Most Useful 50 Merchandising Terms and Definitions

By | December 5, 2016

Merchandising Terms and Definitions

Reeha Ismail Sayyad
Assistant Professor
Kolhapur, India.


Merchandising Terminology:

Export merchandising applies all the principles of fashion merchandising and product merchandising. It is the key-link between the factory and customer. One of the most important tasks of export merchandiser’s is to provide correct and clear information on time to relevant departments and some key-words are there which are very helpful to the export merchandiser to communicate with the buyer is called as terminology. This is also known Merchandising Terms and definitions.

Not only is that, learning the terminology of the fashion industry an important part of fashion education. Many fashion terms are from French language because franc has been the capital of fashion. By using correct terminology, you can show that you are familiar with fashion business.

Important Terminology of Merchandising:

Terminology is very important for a merchandiser. There is lots of merchandising terms and definitions are used during an order execution. Here I am trying to mention most common usable teams in merchandising. If you think, I skip few important terms then kindly comments below. Some most important terminologies we use in export house as listed below-

1. Apparel industry:

The manufacturer who engaged in the manufacturing of clothing. It is also known as the garment business.

2. AQL:

AQL is related to the quality of products. In textile factory Acceptance Quality Level is shortly denoted by AQL.

For more information about AQL, kindly Click Here….

3. Air Way Will:

Air Way Will is an export document .the carrying agreement between exporter /shipper and air carrier which is obtained from the airline used to ship the goods. It’s a receipt of goods received given by airlines.

4. Base Fabric:

Basic fabric is grey fabric. Fabric is the main raw material of garments because major parts of garments are fabric. Initially this fabric is get used for sampling.

Gray fabric

5. Book Inventory:

This term is related to fashion accounting. Inventory book means the dollar value of inventory, as stated in accounting records.

6. Buying Office:

It is an independent or store owned office which is located at a market center and buys for one chain or for many stores. Buying office is also known as buying house. For more about buying house kindly Click here….

A Buying office

7. Buying Plan:

It is a document of a general description of the types and quantities of merchandise that a buyer/ importer expect to purchase for delivery within a specific time. It is also known as purchase order(PO).

8. Bill of Lading:

Bill of loading a document which provides the terms of the contract between the exporter/shipper and the transportation/logistic company to move fright between stated points at a specified charge. It’s a receipt of goods received given by logistic company.

9. Contractor:

It is an independent producer who does the sewing (sometimes cutting) for the manufactures, is called as sample worker.

10. Cutting Order:

Cutting order is a company document to maintain cut and produce a specific quantity of garments.

11. Cut-to-order:

A cutting order based on order received. It relates to sampling department and product development department.

12. CPM:

CPM stands for Cost per Minute. CPM can help to find out per hour, shift, day and week cost of garments.

13. CM:

CM is related to the commercial parts of garments merchandising. The full meaning of CM is Cost of Making. That cost may include with trimmings, Cutting, making, trimmings cost, cost of making time etc.

14. CAD:

CAD is related to the fabric cutting in garments industry. The full meaning of CAD is Computer Aided Design which is used as a theoretical tool to design and develop garment products.

CAD Design by soft wear

15. C.F.R:

C.F.R means cost and freight. It indicates that the exporter will deliver the products onto vessel and pay all the normal charges to get the cargo to the named port/seaport.

16. C.I.F:

C.I.F means Cost Freight and Insurance. A pricing term under which the seller pays all expenses involved in the placing of products on board and in addition prepays the freight and insures the goods to an agreed destination.

17. Cut-off-date:

Cut –off-date is a last date till which a shipping line will accept the packed goods for a particular vessel or ship. Usually it is 5-8 days before actual ship moving date.

18. Down-charge:

Down-charge is a less cost because of fewer trimmings into finished product. If buyer says he wants just finished product without any trimmings or embroidery or prints we should down-charge the buyer means we will decrease production cost.

19. Desk-loom:

This quarter sample(10x20cms)  yarn dyed check or strips swatch to get approval of checks or strip’s repeat and size .usually this loom is made on a hand loom or baby loom. Desk-loom is a term used only for woven checks and strips and not for hosiery strips.

20. Dummy:

Dummy is an artificial human body like doll which is used to get actual human body shape for measurement garments fittings.

Dummy used for basic block

21. Ex- works:

Ex-works means point of origin- a pricing term under which exporter s’ only responsibility is to clear the goods for export and make them available to the buyer at agreed destination.

