Wholesale glossary: more than 70 terms to speak the buyers’ language

At a trade show stand, a buyer asks about the MOQ, the cancel date and the Incoterm before even turning over a price tag. A sales rep who hesitates over a single one of those words loses time, and sometimes the order. Agents, buyers, showrooms, factories and freight forwarders all share this vocabulary of acronyms and borrowed jargon.

This glossary defines it theme by theme and points to the guide that covers each topic in detail. For an overview, read our analysis of the designer brand wholesale market.

Wholesale glossary of sales and channels: who buys, who sells, through which route

These terms separate the two rhythms of wholesale, pre-orders and reorders, and the intermediaries who carry the collection all the way to the stores.

Wholesale

Selling in bulk: a brand sells its products to professional retailers, who resell them to the end consumer.

Retail

Selling directly to the end consumer, in store or online.

Collection order (pre-order)

An order placed during the selling campaign, before production, for delivery the following season.

Reorder (replenishment)

An additional order placed during the season for products already available in stock. See our guide to reorders in wholesale.

Selling campaign

The period during which a collection is presented and sold to buyers, at trade shows, in showrooms or at appointments.

Buyer

The person responsible for selecting and ordering products for a store or retail chain.

Multi-brand retailer

A store that carries products from several brands, as opposed to a brand’s own store.

Concept store

A multi-brand store that curates a selection around a world or a lifestyle, often across several product categories.

Department store

A large multi-brand store organised into departments, with its own buying teams for each category.

Door

A customer’s physical shop. A single retailer can have several, each with its own quantities and delivery address.

Sales agent

An independent intermediary who negotiates on behalf of one or more brands within a territory, paid on commission, without buying the goods.

Distributor

A company that buys products on its own account and resells them within a territory, bearing the stock and credit risk.

Importer

A distributor based in the destination country, who handles customs clearance and often local logistics.

Showroom

A space where collections are presented to buyers, permanent or temporary, run by the brand or by a third party.

Trade show

A trade-only event where brands exhibit their collections and take orders. See our method for preparing a trade show.

B2B marketplace

A platform that connects many brands with many retailers, under its own rules and terms.

B2B ordering portal

A brand’s own ordering site, where its retailers browse the collection and order on their own terms. See our comparison of marketplace or portal.

Sale or return (consignment)

An arrangement in which the retailer only pays for what it sells, while the brand keeps ownership of the stock and takes back unsold goods.

Private label

Products made by a brand or a factory and sold under the retailer’s own brand.

Collection and product: from sample to delivery window

A wholesale collection is sold from documents and samples, long before it exists in stores.

Line sheet

A sales document presenting every style in the collection with its image, colourways, sizes and prices. See our line sheet guide.

Lookbook

A collection of styled photos conveying the world and the looks of the collection. It is increasingly shared in digital form, for example with Lookbook Studio.

Packshot

A photo of a product on its own against a neutral background, used in catalogues and line sheets.

Sample

A piece from the collection made in advance to show to buyers, before production.

Reference (SKU)

The unique identifier of an item, broken down by colourway and size.

Colourway

A colour variant of a style, with its own reference and sometimes its own price.

Size grid

The full set of sizes available for a style, filled in cell by cell when ordering.

Size curve (size ratio)

The breakdown of quantities by size, for example 1 S, 2 M, 2 L and 1 XL, making 6 pieces. It reflects the store’s clientele.

Prepack

A predefined assortment of sizes or colourways sold as a single unit, to speed up ordering and follow a size curve. See our guide to size curves and prepacks.

Carry-over (permanent collection)

Styles continued from one season to the next, often available for reorder all year round.

Pre-collection

A collection presented ahead of the main collection, for earlier deliveries to stores.

Capsule

A small, limited collection presented outside the two main seasons.

Delivery window

The period during which the brand undertakes to deliver an order, for example from 15 January to 15 February.

Cancel date

The date after which the retailer may refuse a late delivery, as set out in the terms of the order.

Prices and margins: where profitability is decided

Between the manufacturing cost and the price tag in store, every player takes its share.

Wholesale price

The price, excluding tax, at which the brand sells to the retailer. See how to calculate your wholesale price.

Recommended retail price (RRP)

The price at which the brand recommends the product be resold to the consumer. It remains a recommendation, because imposing a minimum resale price is prohibited.

Cost price

Everything a piece costs once delivered to the brand’s warehouse: materials, making, freight, duties and a share of development.

Multiplier

The ratio between a selling price and a purchase price. The brand’s links cost price to wholesale price; the retailer’s links wholesale price to shop price.

Markup

Profit expressed as a percentage of the purchase cost excluding tax.

