Plain definitions for the terms that come up in wholesale, EDI, systems and sourcing conversations. Written for the person who nodded through a vendor call and wants to know what was actually said.
Electronic Data Interchange. A standard format that lets two companies exchange business documents system to system, so nobody retypes an order. Major retailers require it as a condition of holding the account.
Any company you exchange EDI documents with, usually a retailer. Each one has its own requirements even when the document types are the same.
The retailer's order, sent to you electronically.
Your confirmation back to the retailer that you received the order, and whether you can fill it as written.
A message describing exactly what is in each carton, sent before the shipment arrives. The document most chargebacks trace back to.
Your bill, sent electronically.
The retailer's amendment to an order it has already sent. Many brands still handle these by hand and should not.
An inventory availability feed, commonly used in dropship programmes to tell a retailer what you can ship.
Sell-through and stock information the retailer sends back to you. Valuable, and frequently ignored.
An automatic receipt confirming a document arrived and could be read. It does not mean the content was correct.
Value-added network. A service that routes EDI documents between trading partners, a bit like a private postal service for EDI.
The standard barcode shipping label on a carton, formerly called UCC-128. It carries the carton's SSCC and has to match what the ASN says.
Serial Shipping Container Code. The unique 18-digit number that identifies a single carton or pallet, printed on the GS1-128 label and referenced in the ASN.
The retailer's rulebook for shipping to it: which carrier, how to book, label placement, pack rules and timing. This, not the vendor demo, is the specification you are actually measured against.
An amount a retailer takes off your invoice payment because a compliance rule was broken. Also called a compliance deduction.
Any amount a retailer short-pays against an invoice. Covers compliance chargebacks as well as agreed allowances, returns and damages.
The date range in which a retailer will accept a shipment. Shipping early or late can trigger a chargeback.
The date after which the retailer can cancel an unshipped order.
The full set of rules a retailer expects suppliers to follow, and the scorecard it uses to measure them.
Stock keeping unit. The smallest trackable version of a product. In apparel, one style in one colour in one size.
How apparel organises product: one style, several colours, several sizes. Systems built for apparel treat that as one item. Generic systems often treat every combination as a separate product you maintain by hand.
The proportion in which sizes are ordered or produced, for example more mediums than extra-smalls.
A fixed assortment of sizes or colours packed together and sold as one unit. Common in wholesale.
The budget left to spend on inventory for a period, after counting what you already own and what is already on order.
The share of inventory received that has sold over a period.
Inventory that is genuinely free to promise to a new order after existing commitments. When channels read different versions of this number, you oversell.
Deciding which orders or channels get which inventory when there is not enough for everyone.
A style that continues from one season into the next.
Enterprise resource planning. The software that runs orders, inventory, production and invoicing from one place.
Warehouse management system. Software that directs receiving, putaway, picking, packing and shipping inside a warehouse.
Order management system. Software that routes and tracks orders across sales channels.
Product lifecycle management. Software for developing product, from design and tech packs through sampling and approval.
Third-party logistics provider. An outside company that stores your inventory and ships your orders.
Software that sits between two systems and moves data between them. Useful, but it adds a subscription and another point that can fail.
A model where a retailer sells your product and you ship it straight to their customer. Platforms such as Dsco and Rithum sit in the middle.
Model Context Protocol. A standard that lets an AI assistant such as ChatGPT or Claude connect to a business system and answer questions from its live data in plain language.
The full cost of a product once it reaches you: the factory price plus freight, duty, insurance and broker fees. Margin calculated without it is not real margin.
Free On Board. A shipping term where the supplier's responsibility ends once goods are loaded for export. Freight and duty from there are yours.
Delivered Duty Paid. A shipping term where the supplier delivers to you with freight and duty already paid.
The Harmonized Tariff Schedule classification that sets the duty rate on an imported product. A misclassification repeats on every shipment.
The tests that decide which country a product legally comes from, and so whether a trade agreement's lower duty applies.
A rule of origin requiring the yarn, and every step after it, to come from within the trade agreement region. USMCA and CAFTA-DR both use it.
A duty exemption for low-value imports. The United States suspended its 800-dollar exemption in 2025, which changed the economics of shipping direct to consumers.
The Uyghur Forced Labor Prevention Act. US law that presumes goods with any Xinjiang link involve forced labour unless the importer can prove otherwise.
The technical document a factory builds from: measurements, materials, construction and trims.
Production where fabric is cut and sewn into garments, as opposed to buying finished goods.
The instruction to cut a set quantity of a style. It becomes the unit production is tracked against, often across several contractors.
Work in progress. Inventory between raw material and finished goods, often sitting at a contractor you do not control.
Minimum order quantity. The smallest order a factory or mill will accept.
Most of these terms have a full guide behind them.
EDI documents, retailer requirements, built in versus third-party, and what it really costs.
Read the guideWhere chargebacks come from, how to dispute them, and how to stop the same ones recurring.
Read the guideApparel-specific versus general-purpose systems and the scorecard that decides a selection.
Read the guideSwitching timelines, rules of origin, forced labour traceability and tariff volatility.
Read the guideTell us what you are dealing with. If it is something we work on, we will say so, and if not we will point you somewhere useful.
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