Retail Terminology – M
M
Manufacturer
A manufacturer is an entity that produces goods or products from raw materials using labor, machinery, and tools. They supply these finished products to wholesalers, retailers, or directly to consumers, often under their brand or as a third-party supplier.
Margin
Margin refers to the difference between the cost of producing a product and its selling price, usually expressed as a percentage. It indicates profitability, showing how much profit a retailer makes after deducting production costs from the revenue generated by sales.
Market Analysis
Market analysis is the process of studying the characteristics of a market within a specific industry. This includes understanding market size, demand, competition, and consumer behavior. The insights gathered help businesses make informed decisions about entering or expanding within the market.
Market Research
Market research involves collecting and analyzing data about consumers, competitors, and market trends. It helps businesses understand customer needs, preferences, and behaviors, enabling them to develop effective marketing strategies and improve product offerings.
Market Segmentation
Market segmentation divides a broad target market into smaller, more manageable subgroups based on shared characteristics such as demographics, psychographics, behavior, or geographic location. This strategy allows for more personalized and effective marketing efforts.
Markup
Markup is the amount added to the cost price of goods to cover overhead and profit before a product is sold to customers. It is typically expressed as a percentage of the cost price and helps determine an item’s selling price.
Markdown
Markdown refers to the reduction in the selling price of merchandise, usually to clear out unsold stock, attract customers, or respond to competitive pricing. Markdowns help manage inventory levels and stimulate sales during off-peak or holiday seasons.
Mass Market Retailer
A mass-market retailer caters to a large segment of consumers by offering a wide range of products at affordable prices. These retailers operate at a high volume with low profit margins to maximize reach and sales. Examples include Walmart and Target.
Merchandise
Merchandise refers to the goods that retailers offer for sale to consumers. This can include any product category ranging from apparel and electronics to groceries and home goods. Effective merchandising involves selecting and displaying products in ways that attract and retain customer interest.
Merchandise Hierarchy
Merchandise hierarchy is an organized structure retailers use to categorize and manage their product assortment. It typically consists of multiple levels, such as departments, categories, classes, and subclasses, allowing for efficient inventory management and data analysis.
Merchandising
Merchandising encompasses all the activities involved in promoting and selling products to customers. This includes product selection, display techniques, pricing strategies, and promotional efforts designed to enhance the shopping experience and boost sales.
Minimum Order Quantity (MOQ)
MOQ is the smallest quantity of a product that a manufacturer or supplier is willing to sell or produce in a single order. It helps ensure that production runs are cost-effective and inventory levels are maintained efficiently.
Manufacturer’s Suggested Retail Price (MSRP)
MSRP is the price point a manufacturer recommends for retailers to use when selling a product to consumers. It’s intended to provide consistency across different retail outlets and reflect the product’s perceived value in the market.
Multi-Channel Retailing
Multi-channel retailing involves using multiple platforms or channels (such as physical stores, online shops, mobile apps, and social media) to sell products and engage with customers. This approach provides consumers various options for purchasing and interacting with the brand, enhancing customer satisfaction and loyalty.