item from a third-party supplier and has it shipped directly to the customer. As a result, the seller doesn’t have to handle the product directly. Source

Drugstores: Drugstores specialize in beauty and personal goods, household essentials, medical supplies, and over-the-counter products. Some examples of drugstores include CVS Pharmacy, Longs Drugs, Meijer, Rite Aid, and Walgreens.

E

eCommerce: The term electronic commerce (eCommerce) refers to a business model that allows companies and individuals to buy and sell goods and services over the Internet.

EDI: Electronic Data Interchange (EDI) is the computer-to-computer exchange of business in a standard electronic format between business partners. EDI documents can flow straight through to the appropriate application on the receiver’s computer (e.g. the order management system) and processing can begin immediately. Sometimes your fulfillment center/3PL has the capability. Source 

Employee: anyone who performs services for you is your employee. This is so even when you give the employee freedom of action. What matters is that you have the right to control the details of how the services are performed.

G

Grocers: Grocers, or grocery stores, are the bridge between specialized natural enhanced retailers where natural brands often begin and larger, conventional retailers. Some examples of grocers are Albertsons, Aldi, HEB, Kroger, Lucky Supermarkets, Raleys, and Wegmens.

I

Independents: A business that is not inextricably associated with another business through common ownership, affiliation, sharing of employees, facilities, equipment, profits and losses.

L

Lifetime Revenue: Lifetime Revenue is the total amount of income generated by the sale of goods or services related to the company’s primary operations recognized over the historic business lifespan.

Limited Liability Company (LLC): A LLC lets you take advantage of the benefits of both the corporation and partnership business structures. LLCs protect you from personal liability in most instances, your personal assets — like your vehicle, house, and savings accounts — won’t be at risk in case your LLC faces bankruptcy or lawsuits. Not an LLC? Visit this link on how you can set your business up as an LLC.

Line Review:A product line review (PLR) works as a validation process for retailers to confirm that their merchandising plan is in line with the overall goals of the organization. Source

M

Manufacturing Capabilities: Each of our programs have different manufacturing criteria. Below are the three options that are on our program applications.

• You or an employee make the products yourself
• You own and utilize your own manufacturing equipment
• You work with a co-manufacturer

P

Price Point: The price point describes the price for which something is sold on the retail market.  

R

Revenue: Revenue is the money generated from normal business operations, calculated as the average sales price times the number of units sold. It is the top line (or gross income) figure from which costs are subtracted to determine net income. Revenue is also known as sales on the income statement. Source

• Tip: Revenue includes all money that has been made from selling your product and helps our review team ensure that you are making money.

S

SKU: Your SKU is a unique code per individual product.

Social Media: Social media is a computer-based technology that facilitates the sharing of ideas, thoughts, and information through the building of virtual networks and communities. By design, social media is Internet-based and gives users quick electronic communication of content. Content includes personal information, documents, videos, and photos. Users engage with social media via a computer, tablet, or smartphone via web-based software or applications. Some examples of social media are Facebook, Instagram, Twitter, TikTok, and LinkedIn.   Source

Sustainability Claims: A delineation used to set apart and promote a product with reference to one or more of the three pillars of sustainability (social, economic, and environmental). Source

V

Vendor Rep Group: A sales agency or company that sells a manufacturer’s products and/or acts as an intermediary to wholesale/mass retail customers.

W

Website: also referred to as “site,” is your own personal domain on the internet where you sell your products. Websites have endings that include but are not limited to “.com”, “.co”, “.in”,”.net”, and etc. Please note, your instagram or facebook page are NOT considered websites but forms of social media

#

3PL: 3PL, or third-party logistics company, provides services to help with supply chain capabilities. 3s. Source

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