Inventory & Stock Control Ch. 14

Advance dating termsIrregulars/Seconds

__ indicate that invoice is dated for some specified time in future__ imperfect or damaged merch. Irregulars have slight imperfections not visible to naked eye. Seconds contain more obvious imperfections/damages

AnticipationCOD

__ extra discount that manufacturers give buyers for paying an invoice in advance of the cash discount date. Only if store has ready cash available.__ "collect on delivery" means that transportation company will collect the amount of the invoice when goods are delivered (use this if vendor uncertain of buyer's credit)

Cash discountQuantity Discount

__ early payments of invoices. Manufacturers want payments as quickly as possible __ entice order more merch. Buyers place order for estimated quantity of merch they need for entire season w/ cancellation date approved by vendor. Vendors saves money in handling/processing large quants.

Seasonal Discount Trade Discount

__ making purchases advance of selling season. Manufac benefits cause able plan production schedules more efficiently __ based on manufacturer's list price. Series of discounts.

Cooperative (co-op) advertising

__ vendors grant special allowance to buyers and this is most common. If buyer runs ad featuring manufacturer's products, manufacturer agree pay percentage of ad's cost

EOM (end-of-month) dating termsExtra dating termsOrdinary dating terms

__ allow buyer calculate discount period form end of the month in which invoice was written net EOM__ give buyer specified number of additional days in which pay invoice and earn cash discount net #X__ most common type of cash discount. Amount of time take advantage of discount calculated from invoice date

FOBFOB destination, charges reversedFOB destination, freight prepaid

__ term associated with transportation "free on board"__ indicates buyer pays shipping charges but seller assumes responsible for goods while in transit__ indicates seller pay freight charges but buyer takes title to goods as soon as shipped

FOB destination (store)FOB origin (factory)

__ term indicates that manufacturer pays shipping charges, title passes to buyer when merch is delivered (ideal for buyer)__ most common used merch is shopped. Title passes to buyer when seller delivers goods to transportation carrier- trans charges, risks, etc. responsible of buyer

FOB shipping point

__ indicates manufacturer has title to goods and pay shipping costs until merch reaches distribution point. From point, buyer takes title to goods and pays trans charges until reach store

Job lotOff-price

__ assortment of merch that vendor has been unable to sell at regular prices and so offers reduced price__ occurs when retailers purchases manufacturers' overruns at deep discounts for purpose of offering consumers low prices on name brand merch

On consignmentOn memorandum

__ return terms: indicates buyer take merch into store but will pay for it only when it sells. Buyer can return any unsold merch (allows increase inventory without increasing capital investment)__ return terms: indicates merch coming into store has return privilege with it. Store pays for merch but can return unsold items at end of certain time

Price decline guaranteePrivate brand

__ protect store if market prices drop over a stated period of time __ private label; avoid competition, creates exclusivity, uniqueness

Promotional buyingQuality checkQuantity check

__ involves purchasing merchandise to be featured in store's promotions, usually part of buyer's overall merch plan__ ensure that merch shipped is identical to quality of merch seen in market__ counting number of items received as well as checking for correct sizes, colors, models & numbers compared to both purchase order and voice

ROG (receipt of goods) dating terms

__ allow buyer to calculate discount period from day merchandise was received in store rather than from invoice date net ROG

Specification buying

__ buyers suggest specifications/changes that upgrade quality of merch, workmanship, styling. Making merch different from similar goods carried by competition. DO this rather than developing private brands

TRUE

True or false: Price negotiation really starts before you go to market. Understanding manufacturing costs involved, you will have a better idea of how much the vendor may be willing to reduce prices.

Discounts

___ Probably the most important terms that you will negotiate are discounts, a reduction in the price of the merchandise.

True or false: return privileges frequently used by vendors when they are selling new merchandise which retailer feels is quite risky since there are no past sales data for product

Commissionaires