Whether you’re a business owner with a start-up on the rise, or you’re taking on a new role in fashion for the first time, understanding the complex fashion terminology that surrounds the industry can seem daunting, to start off with.
Even seasoned professionals in fashion business frequently encounter new terms, software, and processes that spring up in the supply chain.
To help navigate you through, we’ve created a glossary of fashion terms filled with all the basics you’ll need to know to successfully run, or work for, a fashion business.
This fashion terminology glossary will predominantly cover areas such as product development, logistics, manufacturing, and sales, as well as some basic fashion design terms.
Fashion Industry Terms for Product Development
Enterprise Resource Planning
Enterprise Resource Planning (ERP) is software used by businesses to manage key, day-to-day activities that are integral to their operations. This can include supply chain management, accounting, procurement, and logistics among other processes.
In the fashion industry, ERP solutions are especially integral for brands wanting to demonstrate the transparency and sustainability of their business.
Product Lifecycle Management
Product Lifecycle Management (PLM) is software used in the fashion industry that tracks the entire lifecycle of a garment; from ideation to full development. This allows for more efficient resource management within a business.
Supply Chain Management
Supply Chain Management (SCM) is the organisation of every step in a product’s supply chain. The supply chain includes any processes that are carried out until the product reaches its final customer. In fashion, this includes initial procurement, operations, and logistics.
Raw Materials
Raw Materials are anything that is used in the making of a fashion product. This could include fabrics like wool or silk, as well as trims such as buttons, zips, and sequins. It can even include more generalised materials like care labels – any component that is involved in the production of an item.
Supplier
A vendor that provides fashion brands with their raw materials, including fabrics, trims, and packaging.
Fashion Terms for Manufacturing
Manufacturer
A factory that produces a finished good or an assembled good for a brand or a distributor.
Cut-Make-Trim
“Cut, Make, Trim” (CMT) is a fashion term used to describe a manufacturing service that is provided by factories. It involves the cutting of specified fabrics on behalf of a brand, making the garment as per the design, and trimming the relevant areas to create a fully produced product.
Finished Goods
Finished Goods (FG) are any product that is already set to go out to consumers and doesn’t require any further manufacturing.
Purchase Order
A Purchase Order is a document sent from a brand to a supplier when production is required. Often, these will be sent when more raw materials are required to produce a garment.
Production Order / Docket
Also known as a Docket or a Production List, a production order is similar to a purchase order, but is sent from a brand to a manufacturer instead of a supplier.
MID
Short for Manufacturers Identification, an MID code is a quick way of detailing a manufacturer’s full name and address. It is usually found on commercial invoices, particularly in the US.
MOQ
An acronym for “Minimum Order Quantity”, MOQs refer to the minimum amount of product that can be ordered from a manufacturer. MOQs can also be used by fashion businesses to let wholesale buyers know how much they are required to order.
Fashion Technical Terms
Bill of Materials (BOM)
One of the most common terms in fashion, a Bill of Materials (BOM) is an integral document that details all the items (such as raw materials and components) required to create a product, as well as their associated costs and quantities. BOMs can help businesses estimate their material costs and reduce unnecessary waste in their supply chain.
Tech Pack
For the CMT process to be carried out, manufacturers will often ask for a Tech Pack detailing the specifications of a garment before it can be made. This includes information on how to construct the garment, the fabrics needed, and any other design details that are considered integral.
Costs & Pricing Terms in Fashion
Price Lists
A list of wholesale or retail prices for the different products or services a business offers.
Recommended Retail Price
The Recommended Retail Price (RRP) is the initial suggested price of a product, recommended by a brand to a wholesale customer or retailer. This is usually the price that goods will be sold at retail level.
Cost Price
A cost price is a general term used to outline how much it costs to make a garment from start to finish.
Make Cost
The amount of money it costs a business to make a product. This includes the cost of materials, manufacturing, and other additional expenses.
Margin
Also known as “profit margin”, margins refer to the revenue a business makes after paying the cost of goods sold. This is usually measured in percentages.
Mark-Up
A markup is the selling price of a product, minus the amount it costs to make it. Markups help businesses see in whole numbers how much profit they’ll be making from a product sale.
Sales & Fashion Retail Terms
Wholesale Customer
A buyer that purchases products in bulk from a brand to then sell in their own business. This is also defined as a B2B (business-to-business) customer.
Retail Customer
Someone that purchases directly from a brand’s physical store or ecommerce shop. This is also defined as a B2C (business-to-consumer) customer.
Linesheets
A linesheet is a key document used by fashion businesses to help sell their products. They will often include details about a product, such as visuals, prices, colours, sizes, and styles, to help buyers make informed decisions.
Lookbook
A lookbook is a visual catalogue of a brand’s current collection. These usually change every season, or whenever a brand wants to showcase a new line.
B2B Showroom
A B2B showroom is an digital showroom space designed for buyers and brands. Similar to an ecommerce shop, buyers can purchase from brands at a wholesale level directly through a digital portal.
Proforma Invoice
Proformas or “proforma invoices” are preliminary bills of sale, usually sent to buyers when an order is placed and before shipment.
Order Book
Order books provide a breakdown of sold products to date. They are useful for measuring the success of a business.
Logistics Terms
WMS
A WMS, or “warehouse management system”, is a software solution that allows businesses to have full visibility over their supply chain, including stock movement and inventory. This is particularly helpful in the fashion industry because it helps reduce the risk of stock shortage for key products like bestsellers.
Available-To-Sell
Available-To-Sell (ATS) stock is the number of units a business has on hand to sell to consumers.
Projected Stock
Projected stock is the number of units a business expects to be available at the end of a set period. This is usually based on data such as expected good receipts and historic sales.
Inventory Management
The digital tracking of physical products or raw materials within a business. This process is crucial for ensuring brands have enough stock on hand to meet sales demands.
Stock Allocation
The strategic process whereby pools of stock currently held by a brand (or in transit) are distributed across wholesale orders.
SKU
A product SKU, or “stock keeping unit”, is a unique identifier chosen by businesses to help automatically track the movements of individual products. This could be movement from different stores, or across a warehouse, among other areas.
Barcodes
Barcodes are used to track different SKUs and their movements across locations. Common types of barcodes include EAN and UPC.
Customer Reference
Also known as a vendor number, this will typically be a brand’s assigned reference by any department stores that they work with.
Pick & Pack List
A list of goods that helps the fashion logistic department to prepare the shipment of each sales order with the correct quantities, products and sizes.
Export Invoice
Used for international sales orders, export invoices will display all the relevant information needed for a shipment to successfully pass through customs. This includes information such as the type of product, its content, and any region-specific codes.
HTS Code
A Harmonised Tariff Schedule (HTS) code is required when exporting goods to the USA from abroad. They are used to classify products within a shipment.
Intrastat Code
Intrastat codes are required when exporting goods to Europe. They ensure all the goods within a shipment meet the requirements of trade.
Domestic Invoice
An invoice for fashion buyers in the same country as the business, with no export required.
Finding this fashion terminology glossary useful? If you’re on the lookout for a software tool that can help you manage all of these key operations and more, book a free demo with Zedonk to find out what we can do for you.