Margin

Profit expressed as a percentage of the selling price excluding tax. For the same profit, it is always lower than the markup.

Price list

The set of wholesale prices that apply to a country, a currency or a customer.

Discount

A reduction granted on the wholesale price for volume, an early order or a particular customer. It comes out of the brand’s margin.

Early payment discount

A reduction granted in return for paying ahead of the due date.

Orders and payment: the words that commit and finance

A wholesale order binds both parties and is often financed before it is delivered. For cash flow, see our guide to deposits and payment terms in wholesale.

Purchase order

The document that sets out what the customer is ordering, at what price, on what terms and for which delivery. Once signed, it binds both parties.

Electronic signature

A process that identifies the signer and links them to the signed document. See signing a purchase order electronically.

MOQ

Minimum Order Quantity, meaning the minimum order, expressed in value or in number of units and set by the brand or the factory. See setting your minimum order.

Free shipping threshold

The order value above which the brand pays for shipping.

Terms and conditions of sale

The rules governing the brand’s sales: price scale, reductions, payment terms and often delivery, returns or minimum order. In France, they must be provided to any trade buyer who requests them.

Deposit

The share of the order amount paid in advance, often when ordering, to secure production.

Pro forma invoice

A preliminary document that sets out the content of an order but has no value as an invoice. It is used to request a deposit or to prepare for customs clearance.

Payment terms

The payment deadline and method granted to the customer, for example on order, on delivery or at 30 days.

Payment period

The time the customer has to settle the invoice. In France, between businesses, the general rule (article L441-10 of the Commercial Code) caps it at 60 days from the invoice date, or 45 days end of month if the contract provides for it. A few seasonal sectors and purchases intended for export outside the EU follow specific rules.

Outstanding balance

The total amount the customer owes the brand at a given moment, compared with the credit limit granted to them.

Backorder

The part of an order that could not be delivered and will be shipped later, or cancelled with the customer’s agreement.

Credit note

A document that cancels or reduces an invoice, for example after a return or a discount granted after the event.

Logistics and export: who pays for transport and duties

As soon as an order crosses a border, you need to know who arranges transport, who bears the risk and who pays the duties.

Incoterm

An international rule published by the International Chamber of Commerce specifying who pays for transport, insurance and duties, and at what point the risk passes. The version in force is the 2020 edition; the ICC is preparing the next one, Incoterms 2030. See selling wholesale for export.

EXW (Ex Works)

An Incoterm under which the brand makes the goods available at its premises, while the buyer arranges and pays for everything else.

FCA (Free Carrier)

An Incoterm under which the brand hands the goods, cleared for export, to the carrier chosen by the buyer, at its premises or at another agreed place. The risk passes to the buyer on handover, and the main carriage is at the buyer’s expense.

DAP (Delivered at Place)

An Incoterm under which the brand delivers to the agreed place, while import clearance and duties remain the buyer’s responsibility.

DDP (Delivered Duty Paid)

An Incoterm under which the brand covers everything up to the destination, including import clearance and duties.

HS code

A code from the international customs nomenclature (the Harmonized System) that classifies each product and determines the applicable duties.

EORI number

A mandatory identifier for any business that carries out customs formalities in the European Union.

Intra-EU VAT

The regime under which, between two businesses in different EU countries, the supply is in principle invoiced without VAT and the buyer self-accounts for the tax. It requires a valid VAT number.

Available to sell (ATS)

Stock that is not yet allocated to an order and can be offered for reorder.

Packing list

A document detailing the contents of each carton in a shipment, useful to the customer on receipt and to customs.

Performance: measuring what sells at your retailers

Once the goods are delivered, these indicators tell you whether they are moving off the shelves.

Sell-in

The brand’s sales to its retailers.

Sell-out

Retailers’ sales to the end consumer.

Sell-through

The share of products received by the retailer that have been sold to consumers over a period. See sell-through and open-to-buy.

Open-to-buy

The purchasing budget still available to a buyer for a period or season.

Stock cover

The number of weeks of sales that available stock can support at the current rate.

Markdown

A price reduction applied during or at the end of the season. It is not the same as shrinkage, which refers to theft, losses and errors.

Average order value

The average value of an order, calculated over a period, a trade show or a customer.

Stock-out rate

The share of requested references that are no longer available in stock.

Reorder rate

The share of a season’s customers who place another order during the season.

For a brand preparing its first campaign, the order is simple. First set your wholesale price and multiplier, then your minimum order and free shipping threshold, and finally your payment terms and deposit, written down in black and white in your terms and conditions of sale. The vocabulary of logistics and performance will come with the first deliveries.