22. Fabrication:

Fabrication is the process of garments fabric preparation before bulk production that’s why, fabrication is known as a pre-production procedure .The main object of fabrication is selection of appropriate fabric for a garment.

23. Factory out Late Stores:

The store that sells the manufactures overrun directly to consumers.

24. Fashion Director:

The fashion expert of an organization who works with buyer or designers.

25. F.C.L:

F.C.L denoted the full container load. This is the good sign of both buyer and manufacturer. Normally this part handle commercial department in a garments.

26. Free on Board:

The exporters’ undertaken to load the products on the vessel to be used for ocean/ sea transport.

27. Grading:

Grading a procedure of either increasing or decreasing the size of the sample pattern. The process of making a sample size pattern larger or smaller to make up a complete size range.

28. Gross Margin:

Gross margin is related to calculation of manufacturing cost. The difference in dollars between net sales and the net costs of merchandise/ product during a given period.

29. Knit-down:

This is small knitted fabric swatch (which is knitted as per buyers artwork like checks or strips to check the repeat and size) which merchandiser sends to the buyer for approval is known as knit –down.

30. Lab-dip:

This is 10×10 cm swatch dyed in laboratory of mill for checking color standards given on pantone is known as lab dip. This swatch is dyed to get color approval from buyer. Merchandiser has to prepare 4-5 lab dip option for each color because he has to keep one as counter.

Lap-dip of different color

31. Lead Time:

From the date of placing an order to the delivery date this period is known as lead time. Generally lead time is 90-120 days. Lead time is also called as preparing time for order execution.

32. L/C:

The meaning of L/C is letter of credit which given by the buyer via bank. In a normal words L/C is a document of order which is provide buyer to manufacturer where all the terms and conditions are mention.

33. Line Balancing:

Line balancing is a plan of balancing the production schedule as per the time and action calendar. Line balancing is also applied in garments sewing floor for smooth order execution.

34. L.C.L:

L.C.L stands for Less Container Load. When small amount of order execution then less container load for export or import from manufacturer.

35. Mark Down:

Mark down is known as the difference between the original retail price and a reduced price.

36. Mark-up:

The difference between the original retail price and a raised price. It means the difference between manufacturing /cost price and selling price.

37. Modular Manufacturing:

The manufacturing method utilizing a small group of people who work together to produce a finished garment. It means sample development.

38. Offshore Assembly:

Purchase the fabric and cut it but give it to the other country for sewing is known as offshore assembly. For the example we can say that, fabric purchase and cut in the United Kingdom, but sent to the India or Bangladesh for sewing.

39. Partial Shipment:

If the production is only half done and buyer gave us a permission to ship the first half goods we can ship the first half goods and then remaining this shipment is known as partial shipment. It is also known as prance shipment.

40. Pantone:

Pantone is a universal shade color shade card. It gets used in all industries for DTM (dye to match). There are 6 digit numbers for each color. Pantone depends upon TP (take-pad) and TC (take-card).


41. Pattern:

Pattern is a hard thick paper which is used to get the actual shape of different component of a garment. Pattern is also use as guide of a marker paper.

Pattern Paper

42. Style Number:

Style number a series of style which is easy to get the style references.

43. SMV:

SMV stands for the Standard Minute Value. SMV is important topic in garments sewing floor. Standard Minute Value is related with garments time study.

44. Strike-off:

This sample is get done by buyers artwork section to get an approval for print or embroidery and repeat and size for the same. This trail samples made by printer or computerized embroidery, which merchandiser sends to buyer for approval is known as strike –off.

45. Time and Action Calendar: 

Time and action calendar is stands for time and action calendar or Time and action plan. It is also known as issuing plan or production schedule or time and action plan. In order execution process, it’s also denoted as a short form TNA. For more information about TNA, kindly Click here….

Sample format of TNA

46. Thread Run:

Thread run is an important terms in sewing section. The stitching thread and color for the same is known as thread run.

47. Up-charge:

Up-charge is an additional cost which will get added into cost of production as per the buyer’s instructions. It will increase the manufacturing cost. Up charge will get added into these things like embroidery, labels, packing method etc.

48. Vendor:

Vendor is very common word in Ready Made Garments (RMG). In a normal word we know that vendor is a seller, resource, manufacturer or supplier.

49. Vessel-sailing-time:

The time which will get taken by ship or transportation to ship the products is called as vessel-sailing time.

50. Yarn Dips:

It is a same procedure as lab dip. If a fabric is a yarn dyed checks or strips then yarns will get dyed into laboratory and those yarns merchandiser has to send to the buyer for color approval is known as yarn dips.

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