Retail Marketing Chapter 10

Advance shipping notice (ASN)

an electronic document received by the retailer’s computer from a supplier in advance of a shipment.

Backhaul

trips that trucks make to return to distribution centers after delivering merchandise to stores.

Buyer

person in a retailing organization responsible for the purchase and profitability of a merchandise category. Similar to category manager.

Checking

the process of going through goods upon receipt to make sure that they arrived undamaged and that the merchandise received matches the merchandise ordered.

Collaborative Planning, forecasting, and replenishment (CPFR)

a collaborative inventory management system in which a retailer shares information with vendors. CPFR software uses data to construct a computer-generated replenishment forecast that is shared by the retailer and vendor before it’s executed.

Consumer direct fulfillment

a supply chain system in which retailers receive orders from customers and relay these orders to a vendor and then the vendor ships the merchandise ordered directly to the customer. Also called drop shipping.

Cross-docking distribution center

items are unloaded from the shippers’ truck and within a few hours reloaded onto trucks going to stores. These items are prepackaged by the vendor for a specific store, such that the UPC labels on a carton indicate the store to which it is to be sent.

Data Warehouse

a huge database comprised of purchase data collected at the point of sale.

Direct store delivery (DSD)

a method of delivering merchandise to stores in which vendors distribute merchandise directly to the stores rather than going through distribution centers.

Dispatcher

a person who coordinates deliveries from the vendor to the distribution center or stores or from the distribution center to stores.

Distribution center (DC)

a warehouse that receives merchandise from multiple vendors and distributes it to multiple stores.

Drop shipping

a supply chain system in which retailers receive orders from customers and Erelay these orders to a vendor and then the vendor ships the merchandise ordered directly to the customer. Also called consumer direct fulfillment.

Electronic date interchange (EDI)

the computer-to-computer exchange of business documents from retailer to vendor and back.

Floor-ready merchandise

merchandise received at the store ready to be sold, without the need for any additional preparation by retail employees.

Freight forwarders

companies that purchase transport services. They then consolidate small shipments from a number of shippers into large shipments that move at a lower freight rate.

Fulfillment center (FC)

similar to a distribution center, but instead of shipping to stores, it ships directly to customers.

Just-in-time inventory system (JIT)

inventory management system that delivers less merchandise on a more frequent basis than traditional inventory systems. The firm gets the merchandise just in time to be used in the manufacture of another product or for sale when the customer wants it. Also called quick response (QR) inventory system.

lead time

the amount of time between recognition that an order needs to be placed and the point at which the merchandise arrives in the store and is ready for sale.

Mobile task management

technology consisting of a wireless network and a mobile device that receives demand notification and enables a speedy response. This allows the associate closest to the ordered item to physically pull it and verify its availability.

Outsource

obtaining a service from outside the company that had previously been done by the firm itself.

Pick ticket

a document that tells the order filler how much of each item to get from the storage area.

Planner

employees in merchandise management responsible for the financial planning and analysis of the merchandise category and, in some cases, the allocation of merchandise to stores.

Point-of-sale terminal (POS)

a cash register that can electronically scan a UPC code with a laser and electronically record a sale.

public warehouse

warehouse that is owned and operated by a third party.

Pull supply chain

strategy in which orders for merchandise are generated at the store level on the basis of demand data captured by point-of-sale terminals.

Push supply chain

strategy in which merchandise is allocated to stores on the basis of historical demand, the inventory position at the distribution center, and the stores’ needs.

Quick response(QR) Inventory system

inventory management system that delivers less merchandise on a more frequent basis than traditional inventory systems. The firm gets the merchandise just in time for it to be used in the manufacture of another product or for sale when the customer wants it. Also called just-in-time (JIT) inventory system.

Radio frequency Identification (RFID) tag

a technology that allows an object or person to be identified at a distance using radio waves.

Rain check

when sale merchandise is out of stock, a written promise to customers to sell them that merchandise at the sale price when it arrives.

Receiving

the process of filling out paperwork to record the receipt of merchandise that arrives at a store or distribution center.

Reverse supply chain

the process of moving returned goods back through the supply chain from the customer, to the stores, distribution centers, and vendors.

Stockout

a situation occurring when an SKU that a customer wants is not available.

Supply chain management

a set of firms that make and deliver a given set of goods and services to the ultimate consumers.

Ticketing and Marking

procedures for making price labels and placing them on the merchandise.

Universal product code (UPC)

the black-and-white bar code found on most merchandise;used to collect sales information at the point of sale using computer terminals that read the code. This information is transmitted computer to computer to buyers, distribution centers, and then to vendors, who in turn quickly ship replenishment merchandise.

vendor-managed inventory (VMI)

an approach for improving supply chain efficiency in which the vendor is responsible for maintaining the retailer’s inventory levels in each of its stores.

Wholesaler

firms that buy products from manufacturers and resell them to retailers.